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STATE OF MICHIGAN
COURT OF APPEALS
JEANNE STARR ENTERPRISES, INC. and UNPUBLISHED
JEANNE STARR GATER March 1, 2018
Plaintiffs/Counter-Defendants-
Appellants,
v No. 333188
Wayne Circuit Court
MARVIN TOWNS, LC No. 13-016468-CB
Defendant/Counter-Plaintiff-
Appellee.
Before: JANSEN, P.J., and SERVITTO and SHAPIRO, JJ.
SHAPIRO, J. (concurring).
I concur in the result only.
/s/ Douglas B. Shapiro
-1-
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NO. 07-06-0194-CV
IN THE COURT OF APPEALS
FOR THE SEVENTH DISTRICT OF TEXAS
AT AMARILLO
PANEL B
JUNE 14, 2006
______________________________
IN THE MATTER OF THE MARRIAGE OF
TERRY L. TAYLOR AND MARCY L. MILES TAYLOR
_________________________________
FROM THE 72
ND
DISTRICT COURT OF LUBBOCK COUNTY;
NO. 2004-525,283; HONORABLE RUBEN GONZALES REYES, JUDGE
_______________________________
Before QUINN, C.J., and CAMPBELL and HANCOCK, JJ.
MEMORANDUM OPINION
On May 11, 2006, the clerk of this Court received a copy of a notice of appeal filed on behalf of appellant Marcy L. Miles Taylor. By letter dated May 22, 2006, the clerk notified appellant that the filing fee had not been received, and that failure to pay the filing fee within ten days from the date of the letter could result in dismissal of the appeal. Tex. R. App. P. 42.3(c);
Tex. R. App. P. 5.
That date has passed and no response has been received. Accordingly, this appeal is dismissed. Tex. R. App. P. 42.3(c).
The trial court clerk and court reporter’s requests for an extension of time to file the record are denied as moot.
James T. Campbell
Justice
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497 So.2d 703 (1986)
SHEARSON/LEHMAN BROTHERS, INC., Voldemar Strasdas and Alfred Fasulo, Appellants,
v.
Xiomara ORDONEZ, Pedro Munoz, Francisco and Margarita Afanador, Appellees.
No. 4-86-0131.
District Court of Appeal of Florida, Fourth District.
November 12, 1986.
Sidney A. Stubbs, Jr., and Marjorie Gadarian Graham of Jones & Foster, P.A., West Palm Beach, for appellants.
Kim St. James of Kingcade & Campbell, P.A., West Palm Beach, for appellees.
PER CURIAM.
This is an appeal from an order staying arbitration proceedings under a brokerage contract pending resolution of a complaint stating a cause of action for rescission of the contract. Appellees instituted an action against appellants seeking to recover for fraud, state statutory violations, negligent misrepresentation, breach of fiduciary duty, and negligence. Appellants filed a motion to compel arbitration in accordance with the brokerage customer agreement which appellees admitted they had signed. The agreement provided as follows:
This agreement shall inure to the benefit of your successors and assigns, shall be binding on the undersigned, my heirs, executors, administrators and assigns and shall be governed by the laws of the State of New York. Unless unenforceable due to federal or state law, any controversy *704 arising out of or relating to my accounts, to transactions with you for me or to this agreement or the breach thereof, shall be settled by arbitration in accordance with the rules then in effect, of the National Association of Securities Dealers, Inc. or the Boards of Directors of the New York Stock Exchange Inc. and/or the American Stock Exchange, Inc. as I may elect.
At the hearing on the motion to compel arbitration, appellees made an oral motion to amend their complaint to add a count for rescission and/or revocation. The trial court permitted the amendment whereupon appellees filed a motion to stay arbitration pending resolution of the court for rescission. They argued that if rescission were granted the contract upon which arbitration was predicated would be void. The trial court agreed and stayed the arbitration proceedings until rendition of a judgment on the claim for rescission.
We reverse. This matter is governed by federal law and as we stated in Merrill Lynch, Pierce, Fenner and Smith, Inc. v. Melamed, 405 So.2d 790 (Fla. 4th DCA 1981) (Melamed I), under the supremacy clause of the United States Constitution, Article VI, Clause 2, the Federal Arbitration Act supersedes inconsistent provisions of the Florida Arbitration Code. The Federal Arbitration Act, 9 U.S.C. section 2, provides:
A written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction, or the refusal to perform the whole or any part thereof of an agreement in writing to submit to arbitration an existing controversy arising out of such contract, transaction, or refusal, shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.
In basing its ruling upon the last clause in section 2, the trial court erroneously broadened the meaning of the words "contract" and "agreement." Furthermore, the trial court erred in relying on our decision in Borck v. Holewinski, 459 So.2d 405 (Fla. 4th DCA 1984), in that Borck did not involve interstate commerce and was therefore controlled exclusively by the Florida Arbitration Act and Florida law. Here, we are dealing with interstate commerce and federal law which restrict the interpretation of the words "contract" and "agreement" as used in 9 U.S.C. section 2. The federal cases have held that unless the arbitration clause in the contract was allegedly induced by fraud, all claims including claims that the entire contract was induced by fraud, must be submitted to arbitration. In Prima Paint Corp. v. Flood and Conklin Manufacturing Co., 388 U.S. 395, 87 S.Ct. 1801, 18 L.Ed.2d 1270 (1967), the plaintiff sought rescission of a contract containing an arbitration agreement alleging that the defendant fraudulently induced it to enter into the contract. The Supreme Court held that the arbitration agreement was separable from the contract within which it was contained. Since there was no allegation of fraudulent inducement to enter into the arbitration agreement, the controversy over whether there was fraud in the inducement to enter into the contract as a whole was to be settled by arbitration and not the courts. Following Prima Paint, we find that the amended complaint contained no allegations of fraud concerning the arbitration agreement itself. All allegations go to the contract in general. We thus reverse the trial court's order staying arbitration and remand the matter for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
LETTS, DELL and GUNTHER, JJ., concur.
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205 F.2d 865
MONTGOMERY et al.v.MORELAND.
No. 12934.
United States Court of Appeals Ninth Circuit.
June 29, 1953.Rehearing Denied Aug. 21, 1953.As Amended Sept. 1, 1953.
Charles A. Christin, San Francisco, Cal., for appellants.
Nicholas Zoller, Augustus Castro, Edwin E. Huddleson, Jr., Frank D. Tatum, Jr., and Cooley, Crowley & Gaither, San Francisco, Cal., for appellee.
Before MATHEWS, STEPHENS, and BONE, Circuit Judges.
STEPHENS, Circuit Judge.
1
A judgment in accord with a jury verdict was entered whereby the plaintiff, Charles F. Moreland, Sr., was awarded $10,996.41 against defendants, Montgomery Brothers. Costs were assessed at $40.62. It was alleged in the original complaint that defendants had employed the plaintiff by a contract in writing at a salary of $600.00 per month for twelve months beginning February 15, 1948; that he was wrongfully discharged September 23, 1948; and that there is due, owing, and unpaid $2,850.00, salary from date of discharge to February 15, 1949, the end of the contract year.
2
The complaint was amended by alleging that the contract provided in addition to the monthly salary that plaintiff would receive a bonus at the end of the year's services equal to the full year's salary, conditioned only 'that the sales experience of said business for the period February 15, 1948, to February 15, 1949, showed improvement, or, except for said discharge of plaintiff on September 23, 1948, would have shown substantial improvement, over the year's period preceding February 15, 1948. Said bonus is due, owing, and unpaid from defendants to plaintiff in the sum of $7,200.00 to plaintiff's further damage.' Defendants appeal.
3
It is contended by the appellants that there was no contract in writing or otherwise for the payment of a bonus, but if there was it was not to be performed within the year following its making and that under the statute of frauds it cannot be enforced unless either it or some memorandum thereof is in writing and signed by the party to be charged. The case was filed and tried in the United States District Court for the Northern District of California, and jurisdiction is had because of diversity of citizenship: Appellants do business in San Francisco, California, and have a branch at Seattle, Washington. Appellee was to manage the northern branch. The case was tried apparently on California law.1
4
The record is incomplete. At least a part of the oral testimony given by appellee was brought up and this testimony relates to appellee's situation at the time he was employed and as to conversations between him and W. Ray Montgomery, one member of the partnership firm of Montgomery Brothers. There is no other evidence save four letters.
5
Mr. Moreland testified that at the time he and Mr. Montgomery met and discussed employment, he was employed by Hot Point, Incorporated, Chicago, Illinois, at a salary of $6,000.00 per year and that he earned on an average for overtime $35.00 monthly. He had been with the company for over twenty years and was due to retire at the age of sixty-five years on a pension. He was presently fifty-six years old, lived near Chicago, Illinois, With his wife and sons.
6
The following is from appellee's testimony. Mr. W. Ray Montgomery and Mr. Moreland discussed the question of Moreland's employment. Moreland wished to earn $10,000.00 to $12,000.00 yearly. Montgomery said they couldn't pay it as a flat salary but added, 'We do have an opportunity, though, for you in the Northwest. We believe you can make that much money, but it will have to come through a system of bonuses we have in the Northwest and our other offices.' Appellee testified, 'Montgomery stated that the men in the top brackets, top positions in the Seattle office in 1947 and 1946, had earned a bonus equal to their salary.' They had not agreed upon the sum of the salary, and as the meeting of the two was about to break up, Montgomery suggested that Moreland write him with a proposal. But before they parted Montgomery said (and here Moreland quotes Montgomery), 'what about a trial period?' to which Moreland replied, 'That's all right, trial period is all right for the year, for a whole year.' Moreland then goes on to say (apparently from his recollection of what was said), 'and that the bonus would be based on a year's employment, as long as the salary stipulated was at the rate of whatever I got.' Moreland explains that his understanding of the conversation was, that all he had to do to get a year's bonus equal to his salary was to increase sales.
7
On cross-examination Moreland was asked, 'Did you ask him again about those bonuses, how they figured them out?' to which Moreland replied, 'No- he made the statement again, just as I told you, the salary and the bonuses would equal in the Seattle territory.'
8
On re-direct examination counsel then asked Mr. Moreland to repeat the bonus conversation had at the first meeting:
9
'A. He said the bonus in the Seattle territory for the previous year or two had been the same amount as the key man's salary.
10
'Q. An he told you what? A. And I said, 'Is that bonus to be applicable in my case too, the same conditions after we come to an understanding on a salary?'
11
'Q. And what did he say to that? A. And that was- he said it would be figured out for you on the yearly basis.
12
On November 30, 1947, Moreland, in accord with Montgomery's suggestion, wrote to Montgomery saying he would accept $600.00 per month for the first year 'and depend on my successful operation during the year to assure a substantial bonus at the end of a year's operations.'
13
On January 5, 1948, Montgomery replied to Moreland's letter, saying: 'The $600.00 per month for the first year is more in line with my thinking, and we would be willing to start on that basis, with the understanding that the results of your leadership in the Seattle office would determine two things: first, whether or not to continue on this basis, or whether we could increase this at the end of the first year's trial * * * (I)t will not be hard for us, nor for you, to determine the increase or decrease in the business under your management.'
14
Moreland responded in writing to Montgomery's letter, saying (January 14, 1948): 'I did not make any move (toward quitting his then present employment) * * * until I secured a definite proposal or acceptance of proposition put forth in my letter of November 30th. Your letter of November 5, 1948, I consider as your definite acceptance, and expressed desire to have me join your organization under the conditions set forth in my letter of November 30, 1947, and your letter of January 5th.' Not long afterward Moreland resigned his position with Hot Point and entered upon his duties with Montgomery Brothers February 15, 1948. He was discharged without cause before the end of the trial year, i.e., September 23, 1948.
15
Appellee Moreland claims that he changed his position depending upon his contract with Montgomery Brothers and that in the circumstances it would be unconscionable to apply the statute of frauds. We are in full accord with this contention and cite in support thereof Seymour v. Oelrichs, 1909, 156 Cal. 782, 106 P. 88; Monarco v. Lo Greco, 35 Cal.2d 621, 220 P.2d 737; and Tuck v. Gudnason, 11 Cal.App.2d 626, 54 P.2d 88. The principle is exhaustively treated in the Monarco v. Lo Greco case with collection of supporting authority.
16
Was There A Contract To Pay A Bonus?
17
It is implicit from the evidence and in the fact that appellee quit his Eastern position and went to work for appellants, that $600.00 per month was not satisfactory to appellee. He asked for $10,000.00 to $12,000.00 per year. Appellants could not pay that much in a flat salary. Their system of bonuses was suggested, whereby appellee might earn that much. From Montgomery's conversation appellee gained the belief that if he succeeded in doing a better volume of business in the trial year the bonus would equal the salary. There is nothing unreasonable about this. The employee would be put on his mettle. If he fell behind, he would get but the $600.00 monthly salary. If he 'cut the mustard' (Montgomery had expressed his confidence in that old saying), he would realize his desire to better his financial condition and the money earned would not be out of line for a manager of a business whose top men had been getting a 'substantial bonus' which was equal to their salaries. If we follow appellants' reasoning that after the oral conversations, at which the bonus matter was treated as the key toward the contemplated hiring, we would read the letters that followed the conversations as completely eliminating the bonus idea, and determine that the contracting parties went back to a straight $600.00 flat salary which was much less than appellee had in mind and for which he would have to give up his steady job in Illinois.
18
We differ with appellants. Clearly, as we see it, the conversations and the letters constitute, together, progressive treatment as to the hiring terms. How else can the use of the language 'and depend on my successful operation during the year to assure a substantial bonus * * * ,' make any sense whatever? How else can the expression in his letter, 'I sincerely hope that we can get together on this basis' be understood than that the inadequate monthly salary would be supplemented by the bonus they had talked about?
19
In Montgomery's reply letter he nowhere indicates that all that had gone before was held for naught. He is answering Moreland's letter. The bonus question was settled, the salary was open. The $600.00 proposal was agreeable. The first year would tell whether this base pay would be increased or decreased and it would not be difficult to determine which. There is a finality about the letter: ' * * * (U)pon your arrival in Seattle, Mr. Dolbow, who has been acting manager in Seattle, will return to Portland and you will take over. * * * We feel confident that you will be most successful and that this venture will increase your earning capacity. However, this will depend entirely upon yourself and the effort put forth. Therefore, we believe that as quickly as you can arrange matters, * * * that you should make arrangements to proceed to Seattle * * * . * * * Trusting that this will be the most important and best move in your business career * * * .' In the circumstances, these expressions are not consistent with a complete reversal of all that had gone before. Everything that appellee had said plainly indicated that he would not take the position at the flat salary of $600.00 per month. Appellant could not have been so definite as to direct that appellee proceed to Seattle 'as quickly as you can arrange matters * * * ' unless he considered the bonus question settled and there is nothing to support the idea that appellee had waived a bonus as a condition of his employment. Definitely he was agreeing in writing to employ appellee upon a monthly salary of $600.00 and a bonus. However, appellee did not go to Seattle nor did he arrange his matters with his then employers without first writing appellant that he understood he was being employed under the terms of his letter of November 30, 1947, in which he mentioned the bonus subject. And thereafter appellant wrote his acting manager at Seattle informing him that appellee would arrive and that he was to be given 'all the information necessary for him to operate the Seattle office'. All letters are signed by their authors.
20
So far as can be seen by the record, the parties at the trial went thoroughly into the circumstances of the employment. That Moreland was employed by Montgomery Brothers and that letters passed between them which resulted in the employment, is of course certain. That Moreland gave up his Chicago job and moved to Seattle by reason of the employment is beyond question. Thus, it appears that the whole affair was laid before the court. It is true that appellee alleges a written contract, and it is conceded that a written contract for the payment of a salary was established, but the written contract itself shows that there was something else agreed to, i.e., a bonus of some kind. And this is also shown by the oral evidence. We are convinced that the writing does not give the terms of the bonus and that oral testimony is not admissible to supply those essentials so as to establish a written contract for a bonus. However, all of the evidence taken together does establish an oral contract in all of its essentials for the payment of the salary and a bonus as testified to by Moreland.
21
Rule 15(b), Federal Rules of Civil Procedure, 28 U.S.C.A., provides:
22
'When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings. Such amendment of the pleadings as may be necessary to cause them to conform to the evidence and to raise these issues may be made upon motion of any party at any time, even after judgment; but failure so to amend does not affect the result of the trial of these issues. * * * '
23
We hold that, while a written contract was alleged, an oral contract was proved as to the bonus and, since application of the statute of frauds would work an unconscionable injury upon appellee and bestow unjustified enrichment upon appellants, application thereof will be and is estopped.2
24
Affirmed.
1
Cal. Civ. Code § 1624; Cal. Code of Civil Procedure Sec. 1973
2
Lester v. Hinkle, 1923, 193 Ind. 605, 141 N.E. 463, 465. This case goes further than we think justified, but indicates the extent the court will go to award just compensation to employees. We quote therefrom, 141 N.E.at page 465: 'But a contract of present employment is not one which the statute of frauds requires to be written out at length and signed by the parties, and, where the parties have signed a contract of hiring that was indefinite and uncertain and have acted upon it until services have been performed by one party and accepted by the other, the court in which suit is brought to recover compensation may take into account all that was said and done in the matter of rendering the services, accepting them and making payments in that behalf, so far as they may tend to explain the uncertainties in the written contract, or to supply omissions therein. Pennsylvania Co. v. Dolan, 6 Ind.App. 109, 115, 32 N.E. 802, * * * ; American Quarries Co. v. Lay, 37 Ind.App. 386, 389, 73 N.E. 608; Cox v. Baltimore, etc., R. Co., 180 Ind. 495, 505, 103 N.E. 337, 50 L.R.A., N.S., 453 * * * '
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http://www.va.gov/vetapp16/Files5/1639904.txt
Citation Nr: 1639904
Decision Date: 09/30/16 Archive Date: 10/13/16
DOCKET NO. 14-16 642 ) DATE
)
)
On appeal from the
Department of Veterans Affairs Regional Office in Winston-Salem, North Carolina
THE ISSUES
1. Entitlement to an initial rating in excess of 10 percent for lumbar strain (a low back disability).
2. Entitlement to an initial rating in excess of 10 percent for cervical strain (a neck disability).
ATTORNEY FOR THE BOARD
M. Thomas, Associate Counsel
INTRODUCTION
The Veteran, who is the appellant in this case, served on active duty from July 2006 to July 2012.
This matter comes before the Board of Veterans' Appeals (Board) on appeal from a November 2012 rating decision of the Department of Veterans Affairs (VA) Regional Office (RO) in Winston-Salem, North Carolina.
This appeal was previously remanded by the Board in November 2015. Pursuant to the Board's remand directives, the AOJ attempted to schedule the Veteran for a VA examination. However, the Veteran refused examination without explaining her reasons. Under the circumstances, this appeal must be decided based on the evidence of record. See 38 C.F.R. § 3.655(b). Therefore, the Board finds that there has been substantial compliance with the Board's remand directives. Stegall v. West, 11 Vet. App. 268 (1998) (finding that a remand by the Board confers on the Veteran the right to compliance with its remand orders). The Board notes that the United States Court of Appeals for Veterans Claims (Court) has indicated that "only substantial compliance with the terms of the Board's engagement letter would be required, not strict compliance." D'Aries v. Peake, 22 Vet. App. 97, 105 (2008); see also Dyment v. West, 13 Vet. App. 141, 146-47 (1999) (holding that there was no Stegall (Stegall, 11 Vet. App. 268) violation when the examiner made the ultimate determination required by the Board's remand).
FINDINGS OF FACT
1. For the entire rating period on appeal, the Veteran's low back disability has been manifested by painful motion, and did not manifest in forward flexion of the thoracolumbar spine greater than 30 degrees but not greater than 60 degrees; combined range of motion of the throacolubmar spine not greater than 120 degrees; muscle spasm or guarding severe enough to result in an abnormal gait or abnormal spinal contour such as scoliosis, reversed lordosis, or abnormal kyphosis; favorable or unfavorable ankylosis of the thoracolumbar spine or entire spine; or incapacitating episodes due to intervertebral disc syndrome that required bed rest prescribed by a physician and treatment by a physician.
2. For the entire rating period on appeal, the Veteran's neck disability has been manifested by a combined range of motion of 300 degrees, but did not manifest in forward flexion of the cervical spine greater than 15 degrees but not greater than 30 degrees; combined range of motion of the cervical spine not greater than 170 degrees; muscle spasm or guarding severe enough to result in an abnormal gait or abnormal spinal contour such as scoliosis, reversed lordosis, or abnormal kyphosis; favorable or unfavorable ankylosis of the cervical spine or entire spine; or incapacitating episodes due to intervertebral disc syndrome that required bed rest prescribed by a physician and treatment by a physician.
CONCLUSIONS OF LAW
1. The criteria for an initial rating in excess of 10 percent for degenerative disc disease of the lumbar spine have not been met. 38 U.S.C.A. §§ 1155, 5103, 5103A, 5107 (West 2014); 38 C.F.R. §§ 3.159, 3.321, 4.1, 4.3, 4.7, 4.10, 4.71a, Diagnostic Code (DC) 5242 (2015).
2. The criteria for an initial rating in excess of 10 percent for degenerative disc disease of the cervical spine have not been met. 38 U.S.C.A. §§ 1155, 5103, 5103A, 5107 (West 2014); 38 C.F.R. §§ 3.159, 3.321, 4.1, 4.3, 4.7, 4.10, 4.71a, DC 5242 (2015).
REASONS AND BASES FOR FINDINGS AND CONCLUSIONS
Duties to Notify and Assist
The Veterans Clams Assistance Act of 2000 (VCAA) and implementing regulations impose obligations on VA to provide claimants with notice and assistance. 38 U.S.C.A. §§ 5103, 5103A (West 2014); 38 C.F.R. § 3.159 (2015).
As noted above, the claims for initial compensable ratings arise from the Veteran's disagreement with the ratings assigned in connection with the grants of service connection for these disabilities. The courts have held, and VA's General Counsel has agreed, that where an underlying claim for service connection has been granted and there is disagreement as to "downstream" questions such as the propriety of the assigned rating or effective date, the claim has been substantiated and there is no need to provide additional VCAA notice or prejudice from absent VCAA notice. Hartman v. Nicholson, 483 F.3d 1311, 1314 -15 (Fed. Cir. 2007). Consequently, further discussion of the VCAA's notification requirements with regard to these claims is unnecessary.
With regard to the duty to assist, VA has made reasonable efforts to obtain relevant records and evidence. Specifically, the information and evidence that have been associated with the claims file include the Veteran's service treatment records, private treatment records, July 2011 VA examination, and the Veteran's statements. VA attempted to obtain an additional VA examination, but the Veteran refused to schedule the examination. As was alluded to in the Introduction section of this decision, when a claimant fails to report to an examination scheduled in conjunction with an original claim without good cause, the claim shall be rated based on the evidence of record. 38 C.F.R. § 3.655(a), (b). As stated by the Court, the "duty to assist is not always a one-way street" and the veteran is obliged to cooperate in the development of the pending claim. Wood v. Derwinski, 1 Vet. App. 190, 193 (1991). Therefore, the Board will decide this matter based on the evidence of record as it currently stands
As such, the RO has provided assistance to the Veteran as required under
38 U.S.C.A. § 5103A and 38 C.F.R. § 3.159(c), as indicated under the facts and circumstances in this case. The Veteran has not made the RO or the Board aware of any additional evidence that needs to be obtained in order to fairly decide this appeal. Mayfield v. Nicholson, 444 F.3d 1328 (Fed. Cir. 2006). Hence, no further notice or assistance to the Veteran is required to fulfill VA's duties to notify and assist in the development of these claims.
Laws and Regulations - Increased Rating
The Veteran's entire history is to be considered when making disability evaluations. See generally 38 C.F.R. § 4.1 (2015); Schafrath v. Derwinski, 1 Vet. App. 589 (1995). Staged ratings are appropriate for any initial rating claim when the factual findings show distinct time periods during the appeal period where the service-connected disability exhibits symptoms that would warrant different ratings. Fenderson v. West, 12 Vet. App. 119, 126 (1999).
Where there is a question as to which of two evaluations shall be applied, the higher evaluation will be assigned if the disability picture more nearly approximates the criteria for that rating. Otherwise, the lower rating will be assigned. 38 C.F.R.
§ 4.7 (2015). Any reasonable doubt regarding a degree of disability will be resolved in favor of the veteran. 38 C.F.R. § 4.3 (2015).
It is possible for a Veteran to have overlapping disabilities which are attributable to distinct diseases or injuries. Pyramiding, that is the evaluation of the same disability, or the same manifestation of a disability, under different diagnostic codes, is to be avoided when evaluating a veteran's service-connected disability.
38 C.F.R. § 4.14 (2015).
In rendering a decision on appeal, the Board must analyze the credibility and probative value of the evidence, account for the evidence which it finds to be persuasive or unpersuasive, and provide the reasons for its rejection of any material favorable to the claimant. Gabrielson v. Brown, 7 Vet. App. 36, 39-40 (1994); Gilbert v. Derwinski, 1 Vet. App. 49, 57 (1990). Competency of evidence differs from weight and credibility. Competency is a legal concept determining whether testimony may be heard and considered by the trier of fact, while credibility is a factual determination going to the probative value of the evidence to be made after the evidence has been admitted. Rucker v. Brown, 10 Vet. App. 67, 74 (1997); Layno v. Brown, 6 Vet. App. 465, 469 (1994).
When all the evidence is assembled, VA is responsible for determining whether the evidence supports the claim or is in relative equipoise, with a veteran prevailing in either event, or whether a preponderance of the evidence is against a claim, in which case, the claim is denied. 38 U.S.C.A. § 5107(b) (West 2014); 38 C.F.R.
§ 3.102 (2015).
Increased Rating for a Low Back Disability - Analysis
The Veteran is currently in receipt of a 10 percent initial rating for a low back disability. The low back disability is rated under 38 C.F.R. § 4.71a, DC 5237, for lumbar strain.
Disabilities of the spine are rated under the General Rating Formula for Diseases and Injuries of the Spine (for Diagnostic Codes 5235 to 5243, unless 5243 is evaluated under the Formula for Rating Intervertebral Disc Syndrome Based on Incapacitating Episodes). Ratings under the General Rating Formula for Diseases and Injuries of the Spine are made with or without symptoms such as pain (whether or not it radiates), stiffness, or aching in the area of the spine affected by residuals of injury or disease.
The General Rating Formula for Diseases and Injuries of the Spine provides a 10 percent rating for forward flexion of the thoracolumbar spine greater than 60 degrees but not greater than 85 degrees; or combined range of motion of the thoracolumbar spine greater than 120 degrees but not greater than 235 degrees; or, muscle spasm, guarding, or localized tenderness not resulting in abnormal gait or abnormal spinal contour; or, vertebral body fracture with loss of 50 percent or more of the height.
A 20 percent rating is provided for forward flexion of the thoracolumbar spine greater than 30 degrees but not greater than 60 degrees; or, the combined range of motion of the thoracolumbar spine not greater than 120 degrees; or, muscle spasm or guarding severe enough to result in an abnormal gait or abnormal spinal contour such as scoliosis, reversed lordosis, or abnormal kyphosis. 38 C.F.R. § 4.71a.
A 40 percent disability rating is provided for forward flexion of the thoracolumbar spine 30 degrees or less, or favorable ankylosis of the entire thoracolumbar spine. Id.
A 50 percent disability rating is assigned for unfavorable ankylosis of the entire thoracolumbar spine. Id.
A 100 percent disability rating is assigned for unfavorable ankylosis of entire spine. Id.
Note (1) to the rating formula specifies that any associated objective neurologic abnormalities, including, but not limited to, bowel or bladder impairment, should be separately evaluated under an appropriate diagnostic code. 38 C.F.R. § 4.71a.
Note (2) (See also Plate V) provides that, for VA compensation purposes, normal forward flexion of the thoracolumbar spine is zero to 90 degrees, extension is zero to 30 degrees, left and right lateral flexion are zero to 30 degrees, and left and right lateral rotation are zero to 30 degrees. The combined range of motion refers to the sum of the range of forward flexion, extension, left and right lateral flexion, and left and right rotation. The normal combined range of motion of the thoracolumbar spine is 240 degrees. The normal ranges of motion for each component of spinal motion provided in this note are the maximum that can be used for calculation of the combined range of motion. Id.
Note (3) provides that, in exceptional cases, an examiner may state that because of age, body habitus, neurologic disease, or other factors not the result of disease or injury of the spine, the range of motion of the spine in a particular individual should be considered normal for that individual, even though it does not conform to the normal range of motion stated in Note (2). Provided that the examiner supplies an explanation, the examiner's assessment that the range of motion is normal for that individual will be accepted. Id.
Note (4) instructs to round each range of motion measurement to the nearest five degrees. Id.
Note (5) provides that, for VA compensation purposes, unfavorable ankylosis is a condition in which the entire thoracolumbar spine, or the entire spine is fixed in flexion or extension, and the ankylosis results in one or more of the following: difficulty walking because of a limited line of vision; restricted opening of the mouth and chewing; breathing limited to diaphragmatic respiration; gastrointestinal symptoms due to pressure of the costal margin on the abdomen; dyspnea or dysphagia; atlantoaxial or cervical subluxation or dislocation; or neurologic symptoms due to nerve root stretching. Fixation of a spinal segment in neutral position (zero degrees) always represents favorable ankylosis. Id.
Under the Formula for Rating Intervertebral Disc Syndrome (IVDS) Based on Incapacitating Episodes, a rating of 40 percent is warranted for incapacitating episodes with a total duration of at least 4 weeks but less than 6 weeks during the past 12 months. A maximum rating of 60 percent is warranted for incapacitating episodes with a total duration of at least 6 weeks during the past 12 months. 38 C.F.R. § 4.71a, IVDS Formula. For these purposes, an incapacitating episode is defined as a period of acute signs and symptoms due to intervertebral disc syndrome that requires bed rest prescribed by a physician and treatment by a physician. Id. at Note (1).
As an initial matter, the Board notes that the Veteran is a physician. Therefore, the Board finds her to be competent to opine on matters requiring the expertise of a medical professional.
A December 2010 service medical record indicated that the Veteran had been diagnosed, based on MRI evidence, with degenerative disk disease in the lumbar spine at L4-5 and L5-S1.
The Veteran was afforded a pre-discharge VA examination in July 2011. She reported being diagnosed with lumbar degenerative disc disease four years earlier. She reported symptoms of stiffness, paresthesia, and numbness. She denied experiencing fatigue, spasms, decreased motion, weakness, and bowel and bladder impairment. She reported experiencing constant pain, located mostly on the L4-L5 joint. She described the pain as localized, moderate, and exacerbated physical activity. She described functional impairments of limited overall physical activating, carrying, and lifting.
The VA examiner stated that the Veteran's posture was normal and she walked with a normal gait. There was no evidence of radiating pain on movement, muscle spasm, tenderness, guarding of movement, or weakness. Muscle tone and musculature were normal. There was negative straight leg raising bilaterally, and Lasegue's sign was negative. There was no atrophy present in the limbs, and no ankylosis of the thoracolumbar spine. Flexion was 90 degrees, with pain at 90 degrees. The combined range of motion of the thoracolumbar spine was 240 degrees. There was no additional loss of range of motion after repetitive use, including as due to pain, fatigue, weakness, lack of endurance, or incoordination. There was symmetry of spinal motion with normal curves of the spine. The sensory examination was normal bilaterally. There was no evidence of peripheral nerve involvement during examination. There were no signs of lumbar IVDS with chronic and permanent nerve root involvement.
An October 2012 private treatment note indicated that the Veteran had thoracolumbar muscle spasm and tenderness. Range of motion of the thoracolumbar spine was moderately restricted in forward flexion. Lumbar extension was moderately restricted, with pain. Bilateral lateral benign was moderately to markedly restricted. Bilateral rotation was moderately restricted, with pulling and pain. Straight leg raise was negative. She was diagnosed with an acute traumatic myofascial lumbar sprain, related to a recent motor vehicle accident.
A January 2013 private treatment note indicated that the Veteran had returned to per-accident status. There was no palpable spasm, calor, or tenderness. Motions of the lumbar spine were without subjective complaint in all plains. Orthopedic evaluation was unremarkable, and neurological evaluation revealed no motor or sensory deficit.
In the February 2013 Notice of Disagreement, the Veteran stated that her low back disability was improperly rated as lumbar strain, when she had been diagnosed with chronic degenerative disc disease with herniations and nerve root impingements, as well as degenerative joint disease of the lumbar spine. She stated that this caused her pain and disability on a daily basis. She was unable to run or squat without pain. Her activities of daily living, recreational activities, and sleep were all affected by her chronic lower back pain. She reported seeing a chiropractor at least twice a month.
In August 2013, the Veteran's treating chiropractor stated that the Veteran described her pain as a constant "dull, achy" pain that can become worse with prolonged standing, prolonged sitting, multiple bending, and long hours of treating patients.
In her May 2014 substantive appeal, the Veteran stated that she suffered from daily stiffness in her lower back limiting her range of motion. She stated that she had exacerbations of her lower back pain for at least two weeks several times per year.
Based on the above, the lay and medical evidence of record establishes that the Veteran's low back disability warrants a rating of 10 percent, and no higher, for the entire period on appeal. 38 C.F.R. §§ 4.3, 4.7 (2015). The only range of motion report was in the July 2011 VA examination, in which lumbar forward flexion was 90 degrees and the combined thoracolumbar range of motion was 240 degrees. The lay and medical evidence of record indicates that the Veteran has experienced chronic daily pain of the lumbar spine. The weight of the evidence, lay and medical, does not demonstrate that there is forward flexion of the thoracolumbar spine not greater than 85 degrees; combined range of motion of the thoracolumbar spine not greater than 235 degrees; muscle spasm, guarding, or localized tenderness, vertebral body fracture with loss of 50 percent or more of the height; or, ankylosis as is required for a compensable rating under 38 C.F.R. § 4.71 (a), DC 5237.
The July 2011 VA examination report indicates that the Veteran experiences painful motion of the lumbar spine. 38 C.F.R. § 4.59 notes that the intent of the schedule is to recognize painful motion with joint or periarticular pathology as productive of disability. Therefore, it is the intention to recognize actually painful joints as entitled to at least the minimum compensable rating for the joint. Therefore, the Board finds that the Veteran is entitled to an initial 10 percent rating, the minimum compensable rating, for a low back disability, based on objective evidence of painful motion. See 38 C.F.R. § 4.59.
The Board has also considered application of 38 C.F.R. §§ 4.40 and 4.45, and DeLuca for the entire appeal period, specifically the additional limitations of motion due to pain, fatigability, and weakness, in reaching the finding that a disability rating in excess of 10 percent is not warranted. Although the record contains reports that the Veteran experienced pain during range of motion testing, such findings do not provide for rating in excess of 10 percent in this case. The only range of motion report was in the July 2011 VA examination, in which pain was noted on extension and flexion, but no additional loss of range of motion due to pain was noted. The DeLuca factors go to additional loss of function caused by limitation of motion due to pain, fatigability, and weakness. Even with consideration of the additional limitation of motion due to pain, the low back disability does not manifest in forward flexion of the thoracolumbar spine greater than 30 degrees but not greater than 60 degrees; or, the combined range of motion of the thoracolumbar spine not greater than 120 degrees; or, muscle spasm or guarding severe enough to result in an abnormal gait or abnormal spinal contour such as scoliosis, reversed lordosis, or abnormal kyphosis; or, ankylosis of the lumbar spine or entire spine. Therefore, a 10 percent rating under the General Rating Formula for Disease and Injuries of the Spine and 38 C.F.R. § 4.59 is appropriate, and a higher rating is not warranted.
Neither the July 2010 VA examination report nor the private treatment records indicated that the Veteran had IVDS. While Veteran reported having exacerbations of her low back pain for at least two weeks several times per year, there is nothing in the evidence to suggest that these exacerbations required both bed rest prescribed by a physician and treatment by a physician. For this reason, the Board finds that a disability rating under the Formula for Rating Intervertebral Disc Syndrome Based on Incapacitating Episodes is not warranted. See 38 C.F.R. § 4.71a.
The Board has also considered the application of other relevant diagnostic codes. The Board notes that the Veteran's low back disability is currently rated under DC 5237, as lumbar strain. In a February 2013 statement, the Veteran stated that rating her low back disability as lumbar strain reflected an improper diagnosis, as she had been diagnosed with degenerative disc disease of the lumbar spine by a December 2010 MRI. The Veteran is a physician and competent to opine on medical issues. Degenerative arthritis of the spine is properly rated under DC 5242. Both DC 5237 and DC 5242 are rated according to the General Rating Formula for Disease and Injuries of the Spine. Therefore, the Veteran's neck disability is more accurately described by DC 5242, and there is no prejudice to the Veteran in changing the relevant diagnostic code from DC 5237 to DC 5242.
38 C.F.R. § 4.71a, Note (6) provides that DC 5242 for degenerative arthritis of the spine can also be rated under DC 5003. DC 5003 provides that degenerative arthritis established by x-ray findings will be rated on the basis of limitation of motion under the appropriate diagnostic codes for the specific joint or joints involved. Here, the Veteran is in receipt of a 10 percent rating based on painful motion under DC 5242 and 38 C.F.R. § 4.59. Therefore, no additional consideration of DC 5003 is required.
With respect to the Veteran's claim for a higher evaluation of her low back disability as manifested neurologically, the Board must consider the potential application of various other provisions of the regulations concerning VA benefits, whether or not they were raised by the Veteran, as well as the entire history of the Veteran's disability in reaching its decision. Schafrath, 1 Vet. App. at 595. The Board has considered whether a separate rating is warranted for any objective neurologic abnormalities. However, no objective neurologic abnormalities are noted in the record. Therefore, the weight of the evidence of record indicates that no further discussion of separate ratings for objective neurologic abnormalities is warranted.
For these reasons, and resolving all reasonable doubt in favor of the Veteran, the Board finds the weight of evidence does not support an initial disability rating in excess of 10 percent for a low back disability. 38 U.S.C.A. § 5107; 38 C.F.R. §§ 4.3, 4.7, 4.59, 4.71a.
Increased Rating for a Neck Disability - Analysis
The Veteran is currently in receipt of a 10 percent initial rating for a neck disability. The neck disability is rated under 38 C.F.R. § 4.71a, DC 5237, for cervical strain.
As described above, disabilities of the spine are rated under the General Rating Formula for Diseases and Injuries of the Spine (for Diagnostic Codes 5235 to 5243, unless 5243 is evaluated under the Formula for Rating Intervertebral Disc Syndrome Based on Incapacitating Episodes).
The General Rating Formula for Diseases and Injuries of the Spine provides a 10 percent rating for forward flexion of the cervical spine greater than 30 degrees but not greater than 10 degrees; or combined range of motion of the cervical spine greater than 170 degrees but not greater than 335 degrees; or, muscle spasm, guarding, or localized tenderness not resulting in abnormal gait or abnormal spinal contour; or, vertebral body fracture with loss of 50 percent or more of the height.
A 20 percent rating is provided for forward flexion of the cervical spine greater than 15 degrees but not greater than 30 degrees; or, the combined range of motion of the cervical spine not greater than 170 degrees; or, muscle spasm or guarding severe enough to result in an abnormal gait or abnormal spinal contour such as scoliosis, reversed lordosis, or abnormal kyphosis. 38 C.F.R. § 4.71a.
A 30 percent disability rating is provided for flexion of the cervical spine 15 degrees or less; or, favorable ankylosis of the entire cervical spine. Id.
A 40 percent disability rating is provided for unfavorable ankylosis of the entire cervical spine. Id.
A 100 percent disability rating is assigned for unfavorable ankylosis of entire spine. Id.
A December 2010 service medical record indicated that the Veteran had been diagnosed, based on MRI evidence, with mild degenerative disk disease in the cervical spine, extending from C3-4 through C6-7 levels.
The Veteran was afforded a VA examination in July 2011. She reported being diagnosed with cervical degenerative disc disease. She stated that she could walk without limitation, and had symptoms of stiffness, paresthesia, and numbness. She denied experiencing fatigue, spasms, decreased motion, and weakness. She also denied having any bowel or bladder problems related to her cervical spine condition. She reported experiencing constant, localized, and moderate pain located on the base of the occiput. The pain was exacerbated by physical activity. Flare-ups caused the functional impairment of pain. She denied being incapacitated due to her neck disability during the prior 12 months. She reported being unable to lift heavy weights.
Upon examination, there was no evidence of radiating pain on movement, muscle spasm, tenderness, guarding, weakness, loss of tone and atrophy of the limbs. There was no ankylosis of the cervical spine. Flexion was 50 degrees, with pain at 45 degrees. Left and right rotations were both 80 degrees, with pain beginning at 60 degrees. Extension was 45 degrees, with pain at 45 degrees, and lateral flexion was 45 degrees bilaterally, with pain at 45 degrees. Combined cervical range of motion was 300 degrees. There was no additional loss of range of motion after repetitive use, including as due to pain, fatigue, weakness, lack of endurance, or incoordination. There were no signs of cervical IVDS with chronic and permanent nerve root involvement.
An October 2012 private treatment note indicated that the Veteran had constant pain, stiffness, and spasms about the neck, with an intermittent "burning at the base of the neck and upper back and radiating to the shoulders bilaterally. She also complained of intermittent headaches starting at the base of the neck and upper back and radiating to the posterior skull. Range of motion of the cervical spine was markedly restricted in forward flexion, with pain. Cervical extension, bilateral lateral bending, and bilateral rotation were all moderately restricted, with pain. She was diagnosed with an acute traumatic myofascial cervical sprain, with cephalgia and neuritis/radiculitis resulting, related to a recent motor vehicle accident.
A January 2013 private treatment note indicated that the Veteran had returned to per-accident status. There was no palpable spasm, calor, or tenderness. Motion of the cervical spine was without subjective complaint in all plains. Orthopedic evaluation was unremarkable, and neurological evaluation revealed no motor or sensory deficit.
In the February 2013 Notice of Disagreement, the Veteran stated that her neck disability was improperly rated as cervical strain, and should be rated based on her actual diagnosis of chronic degenerative disc disease with herniations as well as degenerative joint disease of the cervical spine. She stated that her neck disability caused her pain and disability on a daily basis. She said that her activities of daily living, recreational activities, and sleep were all affected by her chronic cervical spine pain. She indicated that she saw a chiropractor at least twice a month to treat her neck disability symptoms.
In the May 2014 substantive appeal, the Veteran stated that her cervical spine disability caused daily pain and dysfunction. She stated that she suffered from daily tension headaches and stiffness in her neck, limiting her range of motion. She stated that she suffered frequent exacerbations of her neck pain for at least two weeks several times per year.
Based on the above, the lay and medical evidence of record establishes that the Veteran's neck disability warrants a rating of 10 percent, and no higher, for the entire period on appeal. 38 C.F.R. §§ 4.3, 4.7 (2015). The only range of motion report was in the July 2011 VA examination, in which cervical forward flexion was limited to 50 degrees and the combined cervical range of motion was 300 degrees, with pain limiting the left and right cervical rotation. This combined range of motion is consistent with the criteria for a 10 percent disability rating, as the combined cervical range of motion was greater than 170 degrees but not greater than 335 degrees. The lay and medical evidence of record indicates that the Veteran has experienced chronic daily pain of the cervical spine. The weight of the evidence, lay and medical, does not demonstrate that there is muscle spasm or guarding severe enough to result in an abnormal gain or abnormal spinal contour, cervical flexion greater than 15 degrees but not greater than 30 degrees, or combined cervical range of motion not greater than 70 degrees, as is required for a 20 percent rating under 38 C.F.R. § 4.71 (a), DC 5237.
The Board has also considered application of 38 C.F.R. §§ 4.40 and 4.45, and DeLuca for the entire appeal period, specifically the additional limitations of motion due to pain, fatigability, and weakness, in reaching the finding that a disability rating in excess of 10 percent is not warranted. Although the record contains reports that the Veteran experienced pain during movement testing, such findings do not provide for rating in excess of 10 percent in this case. The worst range of motion report was in the July 2011 VA examination, in which left and right cervical rotation was limited to 60 degrees due to pain. The DeLuca factors go to additional loss of function caused by limitation of motion due to pain, fatigability, and weakness. Even with consideration of the additional limitation of motion due to pain, the low back disability does not manifest in forward flexion of the cervical spine greater than 15 degrees but not greater than 30 degrees; or, the combined range of motion of the thoracolumbar spine not greater than 170 degrees; or, muscle spasm or guarding severe enough to result in an abnormal gait or abnormal spinal contour such as scoliosis, reversed lordosis, or abnormal kyphosis; or, ankylosis of the cervical spine or entire spine. Therefore, a 10 percent rating under DC 5237 and 38 C.F.R. § 4.59 is appropriate, and a higher rating is not warranted.
The Board has also considered the application of other relevant diagnostic codes. The Board notes that the Veteran's neck disability is currently rated under DC 5237, as cervical strain. In a February 2013 statement, the Veteran stated that rating her neck disability as cervical strain reflected an improper diagnosis, as she had been diagnosed with degenerative disc disease of the cervical spine by a December 2010 MRI. The Veteran is a physician and competent to opine on medical issues. Degenerative arthritis of the spine is properly rated under DC 5242. Both DC 5237 and DC 5242 are rated according to the General Rating Formula for Disease and Injuries of the Spine. Therefore, the Veteran's neck disability is more accurately described by DC 5242, and there is no prejudice to the Veteran in changing the relevant diagnostic code from DC 5237 to DC 5242.
38 C.F.R. § 4.71a, Note (6) provides that DC 5242 for degenerative arthritis of the spine can also be rated under DC 5003. DC 5003 provides that degenerative arthritis established by x-ray findings will be rated on the basis of limitation of motion under the appropriate diagnostic codes for the specific joint or joints involved. Here, the Veteran is in receipt of a 10 percent rating based on limitation of motion under DC 5242. Therefore, no additional consideration of DC 5003 is required.
Neither the July 2010 VA examination report nor the private treatment records indicated that the Veteran had IVDS. While Veteran reported having exacerbations of her neck pain for at least two weeks several times per year, there is nothing in the evidence to suggest that these exacerbations required both bed rest prescribed by a physician and treatment by a physician. For this reason, the Board finds that a disability rating under the Formula for Rating Intervertebral Disc Syndrome Based on Incapacitating Episodes is not warranted, and the Veteran's neck disability is properly rated under DC 5242. See 38 C.F.R. § 4.71a.
With respect to the Veteran's claim for a higher evaluation of her neck disability as manifested neurologically, the Board must consider the potential application of various other provisions of the regulations concerning VA benefits, whether or not they were raised by the Veteran, as well as the entire history of the Veteran's disability in reaching its decision. Schafrath, 1 Vet. App. at 595. The Board has considered whether a separate rating is warranted for any objective neurologic abnormalities. The only objective neurologic abnormality noted in the record that is attributable to the service-connected cervical spine disability is chronic headaches.
In the May 2014 substantive appeal, the Veteran stated that her cervical spine disability caused daily tension headaches. There is no evidence of neurological testing related to headaches in the record, and it is unclear whether these headaches are of such severity to be separately compensable. Furthermore, the Veteran refused further VA examinations related to her neck disability. Therefore, the weight of the evidence of record does not indicate that a separate rating for headaches is appropriate.
For these reasons, and resolving all reasonable doubt in favor of the Veteran, the Board finds the weight of evidence does not support an initial disability rating in excess of 10 percent for a neck disability. 38 U.S.C.A. § 5107; 38 C.F.R. §§ 4.3, 4.7, 4.71a.
Extraschedular Consideration
As to consideration of referral for an extraschedular rating, such consideration requires a three-step inquiry. See Thun v. Peake, 22 Vet. App. 111 (2008), aff'd sub nom. Thun v. Shinseki, 572 F.3d 1366 (Fed. Cir. 2009). The first question is whether the schedular rating criteria adequately contemplate the Veteran's disability picture. Thun, 22 Vet. App. at 115. If the criteria reasonably describe the claimant's disability level and symptomatology, then the claimant's disability picture is contemplated by the rating schedule, the assigned schedular evaluation is, therefore, adequate, and no referral is required. If the schedular evaluation does not contemplate the claimant's level of disability and symptomatology and is found inadequate, then the second inquiry is whether the claimant's exceptional disability picture exhibits other related factors such as those provided by the regulation as governing norms. If her disability picture meets the second inquiry, then the third step is to refer the case to the Director of Compensation Service to determine whether an extraschedular rating is warranted.
Turning to the first step, the Board finds that the symptomatology and impairment caused by the Veteran's low back and neck disabilities are specifically contemplated by the schedular rating criteria, and no referral for extraschedular consideration is required. The schedular rating criteria specifically provide for ratings based on limitation of motion, including due to pain, stiffness, and other orthopedic factors. See 38 C.F.R. §§ 4.40, 4.45, 4.59, 4.71a, 4.125a; see also DeLuca at 202. In this regard, the Veteran's low back and neck disabilities are manifested by symptoms of limitation of motion, painful motion, fatigability, and pain on prolonged standing, bending, or sitting. The Board has additionally considered ratings under alternate schedular rating criteria as discussed above. See 38 C.F.R. § 4.20; see also Schafrath, 1 Vet App. at 595.
Additionally, the Veteran has not asserted, and the evidence of record has not suggested, any combined effect or collective impact of multiple service-connected disabilities that create such an exceptional circumstance to render the schedular rating criteria inadequate. As such, the Board finds that the Rating Schedule is adequate to evaluate the Veteran's current disabilities and symptomatology. Therefore, in the absence of exceptional factors, the Board finds that the criteria for submission for assignment of an extraschedular rating pursuant to 38 C.F.R.
§ 3.321(b)(1) are not met. Thun, 22 Vet. App. at 115-16; Johnson, 762 F.3d 1362; Bagwell v. Brown, 9 Vet. App. 337 (1996); Shipwash v. Brown, 8 Vet. App. 218, 227 (1995).
The Board has considered whether the issue of entitlement to a total disability rating based on individual unemployability (TDIU) due to service-connected disabilities was reasonably raised by the record in this case. Rice v. Shinseki, 22 Vet. App. 447 (2009). However, in this case, neither the evidence nor the Veteran suggests unemployability due to her service-connected disabilities. Therefore, entitlement to a TDIU is not considered part of the present appeal.
ORDER
Entitlement to an initial disability rating in excess of 10 percent for a lumbar spine disability is denied.
Entitlement to an initial disability rating in excess of 10 percent for a cervical spine disability is denied.
____________________________________________
JONATHAN B. KRAMER
Veterans Law Judge, Board of Veterans' Appeals
Department of Veterans Affairs
|
NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS APR 19 2016
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
ABRAHAM HERNANDEZ CARBAJAL, No. 14-72180
AKA Abraham Carbajal, AKA Abraham
Carbajal-Hernandez, Agency No. A041-844-858
Petitioner,
MEMORANDUM*
v.
LORETTA E. LYNCH, Attorney General,
Respondent.
On Petition for Review of an Order of the
Board of Immigration Appeals
Submitted April 13, 2016**
Before: FARRIS, TALLMAN, and BYBEE, Circuit Judges.
Abraham Hernandez Carbajal, a native and citizen of Mexico, petitions for
review of the Board of Immigration Appeals’ order dismissing his appeal from an
immigration judge’s decision denying his application for protection under the
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
Convention Against Torture (“CAT”). We have jurisdiction under 8 U.S.C. §
1252. We review for substantial evidence the agency’s factual findings.
Wakkary v. Holder, 558 F.3d 1049, 1056 (9th Cir. 2009). We deny the petition
for review.
Substantial evidence supports the agency’s denial of Hernandez Carbajal’s
CAT claim because he failed to establish it is more likely than not he would be
tortured by or with the consent or acquiescence of the government if returned to
Mexico. See Silaya v. Mukasey, 524 F.3d 1066, 1073 (9th Cir. 2008). We reject
Hernandez Carbajal’s contention that the agency failed to consider all his evidence
or improperly analyzed his case.
PETITION FOR REVIEW DENIED.
2 14-72180
|
NO. 07-10-00308-CV
IN THE COURT OF APPEALS
FOR THE
SEVENTH DISTRICT OF TEXAS
AT
AMARILLO
PANEL E
AUGUST
18, 2011
ROY JON, APPELLANT
v.
LESLEY DINWIDDIE, ET AL.
APPELLEES
FROM THE 72ND DISTRICT COURT OF LUBBOCK COUNTY;
NO. 2009-546,985; HONORABLE RUBEN REYES, JUDGE
Before CAMPBELL
and HANCOCK, JJ. and BOYD, S.J.[1]
MEMORANDUM OPINION
Appellant, Roy Jon, an inmate
proceeding pro se sued ten individual defendants and both the Texas Department
of Criminal Justice (TDCJ) and the University of Texas Medical Branch (UTMB),
alleging a host of claims ranging from assault to use of prison “food loaf” as
cruel and unusual punishment. Jon
alleged that these various acts and omissions violated a number of his
constitutional and statutory rights. On
the defendants’ motion, the trial court dismissed Jon’s claims as
frivolous. We will affirm the trial
court’s dismissal.
Factual and Procedural History
Jon
alleges that, on October 26, 2008, prison officials at the Montford Unit
performed a “shakedown” during which an officer acted aggressively toward Jon
and destroyed some of his personal property.
Jon claims that he was sent to a solitary cell for no reason during the
search. After the search, what remained
of Jon’s property was returned to him, and Jon was moved to another cell.
Jon announced he was on a hunger
strike on October 28, during or after the prison went into lockdown and a
second search of the prison cells was performed. Prison staff ordered Jon to carry his property
to the gym. Jon maintained that he could
not do so because he was ill after haven taken his medication without food and
insisted that the staff provide him a cart.
The staff refused. Lesley
Dinwiddie arrived in response to the disagreement and Jon again expressed that
he wanted a cart to carry his property to the gym. According to Jon, Dinwiddie responded by
slamming Jon against a wall and placing him in restraints.
Defendant
Zulfiquar Hussain then joined in to assist Dinwiddie, and Jon was placed in
another cell. In his petition, Jon
advances an undeveloped assertion that Hussain, perhaps with the assistance of
other unnamed staff members, committed theft.[2] The TDCJ, he claims, was aware of this
incident and permitted the staff’s “negligent use of security devices and
premises.”
As
a result of Jon’s conduct during the search, disciplinary action was taken
against him. Jon claims that he was
denied procedural and substantive due process during the disciplinary
proceeding by Richard Wathen, Terry Tucker, Joel Guana, and the TDCJ. As a result of the disciplinary procedure,
Jon was placed on twenty-five days of commissary and cell restriction. Following the alleged instances of
mistreatment during the lockdown, Jon claims, defendants Allen Hanretta and
Wendy Heckler were deliberately indifferent to Jon’s suffering at the hands of
prison staff and refused to provide him with necessary medical care.
Jon
also complains of a later incident involving a food tray that, he says, was
placed in the proper location for it to be picked up following a meal. Defendant Jeremy Boggs apparently wanted Jon
to move it elsewhere and, when Jon refused, kicked the tray into the cell and
came within five inches of hitting Jon.
By Jon’s account, this close call caused him mental anguish. Jon claims that, by kicking the tray in Jon’s
direction, Boggs violated Jon’s protection against cruel and unusual punishment
and that the TDCJ knew of Boggs’s behavior and failed to maintain adequate
surveillance and inspection that would prevent Boggs from negligently using the
food tray as a weapon.
Jon
refused to return the kicked tray to prison staff when requested. He demanded that a supervisor come down to
get the tray so that Jon could report that Boggs kicked the tray into his
cell. As a result of Jon’s refusal to
comply with an order to bring the food tray to the proper location, he was put
on “food loaf.” Jon claims that “food
loaf” was imposed without supervisor or warden approval and that such
imposition by defendants Joshua Keeney, Frank Renduf, Guana, Wathen, and Tucker
caused him mental and physical anguish and was retaliatory in nature. He maintains that having to eat “food loaf”
for twenty-one meals is cruel and unusual punishment. The TDCJ, Jon claims, knew of and approved
this negligent use of “food loaf.”
Based on these assertions, Jon sued
ten individual defendants, the TDCJ, and UTMB for a variety of statutory and
constitutional violations. The State
responded by filing a motion to declare Jon a vexatious litigant and a motion
to dismiss his suit pursuant to Chapter 14 of the Texas Civil Practice and
Remedies Code. The trial court denied defendants’
motion to declare Jon a vexatious litigant but granted their motion to dismiss
Jon’s suit as frivolous pursuant to Chapter 14.
Jon appealed the dismissal and, in a
forty-six page handwritten brief, brings eleven issues for this Court’s
review. Through ten of his issues, he reasserts
the factual and legal bases of his various claims against defendants. The underlying contention of Jon’s issues is
that the trial court erroneously dismissed his lawsuit. In his final issue, he also complains of
error in the discovery process.
Applicable Law and Standard of Review
Chapter 14 of the Texas Civil
Practice and Remedies Code applies to an inmate’s suit in which an affidavit or
unsworn declaration of inability to pay costs is filed by the inmate. See Tex.
Civ. Prac. & Rem. Code Ann. § 14.002 (West 2002). Among the several grounds on which a trial
court may dismiss such a suit is the finding that the inmate’s suit is
frivolous or malicious. See id.
§ 14.003(a)(2) (West 2002). In
determining whether a claim is frivolous or malicious, the trial court may
consider whether (1) the claim’s realistic chance of ultimate success is
slight, (2) the claim has no arguable basis in law or in fact, (3) it is clear
that the party cannot prove facts in support of the claim, or (4) the claim is
substantially similar to a previous claim filed by the inmate because the claim
arises from the same operative facts. Id.
§ 14.003(b).
We review a trial court’s dismissal
of a lawsuit brought by an inmate who had filed an affidavit or declaration of
inability to pay costs for an abuse of discretion. In re Douglas, 333 S.W.3d 273, 293
(Tex.App.—Houston [1st Dist.] 2010, pet. denied). Under this standard of review, the appellant
inmate must show that the trial court’s action was arbitrary or unreasonable in
light of all the circumstances in the case.
Id. While, generally, we
review dismissals of inmate litigation under Chapter 14 for an abuse of
discretion, we review de novo the
specific question whether there was an arguable basis in law for an inmate’s
claims. Id. To determine whether the trial court properly
concluded that there was no arguable basis in law for an inmate’s suit subject
to Chapter 14, we must examine the types of relief and causes of action the
inmate pleaded in his petition to determine whether, as a matter of law, the
petition stated a cause of action that would authorize relief. Id.
Analysis
Claim of Assault
Jon
claims that, in response to Jon’s medical complaints during the second search,
Dinwiddie used excessive force in such a manner and degree as to constitute an
assault.[3] To put Jon’s contention in its appropriate
context, we note that the facility was in lockdown, and Jon admitted that he
refused to obey the staff’s orders to carry his property to the gym that day,
though he maintains that he was physically unable to do so as a result of his
illness. In light of the evidence, Jon’s
refusal to obey an order during lockdown invokes security considerations
associated with the privileged use of force in a correctional facility:
An officer or employee of a correctional facility is justified in using
force against a person in custody when and to the degree the officer or
employee reasonably believes the force is necessary to maintain the security of
the correctional facility, the safety or security of other persons in custody
or employed by the correctional facility, or his own safety or security.
Tex. Penal
Code Ann. § 9.53 (West
2011).
Dinwiddie’s written statement
concerning the incident cited Jon’s refusal to leave the open cell for the
required search as the basis for the decision to place Jon in restraints. Dinwiddie denied slamming Jon against a wall,
squeezing his neck, or twisting his arm and, instead, explained that Jon
eventually did comply with his orders to turn around and face the wall. Two correctional officers who witnessed the
incident described the incident similarly.
Jon complains that, as a result of
the alleged assault by Dinwiddie, he suffered shoulder and back injuries, neck
strain, and migraines. We note that medical
records that Jon provides do not support his contentions that he sustained
injuries as a result of his encounter with Dinwiddie. Medical records pre-dating the incident at
issue show that Jon complained of shoulder pain in early October and was treated
for that condition. Also inconsistent
with Jon’s account, nurses’ notes taken during a visit a few days after the
encounter with Dinwiddie demonstrate that Jon complained that his back pain was
a result of force used against him two years earlier and that his back had been
hurting since he had to carry his property to the gym during lockdown. The attending nurse reported that there was
no redness or swelling and that Jon had full range of motion. There was no mention of Jon’s reports of
migraines or neck strain.
In the factual context, the trial
court could have concluded that it was reasonable to place Jon in
restraints. Nothing, other than Jon’s
assertions that conflict with other accounts and evidence, suggest that Dinwiddie
used force beyond that which was reasonable under the circumstances. Further, there is no evidence that Jon
sustained injuries as a result of his interaction with Dinwiddie on that
day. Based on the state of the record,
the trial court would have been within its discretion to have found that Jon’s
chances of overcoming Dinwiddie’s Section 9.53 privilege to use reasonable
force on these facts is but slight.
Alternatively, the trial court could have found that it was clear that
Jon cannot prove facts to support his claim that Dinwiddie assaulted him as
alleged.[4] We overrule appellant’s contentions related
to an assault by Dinwiddie.
Claims Related to Disciplinary Action
On appeal, Jon maintains that he was
denied procedural and substantive due process during the 2008 disciplinary
action related to Jon’s conduct during the second search. After sorting through and reading the numerous
grievances in appendices and in the record, most of which are unrelated to
Jon’s encounter with Dinwiddie, it has become clear that Jon utilizes the
grievance system with startling regularity, often filing grievances that
overlap in time and topic. Though it
does appear that Jon complains on appeal of the disciplinary case related to
the encounter with Dinwiddie, his petition identified the case at issue as
disciplinary case number 20090131298, which relates to the food tray incident
and as a result of which he was placed on food loaf. On appeal, Jon identifies the case at issue
as disciplinary case 20090058995, which, according to his allegations, related
to the Dinwiddie encounter and for which he was placed on commissary and cell
restriction for twenty-five days.
Regardless of which case the trial court understood to be at issue, it
would have been correct to conclude that either punishment–food loaf or
commissary and cell restriction–does not raise due process concerns because
such punishments are simply changes in the conditions of Jon’s confinement.
The Due Process Clause does not
protect every change in the conditions of confinement having a substantial
adverse impact on the prisoner. Sandin
v. Conner, 515 U.S. 472, 478, 115 S.Ct. 2293, 132 L.Ed. 2d 418 (1995). A prisoner’s liberty interest is limited to
freedoms from restraint which impose atypical and significant hardships on the
inmate in relation to the ordinary incidents of prison life. Id. at 484. Specifically, cell restrictions and loss of
commissary privileges are merely changes in the conditions of an inmate’s
confinement and do not implicate due process concerns. Hamilton v. Williams, 298 S.W.3d 334,
341 (Tex.App.—Fort Worth 2009, pet. denied) (citing Malchi v. Thaler,
211 F.3d 953, 958 (5th Cir. 2000), and Madison v. Parker, 104 F.3d 765,
767–68 (5th Cir. 1997)).
Here, the trial court could have
concluded that the punishment at issue did not represent an “atypical and
significant hardship[]” and that, therefore, Jon’s claims relating to due
process in his disciplinary hearing had no basis in law. See Sandin, 515 U.S. at
484. We overrule Jon’s contentions on
this issue.
Claims of Cruel and Unusual
Punishment
It
appears that Jon claims that he was subject to cruel and unusual punishment in
violation of the Eighth Amendment when (1) he was forced to eat food loaf as a
disciplinary measure, (2) he was denied medical care, and (3) he was nearly hit
by the tray a staff member kicked in his direction. See U.S.
Const. amend. VIII.
The Eighth Amendment “prohibits the
infliction of ‘cruel and unusual punishments’ on those convicted of
crimes.” Wilson v. Seiter, 501
U.S. 294, 296, 111 S.Ct. 2321, 115 L.Ed.2d 271 (1991). That is to say, the
treatment a prisoner receives and the conditions in which he is confined are
subject to scrutiny under the Eighth Amendment.
See Helling v. McKinney, 509 U.S. 25, 33, 113 S.Ct. 2475,
125 L.Ed.2d 22 (1993). As part of the
Eighth Amendment protection, prison officials are required to provide humane
conditions of confinement by ensuring that inmates receive the basic
necessities of adequate food, clothing, shelter, medical care, and personal
safety. See Farmer v. Brennan,
511 U.S. 825, 832, 114 S.Ct. 1970, 128 L.Ed.2d 811 (1994).
An Eighth Amendment violation exists
where the deprivation of even a single identifiable human need, such as food,
warmth, or exercise, is caused by prison officials’ wanton disregard for the
prisoner's welfare. See Wilson,
501 U.S. at 304. However, not every
deprivation is an Eighth Amendment violation.
To establish an Eighth Amendment violation regarding conditions of
confinement, an inmate must satisfy two requirements. First, the deprivation alleged must be,
objectively, sufficiently serious, and, secondly, a prison official must have
been deliberately indifferent to inmate health or safety. See Farmer, 511 U.S. at 834.
“Food Loaf”
Jon
asserts that defendants Keeney, Renduf, Tucker, Guana, and Wathen used “food
loaf” in such a way as to constitute cruel and unusual punishment under the
Eighth Amendment. However, Jon’s claims
regarding the “food loaf” do not rise to the level of an Eighth Amendment
violation. Other than his expression of
distaste or dissatisfaction with the “food loaf,” Jon presents no evidence or
argument that he suffered a physical or mental injury or developed a physical
or mental condition as a result of having to eat “food loaf” for a week. He does not point to evidence that the “food
loaf” was so nutritionally inadequate or served in a condition that it would
constitute a deprivation of a human need.
The record shows that “food loaf” was served in response to Jon’s
reported conduct in the food tray incident.
That being so, we cannot say that the “food loaf” was anything more than
a “routine discomfort inherent in the prison environment.” See ‘Umar v. Price, No.
09-00-00031-CV, 2001 Tex. App. LEXIS 2232, at *12 (Tex.App.—Beaumont Apr. 5,
2001, no pet.) (not designated for publication).
The trial court could have reasonably
concluded that Jon failed to satisfy the first requirement of an Eighth
Amendment violation that there be a sufficiently serious deprivation of an
identifiable human need. We overrule
Jon’s contentions regarding cruel and unusual punishment in the form of “food
loaf.”
Medical Needs
Despite the presence of a number of
medical records noting Jon’s complaints about the incident but finding no
notable injury, it would appear that, two months after the incident, Jon filed
a grievance alleging that he was being denied proper medical attention for
physical and mental injuries related to the incident. Still setting aside any considerations that the
defendants against whom Jon makes these claims would enjoy immunity, we note
that the record suggests that appellant received a number of visits from the
prison’s medical staff over the days at issue.
Ultimately, it would seem, appellant
was unhappy with the medical treatment he received. However, disagreement or dissatisfaction with
medical treatment received is not sufficient to serve as “deliberate
indifference” such that the disregard of Jon’s medical needs would violate the
Eighth Amendment. See Estelle
v. Gamble, 429 U.S. 97, 104–06, 97 S.Ct. 285 50 L.Ed.2d 251 (1976). Even assuming that Hanretta and Heckler were
negligent, a finding which we do not make here, mere negligence is insufficient
to establish the deliberate indifference required for an Eighth Amendment
violation. See id. at 106.
The trial court could have reasonably
concluded that Jon cannot prove facts to support his claim that Hanretta and
Heckler acted with deliberate indifference to Jon’s serious medical needs such
that their medical treatment would amount to a violation of the Eighth
Amendment. We overrule Jon’s contentions
of deliberate indifference on the part of Hanretta and Heckler.
Kicked Tray
Jon
claims that Boggs used excessive force against him when Boggs kicked the tray
inside Jon’s cell in Jon’s direction. Jon characterizes this action as conduct
subjecting Jon to cruel and unusual punishment.
Jon made clear to the trial court, both in his petition and at the
hearing on the motion to dismiss, that the tray did not hit him.
Whenever prison officials are accused
of using excessive force in violation of the Eighth Amendment, the core
judicial inquiry is “whether [the] force was applied in a good faith effort to
maintain or restore discipline, or maliciously and sadistically to cause harm.” Wilkins v. Gaddy, 130 S.Ct. 1175,
1178, 175 L.Ed.2d 995 (2010) (per curiam) (citing Hudson v. McMillian,
503 U.S. 1, 112 S.Ct. 995, 117 L. Ed. 2d 156 (1992)). Although lack of an injury does not always
defeat an excessive force claim, it is relevant in determining whether a
violation occurred. Id. at
1177–78. The extent of injury may also
provide some indication of the amount of force applied. Id. at 1178.
Based on cases dealing with excessive
force in the Eighth Amendment context, including Wilkins, the trial
court could have concluded that, even if Boggs did kick the tray in Jon’s
direction, such action was not objectively of such a serious nature that it
could be said to be done to “maliciously and sadistically cause harm.” That is, the trial court could have concluded,
within its discretion, that the chance of this claim’s success was slight or
that Jon would be unable to prove facts to support his claim. We overrule Jon’s contentions relating to
this issue.
Claims against TDCJ and UTMB
In
the absence of a relevant waiver of immunity, these two entities, as units of
the State, enjoy sovereign immunity.
Jon’s claims that the TDCJ negligently used tangible personal property
in the forms of restraints and “food loaf” does not invoke an applicable waiver
of the TDCJ’s sovereign immunity. See
Tex. Civ. Prac. & Rem. Code Ann.
§ 101.021(2) (West 2011). Though Jon’s
petition attempts to couch allegations against TDCJ in terms of negligence, a
careful reading reveals that his allegations more accurately sound in
intentional tort. And the Texas Tort
Claims Act (TTCA) specifically provides that the negligent use of property
exception does not apply when a party claims intentional tort. See id. § 101.057(2) (West
2011). Jon’s attempts to cast his claims
in terms of negligence fail; the true nature of his claims more closely
resembles allegations of intentional misconduct.[5]
That
said, there does not appear to be a waiver of immunity applicable to Jon’s
claims such that the TDCJ would be subject to suit. Therefore, looking at Jon’s claims against
the TDCJ, the trial court could have reasonably concluded their “realistic
chance of ultimate success is slight.” See
id. § 14.003(b)(1). We overrule
Jon’s contentions to the contrary.
The
record shows that Jon’s claims against UTMB would likewise fail in that it
appears the TTCA does not provide an applicable waiver by which Jon could
successfully pursue his claims against UTMB.
From our reading of Jon’s contentions, it appears he contends that UTMB
knew of and approved the alteration of his medical records. He attempts to characterize this practice as
negligent use of medical records.[6] His own contentions, however, belie his
efforts to characterize this matter as negligence. He unequivocally accuses prison staff and
TDCJ of knowingly altering records in furtherance of efforts to cover up an
assault by Dinwiddie. It is well
established that, if a plaintiff pleads facts which amount to an intentional
tort, no matter if the claim is framed as negligence, the claim generally is
for an intentional tort and is barred by the TTCA. See Petta, 44 S.W.3d at 580; Pineda
v. City of Houston, 175 S.W.3d 276, 282–83 (Tex.App.—Houston [1st Dist.]
2004, no pet.). The trial court did not
abuse its discretion by dismissing claims against UTMB as frivolous.
Complaints Regarding Discovery
On
appeal, Jon urges that the trial court committed error in some manner
associated with the discovery process.
But he does not identify an adverse ruling on which he bases his
complaint. That being so, there is
nothing preserved for our review. See
Tex. R. App. P. 33.1(a)(2).
Conclusion
Having
overruled appellant’s points of error, we affirm the trial court’s judgment.
Mackey
K. Hancock
Justice
[1] John T. Boyd,
Chief Justice (Ret.), Seventh Court of Appeals, sitting by assignment.
[2]
Though done without a great deal of development,
Jon claimed in his petition that Hussain took some of Jon’s personal
property. On appeal, Jon mentions the
theft of personal property but does not appear to advance an independent
argument regarding the viability of his claim of theft, if any, in relation to
the trial court’s dismissal.
[3]
For the purposes of our analysis and due to the
unclear nature of Jon’s claims against the ten individual defendants, we set
aside any considerations regarding immunity as it applies to the individual
defendants.
[4]
Further, though the trial court could not have
concluded that Jon’s claims had no arguable basis in fact if it had not held a hearing, see Hector v.
Thaler, 862 S.W.2d 176, 178 (Tex.App.—Houston [1st Dist.] 1993, writ
denied), we cannot say that the trial court was so constrained after having
held a hearing in which Jon participated by telephone.
[5]
That is, the nature of the complained-of conduct
sounds more accurately in intentional tort if we assume the conduct would
constitute anything at all more than a reasonable use of force in a
correctional facility. See Tex. Penal Code Ann. § 9.53.
[6]
We would add that information is not considered
tangible personal property, since it is an abstract concept that lacks
corporeal, physical, or palpable qualities.
State Dep’t of Pub. Safety v. Petta, 44 S.W.3d 575, 580 (Tex.
2001). And simply reducing information
to writing on paper does not make the information “tangible personal property”
for the purposes of the TTCA. Id.
(citing Dallas County v. Harper, 913 S.W.2d 207, 207–08 (Tex. 1995)).
|
982 P.2d 334 (1999)
91 Hawai`i 200
Peter KEMA, Sr., Petitioner,
v.
The Honorable Ben H. GADDIS, Judge of the Family Court of the Third Circuit, and Gannett Pacific Corporation, dba Honolulu Advertiser, Department of Human Services (DHS), State of Hawai`i, Jaylin Kema, William Collier, John Doe (dob: 1/09/87), Jane Doe (dob: 4/04/89), John Doe (dob: 5/01/91), Jane Doe (dob: 3/10/93), Respondents.
No. 21733.
Supreme Court of Hawai`i.
July 26, 1999.
*335 J.S. Yoshimoto (of Amano, Pinao & Kobayashi) Honolulu, for the petitioner Peter Kema, Sr.
Craig M. Sadamoto, Hilo, for Jaylin Kema, joins in the petition.
Jeffrey S. Portnoy, Peter W. Olson, and Patrick W. Hanifin, Honolulu, (of Cades Schutte Fleming & Wright) for the respondent Gannett Pacific corporation dba the Honolulu Advertiser.
Bryan C. Yee, Deputy Attorney General, for the respondent Department of Human Services (DHS), State of Hawai`i.
Howard H. Shiroma (of Crudele, De Lima & Shiroma) Hilo, for the respondent William Collier.
Edith Kawai, Kamuela, Guardian Ad Litem for John Doe (dob: 1/9/87), Jane Doe (dob: 4/4/89), John Doe (dob: 5/1/91), and Jane Doe (dob: 3/10/93).
MOON, C.J., KLEIN, LEVINSON, NAKAYAMA, and RAMIL, JJ.
PER CURIAM.
In this original proceeding, the petitioner Peter Kema, Sr. (petitioner) petitions this court for a writ of prohibition or mandamus directing Ben H. Gaddis, district family court judge of the third circuit, to: (1) withhold release of records requested by the respondent Gannett Pacific Corporation, dba Honolulu Advertiser (Advertiser), a general circulation newspaper, pertaining to the family court files of a minor, Peter Kema, Jr.; and (2) vacate a June 17, 1998 decision and order regarding the Advertiser's request for access to confidential family court records. The respondents Department of Human Services (DHS), Jaylin Kema (the mother of Peter Kema, Jr.), the biological father of the half siblings of Peter Kema, Jr., and the guardian ad litem (GAL) for the children responded in support of the petition.
Judge Gaddis granted the Advertiser and other media organizations access to a redacted copy of the closed family court file of Peter Kema, Jr. In his decision and order, Judge Gaddis concluded that additional publicity would not be in the best interest of Peter Kema, Jr.'s siblings and was potentially harmful to them. Judge Gaddis denied release of the siblings' ongoing and closed family court files, but ordered release of the redacted version of Peter Kema, Jr.'s file. Review of the redacted file, however, reflects that the closed Peter Kema, Jr. case was combined with the siblings' case and that the cases are so intertwined that release of the redacted Peter Kema, Jr. file would result in the release of reports and documents from the closed case of the other children, which *336 Judge Gaddis concluded should not be released. Therefore, the petition for writ of prohibition and/or mandamus is granted.[1]
I. BACKGROUND
This original proceeding involves the confidential family court files of Peter Kema, Jr. (also known as Peter Boy), a seven-year-old minor who was reported missing in 1998, as well as two of his minor siblings. All of the children were subject to the jurisdiction of the family court of the third circuit. The family court cases were closed in 1995.
After Peter Boy was reported missing in 1998, the family court opened two new files related to the children. On April 16, 1998, Mike Gordon, a reporter for the Advertiser, wrote to the family court seeking information about the disappearance of Peter Boy. The DHS, the GAL, and Peter Boy's parents objected to Gordon's request. Judge Gaddis overruled the objections and allowed the release of limited information, pursuant to Hawaii Revised Statutes (HRS) § 587-81 (1993).[2] The order for release of information regarding Peter Kema, Jr. was filed on April 17, 1998. The family court entered the following relevant findings of fact (FOFs):
The release of limited information about the past history of this child and the circumstances surrounding his disappearance will not substantially impede any current investigations by law enforcement authorities.
The release of limited information about the past history of this child and the circumstances surrounding his disappearance may encourage members of the public to come forward with helpful information about the disappearance and present whereabouts of the child.
The release of limited information about the past history of this child and the circumstances surrounding his disappearance is in the best interests of the child. Concerns as to the present whereabouts and well-being of this child outweigh concerns as to confidentiality raised on behalf of other family members.
The release of limited information about the past history of this child and the circumstances surrounding his disappearance serve a legitimate purpose in that such a release may materially assist authorities in locating this child.
The release of information concerning this child and family should be limited because court proceedings continue and the rights of other family members to confidentiality should be preserved.
Based upon the foregoing FOFs and pursuant to HRS § 587-81, the family court directed DHS to prepare a synopsis of the allegations contained in the safe home guidelines submitted in the DHS case concerning Peter Boy, including a description of the following: (1) the injuries suffered by Peter Boy when he first came to the attention of DHS; (2) the circumstances and allegations that caused Peter Boy once again to come to the attention of DHS; (3) all known accounts provided to the DHS and law enforcement authorities regarding the disappearance of Peter Boy, including (a) the location of the child when last seen, (b) the names of persons the child was alleged to have been with, *337 (c) the date the child was last seen, (d) a photograph of Peter Boy, and (e) any other information or allegations that might help the public locate Peter Boy. The family court denied release of all other court records and made copies of the synopsis available to the Advertiser and all other media representatives upon request.
On May 19, 1998, the Advertiser petitioned the family court for access to all of the confidential records of the child protective matter involving Peter Boy and his siblings. In support of its petition, the Advertiser cited concerns expressed at an informational meeting conducted by the House Human Services Committee of the Hawai`i House of Representatives on September 11, 1997 regarding DHS's handling of cases and its emphasis on family reunification rather than child protection. The Advertiser opined that it was an appropriate "person" for whom access pursuant to HRS § 587-81 would serve a legitimate purpose. Citing HRS § 571-84(b),[3] the Advertiser contended that it had a legitimate interest in reviewing the family court records in order to advance and protect the welfare of the child and argued that release of the records to the Advertiser would serve the important public purpose of assisting the community in understanding what had transpired in Peter Boy's case.
On June 17, 1998, Judge Gaddis issued a decision and order regarding the Advertiser's request for access to confidential family court records (hereinafter the decision). The decision, citing HRS § 587-81, noted that the family court must always consider the child's best interest when attempting to balance competing interests and when exercising its discretion. In the decision, Judge Gaddis recited that he had considered the following: (1) the best interests of Peter Boy; (2) the best interests of the other children in the family; (3) the privacy interests of the adults in the family; (4) the privacy interests of others; and (5) the purpose of the release of records.
Judge Gaddis concluded that greater public access to the family court records was unlikely to help or hurt Peter Boy and that the overriding concern for his disappearance and safety necessitated that his privacy interests be sacrificed. With regard to the other children, Judge Gaddis found as follows:
Of far greater concern is the impact that additional media exposure may have on the other children in the family. As previously noted[,] these children have already had their names printed in the paper and have been filmed by television news as they were placed in foster care ....
The court has received little other information about how the other children have actually been affected by the publicity in this case.... There are no allegations that these children were recently harmed or neglected by anyone. They have been removed from their home and placed in foster care. Although the court has been advised that the children appear to be doing well, such foster care placements are almost always a traumatic event for older children....
It seems likely that additional publicity about these children would be potentially harmful and would not be in their best interest.
(Emphasis added.)
Addressing the privacy interests of the adult family members, Judge Gaddis acknowledged that child protective proceedings often involve family problems of an intimate nature and that media exposure of family problems can have significant and long-lasting effects on the reputation of a family and can create enduring rifts, particularly in a small community. Judge Gaddis concluded that the concerns and positions of the adult family members in the case weighed against the release of additional family court records.
*338 Assessing the privacy interests of others, Judge Gaddis noted that neither the family court nor the DHS possessed any direct privacy interest under HRS chapter 587 but that confidentiality served an important public purpose both for DHS and the family court. In particular, he found as follows:
Often when DHS is involved with families in abuse and neglect cases, the families are in the midst of conflict, denial, pain and suffering. It is extremely important that family members be encouraged to communicate openly with DHS and service providers. Good DHS social workers succeed in opening lines of communication within families. Effective and honest communication by DHS with family members allow many children to remain safely with persons [whom] they know and love rather [than] in foster care. DHS workers routinely solicit information from families with the understanding that the information shared will not become public knowledge. Such assurances of confidentiality may be compromised when court records and files about a family are opened to the news media.
With regard to the release of records to the Advertiser, Judge Gaddis found as follows:
Questions about the response of agencies and the family court to problems of child abuse and neglect are areas of legitimate concern to both the news media and the public . . . .
. . . .
In light of such concerns, the Court acknowledges that the disclosure of some of the court records in the case of Peter Boy could contribute to public understanding and awareness and would serve a legitimate purpose.
The family court denied the request for release of DHS's records that were not in the possession of the family court, as well as the records of the new Child Protective Services (CPS) case involving Peter Boy, but stated that CPS could provide a press release if new information materialized regarding the child. Judge Gaddis denied access to either the new or the old files containing information regarding Peter Boy's siblings, but ordered that redacted versions of the closed case would be opened to public inspection. Accordingly, the family court granted the Advertiser's request in part, according the Advertiser access to a redacted version of the family court's records in Peter Boy's closed case. The family court ruled that the redacted file, consisting of 577 pages, would be available to anyone who requested it. A subsequent motion for reconsideration was denied.
On July 15, 1998, the family court issued an order staying the release of the redacted records until July 31, 1998, for the purpose of allowing the parties an opportunity to seek interim relief from this court. The petitioner filed the instant petition seeking to prohibit the family court from releasing the confidential records of Peter Boy's case. This court directed all parties to the proceedings to respond to the petition. The Advertiser opposes the issuance of a writ of mandamus.[4] The other parties to the proceeding join the petitioner in urging issuance of the writ of mandamus.
II. STANDARD OF REVIEW
A writ of mandamus and/or prohibition is an extraordinary remedy that will not issue unless the petitioner demonstrates a clear and indisputable right to the relief requested and a lack of other means to redress adequately the alleged wrong or to obtain the requested action. Straub Clinic & Hospital v. Kochi, 81 Hawai`i 410, 414, 917 P.2d 1284, 1288 (1996). Such writs are not meant to supersede the legal discretionary authority of the lower court, nor are they meant to serve as legal remedies in lieu of normal appellate procedures. Id. Where a trial court has discretion to act, mandamus will not lie to interfere with or control the exercise of that *339 discretion, even when the judge has acted erroneously, unless the judge has exceeded his or her jurisdiction, has committed a flagrant and manifest abuse of discretion, or has refused to act on a subject properly before the court under circumstances in which it has a legal duty to act. Id. In this case, mandamus is the appropriate remedy where the family court issues an order releasing confidential files to the media and the order is not immediately appealable or related to the merits of the child protective proceedings. We recognize that the media has expressed interest in other child protective proceedings and take this opportunity to provide guidance to the family courts.
III. DISCUSSION
The Child Protective Act is codified under Hawai`i Revised Statutes (HRS) chapter 587. HRS § 587-81 (1993), see supra note 2, governs the keeping of records for child protective proceedings. The plain language of HRS § 587-81 envisions release of court records only when the family court determines that release is either in the best interest of the child or serves some other legitimate purpose. The question posed by the petition in this case is whether the release of family court records that includes information regarding Peter Boy's siblings serves a legitimate purpose anticipated by the statute. The statute and its legislative history do not define "legitimate purpose," and this court has not previously had occasion to apply the statute.
When construing a statute, our foremost obligation is to ascertain and give effect to the intention of the legislature, which is obtained primarily from the language contained in the statute itself. Pacific Int'l Services Corp. v. Hurip, 76 Hawai`i 209, 216, 873 P.2d 88, 96 (1994) (citation omitted). Our duty is to interpret statutory language in the context of the whole statute and in a manner consistent with the purposes of the statute. State v. Aluli, 78 Hawai`i 317, 322, 893 P.2d 168, 173 (1995) (citing Lealaimatafao v. Woodward-Clyde Consultants, 75 Haw. 544, 551, 867 P.2d 220, 224 (1994)). In short, we must examine the words of the statute in the context in which they are used. Cf. Peterson v. Hawaii Electric Light Co., 85 Hawai`i 322, 328, 944 P.2d 1265, 1271 (1997) (examining context and legislative history).
The Child Protective Act was created to protect "the safety and health of children who have been harmed or are in life circumstances that threaten harm." HRS § 587-1 (Supp.1998). The policy and purpose of HRS chapter 587 is to provide children with prompt and ample protection from the harms detailed therein, with an opportunity for timely reconciliation with their families.[5] HRS § 587-1 further provides that the "chapter shall be liberally construed to serve the best interests of the children and the purposes set out in this chapter." Thus, "legitimate purposes" relevant to HRS chapter 587 are limited to those that further the best interests of the children who come within the jurisdiction of the family court, pursuant to the Child Protective Act, i.e., purposes that will safeguard, treat, and provide services and plans for children in need of protection.[6]
We agree with Judge Gaddis's conclusion that providing information to the media, under certain circumstances, might serve a legitimate purpose under HRS chapter 587. In this case, for example, the first release of information regarding Peter Boy's history was clearly in Peter Boy's best interest because it could have resulted in the acquisition of intelligence regarding Peter Boy's disappearance, which could potentially *340 have enabled the family court to provide services to Peter Boy that would safeguard him. Moreover, the first release of information did not infringe upon the best interests of Peter Boy's siblings. Nonetheless, although we acknowledge that the release of further family court documents to the media might serve some legitimate purpose, the overriding concern of the Child Protective Act in determining whether to release such information remains the best interest of the children involved. Under the Child Protective Act, the interests of other parties or non-parties seeking information are not as compelling as the interests of the children involved.
Here, when assessing the best interests of the other children involved, Judge Gaddis found that "additional publicity about these children would be potentially harmful and would not be in their best interest." He recognized that the old file contained a great deal of material relating to Peter Boy's siblings and attempted to redact the record in order to delete personal information relating to them. Although Judge Gaddis made a determined effort to redact all information relating to the siblings, review of the redacted file reveals that the cases are inextricably intertwined and that release of Peter Boy's file would ultimately result in the release of a large number of documents related to the other children, a result unintended by Judge Gaddis and contrary to the intent and purpose of HRS chapter 587. Because the cases are so interrelated and release of information would be harmful to Peter Boy's siblings, granting the Advertiser access to the family court's record is not in their best interest. Inasmuch as the redactions do not delete all information related to the other children, we conclude that Judge Gaddis's ruling violated the applicable legal standard in allowing access to even a redacted version of the old file.
IV. CONCLUSION
Based upon the foregoing, the petition for writ of prohibition and/or mandamus is granted, and the family court is enjoined from releasing the requested information.
NOTES
[1] This opinion is issued for the purpose of explaining our order, entered on November 20, 1998, vacating the June 17, 1998 decision and order regarding request for access to confidential family court records.
[2] HRS § 587-81 provides:
Court records. The court shall keep a record of all child protective proceedings under this chapter. The written reports, photographs, x-rays, or other information of any nature which are submitted to the court may be made available to other appropriate persons, who are not parties, only upon order of the court after the court has determined that such access is in the best interest of the child or serves some other legitimate purpose; provided that the department may disclose, without order of the court, such information as is in the court record in the manner and to the extent as is set forth in departmental rules that have been legally promulgated and concern the confidentiality of records; provided further that:
(1) The department shall not disclose parties' names to researchers without prior order of the court; and
(2) The department shall report each disclosure to the court and all parties as part of its next report to the court after the department has disclosed information pursuant to this section.
[3] HRS § 571-84(b) (Supp.1998) provides:
(b) Reports of social and clinical studies or examinations made pursuant to this chapter shall be withheld from public inspection, except that information from the reports may be furnished, in a manner determined by the judge, to persons and governmental and private agencies and institutions conducting pertinent research studies or having a legitimate interest in the protection, welfare, treatment, or disposition of the child.
[4] The Advertiser refers to the issuance of orders in other family court cases regarding the release of confidential child protective files as support for its position. We caution counsel that decisions and orders issued in unrelated family court cases that were not reviewed on appeal and addressed in published decisions have no precedential value and should not be cited as authority. Cf. Hawai`i Rules of Appellate Procedure (HRAP) Rule 35(c) (1996).
[5] We note that the focus of the Child Protective Act changed somewhat during the pendency of the proceedings at issue in this case to ensure that the safety and best interest of the children involved in child protective proceedings were viewed as paramount in any family reunification plan. See 1998 Haw. Sess. L. Act 134, § 1 at 504. These changes do not affect our analysis of the family court's proposed release of information to the media.
[6] In this connection, the interests of the press are no different from the interests of the general public. See Gannett Pacific Corp. v. Richardson, 59 Haw. 224, 229-230, 580 P.2d 49, 54-55 (1978) (press' interest in attending court hearing no different than that of general public).
|
20 Cal.App.3d 632 (1971)
97 Cal. Rptr. 844
In re JOHN HARRIS, JR., on Habeas Corpus.
Docket No. 20259.
Court of Appeals of California, Second District, Division Five.
October 15, 1971.
*633 COUNSEL
A.L. Wirin, Fred Okrand, Laurence R. Sperber and Frank S. Pestana for Petitioner.
Joseph P. Busch, Jr., District Attorney, Harry Wood and Robert J. Lord, Deputy District Attorneys, Evelle J. Younger, Attorney General, and William E. James, Assistant Attorney General, for Respondent.
OPINION
STEPHENS, Acting P.J.
On September 20, 1966, the Grand Jury for the County of Los Angeles returned an indictment in two counts against petitioner charging distribution of leaflets in violation of the California Criminal Syndicalism Act (Pen. Code, § 11401, subd. 3). On December 1, 1966, petitioner's demurrer to the indictment was overruled and his motion for dismissal was denied. On December 19, 1966, we denied a petition for writ of prohibition. On January 18, 1967, the California Supreme Court denied a petition for hearing. Petitioner then filed a complaint in the United States District Court, Central District of California, pursuant to the Federal Civil Rights Act (42 U.S.C. § 1983). A three-judge court held the California syndicalism statute unconstitutional on the ground that it is "impermissibly vague and overbroad," and issued an injunction enjoining the district attorney from its enforcement against petitioner (Harris v. Younger (C.D. Cal. 1968) 281 F. Supp. 507). On direct appeal, the United States Supreme Court without reaching the question of the statute's constitutionality, held that "the judgment of the District Court, enjoining appellant Younger from prosecuting under these California statutes, must be reversed as a violation of the national policy forbidding federal courts to stay or enjoin pending state court proceedings except under special circumstances." (Younger v. Harris, 401 U.S. 37 [27 L.Ed.2d 669, 91 S.Ct. 746].) Thereafter, petitioner's petition for writ of habeas corpus was heard and denied by the superior court on May 7, 1971, without written opinion.
Petitioner is once again before us, seeking to secure his release from *634 custody on the ground that the statute under which he is charged is unconstitutional.
When we first considered petitioner's petition for a writ of prohibition in December 1966, this court was bound by the United States Supreme Court's decision in Whitney v. California, 274 U.S. 357 [71 L.Ed. 1095, 47 S.Ct. 641], in which the court directly considered and upheld the constitutionality of the California Criminal Syndicalism Act. Consequently, we denied that petition. Subsequent to our denial, the United States Supreme Court reconsidered the problems raised in Whitney, supra, and struck down an Ohio Criminal Syndicalism statute that was "quite similar" to the California Criminal Syndicalism statute on the ground that the Ohio statute fell "within the condemnation of the First and Fourteenth Amendments." (Brandenburg v. Ohio, 395 U.S. 444 [23 L.Ed.2d 430, 89 S.Ct. 1827].) In Brandenburg, the court expressly overruled the earlier decision in Whitney. (See also, Younger v. Harris, supra.)[1] (1) Therefore, just as we were bound by Whitney to deny petitioner's first petition for a writ, we are now bound by Brandenburg to grant petitioner's present petition for a writ.
Consequently, under compulsion of Brandenburg v. Ohio, supra, 395 U.S. 444, we hold that portion of the California criminal syndicalism statute (Pen. Code, § 11401, subd. 3) under which defendant was indicted to be unconstitutional.
The writ is granted, and the petitioner is ordered discharged.
Aiso, J., and Reppy, J., concurred.
A petition for a rehearing was denied November 2, 1971, and respondent's petition for a hearing by the Supreme Court was denied December 16, 1971.
NOTES
[1] See McSurely v. Ratliff, 282 F. Supp. 848 and Ware v. Nichols, 266 F. Supp. 564 for holdings of unconstitutionality of similar statutes by federal three-judge courts.
|
494 F.2d 1273
UNITED STATES of America, Appellee,v.William Wesley HARRIS and Robert Lee Willis, Appellants.
Nos. 73-1432, 73-1433.
United States Court of Appeals, Tenth Circuit.
April 19, 1974, Rehearing Denied May 22, 1974.
Edward F. Bachofer, Merriam, Kan., for appellant Harris.
Thomas E. Joyce, Kansas City, Kan., for appellant Willis.
Stephen K. Lester, Asst. U.S. Atty. (Robert J. Roth, U.S. Atty., Glen S. Kelly and E. Edward Johnson, Asst. U.S. Attys., on the brief), for appellee.
Before BREITENSTEIN, SETH and DOYLE, Circuit Judges.
PER CURIAM.
1
William Wesley Harris and Robert Lee Willis, in two appeals consolidated in this court, appeal from judgments of conviction, after a jury trial, of having violated 18 U.S.C. 2, 2113(a), and (d). Initially, seven codefendants were charged in the indictment for the bank robbery.
2
The trial below was the appellants' second, following reversal and remand by this court of the first. United States v. Harris, 462 F.2d 1033 (10th Cir.). Appellants, along with defendants Monroe and Odom, who are not before the court in this appeal, were convicted primarily out of the mouths of Colvin and Lewis, the active participants in the bank robbery. Much of the appellants' briefs are concerned with the propriety of this 'accomplice' or 'informant' testimony.
3
Briefly stated, in the light most favorable to the Government, the record discloses the following events: On November 9, 1970, the Tower State Bank of Kansas City, Kansas, was robbed by Colvin and Lewis, who pleaded guilty before trial and testified against the other defendants. They testified that Harris and Willis arranged the overall plan of the robbery, including the theft of the 'getaway' car by Fagan and another man, and 'cased the heist' beforehand with them. Harris and Willis also arranged with Misses Odom and Monroe for a rendezvous where Colvin and Lewis would jump into the trunk of the women's rented car and be driven to a place where they could divide up the proceeds of this endeavor. All went according to plan, except that after the robbery the participants were not able to meet at Lewis' house because there were other people there; they met instead at the house of one Gordon. Harris and Willis helped in counting out the money which was divided among the various persons involved.
4
The record plainly shows that the witness Colvin had expectations of leniency in sentencing, and of non-prosecution for other offenses, both state and federal, in return for his appearance as a witness. Likewise, the witness Fagan had some hope that the fact that he would testify on behalf of the Government would be relayed to his Parole Board, as he was incarcerated at the time. These facts were thoroughly explored by defense counsel during the course of the trial, as were the rather extensive criminal records of these witnesses. Their credibility thus became a matter for the jury to resolve.
5
The defendants urge that instructions referred to in On Lee v. United States, 343 U.S. 747, 72 S.Ct. 967, 96 L.Ed. 1270, and in Todd v. United States, 345 F.2d 299 (10th Cir.), should have been given in this case. We find no facts in the record showing that any witness was an informer giving testimony in the circumstances referred to in the cited opinions. The testimony was given as accomplices, and adequate instructions were given on this point. The instructions, taken as a whole, United States v. Smaldone,485 F.2d 1333 (10th Cir.); United States v. Beitscher, 467 F.2d 269 (10th Cir.), were adequate. See United States v. Owens, 460 F.2d 268 (10th Cir.); Butler v. United States, 408 F.2d 1103 (10th Cir.), and cases cited therein; cf. McGee v. United States, 402 F.2d 434 (10th Cir.). Specific instructions on identification could have been given, see Macklin v. United States, 133 U.S.App.D.C. 139, 409 F.2d 174, but the facts of this case fall within our decision in McGee and the District of Columbia Circuit's holding in Macklin.
6
The appellants also complain that statements made by the prosecution during closing argument were improper and prejudicial as an expression of belief in both the guilt of the defendants and the credible veracity of the prosecution's witnesses. We cannot agree. As the prosecuting attorney stated, in closing: 'We have captured the two bank robbers that went in; we asked them what happened; they told us what happened; they told you what happened and defense counsel says they are lying. That is as simple as the whole case is.' Defense counsel, in closing, stated that Colvin and Fagan were 'plain unadulterated fabricators of lies,' 'people who fabricate things,' 'unworthy of belief,' and 'congenital liars.' Any remarks that the prosecution may have made were not prejudicial, see United States v. Coppola, 479 F.2d 1153 (10th Cir.); Bailey v. United States, 410 F.2d 1209 (10th Cir.); Devine v. United States 403 F.2d 93 (10th Cir.), and were in a fair response to the basic issue, raised by the defense, of the accomplices' testimony. Cf. United States v. Sawyer, 485 F.2d 195 (10th Cir.). The trial court made it clear during the course of closing argument that all of the arguments of counsel, both for the defense as well as prosecution, were not evidence but simply arguments. Included in the court's charge to the jury was the further admonition that 'statements and arguments of counsel are not evidence in the case . . ..'
7
Viewed in the light most favorable to the Government, the evidence supports the jury's finding of guilt. Thus the trial court properly denied the motion for acquittal and the motion for new trial. See, e.g., United States v. Acree, 466 F.2d 1114 (10th Cir.), and cases cited therein.
8
Other claims made by the appellants have been considered and determined to lack merit.
9
The judgment of the district court in each case is affirmed.
|
344 Mass. 200 (1962)
181 N.E.2d 655
MARJORIE J. TUTTLE
vs.
PAUL J. McGEENEY (and a companion case[1]).
Supreme Judicial Court of Massachusetts, Middlesex.
December 4, 1961.
April 16, 1962.
Present: WILKINS, C.J., SPALDING, WILLIAMS, WHITTEMORE, & SPIEGEL, JJ.
*202 David D. Leahy, for the defendant.
Nathan Goldstein, for the plaintiffs.
SPIEGEL, J.
These are two actions of tort arising out of a collision of motor vehicles. They were consolidated and tried together. In the first case, Marjorie Tuttle sought to recover for personal injuries and property damage to her automobile. The other action was by William Bowers to recover for personal injuries. A count for consequential damages by the mother of Bowers was waived during the trial. An auditor, to whom the cases were referred, found for the defendant in each case. The cases were subsequently tried to a jury, who returned verdicts for the plaintiffs.
The cases are here on exceptions of the defendant to the judge's ruling that an exception taken immediately after the judge had returned from a recess which he called without warning was claimed too late; to the judge's refusal to give certain instructions to the jury; to his giving certain instructions to the jury requested by the plaintiffs; and to certain parts of the judge's charge.
The auditor's report is substantially as follows: The accident happened on February 3, 1955, at about 12:30 P.M. at the intersection of Harvard and Portland streets in the city of Cambridge. Traffic entering the intersection from Harvard Street is governed by stop signs and flashing red lights. The plaintiff William Bowers and his brother, Donald, were helping the plaintiff Tuttle to start her car by pushing it with a car owned by their mother. They pushed the Tuttle car for a considerable distance without success. William Bowers, at the request of Tuttle, took the wheel of her car. At this point the Tuttle car was located on Harvard Street about one hundred feet from the intersection of Portland Street. Donald Bowers resumed pushing the Tuttle car and at a point about sixty feet from the intersection it started. William Bowers drove the car toward the intersection at a speed of about twenty-five miles per *203 hour. He slowed down at the intersection but did not come to a stop as required by the stop sign and flashing red light. He continued into the intersection and "when the Tuttle car was about in the middle of the intersection ... it was in [a] collision with a car owned and operated by the defendant." William Bowers was fifteen years old at the time of the accident and did not have a license to operate an automobile.
The auditor found that the defendant McGeeney was proceeding along Portland Street; that he "entered the intersection of Harvard Street at a speed that was not reasonable and proper under the circumstances and conditions then and there prevailing"; and that he saw the Tuttle car "before it reached the stop sign and assumed that it would come to a stop before entering the intersection."
The auditor concluded that "[o]n all the evidence and the reasonable inferences to be drawn therefrom ... the plaintiff William Bowers was not in the exercise of due care"; that "the plaintiff Tuttle has not sustained the burden of proving that she had surrendered control of her automobile to the plaintiff Bowers"; that "accordingly ... the negligence of the plaintiff Bowers is imputed to the plaintiff Tuttle"; and that "... this accident could have been avoided by the exercise of due care on the part of either operator."
At the trial William Bowers testified that, after he and his brother had pushed the Tuttle car for some distance, both cars stopped on Harvard Street and he "went up to Miss Tuttle and said, `Well, let me try it.' And he got into her car, taking over the wheel. She sat next to him to his right. The Tuttle car was about 40 to 60 feet from Portland Street when he got behind the wheel." It was pushed "one or two car lengths when it kicked right over." He "approached Portland Street on Harvard Street at 6 to 8 miles an hour. There was a stop sign and a flashing red light facing him. As he came up to the corner of Harvard and Portland Streets he stopped the Tuttle car." He could not see to his right down Portland Street. "He *204 rolled ahead a couple of feet ..." and "[a]bout 150 feet away, he saw a car [the defendant's] coming into Portland Street. He was going to turn the car back over to Miss Tuttle as he crossed Portland Street." He was proceeding through the intersection at "about 5 to 9 miles per hour." He saw the defendant's car again when it was five to eight feet away "when Miss Tuttle screamed."
The plaintiff Tuttle testified that "[a]s they approached the intersection ... Bowers applied the brakes and stopped the car. He looked to his left and to his right and proceeded across the intersection.... When she looked to the right she saw a car about 75 feet away, which was the one involved in the collision with them.... When her car was about three-quarters across the intersection the defendant's car had reached the intersection.... They were ... going 6 to 8 miles an hour across the intersection in first gear."
1. On cross-examination, the plaintiff Tuttle testified that "[s]he had sears on her person which she could show to the jury." She was asked, "Do you have anything on your person that you could show to the jury?" She replied, "Yes, sir." The judge would not allow an exhibition of such marks or scars to the jury. No exception was taken at that time and the defendant's counsel proceeded with a number of questions regarding the scars on Tuttle's person. There was a bench conference and then the judge said, "Take the morning recess." Immediately upon reconvening, the defendant's counsel asked that an exception be noted to the judge's ruling. The judge refused, stating that "the exception has got to be taken when it is excluded." The defendant's counsel excepted to the judge's refusal to note the exception.
An exception to an adverse ruling is to be taken at the time such ruling is given. Rule 72 of the Superior Court (1954). A number of questions by the defendant's counsel, as well as the recess, intervened between the ruling and the attempted exception. The judge was correct in ruling that the defendant's exception was claimed too late.
*205 Furthermore, whether injured parts of the body should be exhibited to the jury is a matter to be left to the discretion of the trial judge. See Blanchard v. Holyoke St. Ry. 186 Mass. 582, 583.
2. The judge charged, as requested by the plaintiff Bowers, that "if it is found that William Bowers did not stop at the stop sign, the failure to stop ... will not preclude recovery for the injuries sustained by William Bowers, caused by the negligence of the defendant, unless such failure was a contributing cause to the accident"; and "[t]hat the operation of an automobile on the highway by an unlicensed person such as the plaintiff William Bowers does not make him a trespasser and is not conclusive against his right to recover for an injury he sustained in a case in which his lack of a license is not a contributory cause of his injury."
The defendant excepted to the giving of these requested instructions and also to the judge's refusal of his request to "tell the jury that the violation of these various laws involved in this case, if it contributed to the injury, bars recovery...." This latter request was not made in writing before the closing arguments as required by Rule 71 of the Superior Court (1954) nor did it specify the statutes involved.
Furthermore, the instructions requested by the plaintiff Bowers and given by the judge adequately informed the jury as to the legal significance of the violation of the penal statutes to which the instructions referred. Baggs v. Hirschfield, 293 Mass. 1, 3. Kralik v. LeClair, 315 Mass. 323, 326. Berardi v. Menicks, 340 Mass. 396, 400.
3. With regard to the instruction of the auditor's report the judge charged that "[t]hat report is the same as any other piece of evidence.... It stands on the same footing. It is evidence. It hasn't any precedence because it goes to an auditor.... But so far as the auditor's report goes, it has the same standing as any other evidence that is presented to this jury."
The defendant excepted to the instruction of the judge "with reference to the force of an auditor's report."
*206 The defendant contends that there was no evidence introduced at the trial "to contradict or overrule" the auditor's finding that the plaintiff Bowers was not in the exercise of due care or his finding that the plaintiff Tuttle did not sustain the burden of proving that she had surrendered control of her automobile and that therefore the auditor's findings were "decisive."
Findings of fact by an auditor are prima facie evidence. G.L.c. 221, § 56. "The rule as to auditors is, that a finding of fact by an auditor retains the artificial legal force and compelling effect which it has by virtue of being `prima facie evidence,' until, and only until, evidence appears that warrants a finding to the contrary.... The finding of an auditor, after evidence to the contrary appears, remains evidence.... The evidence that warrants a finding contrary to that of the auditor ... may consist of evidence outside the report, introduced at the trial ..., or of subsidiary or specific findings of fact by the auditor, from which an inference may be drawn as to an ultimate or other fact, contrary to the finding of the auditor with reference to that fact." Cook v. Farm Serv. Stores, Inc. 301 Mass. 564, 566-567.
"It was not necessary for the judge to state to the jury this rule [as to the effect of an auditor's report] in its entirety. It was enough to tell them the result of the application of the rule in the present case." Herbert v. Anbinder, 302 Mass. 396, 398.
There was sufficient evidence introduced at the trial to support an inference that Bowers was in the exercise of due care. The judge's charge regarding the effect of the auditor's report was correct in so far as it applied to the auditor's finding of lack of due care on the part of the plaintiff Bowers.
Apart from the auditor's report, the only evidence introduced on the issue of Tuttle's retention of control was the testimony that Tuttle first met Bowers about a half hour before the accident; that Bowers said, "Well, let me try it"; that he took over the wheel; that Tuttle sat next to *207 him; and that he was going to turn the car back over to Tuttle when they had crossed Portland Street. This evidence was insufficient to overcome the compelling effect of the auditor's finding that Tuttle did not sustain the burden of proving surrender of control.
"Control is an incident of ownership, and continues in the owner-occupant of an automobile that is being driven along the public way in the absence of any evidence tending to show that it has been transferred by the owner to the operator." Mendolia v. White, 313 Mass. 318, 321.
The judge's charge that an auditor's report "is the same as any other piece of evidence" was erroneous in so far as it applied to the auditor's finding with respect to surrender of control.
4. The defendant excepted to the judge's refusal to give the following requested instruction numbered 1: "There being no evidence that Marjorie Tuttle relinquished her right of control over her motor vehicle to her operator, William Bowers, she is responsible for his conduct." In view of the fact that Tuttle failed to prove surrender of control, the conduct of Bowers in operating the vehicle is attributed to her. Mendolia v. White, supra, 319-320. Menzigian v. LaRiviere, 334 Mass. 610, 612. Under these circumstances it was error to refuse to give the requested instruction.
The judge compounded the error when, in part of his charge, he stated, "Now, if she [Tuttle] was in control of the car, even if the young man [Bowers] who volunteered to help her start the engine was negligent, it does not prevent her from recovering, provided she proves that the driver of the other car, the defendant here, was negligent."
5. The judge failed to instruct the jury on the issue of contributory negligence except as it related to the violation of certain statutes. The failure to so charge was error. The defendant, however, did not properly direct the attention of the judge to his omission to adequately instruct the jury on this issue. The defendant, therefore, has no standing to object. Dannelly v. Larkin, 327 Mass. 287, 289.
6. We think the instructions on the issue of control interwoven, *208 as it was, with the issue of Bowers's contributory negligence, tended to confuse and mislead the jury. The cases having been tried together, we are of opinion that the erroneous instructions were harmful to the defendant in each of the actions. Substantial justice requires that there be a new trial in each case. See G.L.c. 231, § 124; Pilos v. First Natl. Stores Inc. 319 Mass. 475, 479.
Exceptions sustained in each case.
NOTES
[1] The companion case is by William Bowers against the same defendant.
|
363 P.2d 702 (1961)
Nick KOVACHEFF and Mary Kovacheff, Plaintiffs in Error,
v.
Victor D. LANGHART and John F. McGuire, d/b/a Langhart and McGuire, Architects, Defendants in Error.
No. 19102.
Supreme Court of Colorado. En Banc.
July 24, 1961.
*703 Norton Frickey, E. V. Holland, Denver, for plaintiff in error.
Ryan, Sayre & Martin, Rupert M. Ryan, Boulder, for defendants in error.
MOORE, Justice.
The parties appear here in the same order as they appeared in the trial court.
In their complaint plaintiffs alleged that they instructed defendants, who were licensed architects, to prepare plans and specifications and make estimates for the construction of a building the cost of which was not to exceed $110,000, and that defendants then represented that they would charge a total consideration of six per cent of construction costs for their services; that thereafter, on August 11, 1958, the parties entered into a written contract in which defendants agreed to perform such services for ten per cent instead of six per cent as originally represented. They further alleged that the estimated cost of the building as planned by the architects was in excess of $150,000; that they paid defendants $2,340.55 as required by the written contract, and that they were entitled to the plans, specifications and estimates for the building; that defendants did not exercise that degree of care and skill required of an architect in the preparation of the plans, specifications and estimates, all to their damage in the sum of $2,340.55 for which they asked judgment. Plaintiffs, in addition to the claim for damages, sought rescission of the written contract between the parties.
Defendants filed their answer in which they admitted the contract; admitted that they prepared the plans and specifications and made the estimate for the building; and that they had received $2,340.55; but denied the other material allegations of the complaint. They filed a counterclaim in which they alleged that pursuant to the terms of the written contract between the parties, they completed the preliminary studies, and were paid by plaintiffs as in said contract provided; that thereafter they prepared a cost estimate, and upon completion of same they were authorized by plaintiffs to prepare the general working drawings and specifications; that plaintiffs also authorized them to obtain bids upon the work outlined, which was done, and that following the bids, plaintiffs decided to abandon the actual construction. They further alleged full performance by them and sought a judgment for the balance of their fees and expenses under the contract.
Plaintiffs denied all of the material allegations in the defendants' cross complaint.
After the case was set for trial plaintiffs filed a motion under Rule 97 R.C.P. Colo. to disqualify the trial judge assigned to the *704 case on the grounds: 1. That they had waived their right to a trial by jury on the assumption that another judge to whom the case was originally assigned would conduct the trial. 2. That the trial judge had formed an opinion and could not render a fair and impartial trial because: (a) Plaintiffs' attorney had theretofore been ridiculed and denounced in open court by said trial judge who had a strong dislike for him; (b) during a time when litigation was pending against plaintiffs' attorney and others before the same trial judge, the court invited another attorney, who was apparently involved in the litigation, to his office to review another matter with the possibility of another count being added in said litigation; and (c) that the trial judge was formerly associated in the practice of law with one of the attorneys for the defendant.
Plaintiffs' counsel took no steps to call said motion up for hearing, but on the day the trial was scheduled to begin, the judge whose qualifications to preside were challenged proceeded on his own initiative to dispose of it. He took the position that the motion, supported by affidavit, was sufficient for him to be fully apprised of all of the reasons why plaintiffs sought to disqualify him, and that nothing could be gained by taking evidence. He then proceeded, in open court before all parties and their attorneys to comment upon each of the grounds asserted by plaintiffs as disqualifying him, and rejected them. He then denied the motion and insisted that the trial proceed on its merits as scheduled. No motion for a continuance was made, and no showing to establish that any evidence was unavailable to plaintiffs as a result of immediate trial following the ruling on the motion to disqualify the trial judge.
Following presentation of the evidence and of the arguments of counsel, judgment was entered against plaintiffs on their complaint and in favor of defendants on their counterclaim.
Plaintiffs are here on writ of error seeking reversal on the following points: 1. That the judgment was contrary to the evidence, law and facts. 2. That the trial judge erred in refusing to disqualify himself. 3. That the court erred in deciding the motion to disqualify on its own initiative without notice to the parties and proceeding to trial immediately after disposing of the motion. 4. The judgment was given under the influence of passion and prejudice. 5. The court erred in rejecting certain evidence offered by plaintiffs. 6. The court erred in not requiring one of the defendants to produce a certain memorandum made during the negotiations between the parties.
During the course of the trial, counsel for plaintiffs introduced in evidence the written contract between the parties which was admitted without objection. The trial court found, and we concur, that the contract is not ambiguous and required no extrinsic evidence for its interpretation. It was executed by the parties subsequent to their original negotiations, and the final agreement between the parties was expressed therein.
It is argued that the court erred in not rescinding the contract between the parties on the grounds that plaintiffs could not read it; had never understood portions of it; and had expressly instructed defendants contrary to the terms of the written instrument.
It has been held repeatedly that in the absence of fraud a party cannot say that he did not know the contents of a contract he had executed. O'Brien et al. v. Houston et al., 83 Colo. 109, 262 P. 1020, and cases there cited.
Plaintiffs strongly urge that because they instructed the defendants to prepare plans and specifications for a building which was not to cost in excess of $110,000 and the estimate on the building as planned by defendants substantially exceeded that amount, they were entitled to rescind. It should be noted that all reference to the cost of a building not to exceed $110,000 was made prior to the execution of the written contract, it being *705 silent as to such limitation. It does, however, contain the following clause, "When requested to do so the Architect will furnish preliminary estimates on the cost of the work, but he does not guarantee such estimates." The evidence was ample to support the judgment, and nothing appears in the record to indicate that the trial court was influenced by passion or prejudice in its determination of the issues.
Counsel for plaintiffs devote most of their argument to the ruling of the court denying their motion for a change of the trial judge. They strongly contend that upon the filing of the motion to disqualify, all other proceedings should have been suspended, that the court lost jurisdiction of all matters involved, and should have proceeded to call in another judge.
They further argue that they should have been given an opportunity to introduce evidence in support of the motion. The motion and supporting affidavit speak for themselves and the only question involved is whether the facts alleged are sufficient to compel the judge to disqualify himself. The only potent fact stated is that the judge had formed an opinion, hence could not afford plaintiffs a fair and impartial trial. This statement is made on information and belief, and is based chiefly upon a claimed dislike for plaintiffs' attorney and upon inferences drawn from other alleged acts not connected with the present litigation. In this respect the facts differ from Geer v. Hall, 138 Colo. 384, 333 P.2d 1040, where an affidavit of prejudice disclosed that the judge whose disqualification was sought had stated in open court that he would hold against the respondent there in every case coming before him. We there held that the trial court erred in denying the motion for disqualification. Here, no facts are alleged which would justify, much less compel, the disqualification of the trial court on the ground that a fair and impartial judgment could not be rendered on the facts presented.
Plaintiffs argue that the court was without authority to call the motion up for hearing without notice. The motion was directed against the judge. It was self-explanatory. The parties to the action, as well as their attorneys, were present in response to the trial setting. Trial could not proceed until the motion was disposed of. Notice to the parties could not have afforded the court any better opportunity to rule upon it. We find no abuse of discretion either in the manner in which the court disposed of the motion or in directing that the trial proceed on its merits.
We find no prejudicial error and the judgment of the trial court is affirmed.
FRANTZ, J., not participating.
|
NO. 07-11-0323-CR
IN THE COURT OF APPEALS
FOR THE SEVENTH DISTRICT OF TEXAS
AT AMARILLO
PANEL B
JANUARY 11, 2012
______________________________
JENNIFER BROOKE HODGES,
Appellant
v.
THE STATE OF TEXAS,
Appellee
_______________________________
FROM THE 320th DISTRICT COURT OF POTTER COUNTY;
NO. 62,342-D; HON. DON EMERSON, PRESIDING
_______________________________
ABATEMENT AND REMAND
_______________________________
Before QUINN, C.J., and CAMPBELL and HANCOCK, JJ.
Jennifer Brooke Hodges, appellant, appeals her conviction for possession of a
controlled substance. Appellant timely perfected her appeal. The clerk’s record was
filed on October 24, 2011, and the reporter’s record on October 19, 2011. Appellant’s
brief was due on November 23, 2011. On December 12, 2011, appellant’s counsel filed
a motion to withdraw, which was granted on December 28, 2011. Also on December
28, 2011, appellant was notified by letter that the brief was overdue and that unless
appellant’s brief was filed on or before January 9, 2012, the appeal would be abated.
To date, neither a brief nor an extension motion has been received by the court.
Accordingly, we abate this appeal and remand the cause to the 320th District
Court of Potter County (trial court) for further proceedings. Upon remand, the trial court
shall determine, by reasonable evidentiary procedure it selects, the following:
1. whether appellant desires to prosecute the appeal;
2. whether appellant is indigent; and, if so,
3. whether the appellant is entitled to a free appellate record and the
appointment of an attorney due to his indigency.
The trial court is also directed to enter such orders necessary to address the
aforementioned questions. So too shall it include its findings on those matters
(including the name, address, and phone number of any attorney it may appoint to
represent appellant in this appeal) in a supplemental record and cause that record to be
filed with this court by February 10, 2012. Should further time be needed to perform
these tasks, then same must be requested before February 10, 2012.
It is so ordered.
Per Curiam
Do not publish.
2
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ACCEPTED
12-15-00246-CV
TWELFTH COURT OF APPEALS
TYLER, TEXAS
11/11/2015 4:49:03 PM
Pam Estes
CLERK
FILED IN
12th COURT OF APPEALS
TYLER, TEXAS
11/11/2015 4:49:03 PM
PAM ESTES
Clerk
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28 B.R. 304 (1983)
In re John P. COKKINIAS, Debtor.
Daniel J. BARCH, Plaintiff,
v.
John P. COKKINIAS, Defendant.
Bankruptcy No. 4-81-00794-G, Adv. No. 4-81-0415.
United States Bankruptcy Court, D. Massachusetts.
March 16, 1983.
As Amended March 25, 1983.
*305 Abraham B. Feinstein, Michelman & Feinstein, Springfield, Mass., for plaintiff.
Manuel M. Farber, Cooley, Shrair, Alpert, Labovitz & Dambrov, Springfield, Mass., for defendant.
MEMORANDUM AND ORDER ON COMPLAINT TO DETERMINE DISCHARGEABILITY OF DEBT
PAUL W. GLENNON, Bankruptcy Judge.
Before me is a complaint to determine the dischargeability of a debt filed by Daniel Barch. This action arises from a loan transaction entered into in July of 1981. In his answer, the defendant asserted a counterclaim seeking the assessment of attorney's fees and costs incurred in defending this action.
FACTS
I find the facts to be as follows. The debtor, John P. Cokkinias ("Cokkinias") and the plaintiff, Daniel J. Barch ("Barch") met sometime in the middle of 1980. They had no business dealings with each other. They were purely casual friends, i.e., they socialized at the Y.M.C.A., played golf together, etc. Both men were knowledgeable businessmen; Cokkinias had been in the real estate business for forty years while Barch was the owner of Compudata, a data processing service.
On the evening of July 8, 1981, Cokkinias telephoned Barch, at home, and stated he had a serious problem he had to discuss with Barch. Barch replied he would be in his office shortly and Cokkinias should telephone him there. Soon thereafter, Cokkinias called Barch and stated he was in immediate need of money which, if loaned, could not be repaid for approximately six months. Without asking the reason for the demand, and without asking for any security in return, Barch replied that he would leave a $5,000 check with one of his employees which Cokkinias could pick up that same evening. Cokkinias picked up the check and cashed it the next day. The check was drawn on the account of Compudata, the company owned by Barch.[1]
About two weeks later, Barch called Cokkinias and stated that upon the advice of his accountant, Cokkinias would need to sign some type of papers in recognition of the loan. Barch's accountant was afraid that absent such papers, the Internal Revenue Service might deem the transaction a dividend with adverse tax consequences to Compudata. Cokkinias agreed to later meet Barch at the offices of Leonard Michelman ("Michelman"), Barch's attorney. Cokkinias arrived at Michelman's office before Barch. Michelman showed Cokkinias a document labelled "NOTE". The word "MORTGAGE" preceding "NOTE" was crossed out. Where the type of security pledged was to be typed in, the word "NONE" appeared. According to the terms of the "NOTE", $5,000 was payable on demand and due September 1, 1981, with interest at the rate of 15 percent per annum. At the bottom of the note, below the signature lines, the names John P. Cokkinias and Mary Gail B. Cokkinias (the debtor's wife) were typed in. The note was dated July 21, 1981. Neither the debtor, nor his wife, signed this document.
The next day, upon the request of Barch, Cokkinias picked up a second document. This document was dated July 1981. Only the name John P. Cokkinias appeared below the signature line. Again, no security was listed. Per the terms of this note, payments were to be made on the first day of every other month beginning September 1, 1981. The rate of interest due was not specified. Cokkinias did not sign this second note.
In September 1981, Cokkinias met Barch and stated he would sign an agreement to pay $200 per month until the balance (including *306 interest) was paid. He had yet to make any payments in satisfaction of the loan. A document captioned "Sales Agreement", dated September 1, 1981, was signed by both parties. Under the terms of this agreement, Cokkinias was to begin making payments of $200 on October 1, 1981. Thereafter, $200 was due on the first of every month until the principal amount of $5,000, plus 15 percent annual interest were paid down. Cokkinias made only one payment. On October 5, 1981, Cokkinias filed his Chapter 7 petition.
DISCUSSION
11 U.S.C. § 523(a) provides:[2]
A discharge under section 727, 1141 or 1328(b) of this title does not discharge an individual debtor from any debt . . .
(2) for obtaining money, property, services, or an extension, renewal, or refinance of credit, by
(A) false pretenses, a false representation or actual fraud, other than a statement respecting the debtor's or an insider's financial condition; or
(B) use of a statement in writing
(i) that is materially false;
(ii) respecting the debtor's or an insider's financial condition.
(iii) on which the creditor to whom the debtor is liable for obtaining such money, property, services, credit reasonably relied; and
(iv) that the debtor caused to be made or published with intent to deceive. . . .
As neither party alleges that at the time of the transaction a writing existed upon which Barch could have relied, this action is to be construed, most properly, under subsection (2)(A). Cf. In re Valley, 21 B.R. 674 (Bkrtcy.D.Mass.1982). This Court has recently concluded that the requirements which must be met in order for a debt to be declared nondischargeable pursuant to § 523(a)(2)(A) are:
(1) a false representation by the debtor;
(2) known to be false at the time it was made;
(3) made with the intention and purpose of deceiving the creditor;
(4) which was reasonably relied upon by the creditor;
(5) which resulted in loss or damage to the creditor as a result of the false representation. See In re Valley, supra, at 679.
See also In re Johnson, 18 B.R. 555 (Bkrtcy. S.D.Md.1982) and In re DeRosa, 20 B.R. 307 (Bkrtcy.S.D.N.Y.1982). For a debt to be declared nondischargeable under this subsection, each of the five elements set forth above must be proven. For, it is well settled that the exceptions to discharge are to be strictly construed in favor of the debtor so as to afford the honest debtor the fresh start protection promised by the Bankruptcy Code. See, e.g., In re Johnson, supra; In re Carothers, 22 B.R. 114, 9 B.C.D. 680 (Bkrtcy.D.Minn.1982); In re DeRosa, supra; and In re Vissers, 21 B.R. 638 (Bkrtcy.E.D. Wis.1982).
In the instant action, the five requirements have not been satisfied. At the time of the loan transaction, the debtor did not knowingly make a false statement to Barch and therefore, there could be no statement upon which Barch relied. I recognize that even a misrepresentation of an intent to pay in the future may be sufficient grounds to satisfy, in part, § 523(a)(2)(A). However, it appears that on the evening of the loan transaction, Cokkinias did not misrepresent his intention to pay. Nor did he misrepresent his intention to provide security to Barch for the loan. That evening is the critical point in time at which the representation referred to in § 523(a)(2)(A) is to be examined. By his own admission, Barch testified the reason he requested the debtor to sign a document *307 evidencing the loan was to satisfy his accountant, and possibly the Internal Revenue Service. The fact that the debtor "said something about equity agreement, or something", (Hearing Transcript January 4, 1982 at 18) at the time the loan transaction was made, is insufficient in terms of satisfying § 523(a)(2)(A). The elements which must be shown to have existed, as set forth above, are not met without a showing of specific facts.
The Court is not now passing on whether subsequent to the loan transaction the debtor may have made a false statement which caused § 523(a)(2)(A) to be operable. Such a determination is irrelevant. The law is clear on this point. "[I]f the property was obtained prior to the making of any false representation, subsequent misrepresentation will have no effect upon the discharge of the debt . . . The plaintiff must prove that the claimed fraud existed at the inception of the debt and that [he] relied upon it." (citation omitted) (emphasis supplied). In re Gennaro, 12 B.R. 4 (Bkrtcy.W.D.Pa.1981). See also In re Vissers, supra, at 640 ("[t]he fraud necessary to make a debt nondischargeable must exist at the inception of the debt"), In re DeRosa, supra, at 312 ("the requisite fraudulent intent must be shown to have existed at the time the debtor obtained the money, property, services or extension, renewal or refinance of credit"); In re Jenes, 18 B.R. 405, 407-408 (Bkrtcy.S.D.Fla.1981) ("[i]f property is obtained prior to the making of any false representation, subsequent representations will not prevent discharge of the debt"); In re Geyen, 11 B.R. 70, 72 (Bkrtcy. W.D.La.1981); ("subsequent misrepresentations will have no effect upon the discharge of the debt"); and In re Shepherd, 13 B.R. 367, 372 (Bkrtcy.S.D.Ohio 1981) ("§ 523(a) (2)(A) requires that the false representation be the reason for the creditor's extension of credit").
The creditor, as an experienced businessman, was not without the knowledge or ability to secure protection for himself at the time the loan was made. Admittedly, it is not often that a businessman would lend $5,000 to a casual friend without receiving any type of security in return for the loan. However, it is not for the Court to intervene on behalf of Barch and now offer him an escape from his own mistake. "[A p]laintiff cannot conduct business without due care and then maintain that as a result of deception it extended credit". In re Shepherd, supra, at 372. The discharge provided by 11 U.S.C. § 727 is to be granted to an honest debtor filing for protection under Chapter 7 unless the debtor is guilty of the conduct set forth in the § 523 exceptions.
As to the debtor's counterclaim for attorney's fees and costs (in the amount of $750), § 523(d) provides:
If a creditor requests a determination of dischargeability of a consumer debt under subsection (a)(2) of this section, and such debt is discharged, the court shall grant judgment against such creditor and in favor of the debtor for the costs of, and a reasonable attorney's fee for, the proceeding to determine dischargeability, unless such granting of judgment would be clearly inequitable. (emphasis supplied)[3]
"The purpose of the provision is to discourage creditors from initiating . . . exception to discharge actions in the hopes of obtaining a settlement from an honest debtor anxious to save attorney's fees. Such practices impair the debtor's fresh start." S.Rep. 95-989 95th Cong., 2d Sess. 80 (1978). See also H.R.Rep. No. 95-595 95th Cong., 1st Sess. 365 (1977), U.S.Code Cong. & Admin.News 1978, pp. 5787, 5866. At the trial, neither debtor's counsel nor Barch's counsel introduced any evidence as to whether the debt was a consumer debt. As I recently stated in In re Finnie, 21 B.R. 368, 371 (Bkrtcy.D.Mass.1982),
[I]f the debtor has properly requested an award under § 523(d) in his answer to *308 the complaint, he shall be permitted, within 10 days of a decision thereon, to file a motion for the assessment of such costs and attorney's fees, with accompanying affidavits, which motion shall be granted unless there is interposed a response to the motion by the complaining creditor within five days of the motion. If such a response is filed, the court would then set the matter down for an evidentiary hearing.
Therefore, in accordance with the above:
1. Judgment shall enter in favor of the debtor; the loan of July 8, 1981 is dischargeable;
2. Counsel for the debtor is hereby given ten (10) days within which to file a motion for assessment of costs and attorney's fees with accompanying affidavits. If the Court does not receive a response from the creditor within five (5) days thereafter, the debtor's motion for costs and attorney's fees shall be reviewed and allowed in a reasonable amount.
SO ORDERED.
NOTES
[1] However, this action was brought in the name of Barch, individually.
[2] The Court recognizes that § 523(a) of the Bankruptcy Code governs (the case and) this adversary proceeding although the creditor brought this complaint pursuant to § 17c of the Bankruptcy Act. The Bankruptcy Code became effective on October 1, 1979 and applies to all cases commenced thereafter. As set forth above, this case was commenced on October 5, 1981.
[3] 11 U.S.C. § 101(7) defines a consumer debt as a "debt incurred by an individual primarily for a personal family, or household purpose".
|
37 F.3d 629
Sodipov.U.S. Dept. of Justice**
NO. 94-20260
United States Court of Appeals,Fifth Circuit.
Sept 20, 1994
1
Appeal From: S.D.Tex.
2
DISMISSED.
**
Conference Calendar
|
132 Cal.App.2d 185 (1955)
HELEN McLAUGHLIN ROGERS, Appellant,
v.
J. L. RIHN, as Administrator, etc., et al., Respondents.
Civ. No. 8581.
California Court of Appeals. Third Dist.
Apr. 8, 1955.
Leo C. Dunnell, William H. Herbert, Adey May Dunnell and R. A. Rogers for Appellant.
Tinning & DeLap and J. Vance Porlier for Respondents.
SCHOTTKY, J.
This is an appeal from an order granting a motion of certain defendants for change of place of trial from Amador County to Contra Costa County. The motion was made upon the grounds (1) that they are residents of Contra Costa County; (2) that the cause of action concerns real property which is situate in Contra Costa County; (3) that defendant Rihn is administrator of the estate of W. E. Whitehead, deceased, which estate is being probated in Contra Costa County; and (4) that none of the defendants resides in Amador County. Plaintiff opposed the motion for change of place of trial from Amador County, contending that under section 1555 of the Probate Code, Amador County was the proper place for trial.
The amended complaint alleged in substance that Jesse M. McLaughlin, the father of the plaintiff, died in Oakland, California, in 1896 and that thereafter his will which was probated in Alameda County, California, devised a portion of his estate to the plaintiff; that in 1897, W. E. Whitehead was appointed guardian of the person and estate of the plaintiff, who was then a minor, in a proceeding numbered 640 in Amador County, California; that following his appointment as such guardian, Whitehead received funds from the estate of plaintiff's father which properly belonged to plaintiff, but that Whitehead converted these funds to his own use and never made an accounting of property received by him as such guardian. Said complaint alleged further that in 1929 the guardian, who had bought certain real property in Contra Costa County with these funds, conveyed this property to his daughter, Hazel L. Rihn, and that Hazel L. Rihn and Idele Rickard, in 1929, came into possession of some of these funds and divided the same between them; that the Contra Costa County property is now held by Hazel L. Rihn and J. L. Rihn, but that they hold this property in trust for the plaintiff; that with this property Hazel L. Rihn and J. L. Rihn have purchased additional real property in Contra *187 Costa County, and, in addition, have purchased shares of Pacific Gas and Electric Company, Transamerica and Bank of America, and also hold cash in bank, all of which it is alleged they hold in trust for the plaintiff.
The complaint alleged further that W. E. Whitehead died on July 4, 1929; that he had never been discharged as guardian; that on March 18, 1953, J. L. Rihn was appointed administrator of the estate of W. E. Whitehead in Contra Costa County and that plaintiff filed her claim against said estate with said administrator, who rejected it.
The prayer of the complaint asks for an order restraining J. L. Rihn, individually and also as administrator, and also restraining Idele R. Rickard, from transferring the real and personal property described above. The prayer also prays that the defendants give an accounting as trustees of the real and personal property referred to in the complaint, and also prays for a money judgment against these defendants.
[1] The trial judge in granting the motion for changing the place of trial stated in his memorandum opinion:
"None of the named defendants in this cause is a resident of Amador County. Therefore they are entitled to have the cause transferred to the county where they reside, either on the ground of residence (Code Civ. Proc., 395) or because the cause affects real property in that county (Code Civ. Proc., 392) or because it joins as one of the defendants J. L. Rihn in his official capacity as administrator in the same county (Code Civ. Proc., 395.1)."
"The case does not fall within the scope of Probate Code, section 1555. That section simply says that the guardianship court does not lose jurisdiction of the guardianship proceeding for the purpose of settling the accounts of the guardian, if the guardian dies. And, that the account of a deceased guardian shall be presented by his administrator. It may be that if this proceeding were one simply to require the administrator of the deceased guardian to settle his accounts, venue might lie in Amador County. However, as to this, I express no opinion."
"The complaint on file herein goes much further. It seeks to establish a cause of action for fraud and deceit involving several individuals, including the administrator of the deceased guardian in his official capacity but also as an individual. It also seeks to impress a trust upon real and personal property in the possession of several defendants. It also seeks an accounting from several defendants and it seeks a *188 money judgment against several defendants. A judgment in plaintiff's favor in this action on these issues and against these defendants would go far beyond the purview of Probate Code, section 1555."
We agree with this analysis and adopt it as a part of the opinion of this court.
We are unable to agree with appellant's contention that, because section 1555 of the Probate Code provides that upon the death of a guardian the court does not lose jurisdiction of the proceeding for the purpose of settling the accounts of the guardian and that the accounts of a deceased guardian shall be presented by his executor or administrator, the county which has jurisdiction of the guardianship estate is the proper county for the trial of this action. The fact that the administrator of the estate W. E. Whitehead might be required under said section 1555 to file an accounting in the guardianship proceeding in Amador County does not compel or justify the conclusion that the action against these respondents, as alleged in the complaint, must be tried in Amador County.
Code of Civil Procedure, section 395, provides that subject to the power of the court to transfer actions or proceedings as provided in part 2, title 4, of the Code of Civil Procedure, the county in which the defendants or some of them reside at the commencement of the action is the proper county for the trial of the action.
Code of Civil Procedure, section 392, provides that subject to the power of the court to transfer actions and proceedings, the county in which the real property which is the subject of the action, or some part thereof, is situated, is the proper county for the trial of the following actions:
"(a) For the recovery of real property, or of an estate or interest therein, or for the determination in any form, of such right or interest, and for the injuries to real property."
In Keithly v. Lacey (1946), 77 Cal.App.2d 339 [175 P.2d 235], plaintiffs alleged that defendant held in trust for them an undivided one-half interest in real property in Los Angeles, Tulare and Inyo Counties and personal property consisting of ten first mortgage bonds having a par value of $1,000 each. They prayed for a decree establishing the trust and directing defendant to execute such conveyances as would be necessary to convey to plaintiffs their respective interests. A motion for change of venue from Los Angeles County to Inyo County, where defendant resided, was denied by the *189 trial court. The appellate court reversed the decision and said:
"... Where real and personal actions are joined in the same complaint the case must be tried in the county in which defendant resides if he so demands. [Citing cases.]"
In the instant case two of the defendants reside in Contra Costa County and none resides in Amador County. The real property upon which appellant's complaint seeks to impress a trust is situated in Contra Costa County.
Appellant's complaint shows that defendant J. L. Rihn was appointed administrator of the estate of W. E. Whitehead, deceased, and that said probate proceedings are pending in Contra Costa County. Section 395.1 of the Code of Civil Procedure provides:
"When a defendant is sued in his official capacity as executor, administrator, guardian or trustee, on a claim for the payment of money or for the recovery of personal property, the county which has jurisdiction of the estate which he represents shall be the proper county for the trial of the action."
In view of the foregoing we are satisfied that the trial court correctly determined that respondents were entitled to have the action transferred to Contra Costa County.
The order is affirmed.
Van Dyke, P.J., and Finley, J. pro tem, [fn. *] concurred.
NOTES
[fn. *] *. Assigned by Chairman of Judicial Council.
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250 Kan. 541 (1992)
828 P.2d 355
BANK IV, Olathe, Administrator C.T.A. of the ESTATE OF TILLIE A. FLINN, Deceased, Appellant,
v.
CAPITOL FEDERAL SAVINGS & LOAN ASSOCIATION, et al., Appellees.
No. 66,420
Supreme Court of Kansas.
Opinion filed March 20, 1992.
Keith Martin, of Payne & Jones, Chartered, of Overland Park, argued the cause, and Erich W. Wurster, of the same firm, was with him on the brief for appellant.
John Anderson, Jr., of Overland Park, argued the cause and was on the brief for appellee.
The opinion of the court was delivered by
McFARLAND, J.:
This is an action by the estate of a decedent to recover funds paid to an individual operating under a power of attorney executed by the decedent. The district court entered summary judgment in favor of one of the two defendant savings and loan institutions, and the estate appeals therefrom.
*542 The facts may be summarized as follows. On June 15, 1987, Tillie A. Flinn executed a durable power of attorney designating her nephew James C. Flanders and/or Martha E. Flanders (James' wife) as her attorneys in fact. Tillie's signature on the power of attorney was duly notarized and the estate admits the signature is Tillie's. In January 1988 Tillie owned 12 certificates of deposit issued by defendant Capitol Federal Savings and Loan Association. The value of said CD's was approximately $194,000. Some of the CD's dated back to 1973.
On January 13, 1988, at approximately 10:00 a.m., Martha Flanders went to a Capitol Federal office. She had: (1) the durable power of attorney instrument; (2) five certificates of deposit; and (3) a hand-printed letter identifying Martha as an attorney in fact and stating that Tillie wished to cash the five CD's (identified by number) that Martha had with her. At approximately 10:31 a.m., five checks were given to Martha in the aggregate amount of $135,791.34, representing the funds in said CD's less penalties for early withdrawal in the aggregate amount of $4,757.70. Some of the checks were drawn in Martha's name, individually, and some in the names of James and Martha, also as individuals. Nothing on the checks indicated that they were being issued to said individual or individuals in her or their representative capacities. Uncashed CD's in the aggregate amount of $58,127.58 then remained at Capitol Federal. Tillie was found dead of heart disease later that day. The time of death on her death certificate is set at 11:30 a.m.
Bank IV, as administrator C.T.A. of Tillie's estate, filed two lawsuits in 1990: (1) the action herein against Capitol Federal and Argentine Savings and Loan Association seeking the return of Tillie's funds paid out to the Flanders; and (2) an action against Martha and James Flanders seeking return of said funds. The two actions were consolidated for discovery purposes only. The estate's action against Argentine was settled and dismissed. The district court entered summary judgment in favor of Capitol Federal and the estate appeals therefrom.
It is apparently undisputed that the Flanders spent all sums received by them from Capitol Federal for their personal usage, and that the funds cannot be traced and recovered. Other facts will be stated as necessary for the discussion of particular issues.
*543 The estate contends that the district court erred in granting summary judgment to Capitol Federal. Specifically, the estate contends:
1. Capitol Federal breached a duty to investigate before issuing the checks;
2. the terms of the durable power of attorney instrument were not broad enough to authorize the issuance of checks in the name or names of the attorney(s) in fact as individual(s); and
3. a procedural error by Capitol Federal entitled the estate to summary judgment in its favor.
DUTY TO INVESTIGATE
The estate contends that the size of the transaction involved herein and the forfeiture of interest thereon, coupled with the fact the checks were requested to be issued in the individual name(s) of the attorney(s) in fact were sufficiently suspicious circumstances to create a duty in Capitol Federal to investigate before releasing the funds. Specifically, the estate contends that Capitol Federal should have: (1) determined whether or not Tillie's "true wishes" were being carried out; and (2) checked to see whether Tillie was still alive. Capitol Federal argues that its duty only requires a favorable comparison of the signatures of the depositor with that on the power of attorney, proper identification of the attorney in fact, and a determination that the transaction is within the scope of the power of attorney. Capitol Federal further contends any requirement for additional investigation would be unduly burdensome on lending institutions.
The first aspect of this issue concerns Tillie's competency. It is unclear whether the estate is contending that Capitol Federal should have made inquiry into Tillie's competency as of the time of the execution of the power of attorney or as of the time of the request for the transfer of funds, or both.
As far as the question relates to competency at the time of the transfer of funds is concerned, the matter is resolved by statute. Kansas has adopted the Uniform Durable Power of Attorney Act (K.S.A. 58-610 et seq.). Included therein is K.S.A. 58-611, which provides:
"All acts done by an attorney in fact pursuant to a durable power of attorney during any period of disability or incapacity of the principal have *544 the same effect and inure to the benefit of and bind the principal and the principal's successors in interest as if the principal were competent and not disabled."
Additionally, the instrument itself expressly provides: "This power of attorney is durable and shall not be affected by the subsequent disability or incompetence of the principal."
Thus, incapacity of Tillie at the time of the withdrawal of funds is not a factor in the determination by the lending institution on whether or not to honor the request by an attorney in fact for withdrawal of funds. If it were otherwise, the very purpose of many powers of attorney, which is to allow the orderly transaction of a person's business during contemplated disability or incompetency without expensive and time-consuming probate proceedings, would be defeated.
Did Capitol Federal have a duty, under the facts herein, to investigate into the capacity of Tillie at the time of the execution of the instrument in determining whether or not to honor the request for the withdrawal of funds? We believe not. The circumstances involved herein demonstrate the impracticality of imposing such a requirement. It is 10:00 a.m. on January 13, 1988. The attorney in fact is standing on one side of the counter seeking withdrawal of funds under a power of attorney executed on June 15, 1987. The test for capacity to execute a power of attorney would presumably be comparable to that for capacity to execute a will. An individual who is incompetent most of the time may have lucid intervals in which he or she has the capacity to contract or make a will. Determination of a person's capacity to contract or make a will involves determination of capacity at the particular point in time the instrument was executed. Frequently, there is conflicting testimony among lay persons and health care professionals and the judicial hearings thereon are lengthy and involved. As a practical matter, how could the Capitol Federal employee, responding to the attorney in fact's request for withdrawal of funds, make such a determination? Capitol Federal notes in its brief that every working day it has over 500 transactions involving an agency or power of attorney relationship. The practical effect of requiring such a determination would, again, be to eliminate the power of attorney as a useful tool in the transaction of the *545 business of any elderly, disabled, absent, or otherwise incapacitated individual.
As noted by the district court in its memorandum decision:
"The duty of Capitol Federal to Tillie Flinn, its depositor, focuses on an issue which has drastic and far reaching implications. The final decision of our Appellate Courts will impact upon the management of the assets of our elderly, disabled and also upon the management of our financial institutions. The Durable Power of Attorney provides an inexpensive vehicle for family members to manage the finances of the impaired relative without incurring the substantial expenses of creating a conservatorship. The start-up for a conservatorship is in the range of $10,000.00. Annual accounting fees are much less than the start up costs, but are incurred annually.
"The Power of Attorney eliminates the necessity of opening and maintaining a conservatorship. In order to function the powers of the Attorney-in-Fact must be recognized by financial institutions.
"The public support for the Durable Power of Attorney is manifested by the Legislature's passage of the Uniform Durable Power of Attorney Act. (K.S.A. 58-610 et seq.)"
The estate cites no authority in support of the proposition that a lending institution has a duty to determine the capacity of the grantor at the time of the execution of a power of attorney before honoring a request for a transfer of funds thereunder. We conclude that no such duty exists and that the district court correctly determined that Capitol Federal had no such duty to investigate. It should be noted, perhaps, that there is no claim made that Capitol Federal had actual knowledge of any incapacity or incompetency on the part of Tillie nor had she been adjudicated a disabled or incapacitated person.
This brings us to the claim that Capitol Federal should have ascertained whether or not Tillie was alive when the request for transfer was made.
K.S.A. 58-613 provides:
"(a) The death of a principal who has executed a written power of attorney, durable or otherwise, does not revoke or terminate the agency as to the attorney in fact or other person, who, without actual knowledge of the death of the principal, acts in good faith, under the power. Any action so taken, unless otherwise invalid or unenforceable, binds the principal's successors in interest."
Here again, the estate cites no authority for the proposition Capitol Federal was under some duty to determine that Tillie was alive before transferring the funds. There is no claim made *546 that Capitol Federal had actual knowledge that Tillie was deceased when the transfer was requested. In fact, based upon the death certificate's stated time of death, Tillie was alive when the transfer was made. We find no merit in this point.
Next we shall consider the catchall claim that Capitol Federal should have determined the transfer of funds by checks to the attorney(s) in fact was carrying out Tillie's "true wishes." Presumably, this would entail some type of face-to-face meeting between a representative of Capitol Federal and Tillie to determine if she knew of and approved of the requested transfer and the form of the checks. A telephone call would be insufficient as the Capitol Federal employee would have no way of knowing if the person responding to the call was really Tillie. Inherent in this procedure would be the requirement that the Capitol Federal employee know Tillie or had secured sufficient identification to be positive that the person with whom he or she was conferring was, in fact, Tillie. For reasons already expressed, a duty to determine the "true wishes" of the principal is unrealistic and would result in the loss of powers of attorney as useful tools in the transaction of the business of disabled, elderly, and/or absent principals.
We conclude that when confronted with the request for withdrawal of funds herein, Capitol Federal had a duty to:
1. compare the signature on the power of attorney with Tillie's signature on file as a depositor as to the authenticity thereof;
2. obtain proper identification of the person seeking withdrawal as the person designated attorney in fact;
3. determine whether or not the requested transaction was within the scope of the durable power of attorney presented.
It is uncontroverted that Capitol Federal did compare the signatures, and it is admitted Tillie executed the power of attorney. This requirement then, has been satisfied. There is no claim that the Martha Flanders with whom Capitol Federal dealt was an imposter and not the individual designated as attorney in fact or that Capitol Federal breached a duty relative to her identification. This leaves only the question of whether the transaction was within the scope of the durable power of attorney, and that is the subject of the next issue.
*547 The district court's memorandum decision essentially placed the same three requirements on Capitol Federal and we find no error therein.
SCOPE OF DURABLE POWER OF ATTORNEY
The estate contends that the scope of the durable power of attorney herein was not broad enough to authorize Capitol Federal to issue the checks in the name(s) of the attorney(s) in fact as individuals.
The powers granted are as follows:
"(A) Power with Respect to Bank Accounts. To establish accounts of all kinds for me with financial institutions of any kind; to modify, terminate, make deposits to and write checks on and endorse checks for or make withdrawals from all accounts in my name or with respect to which I am an authorized signatory; to negotiate, endorse or transfer any checks or other instruments with respect to any such accounts; and to contract for any services rendered by any financial institution.
"(B) Power with Respect to Safe-Deposit Boxes. To contract with any Institution for the maintenance of a safe-deposit box in my name; to have access to all safe-deposit boxes in my name or with respect to which I am an authorized signatory; to add to and remove from the contents of any such safe-deposit box and to terminate any and all contracts for such boxes.
"(C) Power to Sell and Buy. To sell and buy personal, intangible or mixed property, upon such terms and conditions as may seem appropriate to use any credit card held in my name to make such purchases and to sign such charge slips as may be necessary to use such credit cards; and to repay from any funds belonging to me any money borrowed and to pay for any purchases made or cash advanced using credit cards issued to me.
"(D) Power to Exercise Rights in Securities. To exercise all rights with respect to securities that I now own, or may hereafter acquire; and to establish, utilize and terminate brokerage accounts.
"(E) Power to Borrow Money (including any Insurance Policy Loans). To borrow money for my account upon such terms and conditions as may seem appropriate and to secure such borrowing by the granting of security interests in any property or interest in property which I may now or hereafter own; to borrow money upon any life insurance policies owned by me upon my life for any purpose and to grant a security interest in such policy to secure any such loans; and no insurance company shall be under any obligation whatsoever to determine the need for such loan or the application of the proceeds therefrom.
"(F) Power with Respect to Taxes. To prepare, sign and file Federal, state and/or local income, gift, property or other tax returns, claims, etc.
"(G) Power to Demand and Receive. To demand, arbitrate, settle, sue for, collect, receive, deposit, expand for my benefit, reinvest or make such other appropriate dispositions of, as my Agent deems appropriate, all cash *548 rights to payments of cash, property (personal, intangible and/or mixed), rights and/or benefits to which I now or may in the future become entitled, regardless of the identity of the individual or public or private entity involved (and for purposes of receiving Social Security benefits, my Agent is herewith appointed my `Representative Payee'); to utilize all lawful means and methods for such purposes.
"I further give and grant to my said Attorney(s)-in-Fact full power and authority to do and perform every act necessary to be done in the exercise of any of the foregoing powers as fully as I might or could do if personally present, with full power of substitution and revocation, hereby ratifying and confirming all that my said Attorney(s)-in-Fact shall lawfully do, or cause to be done by virtue hereof.
"This instrument may not be changed orally.
"This power of attorney is durable and shall not be affected by the subsequent disability or incompetence of the principal.
"TO INDUCE ANY THIRD PARTY TO ACT HEREUNDER, I HEREBY AGREE THAT ANY THIRD PARTY RECEIVING A DULY EXECUTED COPY OR FACSIMILE OF THIS INSTRUMENT MAY ACT HEREUNDER, AND THAT REVOCATION OR TERMINATION HEREOF SHALL BE INEFFECTIVE AS TO SUCH THIRD PARTY UNLESS AND UNTIL ACTUAL NOTICE OR KNOWLEDGE OF SUCH REVOCATION OR TERMINATION SHALL HAVE BEEN RECEIVED BY SUCH THIRD PARTY AND I FOR MYSELF AND FOR MY HEIRS, EXECUTORS, LEGAL REPRESENTATIVES AND ASSIGNS, HEREBY AGREE TO INDEMNIFY AND HOLD HARMLESS ANY SUCH THIRD PARTY FROM AND AGAINST ANY AND ALL CLAIMS THAT MAY ARISE AGAINST SUCH THIRD PARTY BY REASON OF SUCH THIRD PARTY HAVING RELIED ON THE PROVISIONS OF THIS INSTRUMENT."
In holding that the powers granted in the instrument were broad enough to authorize Capitol Federal to issue checks in the name or names of the attorney(s) in fact only, the district court reasoned as follows:
"This is a question of law that is to be decided within the four corners of the written Power of Attorney. The estate contends the document does not authorize the bank to pay Tillie Flinn's funds to Martha Flanders personally. The Court has reviewed the entirety of the Durable Power of Attorney involved in this case and finds the document is not ambiguous with respect to any issue in this case and therefore extrinsic evidence is not necessary to determine the legal effect of the document. The relevant portions of the document are: [Here the district court set forth paragraph (A) and the paragraph immediately following paragraph (G).].
"The language of this Power of Attorney literally gives to the agent all the powers which the principal has with respect to bank accounts. The document does not place restrictions upon the Attorney-in-Fact nor does it place any limitations upon Capitol Federal. Tillie Flinn, personally, could *549 have requested Capitol Federal to pay the deposited funds to the order of Martha Flanders. If Tillie Flinn could have accomplished this then her Attorney-in-Fact has the same authority. The claim by the estate that the Power of Attorney did not authorize the withdrawal and transaction is not well taken.
"The above construction of the Power of Attorney distinguishes the attorney in fact from the agent referred to in Henderson v. Hassur, 225 Kan. 678. The Attorney-in-Fact does owe a fiduciary duty to the principal. This duty does not impose upon third parties a duty beyond restrictions created in the power of attorney."
The form for the instrument at issue was cut from a magazine and not specifically drafted for the use of Tillie. This fact has no bearing on the issues before us but is mentioned only to note that there is no drafter of the instrument who has knowledge of the particular circumstances surrounding its creation and execution.
The estate argues that strict construction of the power of attorney is required and that under such construction there is no authority therein for an attorney in fact to have checks representing the principal's funds issued in the agent's individual name.
We do not agree with this conclusion.
3 Am.Jur.2d, Agency § 30, pp. 533-35, states:
"Powers of attorney are to be construed in accordance with the rules for the interpretation of written instruments generally, in accordance with the principles governing the law of agency, and, in the absence of proof to the contrary, in accordance with the prevailing laws relating to the act authorized.
"As in the case of other written instruments, there is no room for construction of a power of attorney which is not ambiguous or uncertain, and whose meaning and portent are perfectly plain. But in cases where construction of the instrument or the interpretation of its language is necessary that is, where the meaning of the instrument or the operative language therein is uncertain, obscure, or ambiguous the first and foremost rule is that the intention of the parties as it existed at the time the power was granted is to be given effect. Also, the whole of the writing is to be taken together so as to give effect to every part, and each clause should be used to interpret the others. Furthermore, the words in the instrument should be taken in their ordinary and popular sense, rather than according to their strict legal meaning, unless the parties used them in a technical sense or unless a special meaning is given to them by usage, in which case the latter must be followed. Where technical words are used, they should be interpreted as usually understood by persons in the profession or business to which they relate, unless they are clearly used in a different sense."
*550 3 Am.Jur.2d, Agency § 31 states that, as a general rule, powers of attorney are to be strictly construed.
But 3 Am.Jur.2d, Agency § 33, pp. 536-37, states:
"The rule of strict construction of a power of attorney is not absolute and should not be applied to the extent of destroying the very purpose of the power. The rule does not call for a strained interpretation, and if the language will permit, a construction should be adopted which will carry out, instead of defeat, the purpose of the appointment. Even if there are repugnant clauses in a power of attorney, they should be reconciled, if possible, so as to give an effect to the instrument in keeping with its general intent or predominant purpose. Furthermore, the instrument should always be deemed to grant such powers as are essential or usual in effectuating the expressed powers."
Extremely broad powers are granted by the instrument to the attorney(s) in fact. In essence, the instrument is saying to third parties that the attorney(s) in fact are authorized to act in Tillie's place and stead relative to all of her assets and business. Tillie could, obviously, have gone to Capitol Federal, cashed the CD's (with penalties), and had the checks drawn in the individual names of the Flanders. We see nothing in the instrument which operates to limit the powers of the attorney(s) in fact to the withdrawal of funds only if Tillie's name appears on the checks or the agency relationship is otherwise disclosed. Even had the checks been drawn with the agency relationship set forth thereon, the misappropriation of the funds by the agents would not have been avoided. The Flanders had only to deposit the checks and then write checks to themselves.
There are cases which hold a banking institution liable for an agent's misappropriation of a principal's funds, but some additional factor is present in those cases which, in effect, put the bank on notice of the agent's wrongful usage of the funds and made the bank an accessory therein. For example, see First Nat. Bank v. Cooper, 252 Ga. 215, 312 S.E.2d 607 (1984). A son, holding a power of attorney from his father, assigned one of the father's CD's as collateral to secure a personal loan for himself. In affirming the lower court's judgment against the bank, the Georgia Supreme Court stated:
"The portions of the power of attorney relied on by the appellant bank, quoted hereinabove, must be read in the context of the entire power of *551 attorney, which is to be construed strictly and in light of the four corners of the document. [Citation omitted.] The clear and unambiguous purpose of the power of attorney here is to serve and benefit only the grantor of the power, Carlos Cooper. Although the powers granted to the defendant agent were broad in banking matters on behalf of the deceased, there was no authorization for the agent to use such powers on his own behalf, i.e., to secure a personal loan for himself. The defendant bank was on notice as to the extent of the power of attorney, hence was not authorized to allow the assignment of any C/D of the grantor in furtherance of the agent's personal goal of obtaining a loan for himself." 252 Ga. at 216.
This same thread runs through Wickens v. Valley State Bank, 125 Kan. 751, 266 Pac. 81 (1928). A retired farmer set up a trust with a bank officer as trustee. The bank was not a party thereto. The trustee had broad discretionary powers to invest the trust fund. Unfortunately, the trustee pocketed a substantial portion of the trust. In holding the bank was not liable for the trustee's misappropriation of funds, the court stated:
"The selection of an agent or trustee is an individual matter, lying within the power of him who makes the selection. He may change his selection and may require such bond or security as he desires. Having sole power of appointment, he has no right to claim that any third person shall be liable for the default of his agent, selected solely by him, unless the third party has participated in the misappropriations to the extent of becoming a party to the fraud. The defendant bank in the instant case had no right to supervise the investment of the funds or the value of the securities taken, nor had it the right to refuse payment of the check or order of [the trustee]." 125 Kan. at 759.
In 5A Michie, Banks and Banking § 72 (1983), it is stated:
"A principal may expressly authorize a bank to accept or pay checks drawn by an agent or fiduciary to his own order. It is generally held that where an agent draws checks on his principal's account, payable to himself, and deposits them to his own account, the mere form of the transaction, in the absence of additional circumstances, is not sufficient to put [the] depositing bank on notice of the agent's fraud."
Michie states the rule is the same for trustees who withdraw money from a trust account and use it for their own purposes:
"A bank is liable when it has actual or constructive knowledge that a fraud is being or is about to be perpetrated by the fiduciary, and assists him in making a misappropriation of the trust funds. It is held that to render the bank liable it must have actually participated in the misappropriation, or with knowledge reaped some benefit therefrom .... A bank does not become a party to the diversion of an incompetent's funds merely because *552 money is withdrawn by checks made payable to the incompetent's committee." 5A Michie § 57e.
Michie's statement of the law is supported by case law. In Empire Trust Co. v. Cahan, 274 U.S. 473, 71 L.Ed. 1158, 47 S.Ct. 661 (1927), a father had given his son power of attorney to draw checks for him at two banks. The powers of attorney had no pertinent restrictions in them. For two years the son drew checks against his father's account, signing his father's name by himself as attorney in fact. A number of these checks were made payable to the son's order, and the son deposited them in his own accounts and eventually spent the money. The father sued one of the banks in which he had an account.
The trial court and the U.S. Second Circuit Court of Appeals held that the bank had sufficient notice that the son was misappropriating money that the bank should be held liable. The United States Supreme Court reversed, stating:
"The [bank] had notice that the checks were drawn upon the [father's] account, but they were drawn in pursuance of an unlimited authority. We do not perceive on what ground the petitioner could be held bound to assume that checks thus lawfully drawn were required to be held or used for one purpose rather than another.... The notice to the bank was notice only of this [agency] relation of the parties. The [bank] in permitting the son to draw out the money was permitting only what it, like the [father's] banks, would have been bound to allow even if the deposit had been earmarked as a trust." 274 U.S. at 479.
In the end, the Court held that it would be impractical to put the burden on banks to check each agency transaction to make sure the agent is acting within his authority: "`The transactions of banking in a great financial center are not to be clogged, or their pace slackened, by over-burdensome restrictions.'" 274 U.S. at 480 (quoting Whiting v. Hudson Trust Co., 234 N.Y. 394, 406, 138 N.E. 33 [1923]).
In Nashville Trust Co. v. Southern Buyers, Inc., 40 Tenn. App. 11, 288 S.W.2d 469 (1956), a corporation asserted a claim against a bank for allowing an agent of the corporation to draw checks on the corporation's account in his own name. The Tennessee Court of Appeals held that the bank was not liable because the corporation had given the bank a signature card with the agent's name on it, without any limitation. The court said,
*553 "It is generally held that where an agent draws checks on his principal's bank account, payable to himself, and deposits them to his own account, the mere form of the transaction, in the absence of additional circumstances; is not sufficient to put the depositing bank on notice of the agent's fraud." 40 Tenn. App. at 17.
In Dockstader v. Brown, 204 S.W.2d 352 (Tex. Civ. App. 1947), a sister had given her brother a power of attorney which included the power, "in my name, place and stead, to do any and every act, and exercise any and every power that I might, or could do or exercise through any other person, and that he shall deem proper or advisable, intending hereby to vest in him a full and universal power of attorney...." The brother, pursuant to this power of attorney, sold an oil and gas interest in land in which his sister held an interest. After the sale of the interest, the brother, using his power of attorney, withdrew most of the proceeds for his personal use.
The sister sued the brother, the purchasers, and a bank, claiming the bank participated in the conversion by her brother of the money from the sale. The appellate court ultimately held that the bank was not liable. The court said that a bank may be liable for such a conversion when the bank has notice of the wrongdoing. 204 S.W.2d at 358-59. The court distinguished certain other cases in which banks had been held liable, because in those cases there were facts putting the banks on notice, i.e., repeated transactions, etc. The ultimate holding of this case is that a bank may be liable for conversion of funds by a trustee or attorney, but the facts must be such as to put a bank on notice of the conversion. 204 S.W.2d at 359.
In Grace v. Corn Exchange Bank Trust Co., 287 N.Y. 94, 38 N.E.2d 449 (1941), a trustee, over a period of six years, managed to waste and appropriate almost $450,000 from a trust account. He wrote 146 checks on the trust account and deposited them in his own account. The money was spent on the trustee's personal business. The court stated:
"[I]f a bank connives with a trustee and knowingly assists the trustee to embezzle funds he holds as fiduciary, the bank is liable for the moneys embezzled just as any other person, who knowingly assists a wrongdoer, would be liable as a joint wrongdoer for a wrong so committed." 287 N.Y. at 100-101.
*554 The court explained the bank's duties as follows:
"In considering the effect of this evidence we must constantly bear in mind that the bank was under no duty to exercise vigilance to protect the trust estate from possible embezzlement by the trustee. When it accepted the trust account in which the trust funds were deposited, it assumed the obligation to pay out the moneys deposited in accordance with the directions of the trustee. It assumed no other obligation. To establish joint liability of the bank for the derelictions of the trustee, the plaintiffs must prove that the bank gave to the wrongdoer such assistance as would make the bank a participant in the wrong." 287 N.Y. at 102.
The court went on to discuss the fact that although the bank was aware that the trustee was shifting money to his personal account, the bank was not liable unless it appeared that the bank "knew that the trustee was engaged in embezzling trust funds by withdrawal of the trust money in the personal account in order to apply them to his own use ...." 287 N.Y. at 102. The court said that when a trustee withdraws funds in his own name, there is a presumption that he is applying them to a legitimate and lawful use. 287 N.Y. at 102. The appellate court ultimately upheld the trial court's determination that the bank did have sufficient notice to constitute constructive knowledge and affirmed the judgment against the bank, largely because of the number of checks written.
In Cassel v. Mercantile Trust Company, 393 S.W.2d 433 (Mo. 1965), a trustee and executor withdrew money from the decedent's checking account by cashing a series of checks to himself totaling $108,225. He did not use the money for trust or estate purposes. The successor trustee sued Mercantile, alleging that because of the series of transactions, it had sufficient knowledge that the trustee was breaching his duties to hold the bank liable. The court said that there are three ways in which a bank could incur liability for deposits misappropriated by a fiduciary:
"(1) by a violation on its part of the contract, express or implied, between it and the owner of the fund;
"(2) by appropriating the fund, either with or without the fiduciary's consent, to the payment of the latter's debt to the bank; and
"(3) by assisting the fiduciary to accomplish the misappropriation, the bank having knowledge, actual or constructive, that the fraud is being or is about to be perpetrated by the fiduciary." 393 S.W.2d at 437.
*555 The Missouri court went on to say that in order to state a claim for relief, the plaintiff must allege:
"(a) facts which show that the bank had knowledge of the trust character of the funds on deposit and that the fiduciary unlawfully withdrew and misappropriated trust funds;
"(b) facts sufficient to overcome the presumption in which the bank is entitled to indulge, namely that in withdrawing trust funds the fiduciary is acting lawfully and in the performance of his duties as a trustee, and that he will appropriate the money, when drawn, to a proper use;
"(c) facts which show, directly or by necessary inference, that the bank participated in the breach of trust in receiving or permitting the trustee to withdraw the trust funds, by receiving the deposit or permitting the withdrawal with notice of the breach of trust." 393 S.W.2d at 437.
The court held that under the facts and Missouri rules for pleading, the plaintiff had failed to state a cause of action and affirmed the trial court's dismissal.
In the case before us, Capitol Federal was presented with a power of attorney which it is agreed was signed by Tillie, its depositor. Martha Flanders was properly identified as being the Martha Flanders designated as attorney in fact. We conclude the request to cash the CD's and the issuance of checks in the individual name(s) of the attorney(s) in fact was within the scope of the power of attorney. Capitol Federal had the right to assume the attorney in fact was acting lawfully in the performance of her agency duties and to honor the agent's request that the checks be drawn in her own name and that of her husband, also an attorney in fact for Tillie. Capitol Federal had no knowledge the funds would be subsequently misappropriated by Flanders, nor did it participate in such misappropriation. Absent an act and acts amounting to participation in the wrongdoing, Capitol Federal's issuance of the checks in the name(s) of the attorney(s) in fact imposes no liability on Capitol Federal.
We find no error in the district court's entry of summary judgment in favor of Capitol Federal relative to this issue.
PROCEDURAL ERROR
On January 10, 1991, Capitol Federal filed its motion for summary judgment with accompanying statement of uncontroverted facts and memorandum. On January 24, 1991, the estate filed its response thereto and a cross-motion seeking summary judgment *556 with an uncontroverted statement of facts attached. On January 31, 1991, a hearing was held on both motions for summary judgment. At the close of the hearing, the court indicated it had made up its mind on the motions and there was a discussion of whether a memorandum decision would need to be written. Counsel agreed a written decision was needed because there would be an appeal. There was some additional discussion at the end of the hearing concerning the fact that Capitol Federal had not filed a response to the estate's memorandum of uncontroverted facts. As will be recalled from the time frame involved herein, the estate's cross-motion for summary judgment was filed only five business days before the hearing on both motions. Supreme Court Rule 141 (1991 Kan. Ct. R. Annot. 117) grants an opposing party 21 days to respond thereto. Thus, the time had not expired for the filing of this response.
It is unclear whether Capitol Federal expressly waived the filing of a response, but certainly Capitol Federal did not contemplate filing a response. None was filed. The district court issued its memorandum decision on or about February 19, 1991, granting summary judgment to Capitol Federal.
On appeal, the estate contends Capitol Federal's failure to file a response to the estate's uncontroverted statement of facts admits all such alleged facts. It cites Rule 141, which provides that failure to respond is an admission of the uncontroverted facts.
Hearing the motion prior to the expiration of the time for response or the filing of a response is at variance with Rule 141. However, a careful review of the hearing transcript, both parties' statements of uncontroverted facts (including the estate's response), the district court's memorandum opinion, and the issues involved therein and in this appeal convinces us that no reversible error has been shown.
The judgment is affirmed.
ABBOTT, J., concurring and dissenting:
I have no quarrel with the law or reasoning of the majority except as set forth in this dissent. I would point out that most of the authority cited by the majority deals with checks. Clearly, a bank could not function if, in check transactions, the bank was required to do more than the majority opinion requires.
*557 My dissent is simple. In my opinion, the trial judge's grant of summary judgment was premature because I would adopt an additional requirement: If a transaction dependent upon a durable power of attorney is more than a routine transaction and if an officer of the bank is involved directly and has actual or constructive knowledge leading a reasonable person to suspect funds are about to be misappropriated, then the bank has a duty either to inquire into the circumstances before it pays out the money or to pay the funds out in such a manner that will protect the depositor. See Hubbard v. Home Fed'l Savings & Loan Ass'n, 10 Kan. App.2d 547, 557, 704 P.2d 399 (1985); Renzi v. Aleszczyk, 44 App. Div.2d 648, 352 N.Y.S.2d 736 (1974).
My proposed standard raises a fact question of whether a reasonable person would find that Capitol Federal had actual or constructive knowledge funds were about to be misappropriated. I am aware the facts set forth in this dissent do not always correspond with the facts set forth by the trial judge or the majority; however, the record supports the discussion of facts that follows. Summary judgment was premature because, as will be illustrated, the facts are both material and conflicting.
Martha Flanders appeared at Capitol Federal on January 13, 1988, and 20 minutes later walked out with $135,791.34 in checks, some payable to Martha Flanders and some to Martha and her husband, James Flanders.
Mrs. Flanders was taken to the desk of John Denton and, when she explained what she wanted, he took her to Joseph Morley, an assistant vice president. Morley was not acquainted with Mrs. Flanders or her husband. In fact, Morley had never met the Flanders or Mrs. Flinn, the depositor.
Mrs. Flanders presented a durable power of attorney from Mrs. Flinn dated June 15, 1987. On its face, it was apparent the document had been "clipped" from the "Family Circle" magazine issue of June 1, 1987, and the blanks had been filled in. Although not relevant to my dissent, Mrs. Flinn signed the durable power of attorney without legal advice at a time when her treating physician testified she was incompetent. The document was notarized by the same woman who, after a grant of immunity, admitted she also had notarized Mrs. Flinn's purported will, *558 which was forged five days after Mrs. Flinn's death and backdated to December 29, 1987.
Mrs. Flanders also had a handwritten letter signed by Mrs. Flinn, instructing that Mrs. Flinn's niece and nephew, the Flanders, had her power of attorney and that Mrs. Flinn wished to cash five certificates of deposit that she identified by number. Mrs. Flanders wanted three of the certificates of deposit cashed and a check made payable to her personally. The remaining two certificates of deposit were to be cashed and the check made payable to both Mrs. Flanders and her husband. The five certificates of deposit totalled $135,791.34, and Mrs. Flanders forfeited $4,757.70 in accrued interest in order to cash the certificates of deposit.
Morley testified by deposition that the use of a power of attorney is "an unusual occurrence at most banks. You don't see it that often. You want to pay attention to what you are doing." In its brief and at oral argument, Capitol Federal stated that it averages 500 transactions involving agency or the power of attorney relationship each day. Capitol Federal's statement, which is noted in the majority opinion, seems at odds with the deposition testimony of Morley, an assistant vice president of Capitol Federal.
All Morley did was check the signature on the durable power of attorney against the signature on the letter of instruction and the five signature cards, one signature card for each certificate of deposit. He then made out the checks. The entire procedure took less than 20 minutes.
Anyone giving the signatures even a cursory glance can see that Mrs. Flinn's signatures on the early signature cards, dated 1973 and 1982, are clear, firm, and legible. Even the signatures on the cards signed in 1986 are clear, firm, and legible. The signature on the durable power of attorney was started twice. There is only one "hump" on the "M" in "Mrs." and the word "Flinn" is not legible. The handwriting is weak and shaky. The signature on the handwritten letter of instruction (no one would contend the letter itself is in Mrs. Flinn's handwriting) is shaky and meandering.
In summary, a complete stranger entered a financial institution and a bank officer, who had never seen that person before and *559 who did not know the depositor, accepted a durable power of attorney that clearly shows on its face that it was clipped out of a magazine usually sold at a supermarket checkout stand. The bank then paid out a large sum of money to the holders of the power of attorney, after deducting $4,757.70 in forfeited accrued interest. The transaction was based on signatures that clearly showed a deteriorating depositor. To me, the above presents a question of fact whether a reasonable person would be put on notice that funds were about to be misappropriated.
Any inquiry could have prevented the loss. The financial institution also could have fully protected itself by drawing the checks in Mrs. Flinn's name. I cannot agree with the majority's view that, because Mrs. Flanders could have stolen the money later, Capitol Federal's lack of due caution is irrelevant. If the Flanders had deposited the funds and then written checks to themselves, Capitol Federal's duty would have ended and any negligence would be that of another institution. By not making the checks payable to Mrs. Flinn, Capitol Federal made the cashing of the checks simple. Had the checks been made payable to Mrs. Flinn, the theft might have been prevented or the funds recovered. In summary, Capitol Federal could have left Mrs. Flinn in the same position as before the transaction by making the checks for her money payable to her.
I would reverse and remand for trial.
HERD, J., joins the foregoing concurring and dissenting opinion.
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537 U.S. 1220
HOWARDv.UNITED STATES.
No. 02-8468.
Supreme Court of United States.
February 24, 2003.
1
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT.
2
C. A. 5th Cir. Certiorari denied. Reported below: 54 Fed. Appx. 410.
|
22 So.3d 688 (2009)
Gary A. WILLIAMS, Appellant,
v.
STATE of Florida, Appellee.
No. 5D09-1752.
District Court of Appeal of Florida, Fifth District.
November 6, 2009.
*689 Gary A. Williams, Wewahitchka, pro se.
No appearance for Appellee.
PER CURIAM.
Gary A. Williams appeals from the denial of his Florida Rule of Criminal Procedure 3.800(a) motion. In his Volusia County case, Williams was charged with capital sexual battery upon a person less than twelve years of age. He entered into a favorable negotiated plea in which he pled nolo contendere in return for the lesser charge of attempted sexual battery while in a position of familial or custodial authority, a first-degree felony. As further consideration for his plea, the State agreed not to file charges in a separate case.
Williams' written plea agreement, which he and his counsel signed, was individually drafted and very specific about what it meant. He was sentenced, as agreed, to twelve years' prison, followed by ten years of sexual offender probation. At the plea hearing, an extensive discussion ensued about the meaning and consequences of his plea. Williams was informed that filing a motion asserting that his sentence was illegal under the sentencing guidelines would be unsuccessful due to the terms of his plea agreement. Both his attorney and the trial judge presciently warned him that the jailhouse "lawyers" would tell him that he received an illegal sentence, and they explained to him why his sentence was not illegal. Williams expressly indicated his understanding. This was illustrated when his attorney stated, in open court with Williams present:
I've explained to him that this is a plea negotiation that he havehe has received a huge benefit from. And as a result of that, he is agreehe has agreed to this increased incarcerative sentence. So that if he were to turn around and say that I was illegally sentenced, he is completelyone, he affects any gain time that the prison system would give him, as a result of this, because it would be a frivolous appeal. He also understands that there's really nothing to appeal after today, because this is all something that we have negotiated, therefore, if he did appeal, the hehe would end up being punished by whatever Appellate Court, through the department of prisons, for undertaking a frivolous appeal. And he does understand that and has indicated to me that *690 he appreciates all the consequences of this negotiation.
(Emphasis added.)
Ignoring good advice, Williams filed his rule 3.800(a) motion, arguing precisely what his attorney and the judge told him was not a valid claim: "Since my incarceration, I have learned that the court erred in allowing me to agree to a sentence which is illegal under Florida laws." His claim was based on the contention that his twelve-year prison sentence and ten-year probationary sentence, when added together, was "a severe upward departure sentence imposed without oral or written reasons." Conveniently, he ignores the bottom of his scoresheet where it is written in bold letters: "SENTENCE AN AGREED UPON PLEA BARGAIN," under which he initialed or signed his name.
Williams ignores well-settled law in erroneously asserting that the probationary portion of his sentence has to fall under the guidelines when added to his prison sentence. See, e.g., Sullivan v. State, 801 So.2d 185, 186 (Fla. 5th DCA 2001) (under sentencing guidelines, the term "sentence" refers to term of incarceration and not any term of probation; so prison sentence under the guidelines is irrelevant to length of probation to follow, except as limited by statutory maximum for offense), citing Weiner v. State, 562 So.2d 392, 393 (Fla. 5th DCA 1990).
He also wrongly maintains that his total twenty-two year sentence is "illegal" for his "first-degree felony" because it is a Level 7 crime. Again, the law is clear and well-settled that a defendant can agree, through a plea bargain, to a sentence not specifically authorized by statute or rule as long as the sentence does not exceed the statutory maximum. See Maddox v. State, 760 So.2d 89, 103 (Fla.2000). The statutory maximum for a first-degree felony is thirty years. § 775.082(3)(b), Fla. Stat. (1993).
After reviewing his motion and the applicable parts of the record, especially the extremely thorough and specific plea colloquy and written plea, we issued an order directing Williams to show cause why this court should not "issue a written finding and direct that a certified copy be forwarded to the appropriate institution or facility for disciplinary procedures pursuant to the rules of the department." See State v. Spencer, 751 So.2d 47, 48 (Fla. 1999) (litigant must be provided notice and opportunity to respond before preventing further attacks on conviction and sentence). Like his current appeal, Williams' response cited and argued case law that was completely inapplicable.
Williams' motion, appeal, and response demonstrate that he will file pleadings without any attempt to ascertain the proper law on the subject and will ignore the plain words of the plea transcript and his own plea agreement. We warn him and other similarly situated defendants of the dangers in doing so. See, e.g., Simpkins v. State, 909 So.2d 427, 428 (Fla. 5th DCA 2005) (directing Clerk to forward a certified copy of opinion to DOC for consideration of disciplinary procedures where inmate's response demonstrates he obstinately persisted in asserting erroneous interpretations of the law); Johans v. State, 901 So.2d 396, 396 (Fla. 5th DCA 2005) (banning further pro se pleadings in order "to conserve judicial resources" from a frivolous, abuse-of-process case).
We recognize that Williams is a pro se litigant and therefore held to a less stringent standard in technical matters than an attorney. See Haines v. Kerner, 404 U.S. 519, 520, 92 S.Ct. 594, 30 L.Ed.2d 652 (1972). However, a defendant should make some attempt to divine whether the record in his case, or the law he cites, *691 supports or defeats his claim. As one appellate court explained in discussing pro se prisoners' filings:
These motions are either facially insufficient or completely misleading, and illustrate problems with pro se representation which this court is confronting with increasing frequency. The filing of inappropriate, repetitive, or frivolous pleadings places an unwarranted burden upon the staff of this court and interferes with the prompt dispatch of the court's duties. We therefore deem it appropriate to issue this order in opinion form, not just to admonish Blanton personally but to caution all potential pro se litigants that we will insist upon certain standards of diligence and responsibility even as we take into consideration the less stringent technical requirements applicable to prisoner self-representation.
Blanton v. State, 561 So.2d 587, 587 (Fla. 2d DCA 1989).
The situation has only gotten worse in the years since Blanton was issued. See, e.g., Henderson v. State, 903 So.2d 999, 1000 (Fla. 5th DCA 2005) (frivolous appeals do the criminal defendant no good; they clog the court system; and, worse, they hurt meritorious appeals, in part by engendering judicial impatience with all criminal defendants). "Every paper filed with [a court], no matter how repetitious or frivolous, requires some portion of the institution's limited resources. A part of the Court's responsibility is to see that these resources are allocated in a way that promotes the interests of justice." In re McDonald, 489 U.S. 180, 184, 109 S.Ct. 993, 103 L.Ed.2d 158 (1989).
The Clerk of this Court is directed to forward a certified copy of this opinion to the appropriate institution for consideration of disciplinary procedures. See §§ 944.09, 944.279(1), 944.28(2), Fla. Stat. (2008). Having carefully considered Williams' response, we conclude that this appeal is patently frivolous for the reasons previously explained.
AFFIRMED; OPINION CERTIFIED; and FORWARDED to Department of Corrections.
MONACO, C.J., GRIFFIN and COHEN, JJ., concur.
|
471 A.2d 1022 (1984)
Mary Jane BEDNEY, a/k/a Lillie Mae Bedney, Appellant,
v.
UNITED STATES, Appellee.
No. 82-1585.
District of Columbia Court of Appeals.
Argued November 29, 1983.
Decided February 6, 1984.
Richard A. Graham, Washington, D.C., appointed by this court, for appellant.
Daniel M. Cisin, Asst. U.S. Atty., Washington, D.C., with whom Stanley S. Harris, U.S. Atty., Washington, D.C., at the time the brief was filed, Michael W. Farrell and Mary Ellen Abrecht, Asst. U.S. Attys., Washington, D.C., were on the brief, for appellee.
Before NEBEKER and MACK, Associate Judges, and REILLY, Chief Judge, Retired.
PER CURIAM:
Appellant was convicted by a jury of armed assault with intent to kill, D.C.Code § 22-502, -3202 (1981), and carrying a pistol without a license, id. § 22-3204. In challenging the convictions, she contends, inter alia, that the trial court's instructions to the jury were inadequate and that the evidence was insufficient to support the conviction of assault with intent to kill.[1] We affirm.
According to the evidence presented by the government, the armed assault for which appellant was convicted was the culminating event in a quarrel between appellant and another woman, Lenora Cole, which had occurred a few hours earlier at the same place, the corner of 11th and O *1023 Streets, N.W. On the first occasion, after a heated verbal exchange between the two women Cole was accompanied by her sister who joined in the argument the pair resorted to punching and scratching each other. This sidewalk fracas, observed by many onlookers, went on for about 30 minutes, with Cole emerging as the apparent victor and appellant quitting the scene to go to the apartment of a friend who lived nearby.
Several hours later, Cole, equipped with a long piece of piping and reinforced by her sister and her mother, Mrs. Betty Stevenson, returned to the combat zone. Soon thereafter, appellant arrived at the same intersection with two relatives in her wake, a young nephew, Ken Simmons, and her sister. Cole testified that appellant, who was carrying a brown paper bag, came up to her and said "I'm going to get you," but Mrs. Stevenson prevented another fist fight by stepping between them. Appellant then walked to the doorway of a nearby building approximately fifteen feet from where Cole was standing. She removed a revolver from the bag that she was carrying. People standing in the vicinity then heard a noise that sounded like a gunshot. Stevenson testified that she then saw her daughter bend over and that blood was coming from the back of her neck when she lifted her head.
Two police officers, Donald Wikert and James Szewczyk, arrived at the intersection of 11th and O Streets shortly after hearing what seemed to be a gunshot. Officer Wikert approached appellant and picked up a brown paper bag containing a .22 caliber revolver that had dropped to the ground. He placed her under arrest. Officer Szewczyk approached Cole and observed blood coming from an injury behind her right ear.
A crime scene search officer testified that the revolver contained one empty shell casing and four live rounds, and that the absence of dust or debris in the barrel indicated that it had been recently fired. In his inspection of the crime scene, the officer observed a small amount of blood on the sidewalk near where Cole had been standing.
Appellant testified that after the first fight, she washed up at a friend's apartment across the street and emerged later with her two relatives.
She said her sister was carrying a paper bag containing a revolver, which they intended to deliver to their mother who needed it for protection. As they encountered the Cole group, appellant informed them that she was going to report Cole's sister to the Citizens Complaint Bureau in order to recover some money the latter owed to her. As appellant was walking on, Cole approached her from behind with the metal pipe in hand. Appellant's sister then handed her the bag containing the gun. Cole then struck appellant with her pipe.
Appellant ran to the vestibule of a nearby church and removed the revolver from the paper bag upon seeing Cole pull a silver handgun from her pocketbook. Cole's sister began to struggle with Cole over the gun, which appellant said, went off while pointed at the sidewalk. Appellant estimated that she was standing fourteen feet away from Cole when this occurred. Appellant said she could not remember whether she fired the gun in her own possession. When the police arrived, appellant directed them to the gun, then in the bag which she had dropped upon the sidewalk. The police did not recover a gun from Cole, and appellant asserted that Cole passed it off to a bystander.
Appellant's nephew, Simmons, called by the defense, testified that he observed Cole's mother pass a handgun to her daughter. He then saw appellant and Cole aim guns at each other. He heard two gunshots, and shortly thereafter, the police arrived and arrested appellant.
I
Appellant contends that the court's instructions to the jury on the relationship between self-defense and provocation were *1024 inadequate. Specifically, with regard to the charge of assault with intent to kill, appellant argues that the court erred in failing to instruct the jury that provocation by the victim could have negated the specific intent to kill. The error occurred, asserts appellant, when the judge repeated the standard instruction on provocation and self-defense in response to a note from the jury requesting restatement of the relationship between provocation and intent to kill. That instruction informed the jury that if it found that appellant provoked an attack, then appellant could not benefit from a claim of self-defense.[2] Defense counsel did not object to the instruction, and in fact, expressly agreed to it.
Decisions concerning reinstruction of a jury are within the discretion of the trial court. Murray v. District of Columbia, 358 A.2d 651, 653 (D.C.1976); Atkinson v. United States, 322 A.2d 587, 588 (D.C.1974). In the instant case, both the court and counsel interpreted the jury's note as a request to repeat the self-defense instruction and the directions contained therein as to provocation. Given the ambiguous nature of the jury's request, the court's interpretation and reinstruction were reasonable. We recognize the court's duty to remedy a jury's confusion over instructions, Bollenbach v. United States, 326 U.S. 607, 612, 66 S.Ct. 402, 405, 90 L.Ed. 350 (1946); United States v. Bolden, 169 U.S.App.D.C. 60, 67, 514 F.2d 1301, 1308 (1975), but hold that the reinstruction in question was a proper response in clarification. Our review discloses no abuse of discretion and certainly no plain error.
II
Appellant also contends that the evidence is insufficient to support the conviction of assault with intent to kill, stressing in particular that testimony was lacking to prove that the blood on complainant's neck, which one police officer noticed, resulted from a wound inflicted by gunshot. It is true that because her injury was variously described by witnesses as a "scratch" or an "abrasion" and as no hospital or other medical records were presented, the hypothesis that complainant'. skin was grazed by a bullet fired in her direction might be dismissed as speculative. But to prove the offense for which appellant was convicted, a lethal intent can be demonstrated without showing that the assailant succeeded in wounding his intended victim. Fletcher v. United States, 335 A.2d 248, 250-51 n. 5 (D.C.1975); Wooten v. United States, 343 A.2d 281, 282 (D.C.1975).
While there were serious conflicts of testimony with respect to the shooting incident, there was substantial evidence (other than that relating to the neck injury) from which a jury after resolving the credibility issues could conclude that appellant fired at the complainant with the deliberate purpose of causing death.[3]
The record clearly establishes that there was deep animosity between appellant and Cole. In fact, several hours after a lengthy physical altercation between them, appellant approached her antagonist and was heard to say that she was going to "get" her. Shortly thereafter, according to *1025 appellant's own witness, Simmons, appellant aimed a revolver at Cole. Bystanders then heard a gunshot.[4] Finally, Officer Irwin testified that the gun admittedly in appellant's possession appeared to have been recently fired.
Viewing all of the evidence in a light most favorable to the government, we deem it sufficient for a jury to determine beyond a reasonable doubt that appellant shot at Cole intending to kill.
Accordingly, the judgment is
Affirmed.
NOTES
[1] Also assigned as error were certain rulings on the admissibility of testimony in which the application of the hearsay rule was raised. We have examined these rulings. We regard one of them as questionable, but not of such significance that it could have swayed the judgment of the jurors. Kotteakos v. United States, 328 U.S. 750, 66 S.Ct. 1239, 90 L.Ed. 1557 (1946). It was therefore harmless.
[2] The trial judge read instruction 5.17 of the Criminal Jury Instructions for the District of Columbia. The relevant portion, 5.17(D) provides:
If you find that the defendant was the aggressor, or if he provoked the assault upon himself, he cannot invoke the right of self-defense to justify his use of force. However, if one who provokes a conflict later withdraws from it in good faith, and communicates that withdrawal by words or actions, and he is thereafter pursued, he is justified in using deadly force to save himself from imminent danger of death or serious bodily harm.
[3] After the government rested, the defense unsuccessfully moved for acquittal and then introduced testimony. Hence this motion was waived, and the ruling is not before us. Franey v. United States, 382 A.2d 1019, 1021 (D.C. 1978). Thus, in passing upon the asserted error in the denial of appellant's motion for a judgment of acquittal made at the close of all the evidence, the testimony offered by the defense and by the government in rebuttal must be taken into account. Id. at 1022.
[4] The police testimony was that only a single shot was fired and that an inspection of the pavement or sidewalk upon which the Cole gun (if any) was allegedly discharged revealed nothing to indicate the impact of a bullet.
|
808 F.2d 840
McKnight (Ernest W.)v.Trickey (Myrna)
NO. 86-2452
United States Court of Appeals,Eighth Circuit.
DEC 05, 1986
1
Appeal From: E.D.Mo.
2
DENIED.
|
696 F.2d 101
225 U.S.App.D.C. 19
N. Conant WEBB, M.D., Appellant,v.DEPARTMENT OF HEALTH AND HUMAN SERVICES, et al.
No. 81-2345.
United States Court of Appeals,District of Columbia Circuit.
Argued Oct. 22, 1982.Decided Dec. 14, 1982.
Frederick Townsend, with whom Alan B. Morrison and David C. Vladeck, Washington, D.C., were on the brief, for appellant.
Patricia J. Kenney, Asst. U.S. Atty., with whom Stanley S. Harris, U.S. Atty., Royce C. Lamberth, R. Craig Lawrence and Michael J. Ryan, Asst. U.S. Attys., Thomas Scarlett, Chief Counsel, Food and Drug Administration, Washington, D.C., were on the brief, for appellees, Department of Health and Human Services, et al.
Joel E. Hoffman, with whom Patricia R. Sharin and Bruce J. Brennan, Washington, D.C., were on the brief, for appellee, Pharmaceutical Manufacturers Association.
Before WILKEY and GINSBURG, Circuit Judges and BAZELON, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge WILKEY.
WILKEY, Circuit Judge:
1
Appellant, a medical doctor seeking to obtain information from the Food and Drug Administration under the Freedom of Information Act, appeals from the district court's dismissal of his suit. Because we agree with the district court that appellant's attack on the validity of an FDA regulation is not justiciable in the present form, we affirm its decision to dismiss.
I. BACKGROUND
A. Regulatory Scheme
2
Before a manufacturer can legally market a new drug1 in interstate commerce, the Food and Drug Administration (FDA) must approve a New Drug Application (NDA) for that drug.2 An NDA must contain extensive data concerning the drug and its intended use, including full reports of pre-clinical and clinical investigations, adverse reaction reports, and published articles on the use or effectiveness of the drug.3 After evaluating an NDA, the FDA either approves it, rejects it, or requests supplemental information from the submitter.
3
Every manufacturer of a new drug must obtain a separately approved NDA. Thus, a drug manufacturer which has submitted an NDA has a competitive interest in seeing that the information contained in its NDA is not prematurely released to the public. If a manufacturer's competitor could obtain all the data in the manufacturer's NDA, it could utilize them in its own NDA without incurring the time, labor, risk, and expense involved in developing them independently. Premature disclosure of NDA data is further discouraged by the existence of criminal sanctions for FDA officials who release trade secrets without the submitter's consent. These sanctions are contained in both the Food, Drug, and Cosmetic Act4 and the Trade Secrets Act.5
4
In an effort to balance the need to prevent premature disclosure of NDA data against the policy of open disclosure embodied in the Freedom of Information Act (FOIA),6 the FDA promulgated 21 C.F.R. Sec. 314.14, the regulation presently being challenged.7 Under section 314.14 the amount of material to be disclosed in response to a FOIA request depends on the stage of agency review to which the NDA has progressed and the extent to which the information has already been made available to the public. If the NDA is pending and its existence has not been publicly disclosed or acknowledged, no data or information in the NDA file will be disclosed.8 If the NDA is pending, but its existence has been publicly disclosed, the agency may release summaries of selected portions.9 If the NDA has been approved, more information is made available.10 Finally, if the NDA is abandoned or denied, all information not previously disclosed may be obtained.11
5
When the FDA denies a FOIA request, the requester is entitled to de novo review of the agency's decision in a federal district court.12 If the FDA has denied the request on the grounds that the information sought is confidential and thus covered by Exemption 4 of FOIA,13 the agency requires the drug manufacturer to defend, presuming that a failure to defend constitutes a waiver of the confidentiality defense.14 From that point on, the manufacturer bears the burden of proving that the information is covered by Exemption 4.
B. The Present Litigation
6
Dr. N. Conant Webb filed a FOIA request with the FDA in July, 1980, seeking disclosure of the safety and effectiveness data15 contained in Ciba-Geigy's pending NDA for the drug Anturane.16 Webb sought the information because of his interest in evaluating and assessing clinical investigations of new drugs, a subject on which he has lectured in the past. Because the Anturane NDA was pending, FDA denied the request, relying on FOIA Exemption 4, the Food, Drug, and Cosmetic Act, the Trade Secrets Act, and various regulations, including section 314.14.17 Webb's administrative appeal was denied for the same reasons.
7
On 22 January 1981 Webb filed the present suit in federal district court, naming the Department of Health and Human Services, the FDA, and Ciba-Geigy as defendants. The relief sought was twofold. First, Webb sought to compel disclosure of the safety and effectiveness data in the Anturane NDA file. Second, he asked the court to invalidate section 314.14, claiming that the regulation violated FOIA because it permitted the agency to deny his request without a document-by-document review of the file.18 Ciba-Geigy initially indicated that it intended to defend the suit on the merits, but less than five months later it released the requested information pursuant to an agreement with Webb.19 Webb then filed a motion for summary judgment on the issue of the validity of section 314.14. The federal appellees, joined by intervenor, the Pharmaceutical Manufacturers Association (PMA), opposed the motion, and asked the court to dismiss the suit because it no longer involved a live case or controversy.
8
On 24 September 1981 the district court granted appellees' motion to dismiss, ruling that the case was both moot and not ripe. The court held that insofar as the challenge to the regulation rested on Webb's request for information in the Anturane NDA it was moot since that information was already available to him. The court then concluded that it could not properly rule on the validity of the regulation in the absence of an actual denial of information, holding that such a challenge was premature. Finally, the court held that it was not necessary to find the regulation valid in order to rule on Webb's request for attorneys' fees, noting that it was only required to find that the FDA had a reasonable basis for denying Webb's FOIA request. After the district court amended its order to clarify that Webb's dismissal did not prevent him from making a request for attorneys' fees, Webb appealed to this court.
II. TIMELINESS OF THE APPEAL
9
At the outset appellees assert that Webb's appeal should be dismissed because it was not filed in a timely manner. Rule 4 of the Federal Rules of Appellate Procedure provides that the notice of appeal must be filed within 60 days after the judgment is entered.20 The district court below entered its judgment on 24 September 1981, yet the notice of appeal was not filed until 14 December 1981, more than 80 days later. Webb argues that the filing deadline was stayed for 20 days because he filed a motion to amend the judgment, a motion on which the court did not rule until 15 October 1981. Appellees counter by contending that while a Rule 59(e) motion to amend the judgment does stay the time for filing an appeal,21 Webb's motion did not come under that rule because it was a motion for attorneys' fees. They point out that the Supreme Court has recently held that a motion for attorneys' fees is not governed by Rule 59(e).22 Therefore, appellees argue, Webb's motion did not stay the time for filing an appeal and his notice was filed after the 60 day period expired. Although appellees' argument is technically correct, an examination of the circumstances of this case prompts us to hold that Webb should be allowed to proceed.
10
The district court's 24 September judgment contained language indicating that Webb would not be entitled to attorneys' fees.23 At the time, the law with respect to motions for attorneys' fees was in great flux. Two circuits24 had held that a motion for attorneys' fees was governed by Rule 59(e) and that, accordingly, it had to be filed within 10 days of the judgment.25 Four circuits had held to the contrary.26 Wishing to preserve his right to obtain attorneys' fees, Webb filed a "motion to amend the judgment," asking the court to clarify its position on attorneys' fees. Appellees consented to the order amending the judgment, referring to Rule 59(e). More importantly, the court, without comment, granted the motion and amended the order to permit Webb to move for attorneys' fees, apparently treating it as a motion to amend the judgment under Rule 59(e). Subsequently, the Supreme Court resolved the conflict concerning the applicability of Rule 59(e) to a motion for attorneys' fees by holding that such a motion did not have to be filed within the 10 day period imposed by Rule 59(e).27 Thus, although appellees are technically correct that Webb's "motion to amend the judgment" was not a Rule 59(e) motion that stayed the filing deadline, we find that this case comes within the narrow exception to Rule 4 recognized by the Supreme Court in Harris Lines, Inc. v. Cherry Meat Packers, Inc.,28 and Thompson v. Immigration and Naturalization Service.29
11
In Harris Lines, appellant's counsel sought and obtained from the district court an extension of the filing date for appeal on the grounds of excusable neglect. The court of appeals dismissed the appeal as untimely because it disagreed with the district court's ruling on excusable neglect. The Supreme Court reversed, stressing that it would be unfair to penalize the appellant for relying on the trial judge's ruling. "Whatever the proper result as an initial matter on the facts here, the record contains a showing of unique circumstances sufficient that the Court of Appeals ought not to have disturbed the motion judge's ruling."30
12
In Thompson the Court explained what unique circumstances in Harris Lines warranted a lenient application of the filing deadline. The district court in Thompson had erroneously informed appellant that his motion for a new trial was made in a timely manner. After the motion was denied, appellant's appeal was dismissed as untimely. The Supreme Court again reversed, comparing the unique circumstances in Thompson with those in Harris Lines.
13
Here, as there, petitioner did an act which, if properly done, postponed the deadline for the filing of his appeal. Here, as there, the District Court concluded that the act had been properly done. Here, as there, the petitioner relied on the statement of the District Court and filed the appeal within the assumedly new deadline but beyond the old deadline.31
14
These same "unique circumstances" are present here. Webb filed what he thought was a Rule 59(e) motion. Had it been a Rule 59(e) motion, the filing deadline would have been stayed. The district court apparently concluded that the motion was a Rule 59(e) motion. And, although Webb did not rely on an express statement by the district court that the motion was a Rule 59(e) motion, he had good reason to believe that the court was treating it as such, given the unsettled state of the law and the court's willingness to grant the motion. It would be unfair to dismiss Webb's appeal in light of the circumstances. Harris Lines and Thompson teach that such unfairness should be avoided.
III. JUSTICIABILITY
15
Webb concedes that his request for the information in the Anturane NDA was mooted by Ciba-Geigy's release of that information.32 Nevertheless, he argues that his challenge to section 314.14 is still justiciable. We disagree, concluding that in the absence of a particularized FOIA request, the validity of section 314.14 is not ripe for judicial review.
16
The Supreme Court's opinion in Abbott Laboratories v. Gardner33 continues to be the guidepost for determining whether issues presented to a court are ripe for judicial review. In Abbott Laboratories, the Court indicated that the relevant inquiry is two-pronged. In order to determine the ripeness of an issue, we are required to "evaluate both the fitness of the issues for judicial decision and the hardship to the parties of withholding court consideration."34 This two-pronged inquiry in essence requires the court to balance its interest in deciding the issue in a more concrete setting against the hardship to the parties caused by delaying review.35 Thus, if the hardship to the parties is slight, "only a minimum showing of countervailing judicial or administrative interest is needed ... to tip the balance against judicial review."36
17
We first consider the fitness of the issues for judicial decision. Throughout his brief Webb asserts that various documents which might be discoverable under FOIA could be contained in a pending NDA.37 This shows that the validity of applying section 314.14 to a FOIA request will vary depending on what information is actually contained in the NDA file. Further, the amount of information released pursuant to section 314.14 will vary depending on the stage to which the NDA has progressed and the extent to which the information has already been made available to the public.38 Thus, if section 314.14 were challenged in the context of a particularized FOIA request, a court would be able to determine what documents, if any, should have been released, but were not, because of section 314.14. In contrast, if the district court were to rule on the issue now, it would be required to conduct a pseudo-rulemaking proceeding, examining all of the considerations that led the agency to permit or prevent disclosure in the various situations. Therefore, since "judicial appraisal of [the issue] is likely to stand on a much surer footing in the context of a specific application of this regulation than could be the case in the framework of [a] generalized challenge" we conclude that the issue is not fit for judicial review.39 Accordingly, unless the interest in postponing judicial review is outweighed by the resultant hardship to Webb, review should be delayed.
18
The only hardship Webb will endure as a result of delaying consideration of this issue is the burden of having to file another suit.40 This is hardly the type of hardship which warrants immediate consideration of an issue presented in abstract form. In Abbott Laboratories, a case in which immediate review was granted, the plaintiff's conduct was directly governed by the regulation and stiff penalties were attached for noncompliance.41 Thus, as this court noted in a subsequent case, the plaintiff in Abbott Laboratories faced a choice between "burdensome compliance and risky noncompliance."42 Webb is not facing such a dilemma. He does not have to alter his day-to-day conduct in order to comply with section 314.14; nor will he be subject to serious penalties if he fails to comply. He will only be required to file another action when he is again denied information pursuant to section 314.14. As we observed in New York Stock Exchange, Inc. v. Bloom,43 "the inconvenience of having to initiate more than one suit [is not] a hardship sufficient to justify review" when the issues are not otherwise fit for judicial decision.44
19
Webb argues that if a court refuses to adjudicate the validity of section 314.14 in the present context, it will never be reviewed because the validity of the agency's actions is never an issue in a FOIA case. He therefore concludes that the issue must be resolved at this time. If Webb were correct in asserting that the challenged section would never be reviewable in the future, we might agree with his conclusion.45 However, he misunderstands the nature of a FOIA action and therefore arrives at the wrong result.46 Granting full access to the requested documents, as was done in this case, terminates a FOIA action (except possibly for attorneys' fees). Denial of full access, which conceivably may occur in the next case Webb files, will preserve the controversy.47
20
If, in the future, Webb requests information in an NDA and the FDA applies section 314.14 to deny access to that information, Webb will be free to file an action in district court. Even if the FDA turns the defense of that action over to the drug manufacturer who submitted the information, two issues will still be ripe for judicial review. First, the court should consider whether the FDA's administrative denial of access to the documents based on section 314.14 was unlawful. Second, the court should decide whether, considering Exemption 4 of FOIA, the Trade Secrets Act, and section 331(j) of the Food, Drug, and Cosmetic Act,48 Webb would currently be entitled to the particular documents he requested. Thus, the validity of section 314.14 can be challenged in the future any time there is a denial of access submitted to the district court for adjudication. We therefore refuse to require the district court to consider the issue in its present abstract form.49
IV. CONCLUSION
21
Although unique circumstances excuse Webb's technical failure to comport with the requirements of Rule 4 of the Federal Rules of Appellate Procedure, we conclude that the district court correctly refused to adjudicate Webb's substantive claim. Webb is free to challenge the validity of section 314.14 any time that section is used to deny him access to particular documents, but he is not entitled to an adjudication of that issue until he presents it in the form of a live dispute over particular documents. Accordingly, the judgment of the district court is
22
Affirmed.
1
A "new drug" is defined, in part, as:
Any drug ... the composition of which is such that such drug is not generally recognized, among experts qualified by scientific training and experience to evaluate the safety and effectiveness of drugs, as safe and effective for use under the conditions prescribed, recommended, or suggested in the labeling thereof ....
21 U.S.C. Sec. 321(p)(1) (1976). This includes a drug currently on the market if it is proposed that it be used for a "new" purpose.
2
21 U.S.C. Sec. 355 (1976)
3
21 C.F.R. Sec. 314.1 (1982)
4
21 U.S.C. Sec. 331(j) (Supp. IV. 1980). The cited section makes it a crime for
any person to ... reveal[ ] ... any information acquired under authority of section ... 355 [the new drug provision, 21 U.S.C. Sec. 355] of this title concerning any method or process which as a trade secret is entitled to protection.
5
18 U.S.C. Sec. 1905 (Supp. IV 1980). The Trade Secrets Act covers all federal officers or employees and prohibits the disclosure of "any information coming to him in the course of his employment ... which information concerns or relates to the trade secrets ... of any person ...."
6
5 U.S.C. Sec. 552 (1976 & Supp. IV 1980)
7
42 Fed.Reg. 3093 (1977)
8
21 C.F.R. Sec. 314.14(c) (1982)
9
Id. Sec. 314.14(d)
10
Id. Sec. 314.14(e)
11
Id. Sec. 314.14(f)
12
5 U.S.C. Sec. 552(a)(4)(B) (1976)
13
Id. Sec. 552(b)(4). Exemption 4 exempts matters that are "trade secrets and commercial or financial information obtained from a person and privileged or confidential" from the disclosure requirements of FOIA. This court has held that Exemption 4 covers information, the disclosure of which is likely " 'to impair the Government's ability to obtain necessary information in the future; or ... to cause substantial harm to the competitive position of the person from whom the information was obtained.' " Charles River Park "A", Inc. v. HUD, 519 F.2d 935, 940 (D.C.Cir.1975) (quoting National Parks & Conservation Association v. Morton, 498 F.2d 765, 770 (D.C.Cir.1974)
14
21 C.F.R. Sec. 20.53 (1982)
15
Safety and effectiveness data include "all studies and tests of a drug on animals and humans and all studies and tests on the drug for identity, stability, purity, potency, and bioavailability." 21 C.F.R. Sec. 314.14(i) (1982)
16
An NDA had previously been approved for the use of Anturane in the treatment of chronic and intermittent gouty arthritis. Ciba-Geigy submitted the present NDA in support of its proposal to use the drug for the prevention of sudden death in survivors of heart attacks
17
The FDA did release a letter sent by it to Ciba-Geigy, but only because Ciba-Geigy had previously released the letter
18
On appeal Webb asserts that the present action also involves the FDA's denial of his request for information in an NDA for the drug Rimso-50. This is not the case. Although Webb made a FOIA request for information in the Rimso-50 NDA, the FDA's denial of that request was not challenged in the court below. It was not included in the original complaint, nor was the complaint ever amended. We, therefore, refuse to rule on the propriety of the FDA's action with respect to Rimso-50
19
In the agreement Webb agreed to dismiss Ciba-Geigy from the present action
20
In most civil cases, the notice of appeal must be filed within 30 days after judgment is entered. However, the period is increased to 60 days "if the United States or an officer or agency thereof is a party." Fed.R.App.P. 4(a)(1)
21
Fed.R.App.P. 4(a)(4)
22
White v. New Hampshire Department of Employment Security, --- U.S. ----, 102 S.Ct. 1162, 71 L.Ed.2d 325 (1982)
23
The district court, after noting that it did not need to rule on the validity of section 314.14 in order to determine the attorneys' fees issue, stated that the regulation provided "a reasonable basis for the Agency's action here." Webb v. Department of Health and Human Services, No. 81-00159, slip op. at 3 (D.D.C. 24 September 1981). This seemed to be a disposition of the attorneys' fees issue because the court had previously stated that "in order to deny the attorney's fees request; it is only required that the defendant have had a reasonable basis for its actions." Id. (emphasis added) (citation omitted)
24
Glass v. Pfeffer, 657 F.2d 252 (10th Cir.1981); White v. New Hampshire Department of Employment Security, 629 F.2d 697 (1st Cir.1980), rev'd, --- U.S. ----, 102 S.Ct. 1162, 71 L.Ed.2d 325 (1982)
25
Rule 59(e) provides: "A motion to alter or amend the judgment shall be served not later than 10 days after entry of the judgment." Fed.R.Civ.P. 59(e)
26
Obin v. District No. 9, International Association of Machinists, 651 F.2d 574 (8th Cir.1981); Johnson v. Snyder, 639 F.2d 316, 317 (6th Cir.1981); Bond v. Stanton, 630 F.2d 1231, 1234 (7th Cir.1980); Knighton v. Watkins, 616 F.2d 795, 797-98 (5th Cir.1980)
27
White, 102 S.Ct. at 1167-68
28
371 U.S. 215, 83 S.Ct. 283, 9 L.Ed.2d 261 (1962)
29
375 U.S. 384, 84 S.Ct. 397, 11 L.Ed.2d 404 (1964)
30
371 U.S. at 217, 83 S.Ct. at 285 (emphasis added)
31
375 U.S. at 387, 84 S.Ct. at 398
32
Appellant's Brief at 12. The same concession was made during oral argument
33
387 U.S. 136, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967)
34
Id. at 149, 87 S.Ct. at 1515
35
Midwestern Gas Transmission Co. v. FERC, 589 F.2d 603, 618 (D.C.Cir.1978); New York Stock Exchange, Inc. v. Bloom, 562 F.2d 736, 740-41 (D.C.Cir.1977); Independent Bankers Association v. Smith, 534 F.2d 921, 929 (D.C.Cir.1976); Continental Airlines, Inc. v. CAB, 522 F.2d 107, 124-25 (D.C.Cir.1975) (en banc)
36
Diamond Shamrock Corp. v. Costle, 580 F.2d 670, 674 (D.C.Cir.1978)
37
Appellant's Brief at 23-25; Appellant's Reply Brief at 3-4
38
See text at notes 8-11, supra
39
Toilet Goods Association, Inc. v. Gardner, 387 U.S. 158, 164, 87 S.Ct. 1520, 1524, 18 L.Ed.2d 697 (1967)
40
At oral argument Webb argued that the district court's refusal to adjudicate section 314.14's validity at the present time worked an extraordinary hardship on him because he is a frequent FOIA requester who constantly seeks documents in NDAs. However, nothing in the record suggests that Webb has made more than two FOIA requests, one of which resulted in his receiving the requested documents. See text at note 19, supra. In any event, the hardship is not great because Webb is only required to file one FOIA action in which there is a live dispute before he can challenge section 314.14. As noted in the text above, this is not the type of hardship which warrants immediate review of issues not otherwise fit for judicial decision
41
387 U.S. at 152-53, 87 S.Ct. at 1517
42
New York Stock Exchange, Inc. v. Bloom, 562 F.2d 736, 741 (D.C.Cir.1977)
43
562 F.2d 736 (D.C.Cir.1977)
44
Id. at 742
45
In determining "whether there is sufficient hardship to the parties to warrant our review" the court should determine "whether the challenged action will be reviewable in the future. If it will not be reviewable later, our review now may be warranted ...." Bethlehem Steel Corp. v. EPA, 536 F.2d 156, 163 (D.C.Cir.1976)
46
Webb maintains that this court's decision in Mead Data Central, Inc. v. Department of the Air Force, 566 F.2d 242 (D.C.Cir.1977), bars a district court from adjudicating the validity of section 314.14 in the context of a particularized FOIA request. In Mead Data Central we rejected the argument that an agency's failure to follow the procedures outlined in Vaughn v. Rosen, 484 F.2d 820 (D.C.Cir.1973), cert. denied, 415 U.S. 977, 94 S.Ct. 1564, 39 L.Ed.2d 873 (1974), at the administrative level required us to reverse the district court's holding that the requested information was exempt. Webb argues that Mead Data Central precludes a court in a FOIA case from reviewing the procedures followed by an agency at the administrative level. But that case merely held that "[i]n a FOIA action the district court is not limited to review of the quality of the agency's decision-making." Mead Data Central, 566 F.2d at 251 (emphasis added). We did not hold that the district court could not review the legality of the agency's actions
47
Counsel for Webb informs the court that the sequence of events seen here is not novel. Counsel asserts that in five lawsuits over the past four years, Webb's attorneys have represented FOIA requesters denied access to drug testing data on the basis of section 314.14; in each case, the FDA turned defense of the action over to the manufacturer; in each case, the manufacturer released the information prior to judicial decision on the merits. Brief for Appellant at 6 n. 3. Webb's few examples do not demonstrate, however, that section 314.14 is immune from judicial review. We cannot infer from counsel's limited encounters that drug manufacturers will always abandon the fray and voluntarily release the information once a civil action is under way. Our holding today makes clear that section 314.14 will be subject to review when a manufacturer denies a FOIA requester the full access he seeks
48
It may be argued that information in an NDA which is a "trade secret" within the meaning of the Trade Secrets Act or the Food, Drug, and Cosmetic Act is covered by FOIA's Exemption 3. 5 U.S.C. Sec. 552(b)(3) (1976). Exemption 3 relieves an agency from disclosing matters "specifically exempted from disclosure by [a qualified] statute." Because we do not reach the merits in the present case, we express no opinion concerning the validity of that argument
49
Webb contends that the issue of section 314.14's validity is ripe because the FDA's application of that section is currently denying him access to information in the Rimso-50 NDA. If that is true, Webb is free to file an action in district court. However, as noted above, this action does not involve the information in the Rimso-50 NDA. See note 18, supra
|
Affirmed in Part and Reversed and Remanded in Part and Opinion filed
September 29, 2015.
In The
Fourteenth Court of Appeals
NO. 14-13-01100-CV
JANNA RUSSELL, Appellant
V.
DAVID CHRISTOPHER RUSSELL, Appellee
On Appeal from the 246th District Court
Harris County, Texas
Trial Court Cause No. 2007-65512
OPINION
In this appeal after remand, appellant Janna Russell contends that the trial
court failed to comply with this court’s opinion and mandate by refusing to award
her reasonable attorney’s fees and costs in connection with her action for contempt
and enforcement against her former husband, David Christopher Russell. In nine
issues, Janna argues that she presented uncontroverted evidence that she incurred
reasonable attorney’s fees and costs totaling $122,195.00 and is entitled to a
rendition of judgment for that amount. In response, Chris argues that the trial court
complied with this court’s instructions and correctly denied Janna’s request for
attorney’s fees and costs because the amount requested was excessive. We reverse
and remand for a new trial on attorney’s fees, and affirm the remainder of the
judgment.
FACTUAL AND PROCEDURAL BACKGROUND
Janna and Chris were divorced in 2008. In 2009, Janna filed a motion for
contempt and enforcement, contending that Chris had violated several provisions
of the parties’ Agreed Final Decree of Divorce (the “Decree”) and an incorporated
Agreement Incident to Divorce, titled “Property Division.” The proceedings that
followed are recounted in this court’s opinion in Russell v. Russell, No. 14-10-
00494-CV, 2012 WL 3574713 (Tex. App.—Houston [14th Dist.] Aug. 21, 2012,
pet. denied) (mem. op.) (“Russell I”). As explained in Russell I, after several
hearings, the trial court awarded Janna a judgment for $1,224.00 for unreimbursed
medical expenses incurred on behalf of a child and $15,799.00 for funds
previously ordered to be paid into an Amegy Bank UGMA1 Savings Account (the
“UGMA account”) on the child’s behalf. Id. at *1–2. However, the trial court did
not award Janna additional child-support arrearages she sought or attorney’s fees.
In her first three appellate issues in Russell I, Janna asserted that she was
entitled to attorney’s fees and costs based on: (1) Family Code section 157.167; (2)
Family Code section 9.014; and (3) a fee-shifting provision in the Property
Division incorporated into the Decree. Id. at *2. The Russell I court first
considered whether Janna was entitled to attorney’s fees and costs under section
157.167. That section provides that a trial court “shall” award the movant’s
reasonable attorney’s fees and costs if it finds that the respondent has failed to
1
See Tex. Prop. Code §§ 141.001–.025 (Texas Uniform Transfers to Minors Act).
2
make child support payments. See Tex. Fam. Code § 157.167(a). However, the
statute also provides that a trial court may waive this requirement if good cause is
shown and the trial court states the reasons supporting the good-cause finding.
Id. § 157.167(c).
The Russell I court noted that (1) Janna’s pleadings referred to her request
for medical support as child support, (2) case law recognizes that medical support
is an additional child-support obligation, and (3) Janna both pleaded for and
presented evidence to support an award of attorney’s fees. Id. at *3. Moreover, the
trial judge had awarded Janna $1,224.00 in medical support, but gave no reasons
within its findings of fact and conclusions of law or its judgment to support its
failure to award reasonable attorney’s fees to Janna. Id. Accordingly, the Russell I
court held that “the trial court abused its discretion by failing to award attorney’s
fees without stating good cause.” Id. The court also rejected Chris’s argument that
the judge was not obligated to award attorney’s fees because Chris was not held in
contempt. Id. at *4. Having found that the trial court erred by failing to award
attorney’s fees without stating good cause, the court did not address Janna’s
remaining issues regarding attorney’s fees. Id. at *4 n.2. The court also sustained
another of Janna’s issues in which she contended that that the trial court erred by
failing to award Janna a child-support arrearage of $166.78. Id. at *5. The
remainder of the trial court’s judgment was affirmed.
Ultimately, the Russell I court reversed that portion of the trial court’s
judgment denying an award to Janna of reasonable attorney’s fees, as well as the
child-support arrearage of $166.78 plus prejudgment and post-judgment interest on
that amount, and remanded the case to the trial court for further proceedings
consistent with its opinion. Id. at *7. Chris sought review by the Supreme Court of
Texas, but his petition for review was denied.
3
On remand, Janna moved for an award of the additional arrearage and her
attorney’s fees and court costs pursuant to the Russell I court’s opinion and
mandate, arguing that she was entitled to her fees under both section 157.167 and a
fee-shifting provision in the Property Division that was incorporated into the
Decree.2 Janna sought a hearing on her motion, but the trial court declined to hold
a hearing. Instead, on August 13, 2013, the trial court faxed a handwritten rendition
of its judgment on remand, which was memorialized in a written order signed on
September 10, 2013. In the order, the trial court awarded Janna a judgment for
$166.78 plus pre-judgment and post-judgment interest. However, the court denied
Janna an award of attorney’s fees: “The Court finds that David Christopher Russell
is not in contempt, therefore, awards no attorneys fees. Attorney fees are denied at
this time.” The September 10, 2013 order is the subject of this appeal.
Janna moved for a new trial. At a hearing on her motion, Janna argued that
Russell I provided that the trial court’s decision not to hold Chris in contempt was
not a basis for refusing to award fees, and that the case was remanded for the
purpose of awarding attorney’s fees to Janna. The trial judge stated that he did not
believe an award of attorney’s fees was appropriate and orally denied the motion.
The judge also suggested that if the court of appeals believed attorney’s fees
should have been awarded and the record established the amount of those fees, it
would have reversed and rendered, rather than remanding the case back to him.
Further, the trial judge at one point said he did not award attorney’s fees in part
because they were “excessive in the particular instance”; however, he later stated
that he believed that “those fees were reasonable” and should be paid by Janna, but
that Chris should not be made to pay them.
2
Janna did not assert, as she had in Russell I, that she was also entitled to an award of
reasonable attorney’s fees and costs under Family Code section 9.014. See Russell I, 2012 WL
3574713, at *2. Nor does she assert this ground on appeal.
4
Janna moved for findings of fact and conclusions of law. Chris also filed
proposed findings of fact and conclusions of law. In November 2013, the trial court
issued its findings of fact and conclusions of law. Relevant here are the following:
4. The Court hereby finds on August 13, based upon the record
and the court file, this Court ruled on Janna Russell’s Motion
and filed and faxed a letter to the parties, thereby rendering its
ruling.
5. The Court hereby finds that the final Order of September 10,
2013, based on the rendered ruling of August 13, 2013,
provides as it provides.
6. The Court hereby finds that the Order of September 10, 2013
was made based upon review and reconsideration of the trial
record and evidence.
The trial court did not include proposed findings of fact submitted by Chris to
support a finding of good cause, and declined to file amended and additional
findings Janna requested. This appeal followed.
ISSUES AND ANALYSIS
On appeal, Janna raises nine issues: (1) the trial court abused its discretion
on remand in failing to award attorney’s fees to Janna pursuant to the opinion and
mandate in Russell I; (2) the trial court abused its discretion in failing to award
attorney’s fees to Janna in accordance with Texas Family Code section 157.167;
(3) the trial court erred as a matter of law in failing to award attorney’s fees to
Janna; (4) the trial court’s denial of an award of fees to Janna was against the great
weight and preponderance of the evidence; (5) no finding can be implied to support
the trial court’s denial of fees; (6) the trial court erred in failing to award fees
pursuant to the Decree; (7) the trial court’s failure to award fees in keeping with
the Decree changed the division of property; (8) the trial court failed to follow the
law of the case; and (9) Janna seeks remand for fees incurred upon remand, and
5
appeal to this court and to the Texas Supreme Court. We address Janna’s issues
and Chris’s responses in the order and as needed to resolve this appeal.
I. Did the Trial Court Fail to Follow This Court’s Opinion and Mandate?
When an appellate court remands a case and limits a subsequent trial to a
particular issue, the trial court is restricted to a determination of that particular
issue. Hudson v. Wakefield, 711 S.W.2d 628, 630 (Tex. 1986). Thus, in a
subsequent appeal, instructions given to a trial court in the former appeal will be
adhered to and enforced. Id. In interpreting the appellate court’s mandate, the
courts should look not only to the mandate itself but also to the appellate court's
opinion. Id. Even if the remand is limited, however, the trial court is given a
reasonable amount of discretion to comply with the mandate. Austin Transp. Study
Policy Advisory Comm. v. Sierra Club, 843 S.W.2d 683, 690 (Tex. App.—Austin
1992, writ denied).
In this case, the Russell I court reversed and remanded the case “for further
proceedings consistent with [the court’s] opinion” after concluding that the trial
court “abused its discretion by failing to award attorney’s fees [under 157.167]
without stating good cause.” See Russell I, 2012 WL 3574713, at *3, *7. The
Russell I court further clarified that section 157.167 does not require that the trial
court hold Chris in contempt before awarding attorney’s fees. See id. at *4. The
accompanying judgment and mandate provided:
This cause, an appeal in favor of appellee, David Christopher
Russell, signed, March 3, 2010, was heard on the transcript of the
record. We have inspected the record and find error in the judgment.
We therefore order that portion of the judgment of the court below
denying Janna Russell’s reasonable attorney’s fees, and the amount of
$166.78 plus prejudgment and post-judgment interest, REVERSED
and REMAND the cause for proceedings in accordance with the
court’s opinion.
6
On remand, and without a hearing on Janna’s motion to award reasonable fees and
court costs, the trial court again awarded no attorney’s fees to Janna.
Janna contends that the this court’s mandate instructed the trial court to
award her attorney’s fees because, as explained in Russell I, an award under
section 157.167 is mandatory absent good cause stated on the record, and the
failure to find contempt on Chris’s part does not bar an award. See Tex. Fam. Code
§ 157.167(a), (c); Russell I, 2012 WL 3574713, at *3–4. According to Janna, the
trial court repeatedly recognized at both the original trial and on remand that
Janna’s attorney’s fees were reasonable and that Janna’s attorney’s testimony
concerning the reasonableness of her fees satisfied the lodestar criteria of Long v.
Griffin.3 Therefore, she argues, the trial court failed its mandated duty to follow
section 157.167 and award her the full amount of attorney’s fees she requested.
Chris contends, however, that the Russell I opinion and mandate contain no
language instructing the trial court to award Janna fees of $122,195.00. Instead, the
Russell I court held only that the trial court’s failure to award fees without stating a
reason violated section 157.167’s requirement that the trial court must state its
reasons for denying the fees. Chris maintains that the opinion and mandate suggest
at least two possibilities for compliance on remand: (1) the trial court could
maintain his failure to award the fees if he stated his reason for that decision as
required by section 157.167; or (2) the trial court could determine there was no
good cause for the failure to award the fees and enter judgment awarding the fees
under section 157.167.
We agree with Chris that the Russell I court did not instruct the trial court to
simply award Janna her attorney’s fees under the statute; the court merely
recognized the trial court’s error and remanded for the trial court to correct its
3
442 S.W.3d 253, 255 (Tex. 2014) (per curiam).
7
error, either by awarding reasonable fees or stating good cause for denying fees.
Our reading of the opinion’s plain language is further supported by the fact that the
court recognized that Janna had asserted other possible bases for an award of
attorney’s fees, but did not address them. See id. at *4 n.2. The court’s analysis
was limited to explaining that attorney’s fees were recoverable under section
157.167 based on the award of $1,224.00 for medical child support owed; the court
did not discuss whether the trial court’s award of $15,799.00 for the UGMA
account also supported recovery of attorney’s fees under the statute or one of
Janna’s other theories. Therefore, the trial court was free to consider whether Janna
was also entitled to an award of attorney’s fees pursuant to a Family Code statute
or the parties’ contract, as Janna alleged, for the amounts she recovered.
Chris further argues, however, that the trial judge recognized a third option
as reflected in his findings of fact: he reviewed the evidence and the record and,
based on the record as a whole, again declined to award any fees. According to
Chris, the trial court concluded that the fees were excessive and therefore
unreasonable. Chris maintains that the trial court’s failure to award unreasonable
fees does not trigger the application of section 157.167 or its requirement that good
cause for the denial of fees be stated on the record. In support of this conclusion,
Chris argues that the trial court made no finding in the first trial or on remand that
the fees were reasonable, and he points to another of the court’s comments during
the post-remand hearing in which the trial court stated, “I did not award
attorney[’]s fees because in my opinion they were excessive in the particular
instance . . . .”4 Chris also cites this court’s opinion in In the Interest of A.L.S., 338
4
We note that in that same sentence, the trial court went on to say, “and I found that it
was not contemptible and the payment of child support was not a contemptible refusal to pay.” In
any event, the trial court’s comments made at the conclusion of a bench trial are not a substitute
for findings of fact and conclusions of law. See In the interest of W.E.R., 669 S.W.2d 716, 716
(Tex. 1984) (per curiam).
8
S.W.3d 59, 69 (Tex. App.—Houston [14th Dist.] 2011, pet. denied), in which we
held that the trial court did not err by denying attorney’s fees under 157.167
without stating good cause because the movant presented no evidence of fees. Id.
We disagree with Chris that section 157.167 is not triggered if the requested
fees are unreasonable. Section 157.167 expressly provides that the statute is
triggered “if the court finds that the respondent has failed to make child support
payments,” not on a threshold finding of reasonableness. See Tex. Fam. Code §
157.167(a). Absent a specific finding that the respondent has shown good cause to
not pay attorney’s fees, and the court stating the reasons supporting such a finding,
the court is required to award reasonable attorney’s fees to the movant. See id.
§ 157.167(a), (c); Russell I, 2012 WL 3574713, at *3–4; see also Goudeau v.
Marquez, 830 S.W.2d 681, 682 (Tex. App.—Houston [1st Dist.] 1992, no writ).
Moreover, A.L.S. is distinguishable and does not support Chris’s argument. As we
explained in that case, the party seeking attorney’s fees has the burden of proof,
and the movant had waived her right to fees because she offered no evidence
whatsoever to support a fee award. See A.L.S., 338 S.W.3d at 69.
In this case, Janna presented expert witness testimony and exhibits
supporting her attorney’s fees. The trial judge made no finding that the fees sought
were unreasonable, and as noted above, he explained elsewhere in the same
hearing that he believed the attorney’s fees charged to Janna were reasonable, but
also believed that Chris should not have to pay them. The judge also expressly
rejected Chris’s proposed findings that good cause existed for denying attorney’s
fees. Because section 157.167 requires that good cause be stated on the record and
the trial judge rejected proposed finding supporting good cause, this court may not
imply a finding of good cause to support the trial court’s judgment. See Williams v.
Gillespie, 346 S.W.3d 727, 732–33 (Tex. App.—Texarkana 2011, no pet.);
9
Fanning v. Fanning, 828 S.W.2d 135, 143 (Tex. App.—Waco 1992), rev’d in part
on other grounds, 847 S.W.2d 225 (Tex. 1993).
The trial court’s August 13, 2013 letter informing the parties of its ruling
provided, in part, that “[t]his court makes a negative finding on the contempt,
therefore, determining to award no attorney fees. Attorney fees are denied at this
time” (emphasis added). The signed September 10, 2013 judgment contains similar
language. In the findings of fact, the trial court found that its written order of
September 10, 2013 was “based on the rendered ruling of August 13, 2013” and
“provides as it provides.” Additionally, just before overruling Janna’s motion for
new trial, the trial court stated:
I remember. I heard all that and I determined the gentlem[a]n was not
in contempt and I do not think the law is that I must award attorney
fees in a child support issue or in this case in particular when I do not
find him in contempt. And I exercised by discretion which the Court
of Appeals said I don’t have the discretion, but I found that all these
days of trial, those fees were reasonable and Ms. Russell ought to pay
them, but I didn’t find Mr. Russell in contempt and I did not award
attorneys fee[s].
Although one of the trial court’s conclusions of law states that “since contempt was
not found, attorney’s fees must be considered by the court based upon the evidence
in the record,” the trial court’s handwritten ruling of August 13, its September 10
signed order, and its comments at the hearing demonstrate that the trial court
declined to award Janna attorney’s fees because it did not find Chris in contempt.
See Russell I, 2012 WL 3574713, at *4.
Because the trial court failed to award Janna reasonable attorney’s fees
under section 157.167 without stating any reasons supporting a finding of good
cause to deny fees, and further failed to consider Janna’s additional argument on
remand that she was entitled to her reasonable fees under the Decree, the trial court
10
erred by failing to follow the Russell I court’s opinion and mandate.
II. The Sufficiency of the Evidence of Attorney’s Fees to Support
Rendition or Remand
Janna contends that the evidence establishes that her attorney’s fees were
reasonable as a matter of law and therefore she is entitled to rendition of judgment
for the full amount of $122,195.00. Alternatively, Janna contends that the award of
zero attorney’s fees is against the great weight and preponderance of the evidence.
Janna also asserts that the Property Division incorporated into the Decree supports
her claim for attorney’s fees.
In response, Chris argues that Janna failed to establish that her fees are
reasonable as a matter of law. Chris also argues that legally and factually sufficient
evidence exists to support a finding of good cause to deny Janna attorney’s fees,
and that Janna’s failure to segregate her attorney’s fees further supports a good
cause finding. Chris also disputes Janna’s contention that she is also entitled to
recover attorney’s fees under the Property Division.
A. Availability of Attorney’s Fees under Statute or Contract
As noted above, the Russell I court reversed and remanded the case because
Janna recovered unpaid medical support of $1,224.00 and $166.78, but the trial
judge did not award Janna reasonable attorney’s fees and costs or state any reasons
for good cause to deny them as required under Family Code section 157.167. The
Russell I court did not determine whether the award of a judgment for $15,799.00
on Janna’s UGMA account claim also constituted child support for purposes of
section 157.167 or address whether Janna was alternatively entitled to attorney’s
fees under the Decree. See id. at *2–4 & 4 n.2. Because Janna raises these
contentions on appeal, we must first decide whether and to what extent Janna may
be entitled to attorney’s fees either by statute or by contract before we can address
11
the sufficiency of the evidence supporting fees. See Tony Gullo Motors I, L.P. v.
Chapa, 212 S.W.3d 299, 310 (Tex. 2006) (attorney’s fees are not recoverable from
an opposing party unless authorized by statute or contract).
1. Attorney’s fees for enforcement of child support under
Family Code section 157.167
It is undisputed that section 157.167 mandates an award of reasonable
attorney’s fees and costs if the trial court finds that a party has failed to make child
support payments, except that the court may waive the requirement for good cause
shown and the court states the reasons supporting the good-cause finding. Tex.
Fam. Code § 157.167(a), (c); Russell I, 2012 WL 3574713, at *3. Further, section
157.167 does not require that the trial court find contempt before awarding fees.
Russell I, 2012 WL 3574713, at *4. Therefore, absent good cause stated on the
record, the trial court is required to award Janna her reasonable attorney’s fees and
costs in recovering the child-support arrearages of $1,224.00 and $166.78.
Janna argues that the UGMA account also constitutes a type of child support
for purposes of Family Code section 157.167 because the funds were for the
benefit of the child. But Janna cites no authority to support her contention that the
return of funds to a child’s bank account constitutes child support, and we are
aware of none. The record also belies this contention. In the Decree, the UGMA
account appears in the section on “Division of Marital Estate” rather than the
sections relating to child support. And, in her pleadings, Janna categorized her
UGMA account claim as a property claim listed in a section seeking “Enforcement
of Property Agreement Order” rather than under the separate section listing alleged
child support violations. We decline to hold that Janna’s claim for recovery of the
funds in the UGMA account constitutes a type of child support for which section
157.167 provides a recovery of attorney’s fees and costs.
12
2. Attorney’s fees for enforcement of UGMA account claim
under Property Division’s fee-shifting provision
Janna also contends that she is entitled to attorney’s fees under the Property
Division, which is incorporated into the Decree. The Property Division includes
the following fee-shifting provision:
Reasonable attorney’s fees and expenses of a party incurred in
successfully prosecuting or defending a suit under this agreement
against the other party or the other party’s estate will be recoverable
by the successful party in the action.
The Property Division provides that, among other things, Janna is awarded the
property “which belongs to [the child] for which [Janna] has the sole right to
manage,” including the child’s “Amegy Bank UGMA Savings account.” The
Decree requires Chris to deposit $15,799.00 into the UGMA account.
The Family Code provides that, in a divorce proceeding, the parties may
enter into an agreement incident to divorce concerning “the division of the
property and the liabilities of the spouses and maintenance of either spouse.” Tex.
Fam. Code § 7.006(a).5 If the court approves the agreement, the court may set forth
the agreement in full or incorporate the agreement by reference in the final decree.
Id. § 7.006(b). Once the agreement of the parties has been approved by the court
and made part of its judgment, the agreement is no longer merely a contract
between private individuals but is the judgment of the court. Ex Parte Gorena, 595
S.W.2d 841, 844 (Tex. 1979) (orig. proceeding). An agreed divorce decree is a
contract subject to the usual rules of contract interpretation. Broesche v. Jacobson,
218 S.W.3d 267, 271 (Tex. App.—Houston [14th Dist.] 2007, pet. denied).
5
The Family Code also contemplates written agreements between spouses providing for
child support, but terms of an agreement pertaining to child support are not enforceable as a
contract. See Tex. Fam. Code § 154.124; Kendrick v. Seibert, 439 S.W.3d 408, 411 (Tex. App.—
Houston [1st Dist.] 2014, no pet.).
13
The Decree incorporates the Property Division as follows:
The Court finds that the parties successfully mediated this case with
the assistance of Steve A. Bavousett, on July 29, 2008 and further,
that the parties have entered into an Agreement Incident to Divorce, a
document separate from this Agreed Final Decree of Divorce. The
Court approves the attached Agreement Incident to Divorce and
incorporates it by reference as part of this Agreed Final Decree of
Divorce as if it were recited herein verbatim and ORDERS the parties
to do all things necessary to effectuate the agreement. To the extent
permitted by law, the parties stipulate and agree that the Agreement
Incident to Divorce is enforceable as a contract. The Agreement
Incident to Divorce is entitled “Property Division” for all purposes.
Additionally, the Property Division provides:
This Agreement Incident to Divorce in conjunction with the Agreed
Final Decree of Divorce replace and supersede any other agreements
either oral or in writing, between the parties relating to the rights and
liabilities arising out of their marriage. This Agreement Incident to
Divorce and the Agreed Final Decree of Divorce together contain the
entire agreement of the parties.
Because the Property Division is incorporated by reference into the Decree and the
two “together contain the entire agreement of the parties,” the Property Division’s
fee-shifting provision is part of the parties’ agreement and the court’s judgment.
Therefore, the trial court should have determined whether Janna was the successful
party under the Property Division’s fee-shifting provision incorporated into the
Decree. If so, Janna is entitled to an award of reasonable attorney’s fees and
expenses based on her recovery of the $15,799.00 Chris was required to deposit
into the UGMA account.
B. Sufficiency of the Evidence of the Reasonableness of Janna’s
Attorney’s Fees and Costs
According to Janna, the trial court recognized and acknowledged that her
fees were reasonable. Additionally, Janna argues that the expert testimony of her
14
attorney, Ellen Yarrell, concerning the reasonableness of her fees was not rebutted
by opposing expert witness testimony, controverted or impeached, and no other
dollar amount was offered by opposing counsel as a more reasonable amount of
fees and costs. Therefore, Janna maintains, Yarrell’s testimony should be accepted
as a matter of law and this court should render judgment awarding Janna
$122,195.00 in reasonable attorney’s fees.
Chris maintains that Janna’s requested fees are not reasonable when
considering the Arthur Andersen factors of the amount in controversy and results
obtained, attendant circumstances may indicate that the fees are unreasonable, and
Janna did not establish that her fees are reasonable as a matter of law.
1. Standards of review
Generally, we review a trial court’s decision to award attorney’s fees for an
abuse of discretion. Bocquet v. Herring, 972 S.W.2d 19, 21 (Tex. 1998). Under this
standard, legal and factual sufficiency are not independent grounds of error, but
rather are relevant factors in assessing whether the trial court abused its discretion.
Beaumont Bank, N.A. v. Buller, 806 S.W.2d 223, 226 (Tex. 1991).
In a challenge to legal sufficiency, we review the evidence in the light most
favorable to the challenged finding and indulge every reasonable inference that
would support it. City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005). We
credit favorable evidence if a reasonable fact finder could do so and disregard
contrary evidence unless a reasonable fact finder could not. Id. at 827. The
evidence is legally sufficient if it would enable fair-minded people to reach the
verdict under review. Id. In reviewing the factual sufficiency of the evidence, we
consider and weigh all the evidence and should set aside the judgment only if it is
so contrary to the overwhelming weight of the evidence as to be clearly wrong and
unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex.1986).
15
A reasonable fee is one that is moderate or fair but not excessive or extreme.
Garcia v. Gomez, 319 S.W.3d 638, 642 (Tex. 2010). The reasonableness of
attorney’s fees is ordinarily left to the factfinder, and a reviewing court may not
substitute its judgment for the fact finder’s. Smith v. Patrick W.Y. Tam Trust, 296
S.W.3d 545, 547 (Tex. 2009); Ragsdale v. Progressive Voters League, 801 S.W.2d
880, 881 (Tex. 1990) (per curiam).
Generally, the testimony of an interested witness, such as a party to the suit,
though not contradicted, does no more than cause a fact issue to be determined by
the fact finder. Ragsdale, 801 S.W.2d at 882. For the court to award an amount of
attorney’s fees as a matter of law, the evidence from an interested witness “must
not be contradicted by any other witness or attendant circumstances and the same
must be clear, direct and positive, and free from contradiction, inaccuracies and
circumstances tending to cast suspicion thereon.” Id. Even uncontradicted evidence
may do no more than raise a fact issue, however, if “it is unreasonable, incredible,
or its belief is questionable.” Id.; see Smith, 296 S.W.3d at 548 (“But the fee,
though supported by uncontradicted testimony, was unreasonable in light of the
amount involved and the results obtained, and in the absence of evidence that such
fees were warranted due to circumstances unique to this case.”).
Factors to consider when determining what a reasonable award of attorney’s
fees should be include the following: (1) the time and labor required, the novelty
and difficulty of the questions involved, and the skill required to perform the legal
service properly; (2) the likelihood that the acceptance of the particular
employment will preclude other employment by the lawyer; (3) the fee customarily
charged in the locality for similar legal services; (4) the amount involved and the
results obtained; (5) the time limitations imposed by the client or the
circumstances; (6) the nature and length of the professional relationship with the
16
client; (7) the experience, reputation, and ability of the lawyer or lawyers
performing the services; and (8) whether the fee is fixed or contingent on results
obtained or uncertainty of collection before the legal services have been
rendered. Arthur Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812, 818
(Tex. 1997). These factors are not elements of proof, but are guidelines to be
considered in the determination of the reasonableness of a fee. Acad. Corp. v.
Interior Buildout & Turnkey Constr., Inc., 21 S.W.3d 732, 742 (Tex. App.—
Houston [14th Dist.] 2000, no pet.).
2. Yarrell’s testimony concerning the reasonableness of her
fees was disputed
Janna’s petition in her enforcement and contempt action alleged seven
violations of the Decree related to child support and nine violations of the Property
Division, in addition to requesting that Chris be held in contempt, confined, placed
on community supervision, and ordered to post a bond. The original trial record
contains over 100 pages of testimony, cross-examination, and exhibits on the issue
of Janna’s attorney’s fees alone.
Janna’s attorney, Yarrell, testified concerning her qualifications and the
attorney’s fees and expenses incurred on Janna’s behalf. She testified that she
billed at $400 an hour, and her legal assistant billed at $185 an hour. Yarrell
testified that the total fees and costs incurred as of the day before she testified was
$122,195.00. In support of Janna’s requested fees, Yarrell submitted exhibits
detailing the costs incurred and the hours she and her legal assistant spent on the
case broken down by date. Yarrell also testified that some of the fees and costs
were incurred due to Chris’s failure to cooperate with document requests and other
dilatory conduct on Chris’s part.
Chris’s attorney, Jolene Wilson-Glah, did not offer controverting testimony,
17
but she cross-examined Yarrell extensively concerning the reasonableness and
necessity of the attorney’s fees incurred. During cross-examination, Yarrell
acknowledged that Chris had paid some of the child-support violations alleged, but
noted that he did not pay them until after the enforcement action was filed. Yarrell
agreed that some of the violations were non-monetary. In response to questions
concerning the reasonableness of incurring over $122,000.00 in attorney’s fees for
a potential recovery of much less, Yarrell explained that the fees were incurred
based on Janna’s choices in pursuing the present enforcement action against Chris.
Later in the exchange, Yarrell stated that Janna believed that “the disproportionate
division of assets in the divorce was unfair” and it was reasonable for her to
“secure the benefits of the bargain she made.” At one point, the trial court
commented to Yarrell that there was no doubt that she spent all the time she did on
Janna’s case, but “[t]he question is, whether you did too much in Ms. Wilson-
Glah’s opinion.”
Wilson-Glah also attempted to show that some of the same allegations in
Janna’s enforcement had been made in an earlier enforcement action and had been
resolved, and that some actions for which Yarrell sought fees were not part of the
present suit. Yarrell admitted that although she had attempted to segregate fees
relating to an earlier enforcement action, she “may have made some errors.”
On appeal, Chris contends that the focus has always been on the Arthur
Andersen factors of the amount involved and the results obtained, and contends
that the trial court did not err by denying Janna an award of attorney’s fees because
the fees requested were excessive and therefore unreasonable.6 Chris argues that
6
Chris also points to the trial judge’s comment during the hearing on Janna’s motion for
new trial in which the judge stated that he did not award attorney’s fees because “they were
excessive in the particular instance.” However, as discussed above, the judge also stated that he
believed the fees were reasonable in the same hearing, and the record reflects that the trial court
18
Janna’s requested $122,195.00 in attorney’s fees is vastly disproportionate to the
amount of child support in controversy and the amount actually recovered, and
therefore it was within the trial court’s discretion to find the fees unreasonable.
Chris suggests that the fees at issue “are almost 54 times the amount of child
support in controversy and almost 88 times the amount of child support awarded”
and alleges that Janna had a “success rate of less than 20%.”7 Chris also contends
that Janna seeks to recover one-hundred percent of her fees incurred to prosecute
all sixteen of the violations alleged in her petition even though she prevailed on
only three, she lost on other claims involving both monetary and non-monetary
requests for relief, and the trial court did not find Chris in contempt on any of the
violations. Additionally, Chris argues that “attendant circumstances” exist to
support the trial court’s denial of fees because fees were incurred to advance
“frivolous, unfounded or fabricated allegations” relating to specific violations on
which she did not prevail. Therefore, Chris maintains, Janna has failed to
demonstrate that her fees were reasonable as a matter of law.
We agree that Janna has not proved as a matter of law that the fees she seeks
are reasonable. As the record and the parties’ arguments reflect, the proceedings
below were contentious and involved detailed evidence on attorney’s fees relating
to the parties’ long history before the trial court. Although Janna contends that
Yarrell’s testimony was uncontroverted, she was cross-examined at length by
Wilson-Glah concerning whether the fees incurred were reasonable. Wilson-Glah
suggested that Janna’s real motivation was to punish Chris rather than to enforce
the terms of the decree, and Yarrell acknowledged that Janna chose to pursue the
alleged violations despite the amount of fees incurred because Janna felt she had
awarded no fees because he did not find Chris in contempt.
7
Chris’s calculations are limited to the child support recovered and do not take into
account Janna’s recovery of $15,799.00 on the UGMA account claim.
19
been unfairly treated in the divorce. Wilson-Glah also took the position that some
of the fees were incurred for matters that were not at issue in the present
enforcement action, and Yarrell conceded there may have been errors. Because
Yarrell’s testimony was not “free from contradiction, inaccuracies, and
circumstances tending to cast suspicion thereon,” it cannot support the award of
fees as a matter of law. See Ragsdale, 801 S.W.2d at 882. Nor is Janna entitled to
all of the fees she seeks because Chris failed to offer any specific dollar amount as
a reasonable fee, because the burden was on Janna to offer evidence that her fee
was reasonable. See Smith, 296 S.W.3d at 547.
Nevertheless, Janna has presented some evidence to support an award of
fees. An award of no fees is improper in the absence of evidence affirmatively
showing that no attorney’s services were needed or that any services provided were
of no value. See Midland W. Bldg. L.L.C. v. First Serv. Air Conditioning
Contractors, Inc., 300 S.W.3d 738, 739 (Tex. 2009) (per curiam); Cale’s Clean
Scene Carwash, Inc. v. Hubbard, 76 S.W.3d 784, 787 (Tex. App.—Houston [14th
Dist.] 2002, no pet.). Chris does not contend that the record affirmatively shows
that no attorney’s services were needed or that Yarrell’s services were of no value.
Therefore, Janna is entitled to a remand for consideration of the reasonable
attorney’s fees to which she may be entitled.8
C. Segregation of Fees
Chris contends that Janna’s failure to segregate her recoverable and
8
To the extent that Chris argues that evidence of excessive or unreasonable fees,
attendant circumstances (in that Janna’s allegations were frivolous, unfounded, or fabricated), or
the failure to segregate fees is sufficient to support an implied finding of good cause under
Family Code section 157.167, we reject this contention. Chris cites no authority holding that any
of these factors equate to a finding of good cause to deny otherwise mandated fees, and we
decline to so hold on this record. Further, we have already determined that we may not imply a
finding of good cause when the trial court expressly rejected Chris’s proposed findings
supporting good cause.
20
unrecoverable attorney’s fees precludes an award of attorney’s fees as a matter of
law. Generally, a party is required to segregate recoverable from unrecoverable
attorney’s fees in all cases. Chapa, 212 S.W.3d at 313; Kurtz v. Kurtz, 158 S.W.3d
12, 22 (Tex. App.—Houston [14th Dist.] 2004, pet. denied) (“When a plaintiff
seeks to recover attorney’s fees in a case involving multiple claims, at least one of
which supports an award of fees and at least one of which does not, the plaintiff
must offer evidence segregating attorney’s fees among the various claims.”).
Although Chris argues that Janna is not entitled to any fees because she failed to
segregate them, Janna’s evidence of her unsegregated fees is “some evidence of
what the segregated amount should be.” See Chapa, 212 S.W.3d at 314; Arrow
Marble, LLC v. Estate of Killion, 441 S.W.3d 702, 709 (Tex. App.—Houston [1st
Dist.] 2014, no pet). In such a case, remand is appropriate to determine the
segregated fee amount due. Chapa, 212 S.W.3d at 314; Arrow Marble, LLC, 441
S.W.3d at 709.
Janna contends, however, that Chris waived any argument that Janna failed
to segregate her fees because he did not raise the issue in his pleadings, argument,
or a motion for new trial in the underlying enforcement. Therefore, Janna
maintains, she is entitled to recover the full amount of $122,195.00 as a matter of
law. We disagree. In this case, the trial court declined to award any attorney’s fees
to Janna in the original trial, so Chris had no reason to object to any failure on
Janna’s part to segregate. See Arrow Marble, LLC, 441 S.W.3d at 708 (concluding
that plaintiff who did not appear for trial did not waive complaint that defendant
failed to segregate fees, noting that plaintiff was not the party appealing the
judgment or complaining about the trial court’s failure to award any fees). 9 As the
9
In support of her waiver argument, Janna cites to Horvath v. Hagey, No. 03–09–00056–
CV, 2011 WL 1744969, at *6 (Tex. App.—Austin May 6, 2011, no pet.) (mem. op.), in which
the court held that the defendant failed to timely object to the plaintiff’s failure to segregate fees
21
party with the burden of proof, Janna cannot use Chris’s failure to object at trial as
“a vehicle by which [Janna] can maintain on appeal that [she] has conclusively
proved [her] fees as a matter of law.” See id.
Janna also argues that all of her claims provide for an award of attorney’s
fees, either by statute or contract, so she was not required to segregate her fees.
However, as discussed above, Family Code section 157.167 and the Decree’s fee-
shifting provision each impose different requirements on the party seeking to
recover fees. For example, the statute requires the trial court to award Janna
reasonable fees for her recovery of child-support arrearages except for good cause
stated on the record, while the fee-shifting provision requires the trial court to
determine, in the first instance, whether Janna is the successful party before she
can be awarded reasonable fees and expenses for recovering on her UGMA claim.
We have already concluded that Janna presented some evidence to support a
mandatory award of fees for her recovery of child-support arrearages under Family
Code section 157.167 unless the trial court states the reasons supporting a finding
of good cause for waiving the requirement. Additionally, Janna may also be
entitled to an award of reasonable attorney’s fees for her recovery on the UGMA
claim if the trial court finds that she is the successful party pursuant to the Decree’s
fee-shifting provision. Because reasonableness of a fee award is a question of fact
and Janna presented some evidence of her fees, remand for a new trial on the
attorney’s fees issue is appropriate to determine the segregated fee amount due, if
any. See Chapa, 212 S.W.3d at 313–14; Arrow Marble, LLC, 441 S.W.3d at 709.
when the defendant first raised the issue in a motion for new trial. That case is distinguishable,
however, because the plaintiff had been awarded fees and the defendant was challenging the fee
award on appeal. See id. at *2. We also note that in this case, Chris raised the issue of
segregation during the original trial when Janna’s attorney was asked whether the fees sought
included fees for claims made in a previous enforcement action, and he requested (but was
denied) findings of fact on the failure to segregate in both the original trial and on remand.
22
D. Fees on Remand and Appellate Attorney’s Fees
Finally, Janna seeks a remand for attorney’s fees and costs incurred post-
remand in connection with her preparation and presentation of the motion to award
fees and the motion for rehearing filed below, as well as any appeals prosecuted by
her in connection with those motions. Janna points out that she requested such
awards on remand in both motions and asserts that such fees are mandated under
the Decree.10 However, Janna offered no evidence of her attorney’s fees incurred
after remand or appellate attorney’s fees in the trial court, either by affidavit
attached to her motion to award attorney’s fees or by offering evidence at the
hearing on the motion for new trial. Because Janna has not presented any evidence
of the “newly incurred fees” on remand, we deny her request. See Varner v.
Cardenas, 218 S.W.3d 68, 69–70 (Tex. 2007) (per curiam) (declining to allow
post-judgment fees to be determined after appeal by remand to the trial court when
no evidence was offered in the trial court regarding a reasonable fee for those
services); In re Lesikar, 285 S.W.3d 577, 586 (Tex. App.—Houston [14th Dist.]
2009, no pet.) (denying request to present evidence of attorney’s fees incurred on
appeal when no supporting evidence was offered below). On remand from this
appeal, Janna may, however, seek attorney’s fees, including appellate attorney’s
fees, incurred in connection with the second remand and any third appeal to the
court of appeals and the supreme court.
CONCLUSION
On remand from Russell I, the trial court failed to either award Janna
attorney’s fees for her recovery of awards for child-support arrearages or state
good cause for denying her fees as required under Family Code section 157.167.
The trial court also failed to consider Janna’s other asserted grounds for an award
10
Janna does not request appellate attorney’s fees incurred for this appeal.
23
of attorney’s fees. On appeal, we conclude that Janna also may be entitled to her
reasonable attorney’s fees and expenses for her recovery of $15,799.00 on her
UGMA account claim if the trial court finds that she was the successful party as
provided in the Property Division’s fee-shifting provision incorporated into the
Decree. For the reasons explained above, we hold that the trial court abused its
discretion by failing to follow the opinion and mandate in Russell I. Because the
reasonableness of a fee award is a question of fact and Janna produced some
evidence of her fees, we reverse the trial court’s judgment and remand to the trial
court for a new trial on attorney’s fees. We affirm the remainder of the judgment.
On remand, the trial court shall: (1) hear evidence presented by the parties
concerning Janna’s request for attorney’s fees and costs under Family Code section
157.167 and the Decree, including the segregation of fees; (2) determine the
reasonable attorney’s fees and costs Janna is entitled to recover for the child-
support claims on which she recovered under Family Code section 157.167, or
state the reasons supporting a finding of good cause on the record; (3) determine
whether Janna is the successful party under the fee-shifting provision incorporated
into the Decree as a result of her recovery of $15,799.00 on her UGMA claim and,
if so, determine the amount of reasonable attorney’s fees and expenses Janna is
entitled to recover under the Decree; and (4) determine whether and to what extent
Janna is entitled to attorney’s fees and costs incurred in the second remand,
including appellate attorney’s fees for a third appeal, if sought.
/s/ Ken Wise
Justice
Panel consists of Justices Christopher, Donovan, and Wise.
24
|
649 F.2d 397
107 L.R.R.M. (BNA) 2552, 91 Lab.Cas. P 12,754
REICHART FURNITURE COMPANY, Petitioner,v.NATIONAL LABOR RELATIONS BOARD, Respondent.
No. 79-1274.
United States Court of Appeals,Sixth Circuit.
Argued April 3, 1981.Decided May 13, 1981.
Edward J. Simerka, Robb R. Reinker, Schwartz, Einhart & Simerka, Cleveland, Ohio, for petitioner.
Elliott Moore, Deputy Associate Gen. Counsel, Susan Williams, N. L. R. B., Washington, D. C., Bernard Levine, Director, Region 8, N. L. R. B., Cleveland, Ohio, for respondent.
Before EDWARDS, Chief Judge, and ENGEL and MERRITT, Circuit Judges.
PER CURIAM.
1
On receipt and consideration of a petition for review and a cross-application for enforcement of an order of the National Labor Relations Board cited at 238 N.L.R.B. 1578 (1978), this court notes that the threshold question in this case is whether or not the Board erred in overruling the Company's objections to the validity of the representation election at which the Union1 prevailed by a vote of 15 to 9.
2
Subsequent to the election, the Company filed timely objections as to which the Regional Director conducted an administrative investigation, affording the Company full opportunity to proffer proof supporting the allegations and to provide additional information and clarification to aid in the Board's own investigation. Subsequent thereto, the Regional Director issued his report overruling the objections in their entirety and recommending that the Board certify the Union as the exclusive bargaining representative of the Company's employees. The Company thereupon filed timely exceptions to the Regional Director's report and sought a hearing on its objections. After considering the Regional Director's report and the Company's exceptions, affidavits and documents in support of its exceptions and its brief, the Board adopted the Regional Director's findings, conclusions and recommendations and certified the Union as the bargaining representative of the Company's employees.
3
Thereafter, the Union requested bargaining, which the Company refused, and the present unfair labor practice charge was filed contending that the Company's refusal to bargain violated Sections 8(a)(5) and (1) of the National Labor Relations Act. The Board specifically held that issues not raised by the Company in the prior representation proceeding were not "properly litigable in this unfair labor practice proceeding." 238 N.L.R.B. at 1579. Further, the Board reaffirmed its determination in the representation proceeding that the Company had failed to raise "substantial or material issues warranting a hearing" (id.) and granted summary judgment requiring the Company to cease and desist from refusing to bargain with the Union or continue to violate the National Labor Relations Act.
4
On examination of the briefs and record in this case, the court holds that the Board was acting within its appropriate discretion in denying a hearing since no challenge to the election advanced by the Company presented a substantial challenge to the fairness of the election. In NLRB v. Tennessee Packers, Inc., 379 F.2d 172, 177, 178 (6th Cir. 1967), cert. denied, 389 U.S. 958, this court said:
5
It is incumbent upon the party seeking a hearing to clearly demonstrate that factual issues exist which can only be resolved by an evidentiary hearing. The exceptions must state the specific findings that are controverted and must show what evidence will be presented to support a contrary finding or conclusion. Mere disagreement with the Regional Director's reasoning and conclusions do(es) not raise "substantial and material factual issues." This is not to say that a party cannot except to the inferences and conclusions drawn by the Regional Director, but that such disagreement, in itself, cannot be the basis for demanding a hearing. To request a hearing a party must, in its exceptions, define its disagreements and make an offer of proof to support findings contrary to those of the Regional Director. The Board is entitled to rely on the report of the Regional Director in the absence of specific assertions of error, substantiated by offers of proof.
6
(Citations omitted.)
7
These principles have never been overruled in this court and in fact were reaffirmed in Prestolite Wire Division v. NLRB, 592 F.2d 302, 306 (6th Cir. 1979).
8
As this court sees this record, it fails to present factual issues and offers of proof thereon which demand an evidentiary hearing before the Board. This conclusion serves to distinguish this case from Prestolite Wire, supra, and NLRB v. North Electric Co., 644 F.2d 580 (6th Cir. 1981).
9
MERRITT, Circuit Judge, concurring.
10
I agree with the result reached by the Court in this case, but I do not think the opinion adequately articulates the distinction between this case and Prestolite Wire Division v. N. L. R. B., 592 F.2d 302 (6th Cir. 1979); N. L. R. B. v. Curtis Noll Corp., 634 F.2d 1027 (6th Cir. 1980) and N. L. R. B. v. North Electric Company, Plant No. 10, 644 F.2d 580 (6th Cir. 1981). In those cases this Court suggested that the N.L.R.B.'s own rules appear to require, and due process demands, that where a substantial question is raised by an employer regarding the fairness of a representation proceeding, the Regional Director must include in the record transmitted to the Board "documentary evidence" gathered by the Regional Director in connection with his investigation. Section 102.69(g) states that "the Regional Director shall transmit the record to the Board," and that the record shall include "documentary evidence" in addition to certain other papers. In N. L. R. B. v. North Electric Co., supra, we rejected "the Board's position that it does not have to review the documentary evidence" stating that this position is "an abdication of its responsibilities under the National Labor Relations Act." (P. 584). This is the position of our Court stated in Prestolite and Curtis Noll as well.
11
I would not enforce this principle in the present case, however, because the company's arguments are insubstantial and in most instances frivolous. Its argument that remarks by the Board's agent during the election interfered with the election process and its claim that the Union made misrepresentations concerning its constitution and bylaws are to my mind frivolous. I do not see anything in the briefs or in the record that makes out a colorable claim. If the situation were otherwise, however, and the case presented real questions concerning the fairness of the representation proceeding, I cannot at the present time see how either the Board or this Court could review the fairness of the election without having before us the documentary evidence on which the Regional Director based his decision. In the instant case the company has used a "shotgun" approach and has failed to proffer or suggest the probability of any facts that would warrant setting the election aside under applicable legal standards. For this reason I concur in the decision of the Court that the Board was excused from enforcing its rule requiring that all documentary evidence gathered by the Regional Director be made a part of the record.
1
The contesting parties in the election were respectively the Retail Clerks International Union, AFL-CIO (the Union) and the Independent Furniture Workers of the Ohio Valley or Tri-State Area (the Intervenor)
|
211 Ga. App. 840 (1994)
440 S.E.2d 727
BURTTS
v.
THE STATE.
A93A2253.
Court of Appeals of Georgia.
Decided February 4, 1994.
*842 Manning & Leipold, Calvin A. Leipold, Jr., for appellant.
Cheryl F. Custer, District Attorney, Alan S. Clarke, Assistant District Attorney, for appellee.
BEASLEY, Presiding Judge.
Appellant was charged by accusation of driving under the influence of alcohol and failure to use a seat belt. The court denied a motion to suppress/motion in limine which alleged illegality of his arrest. Pursuant to Mims v. State, 201 Ga. App. 277, 278 (1) (410 SE2d 824) (1991), the court permitted a plea of guilty with a preservation of his right to appeal the ruling on the motion.
The trial court found that in March 1993 a trooper stopped appellant's 1979 vehicle because it had a drive-out license plate rather than a regular license plate. His policy is to stop all used vehicles with drive-out license plates to see if they have proper registration and whether they have properly applied to purchase a license plate. Appellant produced the required paperwork to show that he had just purchased the vehicle. He was arrested for driving under the influence of alcohol based on Lloyd's observations of him after he was stopped. The court held that the investigatory stop was lawful and denied the motion, having concluded that a drive-out license plate is only an advertisement for a car dealership and has no more legal authority than no license plate at all.
Appellant argues that OCGA § 40-2-20 (a) gives the purchaser of a motor vehicle which does not have a current and valid Georgia registration 21 days from the date of purchase within which to register and obtain a license to operate it. Although true, it does not mean that if a person operates a motor vehicle within the 21-day grace period without a valid license plate, he is exempt from an investigative stop.
OCGA § 40-2-8 (b) provides, "It shall be a misdemeanor to operate any vehicle required to be registered in the State of Georgia without a valid numbered license plate properly validated; provided, however, that the purchaser of a new vehicle or a vehicle which does not have a current and valid registration or a used vehicle may operate such vehicle on the public highways and streets of this state without a current valid license plate during the 21 day period within which the purchaser is required by Code Section 40-2-20 to register or transfer the registration of such vehicle and provided, further, that the purchaser *841 and operator of a vehicle shall not be subject to the penalties set forth in this Code section during the period allowed for the registration or transfer of registration. If the owner of such vehicle presents evidence that such owner has properly applied for the registration of such vehicle, but that the license plate or revalidation decal has not been delivered to such owner, then the owner shall not be subject to the above penalties." This contemplates that the driver of a newly purchased vehicle may be stopped by police because the vehicle does not exhibit a valid numbered license plate, although the driver may have a defense because the grace period allowed for registration has not expired. About the only way to determine whether the period has expired is to stop the vehicle and inquire; the proof is documentary, not visible without a stop. There is no display of authorization visible externally as there is with dated state-issued plates and decals. In the latter instance, there is no need for a stop.
In Wilder v. State, 192 Ga. App. 891 (386 SE2d 685) (1989), a vehicle was stopped because it had no visible valid license plate but only a rental agency paper drive-out tag. The stop was deemed authorized under OCGA § 40-2-8 for operation without a license tag.
Investigative stops of vehicles are analogous to Terry-stops and are invalid if based upon only an unparticularized suspicion or hunch, or mere caprice or inclination. Jorgensen v. State, 207 Ga. App. 545, 546 (428 SE2d 440) (1993). The stop in Jorgensen was unlawful even though appellant was driving a car with a dealer's drive-out tag, because he was stopped for other reasons which did not give rise to articulable suspicion. On the other hand, in Watson v. State, 190 Ga. App. 696 (379 SE2d 817) (1989), a police officer stopped an automobile with a dealer drive-out tag because the police had experienced high theft rates among cars with dealer drive-out tags. The suspicion engendered by the drive-out tag was more than an unparticularized suspicion or hunch; it was an objective manifestation that the person stopped might be engaged in criminal activity.
Burtts was driving a vehicle which was stopped because it appeared to be a used car without a valid license plate and only a dealer's drive-out tag. The stop was based upon articulable suspicion of illegal operation, there being no visible manifestation that the 21-day period had not expired; it was thus lawful. "`"We have repeatedly held that an authorized officer may stop an automobile and conduct a limited investigative inquiry of its occupants, without probable cause, if he has `reasonable grounds' for such action `a founded suspicion is all that is necessary, some basis from which the court can determine that the detention was not arbitrary or harassing.' (Cit.)" (Cit.)' [Cit.]" Coley v. State, 177 Ga. App. 669, 670 (1) (841 SE2d 9) (1986).
Judgment affirmed. Cooper and Smith, JJ., concur.
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|
10 Ill. App.2d 335 (1956)
134 N.E.2d 671
Alice Jonkman, Appellee,
v.
George Singletary, Appellant.
Gen. No. 46,764.
Illinois Appellate Court First District, First Division.
May 7, 1956.
Released for publication June 12, 1956.
*336 Wyatt Jacobs, for appellant.
Joseph B. Lederleitner, of counsel.
Fischer, Bosgraf & MacKenzie, for appellee.
John J. Kennelly, of counsel.
(Abstract of Decision.)
Opinion by PRESIDING JUSTICE FRIEND.
Order reversed and cause remanded with directions.
Not to be published in full.
|
623 F.Supp. 96 (1985)
Beatrice HENSMAN, Plaintiff,
v.
ADAMS COUNTY DEPARTMENT OF SOCIAL SERVICES; Board of County Commissioners of Adams County, on its own behalf and on behalf of the Adams County Board of Social Services; Colorado Department of Social Services; and the Colorado State Board of Social Services, Defendants.
Civ. A. No. 85-K-1955.
United States District Court, D. Colorado.
December 12, 1985.
*97 William E. Benjamin, Boulder, Colo., for plaintiff.
Richard D. Greengard, Greengard & Senter, Denver, Colo., for Adams Co.
Cathy S. Harris, Hall & Evans, Kathy Stumm, Asst. Atty. Gen., Denver, Colo., for State of Colorado.
MEMORANDUM OPINION AND ORDER
KANE, District Judge.
Plaintiff brings this action against defendants based on the Age Discrimination in Employment Act (ADEA), 29 U.S.C. §§ 621-34, and the Equal Pay Act, 29 U.S.C. § 206. Plaintiff also asserts pendent state claims including violations of the Colorado age discrimination statute, Colo. Rev.Stat. § 8-2-116, and breach of contract. Defendants move to dismiss plaintiff's pendent claims. For the following reasons, I grant defendants' motions.
I
When deciding whether to exercise pendent jurisdiction, I must determine if I have the constitutional power to exercise such jurisdiction. That power exists when there is a substantial federal claim and when both the federal and state claim arise from a common nucleus of operative fact. United Mine Workers of America v. Gibbs, 383 U.S. 715, 725, 86 S.Ct. 1130, 1138, 16 L.Ed.2d 218 (1966). I also must examine the posture in which the nonfederal claim is asserted and the specific statute on which federal jurisdiction is predicated "in order to determine whether `Congress in [that statute] has ... expressly or by implication negated' the exercise of jurisdiction over the particular nonfederal claim." Owen Equipment & Erection Co. v. Kroger, 437 U.S. 365, 373, 98 S.Ct. 2396, 2402, 57 L.Ed.2d 274 (1978) (quoting Aldinger v. Howard, 427 U.S. 1, 18, 96 S.Ct. 2413, 2422, 49 L.Ed.2d 276 (1976)). Even if I have jurisdiction over a nonfederal claim, I must exercise my discretion in determining whether to accept the claim. I should reject a nonfederal claim: (1) when considerations of judicial economy, convenience and fairness to litigants are not present; (2) when a surer-footed reading of applicable state law can be obtained in state court; (3) when state issues predominate in terms of proof, scope of issues raised, or comprehensiveness of remedies sought; or (4) when divergent legal theories of relief are likely to cause jury confusion. Id. 383 U.S. at 726-27, 86 S.Ct. at 1139.
In Pascoe v. Hoyle Lowdermilk, Inc., 614 F.Supp. 546 (D.Colo.1985), the plaintiffs brought an action based on the ADEA and also asserted pendent state claims. I held that, under the Gibbs test, I had constitutional jurisdiction to hear the state claims. Id. I determined, however, that Congress intended to limit the scope of remedies under the ADEA to those specifically enumerated in the statute. Therefore, Congress impliedly negated the exercise of jurisdiction over the state claims. Id. at 547-48. In addition, I found that the state issues would predominate in terms of comprehensiveness of the remedy sought, and that there was a real likelihood of jury confusion in treating the divergent legal theories of relief. Id. at 548. See also DiRito v. Ideal Basic Industries, Inc., 617 F.Supp. 79, 81 (D.Colo.1985) (Kane, J.); Silver v. St. Luke's Hospital, Inc., No. 84-M-2046, slip op. at 4 (D.Colo. May 3, 1985) (Matsch, J.); Borumka v. Rocky Mountain Hospital & Medical Service, 599 F.Supp. 857, 860 (D.Colo.1984) (Moore, J.); Ritter v. Colorado Interstate Gas Co., 593 F.Supp. 1279 (D.Colo.1984) (Carrigan, J.); Hannon v. Continental National Bank, 427 F.Supp. 215, 218 (D.Colo.1977) (Finesilver, J.). Accordingly, I decline to exercise jurisdiction over plaintiff's state claims insofar as they are pendent to her ADEA claim.[1] Thus, I must determine whether to exercise *98 jurisdiction over plaintiff's state claims insofar as they are pendent to her Equal Pay Act claim.
II
Plaintiff seeks numerous remedies under her state claims, including exemplary damages and damages for emotional distress. Congress, however, has expressly limited damages under the Equal Pay Act to back pay, liquidated damages, a reasonable attorney's fee and costs of the action. 29 U.S.C. § 216(b).[2] Adjudication of plaintiff's state claims would circumvent the scope of remedies available under the Equal Pay Act. Therefore, Congress has impliedly negated the exercise of jurisdiction over plaintiff's state claims insofar as they are pendent to her Equal Pay Act claim. See Gerlach v. Michigan Bell Telephone Co., 448 F.Supp. 1168, 1173 (E.D. Mich.1978).
Even if I have jurisdiction over plaintiff's state claims, in the exercise of discretion I refuse to hear such claims insofar as they are pendent to her Equal Pay Act claim. I find that: (1) a surer-footed reading of the applicable state law can be obtained in state court; (2) the state issues would predominate in terms of comprehensiveness of remedies sought; and (3) there is a real likelihood of jury confusion in treating the divergent legal theories of relief. These findings far outweigh any considerations of judicial economy, convenience and fairness to litigants which might favor trial of the claims together.
For the above reasons, defendants' motions to dismiss plaintiff's pendent state claims are granted. This action will proceed only on plaintiff's claims under the ADEA and the Equal Pay Act.
IT IS THEREFORE ORDERED that plaintiff's third and fourth claims for relief are dismissed without prejudice.
NOTES
[1] In DiRito v. Ideal Basic Industries, Inc., 617 F.Supp. 79, the plaintiff's state claims included violations of the Colorado age discrimination statute, Colo.Rev.Stat. § 8-2-116. In Pascoe v. Hoyle Lowdermilk, Inc., 614 F.Supp. 546, the plaintiffs' state claims included breach of contract.
[2] 29 U.S.C. § 216(b) provides:
"Any employer who violates the provisions of section 206 or section 207 of this title shall be liable to the employee or employees affected in the amount of their unpaid minimum wages, or their unpaid overtime compensation, as the case may be, and in an additional equal amount as liquidated damages.... The court in such action shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow a reasonable attorney's fee to be paid by the defendant, and costs of the action."
|
Opinions of the United
2004 Decisions States Court of Appeals
for the Third Circuit
2-18-2004
In Re: Diet Drugs
Precedential or Non-Precedential: Non-Precedential
Docket No. 02-4613
Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2004
Recommended Citation
"In Re: Diet Drugs " (2004). 2004 Decisions. Paper 1002.
http://digitalcommons.law.villanova.edu/thirdcircuit_2004/1002
This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova
University School of Law Digital Repository. It has been accepted for inclusion in 2004 Decisions by an authorized administrator of Villanova
University School of Law Digital Repository. For more information, please contact [email protected].
NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
Nos. 02-4613, 02-4616 and 03-1006
IN RE: DIET DRUGS (PHENTERMINE/
FENFLURAMINE/DEXFENFLURAMINE)
PRODUCTS LIABILITY LITIGATION
Class Members, each of whom is
a member of the Plaintiff Class,
Appellant (02-4613)
IN RE: DIET DRUGS (PHENTERMINE/
FENFLURAMINE/DEXFENFLURAMINE)
PRODUCTS LIABILITY LITIGATION
Williams Bailey Law Firm, LLP;
Blizzard, McCarthy & Nabers, L.L.P.
and Curran & Byrne, P.C., on behalf
of their clients who are Objectors
to and class members affected by
Pretrial Order No. 2663,
Appellants (02-4616)
IN RE: DIET DRUGS (PHENTERMINE/
FENFLURAMINE/DEXFENFLURAMINE)
PRODUCTS LIABILITY LITIGATION
Fleming & Associates, L.L.P.,
on behalf of its clients subject
to the suspension of Fund A and/or
Fund B processing deadlines,
Appellant (03-1006)
Appeal from the United States District Court
for the Eastern District of Pennsylvania
(MDL No. 1203)
District Judge: Honorable Harvey Bartle, III
Argued December 10, 2003
Before: AMBRO, FUENTES and CHERTOFF, Circuit Judges
(Filed February 18, 2004)
Thomas E. Mellon, Jr., Esq.
Stephen A. Corr, Esq.
Mellon, Webster & Mellon
87 North Broad Street
Doylestown, PA 18901
Attorneys for Appellant
Class Members, Plaintiff Class
Robert E. J. Curran, Esq.
Curran & Byrne
606 East Baltimore Pike
P.O. Box 30
Media, PA 19063
Attorney for Appellants
William Bailey Law Firm, LLP
Blizzard, McCarthy & Nabers, LLP
Curran & Bryne PC
2
Sylvia Davidow, Esq.
George M. Fleming, Esq.
Rand P. Nolen, Esq.
Fleming & Associates
1330 Post Oak Boulevard
Suite 3030
Houston, TX 77056
Michael L. O’Brien, Esq.
1330 Post Oak Boulevard
Suite 2900
Houston, TX 77056
Attorneys for Appellant
Fleming & Associates
Jonathan Massey, P.C., Esq. (Argued)
3920 Northampton Street N.W.
Washington, D.C. 20015
Attorney for Appellants
Consolidated Brief
Fred S. Longer, Esq.
Arnold Levin, Esq.
Michael D. Fishbein, Esq. (Argued)
Levin, Fishbein, Sedran & Berman
510 Walnut Street
Suite 500
Philadelphia, PA 19106
Attorneys for Appellees
Plaintiff Class and Class Counsel
Robert D. Rosenbaum, Esq.
Arnold & Porter
555 12 th Street, N. W.
Washington, D.C. 20004
Peter L. Zimroth, Esq. (Argued)
3
Arnold & Porter
399 Park Avenue
New York, NY 10022-4690
Attorneys for Appellee
American Home Products Corporation
Andrew A. Chirls, Esq. (Argued)
Abbe F. Fletman, Esq.
Deena B. Beard, Esq.
Wolf, Block, Schoor & Solis-Cohen
1650 Arch Street, 22nd Floor
Philadelphia, PA 19103
Attorneys for Appellee
AHP Settlement Trust
OPINION
AM BRO, Circuit Judge
Class members who had previously settled their mass tort class actions appeal the
District Court’s Pretrial Order No. 2663 (PTO 2663) suspending claim processing
deadlines contained in a court-approved settlement agreement. Because we conclude that
the District Court acted within its discretion, we affirm.
I. Factual Background
The original class action involved two diet drugs of American Home Products
Corporation (“AHP”), 1 Pondimin and Redux (fenfluramine and dexfenfluramine,
1
AHP changed its name to Wyeth in March 2002.
4
respectively). Approximately four million people took Pondimin and two million took
Redux before AHP removed the diet drugs from the market in 1997 after they were found
to be associated with valvular heart disease (“VHD”). In November 1999, plaintiffs and
AHP executed the Nationwide Class Action Settlement Agreement (the “Settlement
Agreement”). 2
The Settlement Agreement created two separate funds. A smaller fund (Fund A)
was to pay for echocardiogram screening costs, additional medical services to monitor
VHD, and reimbursement of diet drug prescriptions. A larger one (Fund B) was created
to compensate class members for their injuries. In September 2000, the AHP Settlement
Trust (the “Trust”) was created to administer the claims and payments of benefits to class
members.
The Settlement Agreement prescribes certain time periods within which the Trust’s
various claims processing functions must be completed. For example, the Trust has 30
days from the receipt of a claim for assigning a claim number and notifying the claimant
of that number, determining whether the claimant needs to submit additional information
and informing the claimant of it, and confirming the qualifications of any attesting
physician. Furthermore, the Trust must, within 45 days from receiving a completed
claim, determine whether the claimant is eligible for various benefits under the Settlement
2
Final judicial approval of the Settlement Agreement was granted on January 3, 2003.
5
Agreement. The Trust was unable to meet these deadlines.
The Settlement Agreement also provides that “[a]t any time, the Court may extend
any [relevant] time period for good cause shown upon application by the Parties,
Trustees, Claims Administrators(s), . . . , after notice to AHP and Class Counsel.” Based
on this provision, the Trust moved the District Court for suspension of processing
deadlines. The Trust claimed that it could not meet the deadlines because it experienced
an unexpectedly high volume of claims. It also argued that it was overwhelmed with
claims that lacked essential information such as claimants’ names, signatures, or
allegations of diet drug use.3 On December 3, 2002, upon finding that the Trust showed
good cause for the delay, the District Court, in PTO 2663, suspended deadlines for five
months. 4 The District Court noted that the deadlines would be automatically reinstated on
May 1, 2003. Class members appeal the District Court’s order.
II. Jurisdiction
The Trust challenges our jurisdiction, arguing that the District Court’s order is not
final under 28 U.S.C. § 1291. We disagree. While hardly every pretrial order in the Diet
Drug cases is final, this one is.
The only issue before the District Court was whether the Trust was allowed to
extend deadlines for processing claims. Contrary to the Trust’s suggestion, claims for
3
For example, the Trust asserts it received approximately 27,000 deficient claims for a
short time period in the late summer of 2002.
4
The deadlines have twice been extended further.
6
settlement benefits are not in dispute and no other order merges with PTO 2663. As there
are no other issues left to be disposed, appeal of the District Court’s order would not
result in delay. See Bachowski v. Usery, 545 F.2d 363, 368 (3d Cir. 1976) (“The hostility
towards piecemeal appeals expressed by the final judgment rule has a strong basis in logic
and practicality. Forbidding appeals from all interlocutory judgments of the district
courts achieves significant savings in time and resources on the part of litigants and
courts. This is so since if litigation proceeds, the intermediate ruling may lose its
significance . . . .”) (citing Radio Station WOW, Inc. v. Johnson, 326 U.S. 120, 123-24
(1945); 15 C. Wright, A. M iller & E. Cooper, Federal Practice and Procedure § 3907
(1976)). In sum, the order in question was as final as it gets; it was the determination of
the only issue that was before the District Court and, therefore, is appealable under
§1291.5
III. Standard of Review
When the “[s]tipulation [of the parties] places into the District Court’s jurisdiction
ongoing authority over the Settlement, . . . with that comes the discretion necessary to
exercise jurisdiction.” In re Cendant Corp. Prides Litigation, 233 F.3d 188, 194 (3d Cir.
5
Although the District Court’s order expired on May 1, 2003, this case falls under an
exception to the mootness doctrine, which is applicable to “cases challenging ‘short term
orders, capable of repetition, yet evading review.’” Finberg v. Sullivan, 634 F.2d 50, 55
(3d Cir. 1980) (quoting Southern Pacific Terminal Co. v. ICC, 219 U.S. 498, 515 (1911)).
Indeed the further extension of deadlines makes the case for this exception. On
December 19, 2003, the District Court ordered the suspension of deadlines for the third
time – until February 29, 2004.
7
2000). In this case, the Settlement Agreement provides that “the Court may extend any
[relevant] time period for good cause shown upon application by the Parties, Trustees,
Claims Administrators(s) . . . .” Thus, we review the District Court’s order
to extend the deadlines for abuse of discretion. Our review of the admissibility of
evidence is also for abuse of discretion. In re Merritt Logan, Inc., 901 F.2d 349, 359 (3d
Cir. 1990).
VI. Discussion
A.
Class members argue that the Trust did not show good cause to extend the time
period. They contend that the District Court impermissibly rewrote the Settlement
Agreement by finding good cause for the delay and ordering suspension of deadlines. We
disagree.
The District Court concluded that good cause was shown for extension of
deadlines because it found that the delay resulted from unforeseen factors. The Court
first noted that the Trust received an unexpectedly high number of claims, far out of
proportion with the projections on which the Settlement Agreement was based. The
District Court also pointed out that tens of thousands of incomplete claim forms were
filed, which also contributed to the significant delay in processing time.
Class members do not dispute any pertinent findings by the District Court.
However, they assert that the claims processing delay was also due to the incompetence
8
of a contractor the Trust hired. Thus they contend that the District Court erred because it
did not in its order mention the fact that the Trust itself also contributed to the delay.
Because our review is for abuse of discretion, we will reverse if “the district
court’s decision rests upon a clearly erroneous finding of fact, an errant conclusion of
law, or an improper application of law to fact.” Int’l Union, United Auto., Aerospace and
Agric. Implement Workers of Am., UAW v. Mack Trucks, Inc., 820 F.2d 91, 95 (3d Cir.
1987) (citing Int’l Olympic Comm. v. San Francisco Arts & Athletics, 781 F.2d 733, 738
(9th Cir. 1986)). “A finding of fact is clearly erroneous when, after reviewing the
evidence, the court of appeals is ‘left with a definite and firm conviction that a mistake
has been committed.’” Oberti by Oberti v. Bd. of Educ. of Borough of Clementon School
Dist., 995 F.2d 1204, 1220 (3d Cir. 1993) (quoting Anderson v. Bessemer City, 470 U.S.
564, 573 (1985)). In this case, the record indicates that incompetence of the Trust’s
contractor did contribute to the delay to some extent. However, the record also supports
the finding that the unexpected high number of claims was a major cause for the delay.
Morever, the District Court did not find that the large number of claims was the only
cause for the delay. It determined that the delay was “at least in part” the result of
unforeseen factors not specifically noted. Not listing them, while not helpful, need not
destroy our deference to discretion well exercised for the reason noted.
In In re Cendant Corp. Prides Litigation, we determined that “where the parties
affirmatively subjected themselves to the Court’s jurisdiction by seeking its assistance in
9
administering the settlement and deliberately left the important dates to the Court’s
discretion,” the District Court “had the power to modify the terms of the Stipulation
originally set by the Court . . . .” 233 F.3d at 197. Likewise, class members in this case
affirmatively subjected themselves to the Court's discretion by leaving the determination
of what is good cause to the Court instead of defining it themselves. Given that we do not
find any clear error in the District Court’s expressed findings, we conclude that it acted
within its discretion when it found good cause for the suspension of the deadlines.
B.
Class members also challenge the District Court’s ruling regarding the admission
of evidence. Invoking Federal Rule of Evidence Rule 1006,6 they argue that the Trust’s
summary of data was impermissibly admitted because they were not given access to the
original database.
It is well established that “[t]he admission or exclusion of evidence is a matter
particularly suited to the broad discretion of the trial judge.” In re Merritt Logan, 901
F.2d at 359. The summary in dispute was only relevant to this case in that it contained
6
The Rule reads:
Rule 1006. Summaries
The contents of voluminous writings, recordings, or photographs which cannot
conveniently be examined in court may be presented in the form of a chart,
summary, or calculation. The originals, or duplicates, shall be made available for
examination or copying, or both, by other parties at reasonable time and place. The
court may order that they be produced in court.
10
information about how many claims the Trust received and thereby established that a lot
more claims were filed than the Trust had anticipated. Moreover, the record shows that
class members conceded during the hearing that they were not disputing the number of
claims the Trust received. Given the broad discretion accorded the District Court to
admit or exclude evidence, we conclude that it did not abuse its discretion in admitting
the summary evidence.
* * * * *
Accordingly, we affirm the District Court’s PTO 2663.
11
|
Court of Appeals
of the State of Georgia
ATLANTA, March 29, 2017
The Court of Appeals hereby passes the following order
A17A0772. SHANIKA MCGRONE v. THE STATE.
The appellant in this case failed to comply with the notice of docketing mailed by this
Court and with Court of Appeals Rules 22 (a) and 23 (a), regarding the filing of an enumeration
of errors and brief within twenty days after the appeal was docketed. See also Court of Appeals
Rule 13.
On February 15, 2017, this Court ordered the appellant to file an enumeration of errors
and a brief no later than February 27, 2017. As of the date of this order, the appellant's
enumeration of errors and brief still have not been filed. Accordingly, this appeal is deemed
abandoned and is hereby ordered DISMISSED. Court of Appeals Rules 7, 23 (a).
Because procedural deficiencies have deprived the appellant of the right of appellate
review, the appellant is hereby informed of the following in accordance with Rowland v. State,
264 Ga. 872 (452 SE2d 756) (1995):
This Court has dismissed your appeal because an enumeration of errors and a
brief have not been filed on your behalf as required. If this failure occurred while
you were represented by legal counsel and was due to your appellate counsel's
failure to perform the duties of appellate counsel, and if you still wish to appeal,
you may file a motion in the trial court for permission to pursue an out-of-time
appeal. If the trial court grants your motion for an out-of-time appeal, you will
have 30 days from the filing date of the order granting your motion to file in the
trial court a notice of appeal from the judgment of conviction and sentence. If the
trial court denies your motion for an out-of-time appeal, you will have 30 days
from the filing date of the order denying your motion to file in the trial court a
notice of appeal from that order.
The Clerk of Court is directed to send a copy of this order to the appellant as well as to
the appellant's attorney of record, if any. The appellant's attorney is also directed to send a copy
of this order to the appellant.
Court of Appeals of the State of Georgia
Clerk's Office, Atlanta, March 29, 2017.
I certify that the above is a true extract from the minutes
of the Court of Appeals of Georgia.
Witness my signature and the seal of said court hereto
affixed the day and year last above written.
, Clerk.
|
896 F.2d 552
Reimerv.Holmes*
NO. 89-2325
United States Court of Appeals,Fifth Circuit.
FEB 09, 1990
1
Appeal From: S.D.Tex.
2
AFFIRMED.
*
Fed.R.App.P. 34(a); 5th Cir.R. 34.2
|
STATE OF WEST VIRGINIA
FILED
SUPREME COURT OF APPEALS November 4, 2015
RORY L. PERRY II, CLERK
SUPREME COURT OF APPEALS
VERNON MARCUM, OF WEST VIRGINIA
Claimant Below, Petitioner
vs.) No. 15-0143 (BOR Appeal No. 2049686)
(Claim No. 2013004984)
CONSTELLIUM ROLLED PRODUCTS RAVENSWOOD,
Employer Below, Respondent
MEMORANDUM DECISION
Petitioner Vernon Marcum, by Edwin Pancake, his attorney, appeals the decision of the
West Virginia Workers’ Compensation Board of Review. Constellium Rolled Products
Ravenswood, by James Heslep, its attorney, filed a timely response.
This appeal arises from the Board of Review’s Final Order dated January 16, 2015, in
which the Board reversed a July 23, 2014, Order of the Workers’ Compensation Office of
Judges. The Board of Review reinstated a December 13, 2012, claims administrator’s decision
finding that Mr. Marcum met the requirements for filing an occupational pneumoconiosis claim
but modified the claims administrator’s decision to reflect that Mr. Marcum’s date of last
exposure to the hazards of occupational pneumoconiosis was June 30, 1991. In its Order, the
Office of Judges modified the claims administrator’s December 13, 2012, decision to reflect that
Mr. Marcum’s date of last exposure to the hazards of occupational pneumoconiosis was August
31, 1999. In its December 13, 2012, decision, the claims administrator determined that Mr.
Marcum’s date of last exposure to the hazards of occupational pneumoconiosis was October 30,
1990. The Court has carefully reviewed the records, written arguments, and appendices
contained in the briefs, and the case is mature for consideration.
This Court has considered the parties’ briefs and the record on appeal. The facts and legal
arguments are adequately presented, and the decisional process would not be significantly aided
by oral argument. Upon consideration of the standard of review, the briefs, and the record
presented, the Court finds no substantial question of law and no prejudicial error. For these
reasons, a memorandum decision is appropriate under Rule 21 of the Rules of Appellate
Procedure.
1
Mr. Marcum filed an application for workers’ compensation benefits alleging that he
developed occupational pneumoconiosis as a result of exposure to occupational dust hazards in
the course of his employment as a maintenance foreman with Constellium Rolled Products. Mr.
Marcum was employed by Constellium Rolled Products from 1987 until his retirement on
September 1, 1999. On December 13, 2012, the claims administrator held Mr. Marcum’s claim
compensable for occupational pneumoconiosis after determining that he met the requirements for
filing an occupational pneumoconiosis claim, that he was entitled to the benefit of the statutory
presumption enumerated within West Virginia Code § 23-4-8c(b) (2009), and fixed Mr.
Marcum’s date of last exposure to the hazards of occupational pneumoconiosis as October 30,
1990.
On August 13, 2013, Mr. Marcum was deposed. He testified that while employed as a
maintenance foreman with Constellium Rolled Products, he was exposed to significant
occupational dust hazards on a daily basis. Mr. Marcum further testified that he spent a large
portion of his time in the “Hot Line” area of the plant, but went on to state that the nature of his
employment frequently required him to move between various sections of the plant.
On March 13, 2014, Mike Merrifield, a Certified Industrial Hygienist employed by
Constellium Rolled Products, authored an affidavit. Mr. Merrifield’s affidavit covers the time
period from October 31, 1990, through the date of Mr. Marcum’s retirement, namely September
1, 1999. Mr. Merrifield noted that the nature of Mr. Marcum’s employment within the
maintenance department required that he perform work in several different areas of the plant, and
he therefore included an analysis of data obtained from the “Fabrication West”, “Hot Rolling”,
“Scalping”, “Plate”, and maintenance departments. Mr. Merrifield stated that the Occupational
Safety and Health Administration (hereinafter “OSHA”) performed a comprehensive inspection
at Constellium Rolled Products from June of 1991 through October of 1991, with OSHA finding
no evidence of occupational dust hazards associated with any of the departments referenced
within the affidavit. Mr. Merrifield further stated that Constellium Rolled Products performs
inspections and monitors dust and fiber levels using a standard National Institute for
Occupational Safety and Health methodology under a well-documented chain of custody
protocol. He stated that the principal of representative sampling, which is sanctioned and
mandated by OSHA, was used to extrapolate data for the entire time period covered by the
affidavit. Mr. Merrifield further stated that the sampling data revealed average concentrations of
hazardous substances so far below recognized exposure limits for the substances in question that
Mr. Marcum was not exposed to any abnormal, harmful, or hazardous quantities of dust or any
other substance during the time period covered by the affidavit. Finally, Mr. Merrifield stated
that based upon his investigation of the work environment in the departments referenced in the
affidavit; the results of dust level sampling; and his own personal observations, experiences, and
training as an industrial hygienist, Mr. Marcum was not exposed to any abnormal, excessive, or
harmful quantities of dust or any other substance after October 30, 1990.
In its Order modifying the December 13, 2012, claims administrator’s decision, the
Office of Judges held that Mr. Marcum’s proper date of last exposure to the hazards of
occupational pneumoconiosis is August 31, 1999. The Board of Review reversed the Order of
the Office of Judges and reinstated the December 13, 2012, claims administrator’s decision but
2
modified Mr. Marcum’s date of last exposure to the hazards of occupational pneumoconiosis to
June 30, 1991. On appeal, Mr. Marcum asserts that the evidence of record demonstrates that he
was exposed to the hazards of occupational pneumoconiosis until his last date of employment
prior to his retirement, namely August 31, 1999.
The sole issue in the instant appeal concerns the identification of the proper date of Mr.
Marcum’s last exposure to the hazards of occupational pneumoconiosis. West Virginia Code of
State Rules § 85-20-52.2 (2006) states:
If the employer submits credible evidence demonstrating that it has
been in compliance with OSHA and/or MSHA permissible
exposure levels, as determined by sampling and testing performed
in compliance with OSHA and/or MSHA regulations for the dust
alleged by the injured worker, then the Commission, Insurance
Commissioner, private carrier or self-insured employer, whichever
is applicable, may consider that the dust exposure alleged by the
injured worker does not suffice to satisfy the exposure
requirements of W. Va. Code §§23-4-1(b) and 23-4-15(b) only for
the period(s) covered by the sampling or testing. In order for the
evidence to be deemed credible, it must be based upon regularly
scheduled exposure samples from each work area where harmful
exposure has been alleged, which samples will be obtained by
certified industrial hygienists as defined by OSHA and/or MSHA
regulations or government agencies, and the samplings must be
obtained during the period for which the employer is seeking to
avoid chargeability.
The Office of Judges noted that Mr. Marcum testified that he performed a large portion of
work in the “Hot Line” area of the plant and therefore only considered the data from Mr.
Merrifield’s affidavit obtained from that area of the plant. The Office of Judges concluded that
the sampling data submitted in conjunction with Mr. Merrifield’s report is not extensive and
specific enough to Mr. Marcum’s work area to meet the requirements contained within West
Virginia Code of State Rules § 85-20-52.2. Further, the Office of Judges found that Mr.
Marcum’s deposition testimony is sufficient to demonstrate that he was exposed to occupational
dust hazards until the date of his retirement, and therefore determined that his proper date of last
exposure is August 31, 1999.
In its Order reversing the decision of the Office of Judges, the Board of Review took note
of Mr. Merrifield’s conclusion that Mr. Marcum was not exposed to occupational dust hazards
after October 30, 1990. However, the Board of Review found that Mr. Merrifield’s affidavit did
not provide any information regarding Mr. Marcum’s exposure to occupational dust hazards
from October 31, 1990, through June of 1991. The Board of Review then determined that when
considering the evidentiary record and the principal of representative sampling, Constellium
Rolled Products was in compliance with OSHA permissible exposure levels for respirable dust
hazards from July 1, 1991, pursuant to the OSHA comprehensive inspection beginning in June of
3
1991, until Mr. Marcum’s retirement on September 1, 1999. The Board of Review then
concluded that Mr. Marcum’s proper date of last exposure is June 30, 1991.
We agree with the reasoning and conclusions set forth by the Board of Review. Although
Mr. Marcum testified that he was exposed to the hazards of occupational pneumoconiosis until
the date of his retirement, Mr. Merrifield’s affidavit establishes that Mr. Marcum was not
exposed to the hazards of occupational pneumoconiosis throughout the entirety of his
employment with Constellium Rolled Products. Mr. Merrifield’s affidavit establishes that air
quality sampling was performed in compliance with all OSHA regulations and was conducted
using a methodology approved by the National Institute for Occupational Safety and Health. The
results of the sampling reveal that Mr. Marcum was not exposed to the hazards of occupational
pneumoconiosis after June 30, 1991.
For the foregoing reasons, we find that the decision of the Board of Review is not in clear
violation of any constitutional or statutory provision, nor is it clearly the result of erroneous
conclusions of law, nor is it based upon a material misstatement or mischaracterization of the
evidentiary record. Therefore, the decision of the Board of Review is affirmed.
Affirmed.
ISSUED: November 4, 2015
CONCURRED IN BY:
Chief Justice Margaret L. Workman
Justice Robin J. Davis
Justice Brent D. Benjamin
Justice Menis E. Ketchum
Justice Allen H. Loughry II
4
|
419 Pa. 559 (1966)
Schwartz
v.
Schwartz, Appellant.
Supreme Court of Pennsylvania.
Argued November 9, 1965.
January 4, 1966.
Before BELL, C.J., MUSMANNO, JONES, COHEN, EAGEN, O'BRIEN and ROBERTS, JJ.
William Benner Farran, for appellant.
Leonard M. Sagot, with him Ettinger, Poserina, Silverman & Sagot, for appellee.
OPINION BY MR. JUSTICE JONES, January 4, 1966:
This is an appeal from a decree of the Court of Common Pleas No. 1 of Philadelphia County, which preliminarily *560 restrained one defendant from withdrawing or using, until final hearing, any funds on deposit with the other defendant, the Grand Union Savings and Loan Association (Association).
Barbara Eve Schwartz filed this equity action against her mother, Bertha Schwartz, and the Association, seeking to establish her title to and ownership of a certain savings account held by the Association and entitled "Bertha Schwartz in trust for Barbara Schwartz."
At the hearing on the rule for a preliminary injunction, the sole testimony was that of Barbara Eve Schwartz who testified: that in 1948, when she was then six years of age, her mother, Bertha Schwartz, took her to the Association's place of business and her mother deposited $22 in an account, stating that she was opening a savings account for her; that various sums which were received by her from relatives on her birthdays, holidays and at graduation time were the source of other deposits; that, on one occasion, she deposited the sum of $1,000 in this account which money she had received from her grandmother; that she had accumulated savings of $900 which she had deposited in an account in the Philadelphia Savings Fund Society, and she transferred the moneys in that account to the account in question; that the only withdrawal was in the amount of $2,300 which she had loaned to her mother for use in the latter's business, a sum later repaid in installments with interest.
Counsel for Bertha Schwartz contends that Barbara Eve Schwartz has shown merely a revocable trust which belongs to the mother until her death and that the Orphans' Court has exclusive jurisdiction to determine the respective rights of the parties in the fund represented by the savings account. By suggestion filed pursuant to Pa. R.C.P. 1032(2), Bertha Schwartz questions the jurisdiction of the common pleas court in this *561 equity action. In three separate rulings the court below held that equity does have jurisdiction over the subject matter, the last of such rulings being made on February 1, 1965. On March 31, 1965 58 days after the final ruling was made Bertha Schwartz filed the present appeal.
This appeal, which has been taken under the Act of March 5, 1925, P.L. 23, 12 P.S. § 672, to obtain review of the lower court's decision that jurisdiction was not lacking as to this subject matter, must be quashed as having been taken out of time. For this reason, we need not pass on the merits of the contention that jurisdiction lies exclusively in the Orphans' Court.
The Act of 1925, supra, expressly provides that "The appeal here provided for must be taken and perfected within fifteen days from the date when the decision is rendered." As we said in Pennsylvania Coal Company v. Luzerne County, 390 Pa. 143, 145, 134 A. 2d 657: "This requirement is mandatory and admits of no exceptions: Thomas v. McLean, 365 Pa. 526, 528, 76 A. 2d 413; Jones, Admrx. v. Unguriet, 364 Pa. 200, 202, 71 A. 2d 249 . . ." "Nor is there any way by which the statutorily prescribed period for appeal may be judicially extended or obviated.": Jones v. Unguriet, supra (364 Pa. at 202).
In the case at bar, the record clearly shows that the appeal was taken and perfected more than fifteen days in fact, fifty-eight days after the decree appealed from had been entered. The appeal is, therefore, quashed.
Appeal quashed. Appellant to pay costs.
|
245 F.3d 49 (2nd Cir. 2001)
ROBERT M. ALTMAN and VICTORIA L. ALTMAN, his wife, individually and as parents of minor children, RUSSELL ALTMAN and ROSS ALTMAN; MARY ANNDIBARI, individually and as lawful guardian of minor children KRYSTAL M. DIBARI and TIANA N. DIBARI; JOSEPH M. DINOZZI and CECILE D. DINOZZI, his wife, individually and as parents of minor children, JON M. DINOZZI, DANIEL J. DINOZZI, STEVEN M. DINOZZI, and JOSEPH A. DINOZZI, Plaintiffs-Appellees-Cross-Appellants,v.BEDFORD CENTRAL SCHOOL DISTRICT; DR. BRUCE DENNIS, in his capacity as Superintendent of Schools of the Bedford Central School District and Agent/Administrator of its Board of Education; JANE DOE (name unknown, post currently vacant), in his or her capacity as Assistant Superintendent in charge of Curriculum and Instruction for the Bedford Central School District and Agent/Administrator of its Board of Education; DEBORAH TIMBERLAKE, in her capacity as President of the Board of Education of Bedford Central School District; BOARD OF EDUCATION OF THE BEDFORD CENTRAL SCHOOL DISTRICT; JAMES YOUNG, in his capacity as Principal of the Pound Ridge Elementary School; JAMES ALLOY, in his capacity as Principal of Fox Lane Middle School; and RICHARD KRAEMER, in his capacity as Principal of Fox Lane High School, Defendants-Appellants-Cross-Appellees.
Docket Nos. 99-7969(L), 99-9001
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
Argued: May 11, 2000Decided: March 27, 2001
[Copyrighted Material Omitted][Copyrighted Material Omitted][Copyrighted Material Omitted]
CHRISTOPHER A. FERRARA, Ramsey, New Jersey (James M. Bendell, American Catholic Lawyers Association, Inc., Ramsey, New Jersey, on the brief), for Plaintiffs-Appellees-Cross-Appellants.
WARREN H. RICHMOND, Northport, New York (Lawrence W. Reich, Neil M. Block, Ingerman Smith, Northport, New York, Gerald A. Rosenberg, Frances K. Brown, Stacey B. Creem, Rosenman & Colin, New York, New York, on the brief), for Defendants-Appellants-Cross-Appellees.
ELLIOT M. MINCBERG, Washington, D.C. (People for the American Way Foundation, Washington, D.C., of counsel), filed a brief on behalf of Amicus Curiae Bedford Parents, in support of defendants-appellants-cross-appellees.
JAY WORONA, Albany, New York, filed a brief on behalf of Amicus Curiae New York State School Boards Association, Inc., in support of defendants-appellants-cross-appellees.
JAMES R. SANDNER, New York, New York (Katherine A. Levine, New York, New York, of counsel), filed a brief on behalf of Amicus Curiae New York State United Teachers, in support of defendants-appellants-cross-appellees.
MARC D. STERN, New York, New York, filed a brief on behalf of Amicus Curiae American Jewish Congress, principally in support of defendants-appellants-cross-appellees.
ARTHUR N. EISENBERG, New York, New York (Beth Haroules, New York Civil Liberties Union Foundation, New York, New York, on the brief), filed a brief on behalf of Amicus Curiae New York Civil Liberties Union, principally in support of defendants-appellants-cross-appellees.
Before: WALKER, Chief Judge, KEARSE and POOLER, Circuit Judges.
Appeal from so much of a judgment of the United States District Court for the Southern District of New York, Charles L. Brieant, Judge, as declared certain school activities to be in violation of plaintiffs' rights under the Establishment and Free Exercise Clauses of the First Amendment to the Constitution, enjoined such activities, and awarded plaintiffs attorneys' fees. Cross-appeal by plaintiffs from parts of the judgment dismissing their challenges to other activities. See 45 F.Supp.2d 368 (1999).
Affirmed in part, vacated in part, and reversed in part.
KEARSE, Circuit Judge:
1
Defendants Bedford Central School District et al. ("Bedford" or "School District") appeal from so much of a final judgment of the United States District Court for the Southern District of New York, Charles L. Brieant, Judge, as (a) declared that certain school activities violated plaintiffs' rights under the Establishment and Free Exercise Clauses of the First Amendment to the United States Constitution, (b) enjoined the School District and certain of its administrators and other personnel from sponsoring or encouraging those activities, and (c) awarded attorneys' fees to plaintiffs. Following a bench trial, the district court found, to the extent pertinent to Bedford's appeal, that the Establishment and Free Exercise Clauses were violated by certain activities involving a Hindu god ("Ganesha" or "Ganesh"), "worry dolls," and celebrations of the Earth and nature. On appeal, Bedford contends principally that the court should have dismissed all challenges to activities at one of its schools because at the time of trial no plaintiff had standing to challenge those activities, and that the court erred in its application of First Amendment principles to the enjoined activities. Plaintiffs cross-appeal from other parts of the judgment, contending that the court erred in dismissing their challenges to certain other activities.
2
For the reasons that follow, we conclude principally that the judgment should be (1) vacated insofar as it dealt with activities at two schools as to which plaintiffs no longer have standing; (2) reversed insofar as it declared School District programs to violate the First Amendment, ordered the School District to issue guidelines and cease certain activities, and awarded plaintiffs attorneys' fees pursuant to 42 U.S.C. §1988 (1994 & Supp. IV 1998); and (3) affirmed to the extent that it dismissed plaintiffs' challenges to other activities.
I. BACKGROUND
3
The following description is taken principally from the district court's posttrial findings of facts and conclusions of law. Except as indicated, the facts are largely undisputed.
A. The Parties and the Present Action
4
Bedford, located in Westchester County, New York, operates public schools including the Pound Ridge Elementary School ("Pound Ridge Elementary"), the Fox Lane Middle School ("Fox Lane Middle"), and the Fox Lane High School ("Fox Lane High"). The individual defendants are School District administrators sued in their official capacities.
5
Plaintiffs are members of three families who, when the present action was commenced in 1996, were residents and/or taxpayers in the School District. Robert M. Altman and Victoria L. Altman (collectively "the Altmans") are the parents of Russell and Ross Altman. Russell had attended Pound Ridge Elementary until fifth grade; Ross had attended a Bedford elementary school until third grade. In or about 1996, the Altmans enrolled Russell and Ross instead in parochial school pending resolution of the family's criticisms of certain Bedford school activities.
6
Plaintiff Mary Ann DiBari is the grandmother and legal guardian of Krystal M. DiBari and Tiana N. DiBari. At the time of trial, Krystal attended Fox Lane High and previously had attended Fox Lane Middle. Tiana N. DiBari attended Fox Lane Middle at the time of trial and previously had attended Pound Ridge Elementary.
7
Plaintiffs Joseph M. DiNozzi and Cecile D. DiNozzi (collectively the "DiNozzis") are the parents of Jon M. DiNozzi, Daniel J. DiNozzi, Steven M. DiNozzi, and Joseph A. DiNozzi. At the time of trial, Jon attended Fox Lane High and previously had attended Pound Ridge Elementary. Daniel had previously attended Fox Lane Middle; Steven and Joseph had previously attended Pound Ridge Elementary. In 1995, the DiNozzis had removed Daniel, Steven, and Joseph from their respective public schools and sent them to parochial school pending resolution of the present controversy.
8
Plaintiffs brought the present action in October 1996 principally under 42 U.S.C. §1983, seeking injunctive relief and alleging that they are sincere practitioners of the Roman Catholic religion and that a large number of programs in the Bedford schools exposed impressionable children to activities that plaintiffs characterized as
9
(a) The promotion of satanism and occultism, pagan religions and "New Age spirituality", the latter being a religion which promotes as the goal of spiritual progress the full actualization of the human person as the godhead;
10
(b) Instruction in techniques of meditation, yoga, guided-imagery and self-hypnosis; "crystal power", use of the "right-brain" and other "self-realization" techniques;
11
(c) Psychological evaluation and treatment by means of contrived incidents for self-revelation, psychodrama, role-playing, "stress management", so-called "stress thermometers", relaxation and deep-breathing, blindfold walks, encounter groups and other techniques designed to modify human behavior or to pry into the student's innermost thoughts and family life;
12
(d) Instruction in "decision-making" by which matters of morality are reduced to a process of choosing options divorced from objective moral norms, in which process the child, not the parents or God, is the final arbiter of what is right or wrong conduct in a given situation;
13
(e) Transpersonal "affective" teaching methods by which students are subjected to "learning" intuitively by "sharing" innermost fears, dreams, likes, dislikes, aversions, failures, insecurities and the intimate details of their personal and family lives with strangers in a classroom.
14
(Amended and Supplemental Complaint ¶18.) Plaintiffs asserted principally that the challenged activities, including those described in Parts I.B. and I.C. below, violated the Establishment and Free Exercise Clauses of the First Amendment, the Fourteenth Amendment rights of plaintiff parents to raise their children as they see fit, and the Fourteenth Amendment rights of the minor plaintiffs to privacy.
15
When this action was tried in early 1999, Ross Altman was the only plaintiff who was not beyond elementary-school age. Approximately one year prior to trial, however, as discussed in Parts I.E. and II below, the Altman family had relocated to the State of Connecticut, leaving no plaintiff who attended or was eligible to attend Pound Ridge Elementary. In addition, after trial and prior to this appeal, Tiana DiBari graduated from Fox Lane Middle and the DiNozzi Family relocated to the State of Delaware. These events left no plaintiff attending or eligible to attend Fox Lane Middle.
16
B. Activities Found Impermissible by the District Court
17
Following a five-day bench trial in February and March 1999, the district court found, to the extent pertinent to Bedford's appeal, that certain aspects of four of the challenged activities, to wit, those involving Ganesha, worry dolls, Earth Day, and a "Listening to Nature" tape, violated plaintiffs' rights under the Establishment and Free Exercise Clauses of the First Amendment to the Constitution. See 45 F.Supp.2d 368 (1999). The evidence with respect to those activities was as follows.
1. Ganesha
18
During the 1992-93 school year, Pound Ridge Elementary conducted an international enrichment theme week. In one fourth-grade class, Jacqueline Reizes taught her students, who included Krystal DiBari, about India. Reizes selected India because she felt it suitable to the theme week's goal oF.Supp.lementing the curriculum with music, art, dance, and cooking. She designed an elaborate lesson plan that included instruction in the geography and culture of India, and she decorated her classroom with travel posters of India and with Indian textiles and fabrics. Classroom activities included instruction in cooking Indian food, making batik textiles and paisley designs, constructing mosaics out of beans, and replicating an Indian board game.
19
In addition, on one afternoon the class read a two-page story entitled "How Ganesh got his Elephant Head." The story described how, in a fit of anger, "SHIVA, THE MIGHTY GOD with the blue throat," who initially did not realize that Ganesha was his son, cut off Ganesha's head and then restored Ganesha to life by slaying an elephant and fitting the elephant's head on Ganesha's body. But see 45 F.Supp.2d at 383 nn.9-10 (According to legend, Ganesha was made of clay by his mother Parvati, Hindu goddess wife of Shiva. According to the Encyclopedia Britannica, Ganesha was beheaded by Shiva's attendants in battle; to ease Parvati's pain, Shiva promised to cut off the head of the first living creature he encountered--an elephant, as it happened--and join it to Ganesha's body.) Reizes displayed in her classroom a variety of signs describing Ganesha, including the following:
20
Ganesha's head was accidentally cut off when he was a child. Shiva, in a panic, replaced it with the first head he found an elephant's head.
21
Ganesha is a round bellied, good natured Hindu God. He loves to eat.
22
Those who worship Ganesha bring him gifts of fruit.
23
Ganesha is the god of wisdom and success. People pray to him before they begin important projects.
24
45 F.Supp.2d. at 383. Following the reading of the story, students constructed depictions of Ganesha. One, introduced at trial, consisted of a construction-paper representation of the head of an elephant with eyes, ears, and a trunk.
25
During the 1993-94 school year, Reizes taught a third-grade class that included Joseph DiNozzi and Tiana DiBari. In a social studies unit on India, Reizes again read the Ganesha story. She also planned for her students to construct likenesses of Ganesha out of clay; however, the class ran out of time, and that project was not begun. Reizes testified at trial that there was no religious significance in her instruction about Ganesha or about India in general and that she was not attempting to convey any religious message.
26
Plaintiffs contended that the compulsion inherent in such classroom activities violated the minor plaintiffs' Free Exercise rights. In addition, Mary Ann DiBari and plaintiffs' expert witness, Father Mitchell Pacwa, S.J., testified at trial that creating representations of Ganesha violated the Second Commandment's proscription against fashioning images of gods of other religions.
2. Worry Dolls
27
The construction of worry dolls was part of a project sponsored by Pound Ridge Elementary's Discovery Center for arts and crafts. These brightly colored dolls are about 1 inch high and appear to be made from toothpicks, thread, and wire. Joseph DiNozzi made worry dolls as part of the project. Such dolls were also sold at the school store, and Joseph testified that a store employee told him that if he put the dolls under his pillow at night, they "would chase away... bad dreams."
28
Ross Altman testified that he constructed worry dolls in a class taught by Reizes. He stated that Reizes told the class to place the worry dolls "underneath our pillows and pray to the gods and take all our worries... away and dream." Reizes denied having made such a statement.
29
Father Pacwa testified that such instructions violated Catholic tenets against the use of charms.
3. Earth Day
30
Each year, Fox Lane High observed "Earth Day," a day of activities centered around the theme of conservation of the environment and preservation of the planet. The general thrust of the program was usually the same. The celebration was organized by Youth in Action, a high-school club that promoted social and environmental awareness. Customarily, a globe five feet in diameter was placed in a circular outdoor area; students, grouped by grade, gathered around the globe. Local senior citizens were invited to the ceremony in order to foster community spirit. Representatives of each class presented symbolic gifts to the Earth in the form of speeches. Youth in Action's faculty advisor Dale Saltzman normally spoke of "reflecting on the simple things that the Earth provides for us and maybe, for one day, not taking them for granted."
31
The program components varied somewhat from year to year. In some years, the ceremony would begin with a drum roll as students took their places. One year, a display of tombstones was used to symbolize endangered and extinct species. In 1996, Earth Day focused on the preservation of rain forests, with students marching around the circle carrying banners displaying the current state of rain forests around the world. In 1998, the event included speeches by Fox Lane High faculty members as well as a musical performance.
32
Jon DiNozzi testified that at one Earth Day event, Saltzman stated that "[w]e came from the Earth, we're part of the Earth and we're all involved in this cycle. One day we'll become [dead] and then we'll go back to the Earth." 45 F.Supp.2d at 394 (alteration in original). DiNozzi testified that in another year, Saltzman made a speech "mainly about there's just too many people on this Earth" and about how "[w]e need to do something about it."
33
Bedford characterized the Earth Day activities as, in part, an effort to comply with §810 of the New York Education Law, which dates back to 1888 and designates the last Friday of April as "Conservation Day." The statute provides as follows:
34
It shall be the duty of the authorities of every public school in this state to assemble the pupils in their charge on that day in the school building, or elsewhere, as they may deem proper, and to provide for and conduct (1) such exercises as shall tend to encourage the planting, protection and preservation of trees and shrubs, and an acquaintance with the best methods to be adopted to accomplish such results, and (2) such lectures, pictures or tours, as shall tend to increase the interest and knowledge of such pupils in the fish and wild life, soil and water of the state.
35
N.Y. Educ. Law §810(2) (McKinney 2000). According to the Fox Lane High principal, attendance at Earth Day was not compulsory.
4. The "Listening to Nature" Tape
36
Ruthann Funari, who taught life sciences at Fox Lane Middle, instructed her students to compile "data sheets" in class with respect to each season of the year. While students were noting their observations in their respective science research notebooks, Funari would occasionally play music in the background, which she regarded "as a way to have the natural environment which they had observed be more present in the classroom." For the summer study, she played Vivaldi's "Four Seasons." During the fall, she played a tape called "Listening to Nature." The latter, which has a companion book that was not read to the students, contains various sounds of nature, such as birds, frogs, rivers, and ocean waves. At several times on the tape, a voice can be heard intoning nature-theme passages such as the following excerpt (attributed in the accompanying book to turn-of-the century naturalist John Muir):
37
Here is calm so deep, grasses cease waving... wonderful how completely everything in wild nature fits into us, as if truly part and parent of us. The sun shines not on us, but in us. The rivers flow not past, but through us, thrilling, tingling, vibrating every fiber and cell of the substance of our bodies, making them glide and sing.
38
J. Cornell, Listening to Nature, How to Deepen Your Awareness of Nature 42 (1987). The tape also included prayers such as the following Taos Indian invocation:
39
Now this is what we believe.
40
The Mother of us all is Earth.
41
The Father is the Sun.
The Grandfather is the Creator
Who bathed us with his mind
42
And gave life to all things.
43
The Brother is the beasts and trees.
44
The Sister is that with wings.
We are the children of Earth
45
And do it no harm in any way.
Nor do we offend the Sun
46
By not greeting it at dawn.
47
We praise our Grandfather for his creation.
48
We share the same breath together --
49
The beasts, the trees, the birds, the man.
50
Id. at 64. The tape also included the following passage (attributed in the book to Saint Francis of Assissi):
51
Lord, make me an instrument of Thy peace.
52
Where there is hatred, let me sow love;
53
Where there is injury, pardon;
54
Where there is doubt, faith;
55
Where there is despair, hope;
56
Where there is darkness, light;
57
Where there is sadness, joy.
58
O Divine Master, grant that I may not so much seek
59
To be consoled, as to console,
60
To be understood, as to understand,
61
To be loved, as to love.
62
For it is in giving that we receive,
63
It is in pardoning, that we are pardoned,It is in dying to self that we are born to eternal life.
64
Id. at 74. Funari testified that she lowered the volume on the tape whenever words were being spoken. Mary Ann DiBari testified, however, that her granddaughter Tiana heard the prayers or invocations.
C. Other Challenged Activities
65
Plaintiffs also challenged a number of other programs. They included the following.
1. Magic: The Gathering
66
Magic: The Gathering ("MTG" or "Magic") is a complex, strategy-based card game that was played by students in extracurricular clubs that met before school at Pound Ridge Elementary and after school at Fox Lane Middle. Each MTG player is a "wizard" attempting to reduce his opponents' "life total" points from twenty to zero. By drawing and playing cards, players attempt to summon "creatures" and cast "spells" in order to reduce their opponents' point total. The playing cards include depictions of zombies, goblins, vampires, and similar creatures. Students were allowed to participate in MTG only with prior written parental consent.
67
Plaintiffs challenged the School District's endorsement and promotion of MTG, contending, inter alia, that the game glorified worship of Satan, the practice of witchcraft, and blasphemy against Jesus Christ, and that the sponsorship subtly coerced students into participating.
2. Yoga Exercises
68
In 1998, Fox Lane High's athletic director invited Agia Akal Singh Khalsa, a Sikh minister, to conduct yoga exercises for students in gym class. Khalsa, who wore a Sikh turban, a traditional Sikh robe, and the beard of a Sikh minister, has a trademark name of "the Yoga Guy." He led the class in breathing and stretching exercises designed to achieve relaxation, followed by "positive affirmation[s]" such as "I am happy, I am good." He received a small stipend from School District funds for his time and travel.
69
Jon DiNozzi, on request, was allowed to opt out of the yoga exercises. Krystal DiBari testified that she was told that if she did not attend the yoga exercise class, she would be recorded as having cut class and would be ordered to serve detention; but she conceded that, although she did not attend, she did not in fact receive either penalty.
70
Plaintiffs contended that use of a Sikh priest to conduct such exercises on school premises constituted an endorsement of Eastern religions.
3. Buddha
71
Reizes testified that she read to her third or fourth grade class a story about the life of Buddha. Plaintiffs contended that reading that story to young children had the effect of promoting Buddhism, and that because, they assumed, reading about the life of Jesus Christ would not be permissible, reading about the life of Buddha should likewise be impermissible.
4. Quetzalcoatl
72
A teacher at Pound Ridge Elementary, as part of a historical presentation on Mexico, read her fifth-grade class a story about the Aztec bird god Quetzalcoatl. Some students were instructed to make an image of Quetzalcoatl out of cardboard, paper, and pipe cleaners. Students were also told that some persons believe that Quetzalcoatl will return to the world in the year 2012.
73
Plaintiffs contended that the study of Aztec religion, to the exclusion of the Christianity subsequently practiced by the majority of Mexicans, constituted a violation of the Establishment Clause, and that instructing students to create a depiction of Quetzalcoatl violated the Free Exercise Clause as well.
5. "God Messed Up" and Other Poems
74
Another teacher at Pound Ridge Elementary gave her fourth-grade students the assignment of writing poems on topics of their choice. Thereafter, a collection of 32 of the poems, selected by the students, was published as a booklet entitled "Poetry by 4H." Most of the poems concerned such commonplace topics as flowers, telephones, and dogs. Another, about a "fatman," read:
There once was a fatman
Who lived in a trash can
Who outran Pac Man
75
All the way to Spokane.
76
Plaintiffs complained, however, of the inclusion of two poems about God. One read
77
GOD Messed Up.....
When he made cats
He gave them the brains of bats
With bloated legs
78
And pointy ears.
And some claws
79
Made of SPEARS.
Another, entitled "Mess Up," read
God messed up when he made dogs
He gave them the brains of frogs. (tiny)
He gave them deformed bodies and
Really shrimpy legs and hands
And bushy tails and butts, P.U
80
Guess what, he messed up on frogs, too.
81
Plaintiffs contended that the inclusion of these two poems contradicted Catholic teaching that God is omniscient and omnipotent, and hence violated the neutrality required by the Establishment Clause.
6. The "DARE" Program
82
The Drug Abuse Resistance Education ("DARE") Program is a nationwide, copyrighted educational program designed to teach public and parochial students to avoid drug abuse and violence. Trained police officers taught the DARE curriculum in the Bedford public schools. DARE teachings included several lessons that portrayed students in a variety of roles in which they might be lured into abusing drugs or committing violence. Students were provided with advice and instructions about approaches to avoiding such temptations. The program included a "DARE box," in which children could place questions--anonymously if they wished--that they were hesitant to ask in class. The DARE program did not include an instruction as to the morality of drug use; it did instruct that possession and use of unlawful substances is illegal.
83
Plaintiffs' expert witness, psychologist Dr. William R. Coulson, testified that the DARE program constituted "nondirective psychotherapy"--that is, the encouragement of the expression of attitudes and feelings deriving from the "inner sel[f]," with the goal of spontaneously producing insightful understanding, without the need for a "wise man" to give instruction. Coulson testified that DARE had this effect because it encouraged students, in Coulson's words, to "get... in touch with their deeper feelings about using drugs" even if they had never had occasion to consider using drugs in the first place. Plaintiffs contended principally that the DARE program violated the Free Exercise Clause, the Fourteenth Amendment right to privacy, and §2504 of the New York Public Health Law, which prohibits the provision of health services without prior parental consent.
7. Brain Stimulation Exercises
84
In 1995, Reverend Nancy Weber, a self-described psychic and minister in the Life Spirit Congregational Church, taught exercises in creativity, learning, and memory at Pound Ridge Elementary. She received a modest stipend to compensate her for her time and travel. Her activities at the school included playing music, conducting breathing exercises, and leading drawing exercises with the nondominant hand, designed to stimulate the brain, in particular its nondominant hemisphere. Weber did not mention her ministry when she spoke with the students.
85
Plaintiffs contended that attempting to stimulate the brain's nondominant hemisphere promoted New Age religion, was antithetical to Catholic belief, and violated the Establishment and Free Exercise Clauses and their rights to privacy.
8. Peer Facilitator Program
86
The Peer Facilitator Program at Fox Lane High brought juniors and seniors in contact with ninth graders starting high school in an attempt to orient the new students and help them adjust to high-school life. Topics discussed with peer facilitators ranged from academic issues regarding classes and teachers to social issues such as how to avoid succumbing to peer pressure with regard to sex, drugs, and alcohol. Peer Facilitator Program materials included hypothetical questions for students to answer, such as imagining what they would do if they suddenly changed gender, or how their conduct and perspective would change if they were told they had only one year to live. In general, teachers were not present at Peer Facilitator Program meetings.
87
Plaintiffs contended that the Peer Facilitator Program constituted "amateur psychotherapeutic sessions," violating principally the First and Fourteenth Amendments and §2504 of the New York Public Health Law.
9. Meditation Exercises
88
In various classes at Pound Ridge Elementary and Fox Lane Middle, students were exposed to meditation exercises in which classroom lights were turned off and students were asked to imagine themselves in a strange place, or to imagine that their bodies were filling with blue liquid, and to attempt to empty their minds. Plaintiffs contended that these exercises principally violated the First and Fourteenth Amendments and §2504 of the New York Public Health Law.
10. The Ropes Challenge
89
The Ropes Challenge was a physical challenge course at Fox Lane High designed to promote leadership skills and teamwork in outdoor activities. Older students helped lead the course. Activities included a wide variety of exercises in which students climbed over or through obstacles or transported themselves and each other by means of ropes or logs, in all cases working together in order to achieve a common goal. Plaintiffs' expert witness, Dr. Coulson, testified at trial that this program was "an elaborate exercise in non-directive psychotherapy... using group encounter therapeutic techniques."
11. Other Activities
90
Plaintiffs also challenged a variety of other activities, from which they sought to secure a right of opt-out. Those activities included
91
- The Yale Decision Making Program at Fox Lane Middle, which included lessons on stress and stress management, as well as a relaxation exercise, in an effort to help students learn how to make productive and informed choices.
92
- The Myers-Briggs Personality Test, a multiple-choice examination used to assess personality types, administered to students at Fox Lane High.
93
- Psychological counseling at Fox Lane High by a social worker on a variety of issues, occasionally including suicide counseling.
94
- A homework assignment to Pound Ridge Elementary students to keep a journal on their observations of their daily lives and family members. The teacher gave instructions as to how to prevent others from reading portions the student did not want to share.
95
D. The District Court's Findings of Fact and Conclusions of Law
96
In a decision issued on May 21, 1999, the district court found that "[s]ome of the conduct complained of does not seem to have religious overtones, but much of it does." 45 F.Supp.2d at 372. Noting that the basic thrust of the First Amendment's Establishment Clause is "one of government neutrality towards religion," id. at 375, the court discussed United States Supreme Court cases addressing First Amendment issues, and concluded that "[b]ecause this case affect[ed] elementary and secondary public school children of young and impressionable age," 45 F.Supp.2d at 377, the appropriate test was the coercion test set out in Lee v. Weisman, 505 U.S. 577, 587, 591 (1992). In Lee, the Supreme Court stated that "at a minimum, the Constitution guarantees that government may not coerce anyone to... participate in religion or its exercise," 505 U.S. at 587. The district court stated that with respect to young persons, "[e]ven a subtle coercive pressure by a government official to engage in religious activity may violate the First Amendment." 45 F.Supp.2d at 376 (internal quotation marks omitted).
97
With respect to the Free Exercise Clause, the court stated that "[t]he free exercise of religion means, first and foremost, the right to believe and profess whatever religious doctrine one desires." Id. at 378. Hence, "the First Amendment obviously excludes all 'governmental regulation of religious beliefs as such.'" Id. at 378-79 (quoting Sherbert v. Verner, 374 U.S. 398, 402 (1963)). "The government may not compel affirmation of religious belief," or "punish the expression of religious doctrines it believes to be false," or "impose special disabilities on the basis of religious views or religious status." 45 F.Supp.2d at 379. In order to establish a free exercise claim, "'it is necessary... for one to show the coercive effect of the enactment as it operates against him in the practice of his religion.'" Id. (quoting School District of Abington v. Schempp, 374 U.S. 203, 223 (1963)). Such coercion "can be either direct or indirect." 45 F.Supp.2d at 379.
98
The court described the issues in the present case as "the students' right[s] to exercise their own religious beliefs free from state coercion, as well as the right[s] of the parents to control the religious upbringing and training of their minor children." Id. In order to prevail on a given claim, plaintiffs were required to show that coercion "infringe[d] on the Plaintiff's ability to receive an 'important benefit' from the state at the expense of the Plaintiff's right to the free exercise [of] his or her religion." Id. Applying the above principles, the court found, to the extent pertinent to these appeals, that aspects of the programs involving Ganesha, worry dolls, Earth Day, and "Listening to Nature," described in Part I.B. above, violated plaintiffs' Establishment Clause and Free Exercise Clause rights, and that the other challenged activities were not impermissible.
99
1. Ganesha, Worry Dolls, Earth Day, and the Nature Tape
100
The court found that the Pound Ridge Elementary lessons about Ganesha were largely permissible, but that the classes violated plaintiffs' First Amendment rights to the extent that they required the students to create images of the Hindu god:
101
Mrs. Reizes' only purpose in teaching about Ganesha was to educate her students about the Indian culture and society. Although Lord Ganesha is a deity of the modern Hindu religion worshiped by hundreds of millions of people, reading a story common to the Indian culture, as part of an innovative, structured lesson plan about a foreign country and its culture, does not have the purpose or effect of advancing or inhibiting religion.... Considering the relative amount of time that Mrs. Reizes spent on reading the Ganesha story, this challenged activity should be seen as neither advancing or promoting the Hindu religion, but simply educating students about the Indian culture.... Likewise, in the context in which the story was read, the Court finds no indicia of any subtle coercive pressure to engage in the Hindu religion.
102
This subtle coercive pressure is found, however, in the classroom projects of constructing images of Ganesha. It is merely fortuitous that the third grade students never actually made the clay images of Ganesha, as instructed, because they ran out of time. While reading the Ganesha story can be part of a neutral secular curriculum, this Court fails to find any educational justification for telling young impressionable students to construct images of a known religious god. This part of the lesson, however benign in purpose or intent, has the appearance to a child of that age that the school is communicating a message endorsing Lord Ganesha and the Hindu religion. Equally impermissible under the First Amendment is the subtle coercive pressure of instructing young impressionable students to make images of a god other than their own in violation of their religious beliefs....
103
45 F.Supp.2d at 383-84.
104
The court found that the sponsorship of worry dolls at Pound Ridge Elementary, either "by selling them in the school store, or encouraging students to make them in class or in the discovery center, and use them for relief from worry," was unconstitutional because "[i]t prefers superstition over religion." Id. at 385. The court found that this activity was
105
a rank example of teaching superstition to children of a young and impressionable age. It assumes that an inanimate object has some occult power to relieve us from worry and assure a good night's sleep. Father Pacwa testified, without contradiction,... that the use of charms is forbidden by scripture and is an offense against the First Commandment. As Father Pacwa testified, "[t]he recent Catholic Catechism... [prohibits] all forms of divination, magic and sorcery."
106
Id.
107
The court found the Earth Day ceremonies at Fox Lane High violated the First Amendment because "[t]he worship of the Earth is a recognized religion (Gaia), which has been and is now current throughout the world." Id. at 393. The Court found that "[t]he liturgy of Earth Day at Fox Lane High School... evolved into a proceeding which takes on much of the attributes of the ceremonies of worship by organized religions" and which was in many respects "truly bizarre." Id. Thecourt stated that Saltzman's statement that all humans came from the Earth and will one day return to it was "clearly religious teaching" that echoed Genesis 3:19; and the court stated that his comment regarding the Earth's overpopulation and the need to combat it was "directly contrary to the teaching of GenesisI." Id. at 394.
108
To state this unproven fact as an absolute... involved the school district in teaching a doctrine directly contrary to the views of Roman Catholic students and many others. As Father Pacwa pointed out, "the implication would be that you would have to use some sort of birth control to stop this. Also it takes a stance, a moral stance, on what is the problem of the world today, namely, too many people, instead of dealing with other moral issues of more political nature that prevent food from getting to people that need it."
109
Id.
110
The district court also found that playing the "Listening to Nature" tape at Fox Lane Middle promoted "a creed worshiping the Earth." Id. Implicitly rejecting Funari's belief that, because she lowered the volume, her students could not hear the prayers on the tape, the court found that the playing of the tape constituted a "direct presentation to the children of an Earth centered religious belief." Id. at 395. Describing the tape's "essential thrust" as the "promotion of Earth worship and prayer to the Earth," the court held that its playing to students "offend[ed] both aspects of [the religion clauses of] the First Amendment." Id.
2. Other Challenged Activities
111
The court dismissed plaintiffs' challenges to other activities, including those described in Part I.C. above, finding that those activities were nonreligious in nature and did not violate any of plaintiffs' rights under the First or Fourteenth Amendments or under state law.
112
As to Magic, or MTG, the court found that "[n]o reasonable person could regard sponsoring this game as a teaching of religion." 45 F.Supp.2d at 381. It stated that
113
[a]s the game itself is not religious in nature, Plaintiffs' argument that the Defendants by allowing this extracurricular activity are advancing or promoting Satanism as a religion or the occult also fails. Furthermore, since participation was voluntary and permitted only with written parental consent, and not during school hours, this Court finds that the school district neither asserted coercive pressure for students to participate in the game, nor did it infringe on plaintiffs' right to the free exercise of their religion.
114
Assuming, solely for the argument, that Magic:"The Gathering" was religious in nature, the evidence shows, and the Court finds, that no reasonable observer or participant could believe that the school district's actions communicated a message of endorsement of the beliefs, if any, contained within the game. To the contrary, the school district's precautions to present the club as a mere extracurricular activity not endorsed by the school, but simply offered on school grounds not during school hours, is consistent with the Supreme Court's decisions on the interplay between the competing principles of Free Speech, Free Exercise, and Establishment clauses of the First Amendment.
115
Id. at 381-82.
116
The court also found that the yoga exercises did not violate the constitution because "although the presenter was dressed in a turban and wore the beard of a Sikh minister, he did not in his yoga exercise presentation advance any religious concepts or ideas." Id. at 385. Similarly, the court found that the brain stimulation exercises did not violate the constitution because plaintiffs failed to produce any "evidence that Rev. Weber, during her brief visit to the school, taught any religion or performed intuitive counseling, exercised her psychic powers or engaged in telepathy." Id. at 392. Thus, the court noted that although "[t]he entire Nancy Weber lecture may well have been nothing but humbug," Weber had not "required the students to engage in a 'bogus mystical experience' as charged," and the court "conclude[d] that on the totality of the evidence [the brain stimulation exercises] did not rise to the level of a First Amendment violation." Id.
117
Nor did the court see any constitutional violation in the studies of the lives of Buddha and Quetzalcoatl. It found no evidence that the Buddha reading was "conducted in such a fashion as to sponsor belief in Buddha or to violate the First Amendment rights of Plaintiffs." Id. at 387. It likewise found that the study of Quetzalcoatl did not promote belief in Quetzalcoatl and that no student was compelled to create a physical likeness of Quetzalcoatl. See id. The court also noted that "[u]nlike Lord Ganesha, Quetzalcoatl is not currently worshiped in the world and [that] hanging the Quetzal Bird in class should not be regarded as the adoption of a religious symbol." Id. Although students were informed that "some persons believe Quetzalcoatl will return to the world in the year 2012," the court noted that "telling students'some persons believe' is not the same as sponsoring that idea in the minds of the children." Id.
118
As to the "God Messed Up" poems, the district court rejected plaintiffs' contention that the poetry writing program violated the neutrality required by the Establishment Clause. The court noted that
119
[t]he reasonable person or child reading the book of poems would assume that the authors meant it to be funny. The inclusion of these poems on a subject not dictated by the teacher does not constitute the endorsement of an anti-religious message, and indeed it is not certain that the message is intended to be anti-religious. The poetry may have been inspired by "Ma and God," a poem for children written by Shel Silverstein (deceased May 10, 1999), a distinguished humorous poet for children writing in the tradition of A.A. Milne.
120
Id. at 388. The Silverstein poem, introduced by plaintiffs at trial, reads as follows:
MA AND GOD
121
God gave us fingers Ma says, "Use your fork."
122
God gave us voices -- Ma says, "Don't scream."
123
Ma says eat broccoli, cereal and carrots.
124
But God gave us tasteys [sic] for maple ice cream.
125
God gave us fingers Ma says, "Use your hanky."
126
God gave us puddles Ma says, "Don't splash."
127
Ma says, "Be quiet, your father is sleeping."
128
But God gave us garbage can covers to crash.
129
God gave us fingers Ma says, "Put your gloves on."
130
God gave us raindrops Ma says, "Don't get wet."
131
Ma says be careful, and don't get too near to
132
Those strange lovely dogs that God gave us to pet.
133
God gave us fingers Ma says, "Go wash 'em." But God gave us coal bins and nice dirty bodies.
134
And I ain't too smart, but there's one thing for certain--
135
Either Ma's wrong or else God is.
136
S. Silverstein, Where the Sidewalk Ends 119 (1974). The district court found that Silverstein too was
137
apparently intending to be funny. Without endorsing any of the poetry, the Court does not perceive that this evidence arises to the level of a promotion or disparagement of a religious concept.... No First Amendment violation is found....
138
45 F.Supp.2d at 388 (footnote omitted).
139
Similarly, the court found no religious significance in the other programs described in Part I.C. above, such as DARE, the Peer Facilitator Program, and meditation exercises, nor any cognizable violation of state law. It found, for example, that [t]he DARE Program is relatively free of moral overtones, contains no religious emphasis whatsoever, and leaves the "decision" whether or not to use tobacco, alcohol or drugs to the student after evaluating both positive and negative effects.
140
Id. at 390.
141
Finally, the court held that the various claimed invasions of family privacy did not violate any constitutional or statutory provision. Citing Immediato v. Rye Neck School District, 73 F.3d 454, 462 (2d Cir.) ("Immediato"), cert. denied, 519 U.S. 813 (1996), the district court stated that an activity that is alleged to violate the claimed right of a parent to direct the upbringing of his or her children... [is to] be analyzed only under the minimal rational basis standard of review. Thus, the defendants need only prove that the activities at issue are based on a legitimate state interest and that the activities are rationally related to furtherance of that objective.
142
45 F.Supp.2d at 396. The court further noted that Immediato recognized that the state has a "'compelling' interest in educating its youth, to prepare them to participate effectively and intelligently in our open political system, and to be self reliant and self sufficient participants in society." 45 F.Supp.2d at 396 (quoting Immediato, 73 F.3d at 461). Finding that the journal assignments, "although intrusive in nature, do further the state's compelling objective of education," the court held that they did not constitute a violation of the Fourteenth Amendment. 45 F.Supp.2d at 396.
143
E. Denial of Bedford's Motion To Dismiss Challenges to the Pound Ridge Elementary Activities for Loss of Standing
144
After the district court's decision and prior to the entry of judgment, the parties brought to the district court's attention two changes that had occurred or were about to occur in the residence of the plaintiff families. First, Bedford informed the court that it had just learned that in March 1998, the Altman family had moved to Connecticut. Since Ross Altman was the only plaintiff who at the time of trial in 1999 was young enough to attend elementary school, and he and his family had by that time moved out of the School District, Bedford moved to dismiss all claims challenging activities at Pound Ridge Elementary on the ground of lack of subject matter jurisdiction because no plaintiff any longer had standing to challenge those activities.
145
In addition, in mid-July 1999, Cecile D. DiNozzi filed an affidavit with the district court, stating that on July 24, 1999, she and her family would be relocating to Delaware.
146
In a Memorandum and Order dated July 23, 1999 ("Standing Opinion"), the district court denied Bedford's motion. The court noted that because the Altman family no longer resided within the district as of March 1998, and the departure of the DiNozzi family was imminent, the only plaintiffs who might have standing were Mary Ann DiBari and her grandchildren. The DiBari grandchildren were beyond elementary-school age by time of trial; but the court concluded that "[a] municipal taxpayer such as Ms. DiBari has standing to complain about Free Exercise or Establishment Clause violations accomplished in a school within the municipality by its paid employees." Standing Opinion at 5 (emphasis in original).
147
Ms. DiBari is still a taxpayer within the defendant Bedford Central School District, and thus responsible for the funding of the education of her two grandchildren who are still enrolled in schools within the defendant district, as well as funding the general budget for general school district expenses. The Court also notes that the final injunction granted to the plaintiffs is to be enforced district-wide and is not limited to the specific school where the challenged activity occurred initially.
148
As a taxpayer, Ms. DiBari continues to have a personal stake in the outcome of this litigation....
149
This Court's decision after trial in this case is explicit that the defendant district has engaged in conduct that violated the Establishment Clause of the First Amendment of the Constitution. The record is clear that unless prevented by the court, the activities will continue in the future. Public money supported that conduct and those who engaged in it. Actions of the school district are funded, in large part, by local real property taxes. Accordingly, the Court maintains subject matter jurisdiction over this case by reason of the municipal taxpayer standing of plaintiff Mary Ann DiBari as well as her status as legal guardian of her two grandchildren.
150
Id. at 3-4.
F. The Final Judgment
151
On July 23, 1999, the court entered its final judgment, holding, to the extent pertinent to Bedford's appeal, that activities with respect to Earth Day ceremonies, nature worship, worry dolls, and Ganesha image construction activities on school premises violated plaintiffs' rights under the Establishment and Free Exercise Clauses of the First Amendment. To the extent pertinent to the cross-appeal, the court dismissed all of plaintiffs' challenges to other activities.
152
The court entered an injunction containing mandatory and prohibitory provisions. It ordered Bedford to
153
adopt and publish guidelines to teachers and others to insure that they will abide by the Supreme Court's standards set forth in the cases quoted in this Court's Order and Opinion, so as to avoid coercing any student to participate in religion or its exercise or to violate any religious precept held by a child or his or her parents, and to further avoid sponsoring or disparaging religious beliefs held by students and or their parents.
154
Final Judgment and Permanent Injunction at 2. It enjoined and restrained Bedford and most of the named individual defendants
155
A. From sponsoring worship of the Earth or presentation of a liturgy addressed to the Earth as if it were a creator or divine, including any symbolic presentation of gifts to the Earth, the erection of "symbolic structures" equal to an altar, a chorus of ceremonial drums, or any globe on bamboo sticks or other totem serving as a focal point of the worship service, or any religious teaching in connection therewith;
156
B. From sponsoring prayers to the Earth or any creed of worshiping the Earth by means of audio tape or otherwise;
157
C. From sponsoring, instructing or encouraging the fashioning of charms in the form of so-called "worry dolls" by students in the Discovery Center at Pound Ridge Elementary School or elsewhere in the District, the sale of said charms in any school store, or from instructing or suggesting to students through school personnel or otherwise that said charms have supernatural powers to "chase away your bad dreams," "take away all our worries," or any other supernatural or occult power;
158
D. From directing or encouraging students to make likenesses or images of the Hindu god, Lord Ganesha, or any other god.
159
Id. at 3-4. The judgment also granted plaintiffs attorneys' fees and disbursements totaling $106,856.61.
G. The Present Appeals
160
The School District has appealed, contending principally that the injunction and the rulings that the School District violated plaintiffs' rights should be vacated. Plaintiffs have cross-appealed, contending that the district court erred in dismissing their challenges to the activities described in Part I.C. For the reasons that follow, we conclude principally that the district court should have dismissed for lack of subject matter jurisdiction, because of mootness, plaintiffs' challenges to any activities that were not found to have occurred at schools other than Pound Ridge Elementary; that the challenges to the activities at Fox Lane Middle likewise became moot after the entry of judgment and must also be dismissed; that the court erred in ruling that plaintiffs' First Amendment rights were violated; and that the district court's dismissals of plaintiffs' nonmoot claims were correct.
II. SUBJECT MATTER JURISDICTION
161
We turn first to Bedford's challenge to the denial of its posttrial motion to dismiss, for lack of jurisdiction due to plaintiffs' loss of standing, all challenges to activities at Pound Ridge Elementary, and to the matter of whether challenges to the activities at Fox Lane Middle also have become moot.
A. Standing and Mootness
162
The Constitution limits the jurisdiction of Article III courts to matters that present actual cases or controversies. See U.S. Const. art. III, §2, cl.1. This limitation means that when a plaintiff brings suit in federal court, she must have standing to pursue the asserted claims. It also generally means that if the plaintiff loses standing at any time during the pendency of the proceedings in the district court or in the appellate courts, the matter becomes moot, and the court loses jurisdiction. See generally Church of Scientology of California v. United States, 506 U.S. 9, 12 (1992) ("It has long been settled that a federal court has no authority to give opinions upon moot questions or abstract propositions, or to declare principles or rules of law which cannot affect the matter in issue in the case before it." (internal quotation marks omitted)).
163
In order to have standing to bring suit, a plaintiff must allege "injury in fact" to his or her preexisting, legally protected interest; such injury must be "(a) concrete and particularized... and (b) actual or imminent, not conjectural or hypothetical." Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992) (internal quotation marks omitted). Particularized "mean[s] that the injury must affect the plaintiff in a personal and individual way." Id. at 560 n. 1. Aplaintiff "'generally must assert his own legal rights and interests, and cannot rest his claim to relief on the legal rights or interests of third parties.'" Valley Forge Christian College v. Americans United for Separation of Church & State, Inc., 454 U.S. 464, 474 (1982) (quoting Warth v. Seldin, 422 U.S. 490, 499 (1975)). The rare exceptions to this rule generally involve situations in which the plaintiff has a close relation with the third party and "there exists some hindrance to the third party's ability to protect his or her own interests." Edmonson v. Leesville Concrete Co., 500 U.S. 614, 629 (1991). Parents generally have standing to assert the claims of their minor children. See, e.g., Engel v. Vitale, 370 U.S. 421, 423 (1962); Smith v. Organization of Foster Families for Equality and Reform, 431 U.S. 816, 841 n.44 (1977).
164
At issue here is the mootness doctrine, for "[t]he usual rule in federal cases is that an actual controversy must exist at stages of appellate or certiorari review, and not simply at the date the action is initiated." Roe v. Wade, 410 U.S. 113, 125 (1973). "While the standing doctrine evaluates [a litigant's] personal stake as of the outset of the litigation, the mootness doctrine ensures that the litigant's interest in the outcome continues to exist throughout the life of the lawsuit... including the pendency of the appeal." Cook v. Colgate, 992 F.2d 17, 19 (2d Cir. 1993). Thus, even as to claims that plaintiffs originally had standing to assert, the court must determine whether those claims remain live controversies or have become moot.
165
"'A case becomes moot when the issues presented are no longer live or the parties lack a legally cognizable interest in the outcome.'" Freedom Party of New York v. New York State Board of Elections, 77 F.3d 660, 662 (2d Cir. 1996) (quoting New York City Employees' Retirement System v. Dole Food Co., 969 F.2d 1430, 1433 (2d Cir. 1992) (internal quotation marks omitted)). In Doremus v. Board of Education, 342 U.S. 429 (1952), for example, the plaintiffs challenged a state statute providing for the reading, without comment, of five verses of the Old Testament at the opening of each public-school; one of the plaintiffs asserted standing on the ground, inter alia, that his daughter was a public-school student. The Supreme Court rejected that ground, however, noting that the daughter "had graduated from the public schools before th[e] appeal was taken to th[e Supreme] Court," id. at 432, and stating that "[o]bviously no decision we could render now would protect any rights she may once have had[;]... this Court does not sit to decide arguments after events have put them to rest," id. at 432-33.
166
If a claim has become moot prior to the entry of final judgment, the district court generally should dismiss the claim for lack of jurisdiction. See, e.g., Campbell v. Greisberger, 80 F.3d 703, 705 (2d Cir. 1996) (affirming mootness dismissal). Similarly, if a claim becomes moot between the entry of final judgment and the completion of appellate review, the appellate court usually must either dismiss the appeal, see, e.g., Iron Arrow Honor Society v. Heckler, 464 U.S. 67, 72-73 (1983) (per curiam); Dennin v. Connecticut Interscholastic Athletic Conference, Inc., 94 F.3d 96, 100 (2d Cir. 1996), or vacate so much of the district court's judgment as adjudicated that claim and remand for entry of a judgment dismissing that claim, see, e.g., Great Western Sugar Co. v. Nelson, 442 U.S. 92, 93-94 (1979) (per curiam); Penguin Books USA Inc. v. Walsh, 929 F.2d 69, 73-74 (2d Cir. 1991). But see Karcher v. May, 484 U.S. 72, 82 83 (1987) (appellate court should not vacate the judgment below if the case has become moot due to the voluntary act of the losing party); Manufacturers Hanover Trust Co. v. Yanakas, 11 F.3d 381, 383 (2d Cir. 1993) (same).
167
A narrow exception to the principle that a moot claim is to be dismissed, available "only in exceptional situations," City of Los Angeles v. Lyons, 461 U.S. 95, 109 (1983), is that the court may adjudicate a claim that, though technically moot, is "capable of repetition, yet evading review," id. at 109; see Weinstein v. Bradford, 423 U.S. 147, 148-49 (1975) (per curiam). That exception is not applicable, however, unless the repetition would affect the "same complaining party." Id. at 149; see, e.g., Dennin v. Connecticut Interscholastic Athletic Conference, Inc., 94 F.3d at 100-01; Video Tutorial Services, Inc. v. MCI Telecommunications Corp., 79 F.3d 3, 6 (2d Cir. 1996) (per curiam). Thus, in the absence of a class action, the "capable of repetition, yet evading review" exception is not available when the issue is students' rights and the complaining students have graduated from the defendant institution. See, e.g., Board of School Commissioners of Indianapolis v. Jacobs, 420 U.S. 128, 129-30 (1975) (per curiam) (dismissing as moot a challenge by high-school students to regulation of their school newspaper, after the Court learned at oral argument that all plaintiffs had graduated); Fox v. Board of Trustees, 42 F.3d 135, 140 (2d Cir. 1994) (pursuit of First Amendment challenge to regulation barring private commercial businesses from conducting sales demonstrations in students' dormitory rooms mooted by complaining students' graduation), cert. denied, 515 U.S. 1169 (1995); Cook v. Colgate, 992 F.2d at 19 (gender discrimination claim under Title IX of the Education Amendments of 1972, 20 U.S.C. §1681 1688, mooted by graduation of student members of women's ice hockey team).
168
B. Standing To Assert First Amendment Claims
169
To have standing to pursue a claimed violation of the Free Exercise Clause, a plaintiff must allege that her own "particular religious freedoms are infringed." School District of Abington v. Schempp, 374 U.S. at 224 n.9. For example, in McGowan v. Marlyand, 366 U.S. 420 (1961), the plaintiff businessmen were held not to have standing to bring a Free Exercise Clause challenge to Sunday closing laws based on "only economic injury to themselves," without an "alleg[ation of] any infringement of their own religious freedoms due to Sunday closing," id. at 429. Likewise, in Harris v. McRae, 448 U.S. 297, reh'g denied, 448 U.S. 917 (1980), indigent pregnant women were held not to have standing to challenge, under the Free Exercise Clause, a law that limited the use of federal funds to reimburse costs of abortions under the Medicaid program where no named plaintiff "alleged, much less proved, that she sought an abortion under compulsion of religious belief," id. at 320; see also id. at 321 ("'[I]t is necessary in a free exercise case for one to show the coercive effect of the enactment as it operates against him in the practice of his religion.'" (quoting Schempp, 374 U.S. at 223)).
170
In contrast, "the requirements for standing to challenge state action under the Establishment Clause, unlike those relating to the Free Exercise Clause, do not include proof that particular religious freedoms are infringed." Schempp, 374 U.S. at 224 n.9. Thus, standing to assert an Establishment Clause claim may rest either on the plaintiff's direct exposure to the challenged activity, see, e.g., id. (students attending a public school, and their parents, have standing to challenge a program of Bible reading in the school because they are "directly affected by the laws and practices against which their complaints are directed"), or, in certain situations, on the plaintiff's status as a taxpayer, see, e.g., Flast v. Cohen, 392 U.S. 83, 103-04 (1968); Doremus v. Board of Education, 342 U.S. at 433-35.
171
In Doremus, one of the plaintiffs asserting an Establishment Clause challenge to the public-school-Bible-reading practice claimed to have standing not only on the basis that he had a daughter subjected to the reading (a basis mooted by her graduation), but also on the basis that he was "a citizen and taxpayer of the Borough of Hawthorne in the State of New Jersey,... that Hawthorne has a high school supported by public funds[, and that in] this school the Bible is read," id. at 433. The Supreme Court rejected taxpayer status as a basis for standing, however, because the Doremus grievance was not that the plaintiffs were taxed a measurable amount of money but rather that they objected to the practice on religious grounds. The Court stated that [t]here is no allegation that this activity is supported by any separate tax or paid for from any particular appropriation or that it adds any sum whatever to the cost of conducting the school. No information is given as to what kind of taxes are paid by appellants and there is no averment that the Bible reading increases any tax they do pay or that as taxpayers they are, will, or possibly can be out of pocket because of it.
172
Id. at 433 (emphasis added). The Court reiterated the view it had stated in Massachusetts v. Mellon, 262 U.S. 447, 488 (1923), commonly known as Frothingham v. Mellon, that "[t]he party who invokes the power must be able to show, not only that the statute is invalid but that he has sustained or is immediately in danger of sustaining some direct injury as a result of its enforcement, and not merely that he suffers in some indefinite way in common with people generally."
173
Doremus, 342 U.S. at 434 (quoting Mellon, 262 U.S. at 488). The Doremus Court distinguished Everson v. Board of Education, 330 U.S.1 (1947), in which it had found a justiciable controversy, because Everson "showed a measurable appropriation or disbursement of school district funds occasioned solely by the activities complained of." Doremus, 342 U.S. at 434. The Doremus Court stated that
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[t]he taxpayer's action can meet this test, but only when it is a good faith pocketbook action. It is apparent that the grievance which it is sought to litigate here is not a direct dollars and cents injury but is a religious difference. If appellants established the requisite special injury necessary to a taxpayer's case or controversy, it would not matter that their dominant inducement to action was more religious than mercenary. It is not a question of motivation but of possession of the requisite financial interest that is, or is threatened to be, injured by the unconstitutional conduct. We find no such direct and particular financial interest here. If the Act may give rise to a legal case or controversy on some behalf, the appellants cannot obtain a decision from this Court by a feigned issue of taxation.
175
Id. at 434-35 (emphases added).
176
This Court, in addressing the question of a municipal taxpayer's standing to challenge municipal activities, has stated that although that standing does not depend on the plaintiff's ability to show a "likelihood that resulting savings will inure to the benefit of the taxpayer," United States v. City of New York, 972 F.2d 464, 466 (2d Cir. 1992), "under Frothingham we presume a municipal taxpayer's relationship to the municipality is 'direct and immediate' such that the taxpayer suffers concrete injury whenever the challenged activity involves a measurable appropriation or loss of revenue," id. at 470 (internal quotation marks omitted). See also Board of Education v. New York State Teachers Retirement System, 60 F.3d 106, 110-11 (2d Cir. 1995) (municipal taxpayer standing requires ability to identify a "measurable appropriation or loss of revenue" attributable to the challenged activities (internal quotation marks omitted)).
C. The Present Case
177
These principles affect federal jurisdiction with respect to plaintiffs' challenges to activities at both Pound Ridge Elementary and Fox Lane Middle. When this action was commenced, at least one plaintiff was eligible to attend Pound Ridge Elementary, at least one was attending or eligible to attend Fox Lane Middle, and at least one was attending or eligible to attend Fox Lane High. When the case was tried in 1999, however, Ross Altman was the only plaintiff who was not beyond elementary-school age; and he and his family had previously moved out of the School District, relocating to the State of Connecticut. Thus, by the time of trial, no plaintiff could claim any direct injury from activities conducted at Pound Ridge Elementary. Accordingly, plaintiffs' Free Exercise Clause challenges to those activities should have been dismissed for lack of jurisdiction because they had become moot. Although the district court ruled that the challenges to activities at that school were not moot because Mary Ann DiBari had standing as a municipal taxpayer, that ruling was error as to claims under the Free Exercise Clause because none of the DiBaris could meet the requirement that they assert violations of their own particular religious freedoms.
178
For similar reasons, plaintiffs' Free Exercise Clause challenges to activities at Fox Lane Middle became moot prior to this appeal. At the time of trial, Krystal DiBari was already a high-school student; the only plaintiff attending Fox Lane Middle was Tiana DiBari. Tiana graduated from Fox Lane Middle in 1999. And although one or more of the DiNozzi children remained age-eligible to attend that school, the DiNozzi family relocated to Delaware on July 24, 1999, the day after judgment was entered in the district court. Thus, these events have left no plaintiff who, during this appeal, can show that activities at Fox Lane Middle infringe his or her own particular religious freedoms. Accordingly, the Free Exercise Clause challenges to activities at Fox Lane Middle too must be dismissed for lack of jurisdiction.
179
Although standing to assert claims under the Establishment Clause may rest instead on a showing of taxpayer injury, we conclude that the moves of the Altman and DiNozzi families out of the School District and the graduation of Tiana DiBari from Fox Lane Middle also mooted plaintiffs' Establishment Clause challenges to activities at Pound Ridge Elementary and Fox Lane Middle, for we disagree with the district court's conclusion that Mary Ann DiBari had taxpayer standing. In reaching its conclusion, the district court stated that "[p]ublic money supported [the challenged] conduct and those who engaged in it," Standing Opinion at 4, and that taxpayers are responsible for "funding the general budget for general school district expenses," id. at 3. Such general findings, however, are not sufficient; what was required for the establishment of taxpayer standing to complain of activities at Pound Ridge Elementary or Fox Lane Middle was a showing of a measurable appropriation or loss of revenue attributable to the challenged activities at those schools. We see no indication that such a showing was made. We have seen no evidence, for example, that purchases of crayons, clay, or construction paper were made solely for the activities that plaintiffs challenged. The only expenditure adverted to by the district court with respect to either of those schools was a "modest stipend," 45 F.Supp. at 392 n.17, to Weber for the brain stimulation session, which consisted of music, breathing exercises, and drawing exercises with the nondominant hand--all found to be unrelated to religion. The court described the Weber venture as but a "brief visit," id. at 392, did not specify the "modest" amount she received, and made no finding that there was any measurable appropriation to fund her visit.
180
We also reject the district court's view that a municipal taxpayer has standing to complain of school activities within the municipality simply because they are conducted "by its paid employees," Standing Opinion at 5. Nearly all governmental activities are conducted or overseen by employees whose salaries are funded by tax dollars. To confer taxpayer standing on such a basis would allow any municipal taxpayer to challenge virtually any governmental action at any time. Article III, as interpreted by the Supreme Court, requires a good deal more.
181
In sum, we conclude that the Altmans and the DiNozzis no longer have standing to pursue any of the claims asserted in this action; that the DiBaris did not have standing at the time of trial to challenge activities conducted at Pound Ridge Elementary; and that when Tiana DiBari graduated from Fox Lane Middle, the DiBaris lost their standing to challenge activities conducted at that school. The DiBaris thus retain standing to challenge only the activities at Fox Lane High.
182
Of the activities that the district court found unconstitutional, those regarding Ganesha and worry dolls were not found to have taken place at any school other than Pound Ridge Elementary; the "Listening to Nature" tape was not found to have been played at any school other than Fox Lane Middle. Because no plaintiff retains standing to challenge the activities at those schools, claims with respect to those activities must be dismissed as moot.
183
Other challenged activities conducted at Pound Ridge Elementary and/or Fox Lane Middle, but not found to have taken place at Fox Lane High, included those with regard to Buddha, Quetzalcoatl, the "God Messed Up" poems, brain stimulation exercises, the writing of descriptive journals, Magic, meditation, and the Yale decision-making program. The district court dismissed all claims challenging these activities for lack of merit. All of them are moot and hence dismissable for lack of jurisdiction, and we reject on that basis plaintiffs' cross-appeal seeking their reinstatement.
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III. THE MERITS OF THE SURVIVING SUBSTANTIVE CHALLENGES
185
Given our rulings in Part II above, only challenged activities at Fox Lane High remain at issue, and the only activity at that school that the district court found unconstitutional is the celebration of Earth Day.
A. Earth Day and the Establishment Clause
186
The Establishment Clause of the First Amendment provides that "Congress shall make no law respecting an establishment of religion...." U.S. Const. amend I. In Lemon v. Kurtzman, 403 U.S. 602 (1971), the Supreme Court set out a three-pronged test that a governmental practice must meet in order to withstand a challenge under the Establishment Clause. The Lemon test requires that the practice (1) "have a secular legislative purpose," (2) have a "principal or primary effect... that neither advances nor inhibits religion," and (3) "not foster an excessive government entanglement with religion." Id. at 612-13 (internal quotation marks omitted). Only the first two prongs of this test are at issue in this case.
187
In applying the first Lemon prong, the Supreme Court has asked "whether government's actual purpose is to endorse or disapprove of religion." Edwards v. Aguillard, 482 U.S. 578, 585 (1987) (striking down Louisiana law that forbade the teaching of evolution in public schools unless accompanied by teaching of creationism) (internal quotation marks omitted). "Families entrust public schools with the education of their children, but condition their trust on the understanding that the classroom will not purposely be used to advance religious views that may conflict with the private beliefs of the student and his or her family." Id. at 584.
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In addressing the second Lemon prong, i.e., the effect of the practice, in the context of a challenge to the display of a creche in a county courthouse, see County of Allegheny v. ACLU, 492 U.S. 573 (1989), a majority of the Supreme Court applied the standard of whether a reasonable observer would find that the creche had the effect of endorsing religion. See id. at 620 (opinion of Blackmun, J.); id. at 635-36 (O'Connor, J., concurring in part and concurring in the judgment); id. at 642-43 (Brennan, J., concurring in part and dissenting in part, joined by Marshall and Stevens, JJ.); see, e.g., Agostini v. Felton, 521 U.S. 203, 234-35 (1997) (applying endorsement test, along with prongs of the Lemon test, to challenge of government aid to parochial schools). The reasonable-observer test is an objective standard, see, e.g., Americans United for Separation of Church and State v. City of Grand Rapids, 980 F.2d 1538, 1553 (6th Cir. 1992), and we review its application de novo.
189
Further, under the Establishment Clause, "'government may not coerce anyone to support or participate in religion or its exercise.'" Santa Fe Independent School District v. Doe, 530 U.S. 290, 302 (2000) (quoting Lee v. Weisman, 505 U.S. 577, 587 (1992)). In Lee, the Court held that delivery of a prayer by a rabbi at a middle-school commencement violated the Establishment Clause because of the risk that the young students might feel coerced to participate in the prayer. See 505 U.S. at 598-99. The Court found "subtle coercive pressures" in the commencement prayer and in the fact that there was "no real alternative" for a student who wished "to avoid the fact or appearance of participation." Id. at 588. In Doe, the Court held that even where a prayer before a high-school football game was delivered by a student who was elected by the student body, it "ha[d] the improper effect of coercing those present to participate in an act of religious worship." 530 U.S. at 312.
190
Nonetheless, while "[s]chools have a constitutional duty to make 'certain... that subsidized teachers do not inculcate religion,'" Marchi v. Board of Cooperative Educational Services of Albany, 173 F.3d 469, 475 (2d Cir.) (quoting Lemon, 403 U.S. at 619), cert. denied, 528 U.S. 869 (1999), the Establishment Clause does not prohibit schools from teaching about religion. See, e.g., Stone v. Graham, 449 U.S. 39, 42 (1980) (per curiam) ("[T]he Bible may constitutionally be used in an appropriate study of history, civilization, ethics, comparative religion, or the like."). "[S]tudy of religions and of the Bible from a literary and historic viewpoint, presented objectively as part of a secular program of education, need not collide with the First Amendment's prohibition." Epperson v. Arkansas, 393 U.S. 97, 106 (1968); see Schempp, 374 U.S. at 225.
191
Finally, the Establishment Clause "'forbids alike the preference of a religious doctrine or the prohibition of theory which is deemed antagonistic to a particular dogma.'" Edwards v. Aguillard, 482 U.S. at 593 (quoting Epperson, 393 U.S. at 106-07) (emphases in Aguillard). Thus, on the one hand, the fact that a governmental action or message coincides with the beliefs of certain religions does not, without more, invalidate that action or message. See McRae, 448 U.S. at 318-20 (ban on Medicaid funding of abortions does not violate Establishment Clause even though it coincides with Catholic doctrine); McGowan, 366 U.S. at 442-45 (Sunday closing laws do not violate Establishment Clause even though they coincide with Christian doctrine); id. at 442 ("[M]urder is illegal[;].... the fact that this agrees with the dictates of the Judaeo Christian religions while it may disagree with others does not invalidate the regulation."). On the other hand, the Establishment Clause does not prohibit teaching about a doctrine, such as evolution, merely because it conflicts with the beliefs of a religious group. See Epperson, 393 U.S. at 109. In sum,
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[t]here is and can be no doubt that the First Amendment does not permit the State to require that teaching and learning must be tailored to the principles or prohibitions of any religious sect or dogma.
193
Id. at 106 (emphasis added).
194
In the present case, the district court concluded that the celebration of Earth Day at Fox Lane High constituted a religious ceremony because (a) "[t]he worship of the Earth is a recognized religion (Gaia), which has been and is now current throughout the world," 45 F.Supp.2d at 393, (b) the proceedings "t[ook] on much of the attributes of the ceremonies of worship by organized religions," id., and (c) the faculty advisor's statements paralleled one statement in Genesis (and hence was found to constitute "clearly religious teaching," id. at 394), and contradicted another in a way that plaintiffs viewed as an endorsement of birth control, contrary to principles of Catholicism, see id. Presumably the organized-religion ceremonial attributes referred to by the court were the actions prohibited in the court's final injunction, e.g., use of "'symbolic structures' equal to an altar," use of "any globe on bamboo sticks," and use of "a chorus of ceremonial drums." Final Judgment and Permanent Injunction at 3, ¶A. In light of the evidence and of the findings made, or not made, by the district court, we have difficulty with the court's conclusion.
195
First, the court did not find that the School District sponsored Earth Day ceremonies with any intent to establish religion. Although plaintiffs' pleading alleged that there was a Bedford "program" to promote satanism and "New Age spirituality" (Amended and Supplemental Complaint ¶18(a)) and the "Veneration of Pagan Gods" (id. page 12 (italics in original)), the court found that there was no such "program," 45 F.Supp.2d at 373. As to the Earth Day ceremonies in particular, the court found that their sponsorship "started out innocently enough," id. at 393, originating in the century-old provision of the New York State Education Law that there be an annual celebration of Conservation Day. That provision, quoted in full in Part I.B.3. above, requires public schools to "assemble the pupils... in the school building, or elsewhere," to "conduct... such exercises as shall tend to encourage the planting, protection and preservation of trees and shrubs," and to use "lectures, pictures or tours... to increase the interest and knowledge of such pupils in the fish and wild life, soil and water of the state." N.Y. Educ. Law §810(2).
196
Further, the district court did not find that the Earth Day program was coercive. And, for the reasons discussed in Part III.B. below, we agree that it was not. Given that the School District's sponsorship of Earth Day ceremonies had a secular purpose and was not coercive, the inquiry becomes whether those ceremonies had the effect of endorsing the Gaia religion.
197
On this issue, we disagree with the district court, for we cannot conclude that an objective observer would view the Earth Day ceremonies as having a Gaia-endorsing effect. Although the district court stated that the Earth Day ceremonies involved "addresse[s] to the Earth as if it were the Creator, or divine," and "prayers... to the Earth," 45 F.Supp.2d at 397, scant evidence was cited to support that finding. The "address" that comes closest to the court's description appears to be the Taos Indian invocation on the "Listening to Nature" tape, played at Fox Lane Middle, suggesting that the Earth was "Mother of us all," J. Cornell, Listening to Nature, How to Deepen Your Awareness of Nature at 64 ("The Mother of us all is Earth. / The Father is the Sun. / The Grandfather is the Creator / Who bathed us with his mind / And gave life to all things /... We praise our Grandfather for his creation."). But there is no indication that that tape was played at any Earth Day ceremonies; and even that invocation describes "The Grandfather," not the Earth, as the Creator. The court did not cite evidence to support its statement that the Earth was designated the Creator, or as a Divine Being, or was worshiped at the School District's Earth Day ceremonies.
198
Further, we have seen in the trial testimony little or no probative mention of Gaia. For example, the student president of Youth in Action, which organized the Earth Day ceremonies, was asked if he had heard of Gaia; he testified that he had, and that he understood it to be the belief that the Earth is a living thing. But he did not suggest that the Earth Day ceremonies were meant to represent rituals of Gaia or any other religion. Rather, he stated that the Earth Day activities were designed merely to help students understand environmental problems and to foster respect for the Earth, and that there was no worshiping of the Earth nor any religious significance in any of the components of the Earth Day celebration. Similarly, an issue of the Fox Lane High newspaper introduced by plaintiffs and relied on by the district court, while containing a reference to "Mother Earth," described Earth Day as a day whose celebration was special precisely because it was not religious. (See The Forum April 1997 ("Forum article") ("There are no barriers, such as religion or cultural differences, to hold us back in our realization of our relationship with the earth and all things around us. Although this may be one of the most important holidays of the year, many of us are still unsure of its meaning, probably because, unlike religious holidays, there are no strict ceremonies or interpretations of Earth Day; it is simply a celebration of the Earth.").) Thus, we see no greater religious significance in the article's colorful reference to "Mother Earth" in this context than if the article had referred to "Father Time."
199
The district court made no finding that anyone attending the ceremonies suggested that the Earth possessed supernatural powers or that it should be worshiped; nor have plaintiffs called to our attention any evidence of such a suggestion. The court pointed to two remarks of the faculty advisor, one that was consistent with the teachings of Genesis, and one that was contrary to those teachings. But we cannot conclude that a reasonable observer would view either of those statements as having a Gaia-endorsing effect; Supreme Court precedent makes clear that the Establishment Clause is not transgressed merely because a statement either is in agreement with, or is in disagreement with, a given religious tenet.
200
Finally, we cannot conclude that the ceremonial acts that the district court pointed to and enjoined would be viewed by an objective observer as suggesting that the Earth was Divine, or the Creator, or a Being to be worshiped, or that the proceedings were in nature religious. For example, when the court enjoined the use of "'symbolic structures' equal to an altar," it was quoting the 1997 Forum article; but the "symbolic structures" referred to in that article were not altar-like; the article stated that they were tepees. Nor has our attention been directed to any evidence that students were called upon to place any objects on a structure like an altar; rather, the testimony was that the proffered "gifts" were purely metaphorical, such as gifts of knowledge and wisdom in the form of speeches. Further, though the court enjoined the use of drum rolls during Earth Day ceremonies, drum rolls are commonly used in proceedings having no religious significance whatever. And although the display of a globe on bamboo poles is less common, the district court did not adequately explain why such display of a globe, or the roll of drums, had significance that was religious.
201
As the court noted, the faculty advisor's memorandum described the Earth Day ceremonies as reflecting "the core idea of respect for the earth...." 45 F.Supp.2d at 394. Respect, however, does not inevitably suggest religion. Indeed, the rituals employed in the Fox Lane High ceremonies, although more imaginative, strike us as not fundamentally different from rituals codified by Congress for showing respect to the United States flag. For example, Congress has instructed that when the flag is displayed during a rendition of the national anthem,
202
(A) all present except those in uniform should stand at attention facing the flag with the right hand over the heart;
203
(B) men not in uniform should remove their headdress with their right hand and hold the headdress at the left shoulder, the hand being over the heart; and
204
(C) individuals in uniform should give the military salute at the first note of the anthem and maintain that position until the last note.
205
36 U.S.C. §301(b)(1) (Supp. IV 1998). Similar requirements are imposed for stances when the flag is hoisted, lowered, or passed. See 4U.S.C. §9 (Supp. V 1999); see also id. §8(b) (the flag should never touch the ground or floor); id. §8(c) (flag should never be carried horizontally); id. §8(h) (flag should not be used to hold or carry any object); id. §8(k) (when no longer suitable for display, flag should be destroyed in a "dignified way").
206
An objective observer would not view these detailed prescriptions for honoring the American flag--rituals that are observed daily across the nation--as an indication that Congress, or any governmental entity that observes such ceremonial respect, has established flag worship as a religion. We conclude that an objective observer similarly would not view the School District's Earth Day ceremonies as endorsing Gaia or Earth worship as a religion. Accordingly, we vacate the judgment's declaration that the Earth Day celebrations violated the Establishment Clause.
B. Earth Day and the Free Exercise Clause
207
The Free Exercise Clause of the First Amendment provides that "Congress shall make no law... prohibiting the free exercise []of [religion]." U.S. Const. amend I. This Clause
208
has a double aspect. On the one hand, it forestalls compulsion by law of the acceptance of any creed or the practice of any form of worship. Freedom of conscience and freedom to adhere to such religious organization or form of worship as the individual may choose cannot be restricted by law. On the other hand, it safeguards the free exercise of the chosen form of religion. Thus the Amendment embraces two concepts, freedom to believe and freedom to act. The first is absolute but, in the nature of things, the second cannot be.
209
Cantwell v. Connecticut, 310 U.S. 296, 303-304 (1940). Where there is no indication that a restriction of a plaintiff's religious activities was the defendant's actual objective, but only that its actions, neutral on their face, had a restrictive effect, the proper inquiry is "'whether government has placed a substantial burden on the observation of a central religious belief or practice and, if so, whether a compelling governmental interest justifies the burden.'" Jimmy Swaggart Ministries v. Board of Equalization, 493 U.S. 378, 384-85 (1990) (quoting Hernandez v. Commissioner, 490 U.S. 680, 699 (1989)); see Wisconsin v. Yoder, 406 U.S. 205, 220 221 (1972).
210
In the present case, although the Final Judgment and Permanent Injunction indicated that the Earth Day activities violated both the Establishment Clause and the Free Exercise Clause, the court made no ruling on Earth Day expressly relating to the latter Clause and made no findings sufficient to support a conclusion of free exercise violation. First, the court did not suggest that any restriction of the plaintiffs' religious activities was intended. To the contrary, as discussed in the preceding section, the court stated that the ceremonies had an "innocent[]" origin in the state statutory requirement that public schools conduct exercises to instill in their students an interest in fish, wildlife, vegetation, and the soil.
211
Thus, the principal question was whether the Earth Day ceremonies had a religion-burdening effect. The district court focused principally on the faculty advisor's criticism of overpopulation of the Earth, which the court stated was contrary to the teaching of Genesis, and on Father Pacwa's interpretation of that remark as advocacy of birth control. The mere evidence that plaintiffs found that remark and perhaps some other aspects of the ceremonies offensive to their beliefs, however, did not suffice to prove a free exercise violation, for the court made no finding that students were required to participate in the Earth Day ceremonies. The principal of Fox Lane High testified that attendance was not compulsory, and we see no indication that the district court discredited that testimony. Absent a finding that students were required to attend or participate in the Earth Day ceremonies, we conclude that there was no interference with plaintiffs' free exercise of their chosen religion.
212
Accordingly, we reverse the judgment's declaration that the Earth Day ceremonies at Fox Lane High violated the Free Exercise Clause.
C. Plaintiffs' Cross-Appeal
213
Plaintiffs cross-appeal from so much of the judgment as dismissed their claims challenging the activities described in Part I.C. above. They maintain that those activities violated the Establishment and Free Exercise Clauses, the Fourteenth Amendment right to privacy, and/or state law. As indicated in Part II above, many of the claims pursued by plaintiffs on their cross-appeal are claims that have become moot since the commencement of the litigation, and we lack jurisdiction to reinstate those claims.
214
As to the dismissed claims over which we have jurisdiction, we agree with the district court that those claims lack merit. In light of the discussion in Parts III.A. and B. above, we affirm their dismissal substantially for the reasons stated in that discussion and in the district court's opinion.
IV. THE RELIEF GRANTED
215
Finally, independently of the merits of plaintiffs' claims, we conclude that the relief granted in the district court's Final Judgment and Permanent Injunction was inappropriate.
216
First, as set out more fully in Part I.F. above, the district court's final judgment contains a mandatory injunction requiring the School District to adopt and publish guidelines (the "Guidelines Injunction") to ensure compliance with
217
the Supreme Court's standards set forth in the cases quoted in this Court's Order and Opinion, so as to avoid coercing any student to participate in religion or its exercise or to violate any religious precept held by a child or his or her parents, and to further avoid sponsoring or disparaging religious beliefs held by students and or their parents.
218
Final Judgment and Permanent Injunction at 2. Even leaving aside our rejection of the district court's application of Supreme Court First Amendment doctrine, see Part III above, the terms of this injunctive provision are impermissibly vague. See generally Fed. R. Civ. P. 65(d) (injunction must "describe in reasonable detail... the act or acts sought to be restrained"). The requirement that an injunction be specific "reflects Congress' concern with the dangers inherent in the threat of a contempt citation for violation of an order so vague that an enjoined party may unwittingly and unintentionally transcend its bounds." Sanders v. Air Line Pilots Ass'n, 473 F.2d 244, 247 (2d Cir. 1972); see 11A C.Wright, A. Miller, & M. Kane, Federal Practice and Procedure §2955, at 308 09 (2d ed. 1995).
219
Given the vast array of religious practices, an injunction stating simply that a party must create guidelines "to ensure" that school personnel will avoid coercing any pupil "to participate in religion or its exercise," Final Judgment and Permanent Injunction at 2, is insufficiently specific. Without greater guidance in the injunction itself, an attempt at compliance would likely result in guidelines that either were so detailed as to foreclose activities having no religious significance, or so general as to provide little guidance. Similarly flawed is the requirement that the School District promulgate a guideline to ensure that an activity will not "violate any religious precept held by a child or his or her parents," id.
220
Second, the prohibitory provisions of the Final Judgment and Permanent Injunction, quoted in Part I.F. above, are flawed either for jurisdictional reasons or because they were not adequately supported. The jurisdictional problems affect injunctive paragraphs B, C, and D, which prohibit the School District from sponsoring activities relating to nature tapes, worry dolls, and Ganesha. Those activities were found to have been conducted at Pound Ridge Elementary or Fox Lane Middle, not at any other school; and, as discussed in Part II above, plaintiffs' challenges to activities at Pound Ridge Elementary and Fox Lane Middle have become moot.
221
We note that the district court stated in its Standing Opinion that all of the injunctive provisions were to be applicable to all schools in the School District. Although that view was consistent with the district court's view that any Bedford taxpayer could bring suit to halt any school activity characterized as religious, even without having any child who was or would be eligible to attend school, we have rejected taxpayer standing in this case. Moreover, given the court's reliance on the view that various activities had a subtly coercive effect on children who were young and impressionable, see, e.g., 45 F.Supp.2d at 383-85, blanket prohibitions against a given activity at all schools at whatever level, without particularized findings as to how an objective observer would view each activity at each level, were inappropriate.
222
As to the Earth Day ceremonies, discussed in Part III.A. above, the prohibitions were inappropriate because the specific features enjoined, such as drum rolls and globes on poles, were not shown to be used in ways that were religious; and no evidence has been cited to support the finding that the ceremonies included worship of the Earth or liturgies addressed to the Earth as if it were the Creator or a Divine Being.
223
Finally, given our reversal of the district court's rulings in favor of plaintiffs on their First Amendment claims, the district court's award of attorneys' fees to them as "prevailing part[ies]," 42 U.S.C. §1988, must also be reversed. See, e.g., Russo v. State of New York, 672 F.2d 1014, 1023 (2d Cir. 1982) ("The teachings of the Supreme Court... foreclose [an] expansive interpretation of section 1988" that would allow "attorney's fees under section 1988 to a party who does not succeed on his civil rights claim...."), modified on other grounds, 721 F.2d 410 (2d Cir. 1983).
CONCLUSION
224
We have considered all of the parties' contentions in support of their respective appeals. For the foregoing reasons the judgment of the district court is vacated insofar as it adjudicated claims challenging activities at Pound Ridge Elementary School and Fox Lane Middle School, and is remanded for dismissal of those claims for lack of subject matter jurisdiction; the judgment is reversed insofar as it declared activities of the School District to violate the First Amendment and granted injunctive relief and attorneys' fees; and it is affirmed insofar as it dismissed other claims asserted by plaintiffs.
|
40 Cal.App.2d 786 (1940)
THE PEOPLE, Respondent,
v.
DONLEY M. RINESMITH et al., Appellants.
Crim. No. 3367.
California Court of Appeals. Second Appellate District, Division One.
September 30, 1940.
Franklin B. MacCarthy for Appellants.
Earl Warren, Attorney-General, and L. G. Campbell, Deputy Attorney-General, for Respondent.
White, J.
In two informations which were consolidated for trial defendants were accused of the crimes of robbery and grand theft. Following trial before a jury, defendants were convicted on both counts. From the judgments and the order denying their respective motions for a new trial this appeal is prosecuted.
As to the robbery charge, the facts may be thus summarized: On the afternoon of January 8, 1940, Joe Overman, 66 years of age, was in a toilet at 125 South San Pedro Street in the *788 city of Los Angeles, when, according to his testimony, the defendant Keech grabbed him around his arms and body, making his approach from behind, and while he was thus pinioned by Keech defendant Rinesmith took from the pocket of Overman, the prosecuting witness, a billfold containing $40. After admonishing the victim "not to squawk", the robbers made their escape, taking with them the billfold and money heretofore mentioned.
Viewing the evidence as to the grand theft charge in the light most favorable to the prosecution, as we are required to do following a guilty verdict, it appears that one Frank Wisniewski, a retired railroad man 70 years of age, was walking down a street in the city of Glendale, county of Los Angeles, in the forenoon of January 3, 1940, when he was accosted by appellant Keech, who asked for directions to a show. Immediately after that meeting defendant Rinesmith came up and Keech, referring to the subject of his conversation with complainant, said, "Maybe you can help us out a little," and the three thereupon engaged in conversation. The group then went to the Globe Restaurant in Glendale and sat in a booth, where they were very shortly thereafter joined by a woman. The conversation turned upon the amount of money each of the trio had, and Keech represented himself to be in possession of a large sum and displayed a large roll of bills, offering to wager $100 against $5 that neither of the other men had a bank account. The complainant apparently accepted the wager, and thereupon went to his home with defendant Keech and secured a bank book evidencing the sum of $2,500 to his credit in a savings account in a Glendale bank. After the complainant showed the defendants this bank book, the defendant Keech offered to bet $700 against $25 that the complainant would be unable to withdraw the money from his bank. Defendant Rinesmith finally agreed to put up the $25 for the victim against the $700 offered by Keech, and the money was thereupon turned over to their girl companion to act as stakeholder. After the bet was posted the complainant went to the bank and withdrew $2,500 in cash and returned to the restaurant where the two defendants and a woman were waiting. All of them sat down in a booth, and the victim showed the others the $2,500 in anticipation of winning the $700. The complainant testified that Mr. Rinesmith somehow got the $2,500 out of his hand *789 upon the pretext of examining it more minutely, and that he thereupon took the $725 from the girl and apparently put both piles of money together and wrapped the same up in a napkin, which he placed under complainant's shirt. The quartet remained in the restaurant for about an hour, whereupon the victim started for home, secure in the thought that he had not only his $2,500 but the wager as well. Giving the package to his wife, appellant discovered upon her opening it that all he had was a one-dollar bill wrapped around blank paper.
[1] For their first ground of appeal appellants assert prejudicial error on the part of the trial court in refusing to limit the cross-examination of a defense witness, Don King, and appellant Rinesmith testifying as a witness in his own behalf. The witness King was called to establish an alibi for defendant Keech. While the cross-examination of this witness was minute and thorough, we perceive no resultant prejudice to defendant Keech therefrom. The cross-interrogatories in the main were such as to test the strength or weakness of the witness' recollection concerning persons he met, places he visited, and dates when he claimed defendant Keech was in his company, particularly with reference to the day the theft of Wisniewski's money occurred. The cross-examination did no violence to defendant Keech's substantial rights. [2] Equally without merit is the claim of appellant Rinesmith that prejudice resulted from his cross-examination by the district attorney. On direct examination this appellant was not interrogated as to his occupation, but on cross-examination he was asked where he was working at about the time when the charged offenses were committed, in response to which questions he testified that he was not working but made his money by betting on horse races. Appellant Rinesmith now contends that he was prejudiced by being compelled to admit that he made his money on the races. The complaint is trivial. Appellant was charged with robbery and theft. He denied on cross-examination that he took any money from either of the victims. It was proper cross-examination to elicit the source of his income as well as that of money in his possession. [3] On cross-examination any fact may be elicited which the jury might deem inconsistent with the direct testimony of a witness, and the defendant testifying in his own behalf is in this respect put upon the same plane as other witnesses. *790
[4] We come now to a consideration of appellants' claim that the trial court erred in permitting the deposition of Joe Overman, the complaining and only witness in connection with the robbery charge set forth in count I of the information, to be read into evidence, when the only foundational showing was the testimony of a police officer that although the witness in question was within the county of Los Angeles, he was too ill to attend the trial and testify. Appellants' contention in this regard must be uphold. Upon the aforesaid showing the court permitted the evidence of the witness Overman taken at the preliminary examination to be read at the trial. Section 686 of the Penal Code provides that this kind of evidence may be introduced only "upon it being satisfactorily shown to the court that he" (the witness) "is dead or insane, or cannot with due diligence be found within the state". [5] The right of a defendant in a criminal action to cross-examine the witnesses against him is of the highest importance, and the deposition of such a witness can only be offered in strict conformity with the statute. The fact that a witness, though within reach of process of subpoena, is too unwell to appear before the jury, is not one of the grounds which will permit such a deposition to be read at the trial. (People v. Bojorquez, 55 Cal. 463; People v. Plyler, 126 Cal. 379 [58 P. 904].) In the instant case the defendants refused to stipulate to the introduction of the "testimony". The court thereupon took testimony from the police officer as to the illness of the witness, and over defendants' protest ordered the testimony given by the complaining witness at the preliminary examination to be read to the jury at the trial. This was error. The deposition was incompetent, and as such deposition contained the testimony, the latter was also incompetent. The testimony contained in the deposition being the only testimony adduced against the defendants on the charge of robbery contained in count I, the judgment and order as to such count must be reversed.
[6] Appellants next urge that the evidence was insufficient to support the verdict rendered as to defendant Rinesmith on count II. As so often happens in cases of this type, the evidence is highly conflicting, especially as to defendant Rinesmith. But even though we concede that the evidence is equally compatible with a conclusion of innocence as it is with one of guilt, nevertheless we are powerless to disturb the finding *791 of the jury in adopting by their verdict the hypothesis of guilt and rejecting the hypothesis of innocence, unless there is no evidence to support the implied finding of the jury that the hypothesis of guilt is the more reasonable of the two hypotheses. (People v. Bresh, 33 Cal.App.2d 161, 163 [91 PaCal.2d 193]; People v. Tom Woo, 181 Cal. 315, 326 [184 P. 389]; People v. Newland, 15 Cal.2d 678 [104 PaCal.2d 778].) The complaining witness was positive in his identification of appellant Rinesmith and he had plenty of opportunity to observe such appellant upon the occasion when the money was lost. Other witnesses testified to circumstances which gave strength to the victim's identification of appellant Rinesmith as being one of the participants in the theft. If we assume, as we must, in favor of the verdict the existence of every fact which the jury could have reasonably deduced from such evidence, then the verdict is amply supported. [7] When, as here, the circumstances are such as to reasonably justify the verdict of the jury, then, notwithstanding that this court might be of the opinion that those circumstances could also reasonably be reconciled with the innocence of the defendant, we are nevertheless without warrent to interfere with the determination of the jury thereon. That this is the law is directly and positively held by our Supreme Court in People v. Newland, supra.
[8] Finally, appellants assert that in his closing argument to the jury the district attorney was guilty of prejudicial misconduct in what he said of and concerning Donald King, a witness called on behalf of defendant Keech. In that connection the record discloses the following:
"Mr. Barnes (Deputy District Attorney): ... I am sure he does not want me to tell you anything outside of the record about this man King. I am sure he does not. And I will not go outside of the record, but I will say--"
"Mr. MacCarthy (Defendants' Counsel): Just a moment, we object to that and assign that remark as misconduct."
"Mr Barnes: Counsel invited it, when he made a remark of that kind in his argument of this case to the jury."
"The Court: The assignment will be denied."
The foregoing constitutes the only part of either the arguments of the defendants' counsel or of the district attorney to the jury that has been furnished to us on this appeal. True, 9 defendants' counsel objected to the remarks of the district *792 attorney, but the latter countered with the statement that what he said was prompted by a similar remark made by appellants' counsel in his address to the jury. While we do not commend the remarks made by the district attorney and have often reminded prosecuting officers of their duty to temper their remarks and to refrain from saying things or conducting themselves in a manner which may tend to prejudice the defendant, nevertheless in the state of the record before us it is entirely apparent that the district attorney was making the statement in question in response to the argument made on behalf of the defendants. Where, as here, the record indicates that the statement of the district attorney was invited, it is not prejudicial misconduct. (People v. Kennedy, 21 Cal.App.2d 185, 206 [69 PaCal.2d 224].) Not only was it the duty of defendants' counsel to challenge the statement made by the district attorney that the former's argument to the jury prompted the latter's statement against which complaint is made; but appellants have failed to comply with the requirements of section 7 of rule II of the Rules for the Supreme Court and the District Courts of Appeal, for which last-named reason this court might well refuse even to consider this assignment of error. However, having done so, we are compelled to say, under the state of the record before us, that we find in the comment made by the district attorney no misconduct sufficient to justify a reversal.
For the reasons herein stated the judgments and the order denying defendants' motion for a new trial as to count I are, and each is, reversed and the cause remanded for a new trial as to such count. The judgments and the order denying defendants' motion for a new trial as to count II are, and each is, affirmed.
York, P. J., and Doran, J., concurred.
|
569 S.E.2d 858 (2002)
256 Ga. App. 902
STINSON
v.
The STATE.
No. A02A1551.
Court of Appeals of Georgia.
May 30, 2002.
Reconsideration Denied August 8, 2002.
*859 Chandler & Britt, Walter M. Britt, Deborah F. Weiss, for appellant.
Daniel J. Porter, Dist. Atty., George F. Hutchinson III, Asst. Dist. Atty., for appellee.
PHIPPS, Judge.
Following remand in State v. Stinson,[1] James Stinson was tried and convicted of one *860 count of aggravated sexual battery and four counts of sexual battery. In this appeal of his convictions, he complains of certain of the trial court's evidentiary rulings and jury instructions. We find no error and affirm.
State's evidence showed that in the early morning hours of February 14, 1998, the complaining witness, K.D., was sitting in a car in the parking lot of a supermarket. She was there with a man with whom she had previously worked and had an affair. Stinson, a uniformed Gwinnett County police officer, appeared on the scene and decided to investigate. After discovering that K.D.'s driver's license had been suspended, Stinson instructed her male companion to leave. While detaining K.D., Stinson sexually battered her in various ways and forced her to perform oral sex. Following this incident, K.D. and her husband divorced. Stinson's defense was that his sexual contact with K.D. was consensual.
1. Stinson charges the trial court with error in refusing to admit pleadings in a civil action by K.D. against him, his chief of police, and Gwinnett County arising from the subject incident.
Although K.D. dismissed her action prior to trial,[2] Stinson argues that the county's answer should have been admitted because in it the county denied that Stinson committed the acts giving rise to this prosecution. According to Stinson, the State is, therefore, judicially estopped from taking a contrary position in this proceeding. There is no merit in this argument.
"The federal doctrine of judicial estoppel `precludes a party from asserting a position in a judicial proceeding which is inconsistent with a position previously successfully asserted by it in a prior proceeding.'"[3] In the prior civil case, however, K.D. sued Gwinnett County. This is a prosecution by the State of Georgia against Stinson. The State could not have asserted an inconsistent position in the prior proceeding, because it was not a party to it. Moreover, the defense of estoppel is unavailable against the State where its application would thwart a strong public policy,[4] such as enforcement of the criminal law. For these reasons, the county's denial of the allegations of K.D.'s civil complaint in no way estops the State from bringing these criminal charges. In addition, the court allowed Stinson to elicit testimony concerning the county's answer to K.D.'s civil complaint, and defense counsel was permitted to comment on its contents during closing argument. The court merely ruled that the complaint could not go out with the jury. We find neither harm nor error.
2. Stinson contends that the trial court erred in refusing to admit K.D.'s petition for divorce. Stinson argues that statements in the divorce petition contradicted K.D.'s trial testimony. We find no contradiction.
3. Stinson complains of the trial court's refusal to instruct the jury on impeachment by proof of general bad character.
"A witness may be impeached by evidence as to his general bad character. The impeaching witness should first be questioned as to his knowledge of the general character of the witness, next as to what that character is, and lastly he may be asked if from that character he would believe him on his oath."[5] In this case, neither the State nor Stinson used this mode of impeachment at trial. Instead, *861 Stinson sought to impeach K.D. based on prior contradictory statements. The court charged the jury on that method of impeachment. The court did not err in refusing to charge the jury on the method of impeachment set forth in the requested charge.
4. Stinson contends that the court erred in refusing to charge the jury on OCGA § 24-9-68: "The state of a witness's feelings toward the parties and his relationship to them may always be proved for the consideration of the jury."
Stinson argues that this charge should have been given because of the civil lawsuit K.D. filed against him and the county. But, as previously noted, K.D. dismissed that suit. Moreover, the court charged the jury that in passing upon credibility of witnesses, it could consider their interest or lack of interest in the occurrences about which they testified. That was the applicable legal principle here. The court did not err in refusing to give the requested charge.
5. Contrary to argument advanced by Stinson in his final claim of error, the court did not err in refusing to instruct the jury that it should consider K.D.'s character in determining whether the sexual contact with him was consensual or against her will.
As authority in support of this request to charge, Stinson relied on the rape shield statute.[6] That statute, however, is not directly applicable to sexual offenses such as sexual battery or aggravated sexual battery.[7] Moreover, even if it were directly applicable, it precludes admission of evidence concerning the complaining witness's past sexual behavior unless, among other things, that behavior involved the participation of the accused.[8] Here, there is no evidence of any past sexual behavior between Stinson and K.D. The court did not err in refusing to give this request to charge, as it was not supported by any legal authority.[9]
Judgment affirmed.
ANDREWS, P.J., and MIKELL, J., concur.
NOTES
[1] 244 Ga.App. 622, 536 S.E.2d 293 (2000) (reversing trial court's grant of Stinson's motion to suppress his pretrial statements to police).
[2] Compare Chancellor v. State, 165 Ga.App. 365, 372(23), 301 S.E.2d 294 (1983).
[3] (Footnote omitted.) Wolfork v. Tackett, 273 Ga. 328, 540 S.E.2d 611 (2001).
[4] State Soil & Water Conservation Comm. v. Stricklett, 252 Ga.App. 430, 435(2), 555 S.E.2d 800 (2001).
[5] OCGA § 24-9-84.
[6] OCGA § 24-2-3.
[7] See Mobley v. State, 212 Ga.App. 293, 294(1), 441 S.E.2d 780 (1994).
[8] OCGA § 24-2-3(b).
[9] See Woityra v. State, 213 Ga.App. 89(1), 443 S.E.2d 867 (1994).
|
240 S.W.3d 871 (2007)
Michael David SPRINGER, Petitioner,
v.
Lisa Fergason SPRINGER, Respondent.
No. 06-0382.
Supreme Court of Texas.
November 2, 2007.
Michael David Springer, pro se.
Patrick Gordon Barkman, Cleburne, for respondent.
Rafael Edward Cruz, Anthony G. Brocato Jr., Marjolyn Carol Gardner, Office of the Attorney General, Law Enforcement Defense Division, Austin, for other interested party.
PER CURIAM.
Michael Springer's wife filed for divorce while he was incarcerated and Springer sought to appeal the resulting judgment dividing marital property. Springer timely filed a notice of appeal, but did not pay the filing fee or file an affidavit of indigence "with or before" the notice as Texas Rule of Appellate Procedure 20.1(c)(1) requires. One month after *872 filing his notice of appeal, Springer filed an affidavit of indigence. Two months later, the court of appeals notified Springer that his filing fee was past due and his case would be dismissed if the fee was not paid within ten days. Springer did not pay the fee. The court of appeals dismissed Springer's appeal for failure to pay the fee or file an affidavit of indigence "with or before" the notice of appeal. We hold that the court of appeals erred in dismissing Springer's appeal.
We recently decided two cases similar to the one presented. In Higgins v. Randall County Sheriff's Office, the court of appeals dismissed an inmate's appeal for failure to file an affidavit of indigence "with or before" the notice of appeal, although the affidavit was filed within the ten days the court of appeals' order allowed to correct the error by paying the fee. 193 S.W.3d 898, 899-900 (Tex.2006). Similarly, in Hood v. Wal-Mart Stores, Inc., the court of appeals dismissed an appeal when the appellant filed an affidavit of indigence not "with or before" the notice of appeal but within the ten-day period for paying the filing fee. 216 S.W.3d 829, 830 (Tex.2007). We reversed those dismissals, noting that the affidavit of indigence is no longer a jurisdictional requirement and holding that Rule 44.3 prohibits dismissal for formal defects or irregularities in appellate procedure without first allowing the appellant a reasonable time to correct the error. Id. at 830; Higgins, 193 S.W.3d at 899-900. Thus, failure to file an affidavit of indigence "with or before" a notice of appeal will not support dismissal unless the appellant is given a reasonable time to correct the defect and fails to do so.
In this case, Springer's notice of appeal was initially defective because it was unaccompanied by the filing fee or an affidavit of indigence as required by Rule 20.1(c)(1). However, Springer corrected the defect by filing his affidavit of indigence shortly thereafter; it was not even necessary for the court of appeals to permit him additional reasonable time to correct the defect. Accordingly, without hearing argument, we grant the petition for review, reverse the court of appeals' judgment, and remand to that court for further proceedings consistent with this opinion. See TEX.R.APP. P. 59.1.
|
Filed 1/15/02 by Clerk of Supreme Court
IN THE SUPREME COURT
STATE OF NORTH DAKOTA
ORDER
2002 ND 12
Supreme Court No. 20020004
In The Matter of The Judicial Vacancy in District Judgeship No. 2
With Chambers in Minot, North Dakota,
Northwest Judicial District
[¶1] On January 3, 2002, the Supreme Court received notification the Honorable Everett Nels Olson, Judge of the District Court with chambers in Minot, Northwest Judicial District, would not seek reelection when his term expired at the end of this year. Judge Olson's declaration that he does not intend to seek reelection to Judgeship No. 2 created a judicial vacancy under Section 27-05-
02.1(4), N.D.C.C.
[¶2] Under Section 27-05-02.1, N.D.C.C., this Court is required to review vacancies that occur and determine, within 90 days of receiving notice of a vacancy, whether the office is necessary for effective judicial administration. This Court may, consistent with that determination, order the vacancy be filled or order the vacant office transferred to a judicial district in which an additional judge is necessary, to be filled in that district.
[¶3] In October and November, 2001, this Court had occasion to receive and review testimony on judicial service needs, population and caseload trends, and other criteria identified in Administrative Rule 7.2, Section 4, in the Northwest Judicial District. This review and the associated consultation were conducted in light of the untimely death of the Honorable Glenn Dill, III, who held Judgeship No. 6, with chambers at Minot, in the Northwest Judicial District.
See
In the Matter of the Judicial Vacancy In District Judgeship No. 6, with Chambers In Minot, North Dakota, Northwest Judicial District, 2001 ND 199.
[¶4] We take judicial notice of the information contained in that file, including information resulting from the consultation with judges and lawyers of the Northwest Judicial District. An additional hearing was not conducted in Minot concerning the vacancy in Judgeship No. 2. For purposes of the consultation provided for under Section 27-05-02.1(4), N.D.C.C., the November 27, 2001, consultation with lawyers and judges of the district is sufficient for determining the disposition of this vacancy.
See
e.g.
, In the Matter of the Judicial Vacancy In District Judgeship No. 2, with Chambers In Grand Forks, North Dakota, Northeast Central Judicial District, 2000 ND 35.
[¶5] We have reviewed whether the transfer of the vacant office to another judicial district is warranted in light of the information received.
[¶6] This order is based on the determination that the office is necessary for effective judicial administration in its present location.
[¶7] IT IS HEREBY ORDERED, that Judgeship No. 2 at Minot in the Northwest Judicial District be filled; that an election for this office be held; and that this office appear on the 2002 primary and general election ballots in North Dakota.
[¶8] Dated at Bismarck, North Dakota, this 15th day of January, 2002.
[¶9] Gerald W. VandeWalle, C.J.
Dale V. Sandstrom
William A. Neumann
Carol Ronning Kapsner
Mary Muehlen Maring
|
Filed 8/4/16 County of Tulare v. California Public Employment Relations Board CA5
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.
N THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIFTH APPELLATE DISTRICT
COUNTY OF TULARE, F071240
Petitioner, (PERB Dec. No. 2414-M,
v. Case No. SA-CE-748M)
CALIFORNIA PUBLIC EMPLOYMENT
RELATIONS BOARD, ORDER MODIFYING OPINION
Respondent; AND DENYING REQUESTS
FOR PUBLICATION
SERVICE EMPLOYEES INTERNATIONAL [NO CHANGE IN JUDGMENT]
UNION LOCAL 521,
Real Party in Interest.
It is hereby ordered that the opinion filed herein on July 11, 2016, be modified as
follows:
1. On page 34, correct the numbered heading to read as follows:
IV. Discussion of Vested Rights
Except for the modification set forth, the opinion previously filed remains
unchanged. This modification does not effect a change in the judgment.
In addition, the requests for publication of the opinion filed in the above entitled
matter are hereby denied. The opinion does not establish a new rule of law, nor does it
meet any of the other criteria set forth in California Rules of Court, rule 8.1105(c).
In compliance with California Rules of Court, rule 8.1120(b), the
Clerk/Administrator of this court shall transmit copies of the requests for publication, the
opinion, and this order to the Supreme Court.
HILL, P.J.
WE CONCUR:
LEVY, J.
GOMES, J.
2.
Filed 7/11/16 County of Tulare v. California Public Employment Relations Board CA5 (unmodified version)
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
FIFTH APPELLATE DISTRICT
COUNTY OF TULARE,
F071240
Petitioner,
(PERB Dec. No. 2414-M,
v. Case No. SA-CE-748-M)
CALIFORNIA PUBLIC EMPLOYMENT
RELATIONS BOARD, OPINION
Respondent;
SERVICE EMPLOYEES INTERNATIONAL
UNION LOCAL 521,
Real Party in Interest.
ORIGINAL PROCEEDING; PETITION FOR WRIT OF EXTRAORDINARY
RELIEF.
Kathleen Bales-Lange, County Counsel, Jennifer M. Flores, Deputy County
Counsel; Renne Sloan Holtzman Sakai, Charles D. Sakai and Erich W. Shiners for
Petitioner.
Patrick Whitnell and Corrie L. Manning for League of California Cities and
California State Association of Counties as Amicus Curiae on behalf of Petitioner.
J. Felix De La Torre, Wendi L. Ross, Laura Z. Davis and Daniel M. Trump for
Respondent.
Weinberg, Roger & Rosenfeld, Anne I. Yen and Kerianne R. Steele for Real Party
in Interest.
-ooOoo-
In this writ proceeding, County of Tulare (County) challenges the decision of the
California Public Employment Relations Board (the Board), which concluded County
committed an unfair practice by repudiating its obligations under two addenda to the
2009 Memorandum of Understanding (MOU) between County and the employee
organization representing five bargaining units of its employees. County contends the
Board misinterpreted the addenda, erroneously determined County waived its right to
implement its final offer after reaching impasse in negotiating a successor MOU because
of the executory obligations imposed by the addenda, and erroneously concluded the
employees had a vested right to future promotions and salary increases. We deny the
petition for a writ, but modify the Board’s decision to exclude the discussion of vested
rights, which is inaccurate in the context of the questions presented in this proceeding.
FACTUAL AND PROCEDURAL BACKGROUND
County is a public agency subject to the Meyers-Milias-Brown Act. (Gov. Code,
§ 3500 et seq.; MMBA.) Service Employees International Union Local 521 (Union) is a
recognized employee organization representing five bargaining units of employees of
County. (Gov. Code, § 3501, subd. (b).) County and Union agreed to an MOU that
provided it was effective August 1, 2009 to July 31, 2011 (2009 MOU). Because of
County’s financial situation at the time, in the 2009 MOU, Union agreed to concessions
in salaries and promotions. Two addenda to the 2009 MOU are in issue in this case.
Addendum B provided that personnel rule 3.1.1 was suspended “for all classifications
within a flexibly allocated class series for the term of the contract.” A flexibly allocated
classification is a job classification in which there are multiple levels, beginning with an
entry level and moving up to more experienced levels. Promotion from one level to
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another results in a salary increase. Addendum C provided that “merit or step increases
will be suspended for the term of the contract.” Employee performance was evaluated
annually; employees achieving a high enough rating on their evaluations would be moved
up a step within their classification. The effect of these two addenda was to freeze
promotions and salary increases during the term of the 2009 MOU.
In 2011, the parties met to negotiate a successor MOU. Because County was
facing a deficit of up to $4.6 million, County’s initial proposal included a continuation of
the freeze on promotions and salary increases. Union’s position was that, after expiration
of the 2009 MOU, the employees it represented were entitled to be moved up in
accordance with the promotions or step increases earned during the term of the 2009
MOU.1 Its position was based on language of the two addenda. After providing for a
freeze of promotions, addendum B provided: “Commencing the first full pay period
following the expiration of the agreement each employee having qualified during the
term of the agreement for promotion to a higher classification in a flexibly-allocated
classification will be placed at the step in that classification which in the absence of this
provision would have taken effect during the agreement.” After freezing step increases,
addendum C provided: “Commencing the first full pay period following the expiration of
the agreement each employee having qualified during the term of the agreement will be
placed at the step in the range which in the absence of this provision would have taken
effect during the agreement.” Each of County’s 2014 proposals included a continued
freeze of promotions and step increases.
The parties could not reach agreement on a successor MOU; County declared an
impasse and its Board of Supervisors elected to implement County’s final offer, including
the continued suspension of promotions and salary increases. Union filed an unfair
1 Union sought only prospective salary increases. It did not seek backpay for the period
during which the 2009 MOU was in effect.
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practice charge with the Board, alleging County repudiated the terms of the two addenda,
which contractually obligated County to give effect to promotions and step increases
earned, but suspended, during the term of the 2009 MOU. The Office of the General
Counsel issued a complaint against County, alleging County committed an unfair practice
by refusing to implement addenda B and C to the 2009 MOU.
The matter was heard by an administrative law judge, whose proposed decision
was in favor of County. Union filed a statement of exceptions to the proposed decision,
and County filed a response. The Board issued its decision in favor of Union. County
filed its petition for a writ of extraordinary relief with this court, seeking a writ directing
the Board to vacate its decision and enter a new order dismissing the complaint and the
unfair practice charge against County. Alternatively, County seeks a writ directing the
Board to vacate the portions of its decision discussing constitutionally vested rights.
Amici curiae, League of California Cities and California State Association of Counties,
urge this court to hold that a local public agency’s waiver of the right to implement the
terms of its final offer must be “clear and unmistakable”; they also join County in urging
this court to direct the Board to exclude from its decision the discussion of vested and
constitutionally protected rights.
DISCUSSION
I. Standard of Review
The Board processes charges of unfair practices brought under the MMBA. (Gov.
Code, § 3509, subd. (b).) “Any charging party, respondent, or intervenor aggrieved by a
final decision or order of the board in an unfair practice case … may petition for a writ of
extraordinary relief from that decision or order.” (Gov. Code, § 3509.5, subd. (a).) The
petition must be filed in the court of appeal. (Gov. Code, § 3509.5, subd. (b).) “The
court shall have jurisdiction to … make and enter a decree enforcing, modifying, and
enforcing as modified, or setting aside in whole or in part the decision or order of the
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board. The findings of the board with respect to questions of fact, including ultimate
facts, if supported by substantial evidence on the record considered as a whole, shall be
conclusive.” (Ibid.)
“PERB is ‘one of those agencies presumably equipped or informed by experience
to deal with a specialized field of knowledge, whose findings within that field carry the
authority of an expertness which courts do not possess and therefore must respect.’
[Citation.] ‘[T]he relationship of a reviewing court to an agency such as PERB, whose
primary responsibility is to determine the scope of the statutory duty to bargain and
resolve charges of unfair refusal to bargain, is generally one of deference’ [citation], and
PERB’s interpretation will generally be followed unless it is clearly erroneous.”
(Banning Teachers Assn. v. Public Employment Relations Board (1988) 44 Cal.3d 799,
804.) “‘It is, however, “the duty of this court, when … a question of law is properly
presented, to state the true meaning of the statute … even though this requires the
overthrow of an earlier erroneous administrative construction.”’” (Cumero v. Public
Employment Relations Bd. (1989) 49 Cal.3d 575, 587.)
When the meaning of an MOU is in dispute, we apply de novo review, unless the
interpretation turns upon the credibility of extrinsic evidence. (National City Police
Officers’ Assn. v. City of National City (2001) 87 Cal.App.4th 1274, 1278.) “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.” (Winet v. Price (1992) 4 Cal.App.4th 1159, 1166 (Winet).)
II. Interpretation of MOU
A. Contract interpretation
“The MMBA requires the public agency and employee organization to ‘meet and
confer in good faith’ [citation], and when an agreement is reached it must be reduced to a
written MOU and presented to the governing body for determination. [Citation.] Once
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approved by the agency’s governing body, the MOU becomes a binding agreement and
must be interpreted by the same rules as apply to other public or private contracts.”
(Social Services Union v. Alameda County Training & Employment Bd. (1989) 207
Cal.App.3d 1458, 1465.)
“Under statutory rules of contract interpretation, the mutual intention of the parties
at the time the contract is formed governs interpretation. [Citation.] Such intent is to be
inferred, if possible, solely from the written provisions of the contract. [Citation.] The
‘clear and explicit’ meaning of these provisions, interpreted in their ‘ordinary and popular
sense,’ unless ‘used by the parties in a technical sense or a special meaning is given to
them by usage’ [citation], controls judicial interpretation. [Citation.] Thus, if the
meaning a layperson would ascribe to contract language is not ambiguous, we apply that
meaning.” (AIU Ins. Co. v. Superior Court (1990) 51 Cal.3d 807, 821–822.)
The Board’s interpretation of the language of the addenda is consistent with the
clear and explicit meaning of the words used, construed in their ordinary and popular
sense. Addendum B states in its entirety:
“Effective August 2, 2009 suspend Personnel Rule 3.1.1 for all
classifications within a flexibly allocated class series for the term of the
contract. Exceptions to this suspension of the rule may be made by the
County Administrative Officer on a case by case basis. Commencing the
first full pay period following the expiration of the agreement each
employee having qualified during the term of the agreement for promotion
to a higher classification in a flexibly-allocated classification will be placed
at the step in that classification which in the absence of this provision
would have taken effect during the agreement. Further the eligibility date
for the subsequent step or promotion in a flexibly-allocated classification, if
any, will be set up in the payroll system on the date, which in the absence
of this provision would have taken effect during the agreement. Nothing
herein precludes the rights of the County not to grant such a promotion or
step increase as set forth in the Personnel Rules and regulations.”
According to the plain meaning of this provision, employees who qualified for a
promotion during the term of the 2009 MOU “will be placed” in the higher classification
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commencing the first full pay period after expiration of that MOU. The addendum uses
the mandatory term “will,” rather than the permissive or discretionary term “may.” (See
Jones v. Catholic Healthcare West (2007) 147 Cal.App.4th 300, 307 [“[c]ourts routinely
construe the word ‘may’ as permissive”]; Compton College Federation of Teachers v.
Compton Community College Dist. (1982) 132 Cal.App.3d 704, 711 [contrasting
“permissive words such as ‘may’ … with mandatory words such as ‘will,’ ‘shall’ and
‘must’”]; see also International Brotherhood of Electrical Workers, Local 1245 v. City of
Redding (2012) 210 Cal.App.4th 1114, 1117 [construing MOU provisions that “‘City will
pay’” 50 percent of its retirees’ medical insurance premiums and that this provision “‘will
remain in full force and effect, unless modified by mutual agreement’” as binding,
enforceable promises that gave rise to vested rights in the retirees].)
The provision that employees otherwise entitled to promotions “will be placed” in
the higher classification expresses a binding, enforceable promise. The promise is not
conditioned on any improvement in County’s finances prior to the date of performance,
or on the results of any future MOU negotiations. It is a clear and unqualified promise,
accompanied by a specified time for performance. Additionally, the addendum provides
that eligibility for future promotions, after those implemented in the first pay period after
expiration of the 2009 MOU, will be based on the date on which the promotion would
have taken effect in the absence of the freeze.
Addendum C states:
“Effective August 2, 2009, merit or step increases will be suspended for the
term of the contract. During the contract period the County will track and
identify the dates on which merit increases would normally be received.
Commencing the first full pay period following the expiration of the
agreement each employee having qualified during the term of the
agreement will be placed at the step in the range which in the absence of
this provision would have taken effect during the agreement. Further the
eligibility date for the next step, if any, will be set up in the payroll system
on the date, which in the absence of this provision would have taken effect
during the agreement. Nothing herein precludes the rights of the County
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not to grant a merit increase as set forth in Rule 4 of the Personnel Rules
and regulations.”
The plain meaning of this provision is that, during the term of the 2009 MOU,
County was required to track the dates on which merit increases would normally have
been received. Then, in the first pay period after expiration of the 2009 MOU, employees
“will be placed” at the step in the range they would have achieved in the absence of the
freeze. Thus, after expiration of the 2009 MOU, County was required to place employees
who qualified for step increases during the term of the agreement at the steps for which
they qualified. Additionally, County was required to set up its payroll system to reflect
the date on which the merit increase would normally have taken effect, to use in
determining eligibility for subsequent increases.
We conclude the Board correctly interpreted the addenda, in accordance with the
plain and ordinary meaning of the language used, as requiring County to move all eligible
employees to the steps or levels within their classifications to which they would have
been moved during the term of the MOU in the absence of the freeze, commencing the
first full pay period after expiration of the 2009 MOU.
B. Extrinsic evidence
“The language of a contract is to govern its interpretation, if the language is clear
and explicit, and does not involve an absurdity.” (Civ. Code, § 1638.) “When a contract
is reduced to writing, the intention of the parties is to be ascertained from the writing
alone, if possible.” (Civ. Code, § 1639.) The parol evidence rule generally prohibits the
introduction of any extrinsic evidence, whether oral or written, to vary, alter or add to the
terms of an integrated written instrument. (Alling v. Universal Manufacturing Corp.
(1992) 5 Cal.App.4th 1412, 1433.) It “establishes that the terms contained in an
integrated written agreement may not be contradicted by prior or contemporaneous
agreements.” (Casa Herrera, Inc. v. Beydoun (2004) 32 Cal.4th 336, 344 (Casa
Herrera).)
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Extrinsic evidence, however, may be admitted to aid in interpreting a contract
when its language is ambiguous. (Winet, supra, 4 Cal.App.4th at p. 1165.) “The test of
whether parol evidence is admissible to construe an ambiguity is not whether the
language appears to the court to be unambiguous, but whether the evidence presented is
relevant to prove a meaning to which the language is ‘reasonably susceptible.’ [Citation.]
[¶] The decision whether to admit parol 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.”
(Ibid.) “Extrinsic evidence is thus admissible to interpret the language of a written
instrument, as long as such evidence is not used to give the instrument a meaning to
which it is not reasonably susceptible.” (Morey v. Vannucci (1998) 64 Cal.App.4th 904,
912, fn. omitted.) The first step of the test, whether the proffered evidence is relevant to
prove a meaning to which the language is reasonably susceptible, is a question of law
subject to de novo review. (Winet, at p. 1165.)
1. The extrinsic evidence was not relevant to prove a meaning to
which the language of the addenda was reasonably susceptible.
County has not proposed an interpretation of the actual language of the addenda
contrary to the interpretation offered by Union and adopted by the Board. Without
reference to any particular language, County has taken the position that the addenda only
required County to keep track of accrued promotions and step increases so they could be
credited to employees if and when the freeze was lifted. The language of the addenda on
its face is not susceptible to the interpretation offered by County.
Addendum B contained no language regarding keeping track of promotions and
increases so they could be credited to employees later. Rather, it provided that, at the
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specified time, “each employee having qualified during the term of the agreement for
promotion to a higher classification in a flexibly-allocated classification will be placed at
the step in that classification which in the absence of this provision would have taken
effect during the agreement.” That language is not reasonably susceptible to an
interpretation that County agreed only to track eligibility for promotions and step
increases to take effect at some undefined future date.
Addendum C states: “During the contract period the County will track and
identify the dates on which merit increases would normally be received.” If that were
County’s only promise, the language would be susceptible to the interpretation County
advocates. But addendum C also contains language similar to that of addendum B: at the
specified time, “each employee having qualified during the term of the agreement will be
placed at the step in the range which in the absence of this provision would have taken
effect during the agreement.” Again, the language is not reasonably susceptible to an
interpretation that County agreed only to track eligibility for promotions and increases to
take effect at some undefined future date.
“Courts must interpret contractual language in a manner which gives force and
effect to every provision, and not in a way which renders some clauses nugatory,
inoperative or meaningless.” (City of Atascadero v. Merrill Lynch, Pierce, Fenner &
Smith, Inc. (1998) 68 Cal.App.4th 445, 473–474.) County’s proposed interpretation of
the addenda completely disregards the crucial language promising that employees would
receive the promotions or step increases for which they qualified during the term of the
2009 MOU, commencing the first full pay period after expiration of the MOU. County’s
interpretation renders that provision nugatory, inoperative and meaningless.
The extrinsic evidence offered by County in support of its interpretation of the
addenda language did not prove a meaning to which the language was reasonably
susceptible. County relied on the testimony of Greg Gomez, a member of the team that
negotiated the 2009 MOU on behalf of Union. It focused on Gomez’s testimony that
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Union “wanted clear language that put the pressure on the County to maintain tracking of
how people were going to be or should have been promoted during that period of time,”
and Tim Huntley, the chief negotiator for County, responded there was a mechanism to
track promotions and step increases without implementing them.
Parol evidence of a prior or contemporaneous oral agreement is not admissible to
vary or contradict the terms of a written agreement. (Casa Herrera, supra, 32 Cal.4th at
p. 344.) Thus, evidence that the parties discussed some other arrangement before
executing the written agreement was not admissible to contradict the terms of the written
contract. Additionally, “[p]arol evidence is admissible only to prove a meaning to which
the contractual language is ‘reasonably susceptible’; not to flatly contradict the express
terms of the agreement.” (Consolidated World Investments, Inc. v. Lido Preferred Ltd.
(1992) 9 Cal.App.4th 373, 379 (Consolidated World).) County’s proposed interpretation
of the addenda as promising only that County would track promotions and step increases,
and not that it would terminate the freeze, would flatly contradict the plain meaning of
the express language used in the addenda. Thus, the Board correctly determined
County’s extrinsic evidence was not admissible to show that the addenda had a meaning
contrary to what their plain language expressed.
2. If considered, the extrinsic evidence supported the Board’s
interpretation of the addenda.
Although the Board found County’s extrinsic evidence was not admissible, it also
determined that the extrinsic evidence of the parties’ bargaining history actually
supported Union’s interpretation of the addenda. To the extent extrinsic evidence was
admitted at the hearing before the administrative law judge, and was considered by the
Board in reaching its decision, the Board’s decision in favor of Union was supported by
substantial evidence on the record considered as a whole. “‘The substantiality of evidence
must take into account whatever in the record fairly detracts from its weight.… [A]
reviewing court is not barred from setting aside a Board decision when it cannot
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conscientiously find that the evidence supporting that decision is substantial, when
viewed in the light that the record in its entirety furnishes, including the body of evidence
opposed to the Board’s view.’” (George Arakelian Farms, Inc. v. Agricultural Labor
Relations Bd. (1980) 111 Cal.App.3d 258, 265.)2
Gomez testified that, when negotiations for the 2009 MOU began, Union
understood County anticipated a significant reduction in revenue and expected financial
concessions in the agreement. County proposed one year of concessions, but Union
offered a two-year contract. Union made clear, however, that at the end of those two
years, it wanted the employees who had given up promotions and step increases to be
made whole; by “made whole,” it meant everyone would move up to where they should
have been, to the steps they would have received during the freeze. Other unions were
negotiating at the same time; Union was the only one that offered a two-year freeze on
promotions and step increases, so County agreed, as a reward, to the language of the
addenda. Gomez testified that, during bargaining sessions, Union expressed its desire for
assurances that, at the end of the two years, employees would get their promotions and
step increases back; Huntley affirmed that.
County contends the Board misinterpreted Gomez’s testimony. It focuses on the
testimony concerning County tracking the promotions and step increases that would have
been granted in the absence of the freeze. County asserts “PERB strain[ed] its
interpretation of Gomez’s testimony to mean exactly what he declined to say under oath –
that the County promised restoration of the promotions and increases.” But County’s
argument ignores other portions of Gomez’s testimony. Gomez stated multiple times
that, during negotiation of the 2009 MOU, Union made clear to County that it would
2 The court in George Arakelian Farms made this statement in its discussion of federal
cases interpreting the National Labor Relations Act (29 U.S.C. § 151 et seq.; NLRA). NLRA
cases are persuasive authority for interpreting similar provisions of the MMBA. (County of Los
Angeles v. Los Angeles County Employee Relations Com. (2013) 56 Cal.4th 905, 919.)
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agree to a two-year freeze, but at the end of the two years, the employees had to be made
whole. He stated: “[T]here were discussions going back and forth. … [W]hat would it
look like? … [W]e know that you want some kind of assurances that everyone will be
made whole at the end of those two years, so what would it look like? And this was …
what they passed to us across the table.”
Additionally, Gomez testified:
“Q But nobody from the County ever said that no matter what
happens with the economy in 2011 these will be granted?
“A I believe he did at one point.
“Q Who’s he?
“A Tim Huntley.
“Q And did Tim Huntley say that directly to you?
“A In open session, in a bargaining session. He wouldn’t have
said it that way. He said it more general and that he agreed with us. We
reiterated. I mean this didn’t just happen in one meeting. There were a
couple of meetings where we told him, you know, we want assurances that
at the end of those two years we will get our step increases and we will get
our merits back. And he reaffirmed that.
“Q But he did not say that it would happen no matter what?
“A I don’t believe so.”
Thus, the testimony was that, although Huntley did not use the language “it would
happen no matter what,” he agreed with Union and reaffirmed to it that, at the end of the
two-year term of the MOU, the employees would get their promotions and step increases
back. Gomez clarified that Union did not expect retroactive payment of the increases for
those two years, but only that employees would wind up on the step they should have
been on. The language of the addenda was what County proposed to Union to
accomplish that. The testimony at the administrative hearing supports the Board’s
interpretation of the addenda as requiring County to move employees into the
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classification levels and steps they would have achieved during the term of the 2009
MOU in the absence of the suspension of promotions and step increases.
County also argues that the economic situation in 2009 and 2011 and Union’s
conduct during the 2011 negotiations demonstrated that the parties did not intend the
addenda to guarantee that promotions and step increases would be restored after
expiration of the 2009 MOU. The testimony at the hearing indicated the parties were
well aware of the economic situation when they negotiated the 2009 MOU and the
addenda to it. Nonetheless, the provisions they drafted and agreed to, embodied in
addenda B and C, contained express promises to place employees at the steps and
classifications at which they would have been placed during the term of the MOU in the
absence of the suspension of promotions and step increases. Extrinsic evidence cannot be
used to flatly contradict the express terms of the agreement. (Consolidated World, supra,
9 Cal.App.4th at p. 379.)
County contends the 2011 negotiations demonstrate “both parties considered
future merit-based promotions and salary increases to be negotiable, not guaranteed.”
County’s initial proposal in 2011 included a continuation of the suspension of promotions
and step increases. Union initially proposed that the step increases be restored effective
July 31, 2011, and a new sixth step be added. It made no proposal regarding promotions,
merely indicating the issue needed more discussion. Union later proposed giving
employees the promotions and steps they would have received during the 2009 MOU,
and then refreezing promotions and step increases.
Gomez testified that Shelline Bennett, the lead negotiator for County in 2011,
asked several times what Union thought would happen at the end of the term of the 2009
MOU; each time Union reasserted that the language was clear and everyone had to be
made whole, had to come up to where they should have been. Regarding why Union’s
initial proposal indicated County’s proposal regarding promotions needed more
discussion, Gomez stated: “[W]e were trying to reach a mutual agreement that would be
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in the best interests of both the County and the Union. Everything was up for discussion.
We were trying to maybe see if there was a way we could save the County money. I
think I testified that at one time we had offered the County maybe you only give us one
step and not both of them, or you know, maybe there’s different ways that we can work
this out.” The language “need more discussion” merely meant Union wanted to continue
bargaining over this item.
Gomez further testified that Union’s position throughout the 2011 negotiations
was that the employees would get the steps they were owed. It made proposals that
would have absolved County from some of its obligations; the sense at the bargaining
table was that County did not have a lot of money, but at the same time it had a
contractual obligation it needed to live up to. There was room for movement, but County
kept saying “no.”
At the meeting of the Board of Supervisors on July 26, 2011, when the Board
approved implementation of County’s final offer, Gomez spoke to the Board. He
reasserted the Board needed to fulfill its contractual obligation and give employees their
step increases, and told them implementing County’s final offer was a mistake.
Thus, even if the Board considered the extrinsic evidence offered at the hearing, in
addition to the plain language of the addenda to the 2009 MOU, its construction of the
language of addenda B and C, and its implied findings as to the mutual intent of the
parties, were reasonable and supported by substantial evidence on the record considered
as a whole.
3. Other extrinsic evidence
County contends other provisions in the 2009 MOU indicated the parties did not
intend addenda B and C to create a contractual right to restoration of promotions and step
increases effective after the 2009 MOU expired, without regard to whether County’s
economic situation had improved by 2011. County refers to articles 43 and 69 of the
2009 MOU. County did not raise this argument at the hearing before the administrative
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law judge or in its arguments to the Board. “As a general rule, a party is precluded from
urging on appeal any point not raised in the trial court. [Citation.] Any other rule would
‘“‘permit a party to play fast and loose with the administration of justice by deliberately
standing by without making an objection of which he is aware and thereby permitting the
proceedings to go to a conclusion which he may acquiesce in, if favorable, and which he
may avoid, if not.’”’” (In re Riva M. (1991) 235 Cal.App.3d 403, 411–412.) We believe
the same rule is appropriate when the court, by writ proceeding, reviews an adjudication
by a trial court or administrative agency.
Even if we were to consider County’s argument on the merits, however, we would
reject it. Article 43 of the 2009 MOU authorized either party to renegotiate the
provisions of that MOU after one year, by giving notice to the other party at least 90 days
before July 31, 2010. It stated: “The intent of this Article shall not be to replace any
Addendums, Side Letters, or other attachments to this agreement, but such attachments
may be modified to reflect the economic circumstances during the term of this
Agreement.” There is no evidence either party exercised its right under this article to
renegotiate addendum B, addendum C, or any other provisions of the MOU during the
term of the agreement. Article 43 evinces an intent to allow a mid-term renegotiation of
the MOU and its addenda if the economic situation changed during the term of the MOU.
Because the opportunity to reopen bargaining during the term of the MOU was not
exercised, the addenda and the obligations they imposed remained unaltered. Article 43
says nothing about the substance of addendum B or addendum C, when or how they were
to be performed, or what was to happen after expiration of the 2009 MOU.
Article 69 of the 2009 MOU provides: “In the event … employee layoffs become
necessary during the term of this agreement, the County will meet and confer over the
impacts of the layoffs. The County reserves the right to make and consider alternative
proposals to reduce costs to lessen the severity of the layoffs.” This provision also
pertains to circumstances occurring “during the term of this agreement,” which
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apparently did not occur. It reflects County’s legal (not merely contractual) obligation to
meet and confer over the effects of layoffs before implementing them. (See Claremont
Police Officers Assn. v. City of Claremont (2006) 39 Cal.4th 623, 634 (Claremont).) It
says nothing about addendum B or addendum C, nothing about promotions or step
increases, and nothing about what is to happen after expiration of the MOU.
County argues these articles indicate the parties understood the County’s
precarious financial situation, and it would be “incongruous” and “absurd” for the parties
to agree to allow renegotiation of terms and consideration of alternatives to layoffs during
the term of the MOU, but not allow renegotiation of the termination of the freeze on
promotions and step increases, which it describes as an alternative to layoffs, in the
process of negotiating a successor MOU. Whether it is incongruous or absurd or not, the
language of the addenda is clear. We cannot rewrite the parties’ agreement in the guise
of interpreting it. (Rodriguez v. American Technologies, Inc. (2006) 136 Cal.App.4th
1110, 1122 [“While we may question the wisdom of the parties’ choice,… the parties
were free to choose their [contractual provisions]. The court will not rewrite their
contract”]; Wyandotte Orchards, Inc. v. Oroville-Wyandotte Irrigation Dist. (1975) 49
Cal.App.3d 981, 986–987 [“the courts cannot rewrite a contract to avoid difficulty or
hardship”].)
County also complains the Board “completely ignored the language of the
Personnel Rules themselves, language which shows that merit-based promotions and
salary increases are conditional, not absolutely guaranteed.” It is not surprising the Board
did not analyze the language of the personnel rules, considering neither party presented
those rules to the Board or placed them in evidence at the hearing before the
administrative law judge. County has requested that we take judicial notice of the
personnel rules, since they are not included in the record before us. We deny that
request.
17.
We reiterate that a party is generally precluded from urging in this court any point
not raised below. (In re Aaron B. (1996) 46 Cal.App.4th 843, 846.) “However, ‘a
litigant may raise for the first time on appeal a pure question of law which is presented by
undisputed facts.’” (B & P Development Corp. v. City of Saratoga (1986) 185
Cal.App.3d 949, 959.) Whether we consider the question is a matter within our
discretion. (Resolution Trust Corp. v. Winslow (1992) 9 Cal.App.4th 1799, 1810.) We
decline to do so here, because it is far from clear this issue is purely legal. If the issue
had been raised before the administrative law judge, the parties would have had the
opportunity to present extrinsic evidence concerning their intent in referring to the
personnel rules in addenda B and C, as well as extrinsic evidence concerning the meaning
of the personnel rules and how they have been applied in the past. In the absence of such
an opportunity, it would be inequitable for us to rule on the issue as if the facts were not
in dispute and the question was purely one of law.
III. MMBA Violation
The Board interpreted the provisions of the 2009 MOU and its addenda because
this was necessary in order to determine whether County committed an unfair practice, in
violation of the MMBA, by unilaterally changing its policy regarding promotions and
step increases; Union alleged County made a unilateral change by repudiating its
contractual obligation and refusing to implement the provisions of addenda B and C of
the 2009 MOU. The Board analyzed the plain meaning of the language of addenda B and
C, and concluded it was “sufficiently clear to establish an enforceable promise that, on
the date specified, the County would restore the flex promotions and merit step increases
provided for by its Personnel Rules and place SEIU-represented employees at the steps in
the classification and pay ranges that employees would have attained had the parties not
agreed to suspend flex promotions and merit step increases during the 2009-2011 MOU.”
It also found that, even if it considered extrinsic evidence, the result would be the same.
18.
We agree with the Board’s interpretation of the terms of the MOU and its
addenda. The next question is whether the Board correctly determined County violated
the MMBA by unilaterally changing its policy on promotions and step increases when it
repudiated the addenda and refused to implement the accrued promotions and step
increases commencing the first pay period after expiration of the 2009 MOU, and instead
insisted that all promotions and step increases were subject to negotiation in bargaining
for a successor MOU in 2011.
A. Rules governing collective bargaining
The MMBA governs collective bargaining between public employers and their
employees. (San Bernardino Public Employees Assn. v. City of Fontana (1998) 67
Cal.App.4th 1215, 1220 (Fontana).) It imposes on the governing body of a public
agency and the bargaining representative of the employees a duty to “meet and confer in
good faith regarding wages, hours, and other terms and conditions of employment with
representatives of … recognized employee organizations,” and to “consider fully such
presentations as are made by the employee organization on behalf of its members prior to
arriving at a determination of policy or course of action.” (Gov. Code, § 3505.) The
parties must “meet and confer … to endeavor to reach agreement on matters within the
scope of representation prior to the adoption by the public agency of its final budget for
the ensuing year.” (Ibid.) The parties “are not required to reach an agreement because
the employer has ‘the ultimate power to refuse to agree on any particular issue.’”
(Claremont, supra, 39 Cal.4th at p. 630.) They must, however, make a genuine effort to
reach agreement. (Ibid.)
If the parties bargain to agreement, the agreement reached, once ratified by the
public employer, is binding. (Gov. Code, § 3505.1; Glendale City Employees’ Assn., Inc.
v. Glendale (1975) 15 Cal.3d 328, 336 (Glendale).) “An MOU is binding on both parties
for its duration.” (Fontana, supra, 67 Cal.App.4th at p. 1220.) During the term of the
MOU, neither party can be compelled to renegotiate the terms contained in the MOU.
19.
“[T]he terms of a collective bargaining agreement, once agreed upon, ‘constitute a waiver
for the term of the agreement of the right to bargain over issues expressly covered
therein.’” (Fountain Valley Elementary School Dist. (1987) PERB Dec. No. 625 [11
PERC ¶ 18115, p. 23] (Fountain Valley).) An employer violates its statutory obligation
when it “seeks to modify during the life of an existing contract terms and conditions of
employment embodied in the contract and made effective for its term.… [A] bargain
having already been struck for the contract period and reduced to writing, neither party is
required under the statute to bargain anew about the matters the contract has settled for its
duration, and the employer is no longer free to modify the contract over the objection of
the Union.” (Id. at pp. 26–27.)
If the parties do not reach agreement, “‘[t]he duty to bargain requires the public
agency to refrain from making unilateral changes in employees’ wages and working
conditions until the employer and employee association have bargained to impasse.’”
(City of El Cajon v. El Cajon Police Officers’ Assn. (1996) 49 Cal.App.4th 64, 71–72.)
Thus, when an MOU expires, the employer cannot unilaterally change its employees’
wages, hours, or other terms and conditions of employment; it must meet and confer with
the union representing the employees until the parties reach agreement or impasse. When
the parties have reached impasse, and complied with any impasse resolution procedures,
the public agency may implement its last, best, and final offer. (Gov. Code, § 3505.7.)
Until impasse is reached, however, the employer must maintain the status quo and cannot
unilaterally change the employees’ wages, hours, or other working conditions. (San
Joaquin County Employees Assn. v. City of Stockton (1984) 161 Cal.App.3d 813, 818–
819.)
The subjects on which the parties are required to bargain before the employing
public agency may implement its final offer are referred to as mandatory subjects of
bargaining. Under the MMBA, the parties are required to bargain “regarding wages,
hours, and other terms and conditions of employment.” (Gov. Code, § 3505.) Matters
20.
not falling within these categories are nonmandatory or permissive subjects of
bargaining.3 (South Bay Union School Dist. v. Public Employment Relations Bd. (1991)
228 Cal.App.3d 502, 505, fn. 4 (South Bay); City of Glendale (2012) PERB Dec.
No. 2251-M [36 PERC ¶ 157, pp. 13–14].)
Nonmandatory subjects of bargaining are not required by the MMBA to be
negotiated between the public employer and the employees’ bargaining representative.
Although the parties are not required to negotiate them, they may bargain over them and
include them in their MOUs by mutual agreement. (City of San Jose, supra, PERB Dec.
No. 2341-M at p. 43.) “However, an employer may not insist on acceptance of a
proposal containing a permissive subject of bargaining over a ‘clear and express refusal
by the union to bargain’ over the matter.” (Ibid.)
As to permissive subjects, “each party is free to bargain or not to bargain, and to
agree or not to agree.” (NLRB v. Wooster Div. of Borg-Warner Corp. (1958) 356 U.S.
342, 349.) “Since a party has no absolute right to negotiate concerning a ‘nonmandatory
subject of bargaining,’ it has no prerogative of continuing the bargaining to the point of
impasse and no proper election to declare impasse [on the nonmandatory subject]. A
declaration of impasse with respect to an issue which is a ‘nonmandatory subject of
bargaining,’ therefore, is an unfair labor practice.” (South Bay, supra, 228 Cal.App.3d at
p. 505, fn. 4.) Further, “conditioning mandatory subjects of bargaining on resolution of
3 “The category ‘non-mandatory’ subjects includes both ‘permissive’ subjects and ‘illegal’
or ‘prohibited’ subjects.” (City of San Jose (2013) PERB Dec. No. 2341-M at p. 43
<http://www.perb.ca.gov/decisionbank/pdfs/2341M.pdf> [as of Jun. 22, 2016] (City of San
Jose).) Illegal subjects involve matters prohibited by external law or public policy. They are
nonnegotiable; they cannot be included in an MOU and may not serve as the lawful basis for a
declaration of impasse or be imposed by the employer on reaching impasse. (Id. at pp. 43–44.)
There is no suggestion in this case that the parties bargained over any illegal subjects.
Accordingly, the term “nonmandatory” as used herein refers only to permissive subjects of
negotiation.
21.
nonmandatory subjects … is a per se unfair practice.” (Lake Elsinore School Dist. (1986)
PERB Dec. No. 603 [11 PERC ¶ 18022, pp. 5–6].)
“Negotiating over a non-mandatory subject does not convert it to a mandatory
subject, nor does it oblige the party who has begun so negotiating to continue.” (Berkeley
Unified School Dist. (2012) PERB Dec. No. 2268 at p. 13
<http://www.perb.ca.gov/decisionbank/pdfs/2268E.pdf > [as of Jun. 22, 2016].) “[E]ven
at impasse, an employer may not impose proposals on non-mandatory subjects or which
conflict with statutory rights of employees or of the union.” (Id. at p. 12.)
Nonmandatory subjects include matters the parties have already agreed to in their
MOU. In Fountain Valley, the school district and the employees’ union were parties to a
collective bargaining agreement that was effective from July 1, 1982 through June 30,
1985. (Fountain Valley, supra, PERB Dec. No. 625 [11 PERC ¶ 18115, p. 2].) The
agreement allowed reopening during its term on the issues of salary and calendar only.
During the term of the agreement, legislation was enacted, offering additional revenue to
districts that increased their instructional minutes and days. (Id. at p. 3.) The school
district could not qualify without increasing the instructional minutes for grades 1 and 2.
(Id. at pp. 3–4.) When the union submitted a salary proposal pursuant to the reopener
language, the school district sought to renegotiate instructional minutes, although the
existing agreement specified the number of instructional minutes applicable during the
term of the agreement. (Id. at pp. 2–4.) The union was unwilling to renegotiate
instructional minutes, and rejected the school district’s offers. (Id. at pp. 4, 29.) When
the parties reached impasse on the salary issue, the school district unilaterally adopted an
increased number of instructional minutes for grades 1 and 2. (Id. at p. 4.) The union
filed an unfair practice charge based on the unilateral changes. (Id. at p. 5.)
The Board analyzed the issues under the Educational Employment Relations Act
(Gov. Code, § 3520, et seq.; EERA), which contains provisions similar to those of the
MMBA and is also administered by the Board. (Gov. Code, §§ 3541, 3541.3.) It
22.
concluded the school district violated the EERA by unilaterally changing the instructional
minutes. (Fountain Valley, supra, PERB Dec. No. 625 [11 PERC ¶ 18115, pp. 9–10].)
The school district argued it had not violated the EERA because it gave the union
notice and an opportunity to negotiate changes in instructional minutes before it
implemented its proposal, but the union refused to bargain in good faith. Fountain
Valley, supra, PERB Dec. No. 625 [11 PERC ¶ 18115, pp. 3, 5].) The Board rejected
that argument. “[A]n employer’s unilateral action on a matter within the scope of
representation is a per se violation of the EERA.” (Id. at p. 17.) Changes in instruction
time were within the scope of representation. (Id. at p. 18.) The changes made by the
school district constituted a repudiation of the contract. (Ibid.) Collective bargaining
agreements are binding on both the employer and the union; “a charging party establishes
a violation of the EERA if it proves that an employer breached or otherwise altered a
collective bargaining agreement and that the breach amounted to a change of policy that
had a generalized effect or continuing impact upon the terms and conditions of
employment of bargaining unit members.” (Id. at p. 19.) Because agreement to a
collective bargaining agreement constitutes a waiver for the term of the agreement of the
right to bargain over the issues contained in it, the union had no duty to renegotiate
instructional minutes, and it refused to do so. (Id. at p. 23.) The Board noted: “[O]ur
responsibility in administering EERA is to make it possible for the parties to negotiate
collective bargaining agreements in good faith and, once they have done so, to protect
their right to rely on their agreements.” (Id. at p. 8.) The union was entitled to rely on
the negotiated agreement. (Ibid.)
Federal cases have reached the same result in situations arising under the NLRA.
(Standard Fittings Co. v. NLRB (5th Cir. 1988) 845 F.2d 1311, 1315; St. Barnabas
Medical Center (2004) 341 NLRB 1325.) In Standard Fittings, the court stated:
“Section 8(d) of the NLRA prohibits either party from insisting upon a modification of
the agreement during its term. While a contract is in force, section 8(d) permits the union
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to refuse, even unreasonably, an employer’s proposal to modify the terms established by
the collective bargaining agreement. [¶] The union thus need not assent to proposed
changes in the contract, no matter how necessary to the survival of the enterprise. The
result may be harsh, but the law is clear that a party may not escape its obligations under
a collective bargaining agreement because of financial difficulties.” (Standard Fittings
Co. v. NLRB, at p. 1315.)
Further, in the absence of a reopener clause, if the employer proposes that the
parties reopen negotiations during the contract term on matters covered in the contract,
and the union agrees to discuss, or even renegotiate, the matters, the employer is not
authorized to unilaterally implement its proposal if the parties fail to reach an agreement.
“There is certainly nothing to support [the employer’s] thesis that, once having agreed to
listen to [the employer] or even to ‘renegotiate,’ the agreement became a nullity and that
[the employer] was free to comply with it or violate it, at its pleasure. To find that, once
the Union agrees to listen to and to talk about mid-term modifications, it waives all its
rights under a written collective-bargaining agreement, would forever deter any labor
organization from talking about any changes, no matter what the circumstances, and
would destroy even the possibility of discussing an employer’s financial difficulties.”
(Herman Brothers, Inc. (1984) 273 NLRB 124, 126 (Herman Brothers).) “[A]lthough an
employer may unilaterally institute changes when an impasse occurs during the
negotiations for an initial bargaining agreement or following the expiration date of an
expiring contract, the employer may not do so where, as here, the contract has not yet
terminated.” (Id. at p. 127.)
Thus, the parties’ collective bargaining agreement is binding and, in the absence of
a provision for reopening the matters in issue, the agreed upon terms cannot be changed
unilaterally while the agreement is still in effect. This is true even if the parties
voluntarily agree to discuss or renegotiate changes during the term of the agreement. An
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agreement to discuss modifications of the terms while the agreement is still in effect does
not abrogate the existing terms of the agreement.
These cases demonstrate that, once the parties have agreed on an MOU and it is
ratified by the public agency employer, it is binding and enforceable; the employer
commits an unfair practice if it unilaterally changes the terms contained in the MOU
while those terms remain in effect. Terms that address mandatory subjects of bargaining
can be changed after expiration of the MOU, if the employer gives the union notice and
an opportunity to negotiate new terms. The terms may be changed by the parties
mutually agreeing to a successor MOU; alternatively, the employer may implement its
final offer after the parties’ negotiations toward a successor MOU have reached impasse.
Negotiating and including terms relating to nonmandatory subjects of bargaining
is voluntary. Either party may decline to bargain over nonmandatory subjects, even if
those subjects were included in the expiring MOU. The employer cannot insist on
including nonmandatory subjects in the negotiations and cannot impose terms relating to
them on the union after impasse as part of implementation of its final offer.
B. Effect of timing of performance of obligations in the addenda
County seems to argue that the promises made in the addenda expired along with
the rest of the MOU on July 31, 2011. Therefore, in negotiating a successor MOU,
County was free to bargain for the continuation of the suspension of promotions and step
increases; further, because promotions and compensation are mandatory subjects of
negotiation, if the parties did not agree and reached impasse, County could unilaterally
implement its final offer.
The Board rejected County’s argument that negotiations for the 2011 MOU
superseded the provisions of the 2009 addenda, permitting County to bargain the
continued freeze on promotions and step increases to impasse then implement its final
offer on that subject. The Board observed that, once ratified, the terms of the MOU were
fixed for the duration of the agreement; the parties could neither repudiate the promises it
25.
contained nor accept the benefits of the agreement, but reject less favorable provisions
that were intrinsic to the bargain. (See Glendale, supra, 15 Cal.3d at p. 336.) The Board
concluded “the impasse rule is subject to any outstanding contractual obligations the
employer may have incurred.” It found “nothing in the language or purpose of MMBA
section 3505.7 to suggest that the right to impose terms at impasse in successor
negotiations authorizes the employer to disregard any outstanding contractual obligations
under its previous agreement, simply because those obligations do not mature until after
the agreement has expired.” We conclude the Board’s interpretation of the MMBA was
not clearly erroneous. It correctly determined County’s preexisting contractual obligation
imposed by addenda B and C precluded County from renegotiating the termination of the
freeze on promotions and step increases when it bargained for a successor MOU in 2011,
and from implementing at impasse an offer that included a provision for continuation of
that freeze.
Generally, “legislation in California may be said to create contractual rights when
the statutory language or circumstances accompanying its passage ‘clearly “… evince a
legislative intent to create private rights of a contractual nature enforceable against the
[governmental body].”’ [Citation.] … Where, for example, the legislation is itself the
ratification or approval of a contract, the intent to make a contract is clearly shown.”
(Retired Employees Assn. of Orange County, Inc. v. County of Orange (2011) 52 Cal.4th
1171, 1187 (Retired Employees).) The 2009 MOU and its addenda took the form of a
contract, which was approved by County’s Board of Supervisors. Thus, the intent to
create contractual rights is clear.
Article 50 of the 2009 MOU provided: “The provisions of this MOU commenced
on August 1, 2009 and shall remain in effect until July 31, 2011.” Addenda B and C,
however, provided that promotions and step increases were to be suspended effective
August 2, 2009, and, “[c]ommencing the first full pay period following expiration of the
agreement,” employees “will be placed” at the step the employee would have reached
26.
during the term of the MOU in the absence of the suspension. Thus, while the main
portion of the MOU was to remain in effect only until July 31, 2011, the obligations
imposed by the addenda were expressly to be performed “following the expiration of the
agreement.”
The whole contract must be interpreted together, and must be given “such an
interpretation as will make it lawful, operative, definite, reasonable, and capable of being
carried into effect, if it can be done without violating the intention of the parties.” (Civ.
Code, §§ 1643, 1641.) County’s interpretation of the addenda as not surviving expiration
of the MOU would render the promises expressed in the addenda illusory; that is, the
obligations would have expired before the time set for their performance. In keeping
with our duty to construe the contract so as to make its provisions operative, reasonable,
and capable of being carried into effect, we must construe the specific provisions of the
addenda—that they will be performed following expiration of the agreement—as
exceptions to the general provision that the MOU was to remain in effect until July 31,
2011. This interpretation is consistent with the intent expressed in the language of the
addenda, that the suspension of promotions and step increases would last for the term of
the MOU, then end the first pay period after expiration of the MOU.
Thus, we conclude addenda B and C imposed binding contractual obligations
County expressly agreed to perform during the first pay period after expiration of the
2009 MOU. Further, because these were binding contractual obligations, already
bargained for in connection with the 2009 MOU, they were nonmandatory subjects of
bargaining in the 2011 MOU negotiations.
Considerable confusion was engendered in this case by the terminology used by
the parties, the administrative law judge, and the Board. They referred to the addenda as
imposing “future rights”; they discussed whether and when the employees’ rights
thereunder “matured,” “accrued,” or “vested,” or whether they “survived expiration” of
the MOU. We believe the situation was more accurately described by the Board when it
27.
referred to the obligations imposed by the addenda as “executory contractual obligations
arising from a prior agreement” and “outstanding contractual obligations the employer
may have incurred.”
Obligations imposed by a collective bargaining agreement may be set for
performance at a time independent of and after expiration of the main agreement; they
remain binding even after expiration of the main agreement. In United Steelworkers of
America v. Fort Pitt Steel Casting (3d Cir. 1979) 598 F.2d 1273 (United Steelworkers),
paragraph 140 of the parties’ collective bargaining agreement provided that “in the event
of a labor dispute at the end of termination of this Agreement, The Company will
continue hospitalization and insurance benefits”; at the end of the dispute, the employer
was to be reimbursed for its payments. (Id. at p. 1276.) After the collective bargaining
agreement terminated and the parties were unable to negotiate a new agreement, the
employees went on strike. The employer unilaterally implemented its proposal for a new
agreement, which allowed it to terminate the insurance premium payments after 30 days.
The trial court subsequently held the employer in contempt for violating an injunction
requiring it to continue paying the premiums necessary to keep the insurance policies in
effect. (Id. at pp. 1276–1277.)
Reviewing the contempt order, the court concluded the impasse doctrine permitted
the employer to unilaterally implement its own proposal only when it was not bound by
contrary provisions that had already been agreed upon by the parties. (United
Steelworkers, supra, 598 F.2d at p. 1281.) Paragraph 140 of the agreement was still
operative. “That paragraph did not even take effect until the rest of the 1975 Agreement
had expired and the labor dispute had begun, and did not lapse, by its terms, until the end
of the dispute. Thus, because Fort Pitt had already struck a bargain with the Union on
paragraph 140, it was precluded from altering the substance of that bargain, without the
Union’s approval, during the life of paragraph 140 i.e., until the end of the labor dispute.”
(Id. at p. 1281, fn. omitted.)
28.
In Meilman Food Industries, Inc. (1978) 234 NLRB 698, the parties’ collective
bargaining agreement provided that, “‘[i]f as of … November 15 of any year during the
life of this agreement the Consumer Price Index’” reached a specified level, “‘then
effective with the first pay period beginning on or after the following … January 1,’” the
employees would receive a cost-of-living increase. (Id. at pp. 698, 704, italics omitted.)
The agreement expired December 6, 1974. (Id. at p. 698.) On November 15, 1974, the
Consumer Price Index exceeded the specified level. The NLRB interpreted the cost-of-
living provision according to its plain meaning; because the Consumer Price Index
exceeded the required level on November 15, 1974, a date within the life of the
agreement, the employees were entitled to a cost-of-living increase, payable on January
1, 1975. The employer’s refusal to effectuate the increase on that date, based on a claim
the agreement had expired, was a unilateral change in the existing wage structure that
violated the governing statute. (Id. at pp. 698, 705.)
In accordance with these cases we conclude that, when the parties have bargained
to agreement, and included in their MOU terms that are to be performed after expiration
of the main part of the MOU, those provisions are binding on the parties according to
their terms. They do not expire with other obligations under the agreement. Because
they are binding terms of the MOU, while the executory obligations remain, those
obligations are not mandatory subjects of bargaining for a successor MOU. An MOU is
binding on the parties for its duration. (Fontana, supra, 67 Cal.App.4th at p. 1220.) As
to executory obligations, the duration includes the time for performance of those
obligations. The employee representative cannot be compelled to renegotiate them; the
employer cannot bargain them to impasse, then impose contrary terms as part of
implementation of its final offer.
Like the disputed provisions in United Steelworkers and Meilman Food Industries,
the provisions in the addenda to the 2009 MOU for placing the employees at the levels
and steps earned during the term of that agreement did not take effect until the rest of the
29.
2009 MOU had expired. The addenda remained operative and executory until the first
full pay period after expiration of the MOU, at which time County was required to
perform in accordance with them. The fact that the parties had already bargained to
agreement on those provisions prevented County from compelling renegotiation when
bargaining for a successor MOU. They were nonmandatory subjects of bargaining
during the duration of the agreement, which included the duration of the addenda.
Because they were not mandatory subjects of negotiation, County could neither compel
Union to renegotiate the addenda, nor bargain them to impasse and impose contrary
obligations by implementing its final offer.
Repudiating a contractual obligation under the addenda to an MOU while that
obligation remains in effect constitutes a unilateral change in terms and an unfair labor
practice. (See Standard Teachers Association (2005) PERB Dec. No. 1775 [29 PERC ¶
162, p. 16] [“The repudiation of an agreement … is virtually the definition of an unlawful
unilateral change”].) In 2011, County was free to negotiate terms affecting future
promotions and step increases. It could not, however, bargain from a position that
abrogated its existing obligation to grant promotions and step increases immediately after
expiration of the 2009 MOU and that assumed County could simply continue the freeze
on promotions and step increases.
C. Waiver of right to implement final proposal on impasse
A public agency employer is authorized by statute to implement its last, best, and
final offer, after reaching impasse and exhausting any applicable postimpasse procedures.
(Gov. Code, § 3505.7.) County argues that it did not waive this statutory right, and so it
was not precluded from implementing its final offer, including a provision for
continuation of the freeze on promotions and step increases, after reaching impasse in the
negotiation of a successor MOU in 2011. County asserts that a waiver, especially of a
statutory right, will not be lightly inferred, but must be “clear and unmistakable”; further,
the party claiming waiver must show the matter was “fully discussed” and “consciously
30.
explored” and the waiving party “consciously yielded” its interest in the matter.
(Oakland Unified School Dist. (1982) PERB Dec. No. 236 [6 PERC ¶ 13201]; Amador
Valley Joint Union High School Dist. (1978) PERB Dec. No. 74 [2 PERC ¶ 2192]; Los
Angeles Community College Dist. (1982) PERB Dec. No. 252 [6 PERC ¶ 13241].)
The Board concluded the “clear and unmistakable” standard was met. It held that
“parties may expressly agree to limit an employer’s right to impose terms at impasse, or
they may impliedly achieve the same result by agreeing to terms that do not mature until
after the agreement has expired. Accordingly, where, as here, a contractual right survives
expiration of the agreement, the employer is not free to impose terms that abrogate or
impair that right.”
We agree County was not free to impose at impasse in 2011 terms that abrogated
its obligations under the addenda to the 2009 MOU. County and amici curiae object to
the suggestion that a “clear and unmistakable” waiver of County’s right to bargain to
impasse and implement its final offer can be implied. Their arguments assume County
had a “right” in 2011 to bargain to impasse and implement County’s final offer on the
subject of termination or continuation of the freeze on promotions and step increases, a
right which could only be waived expressly. County seems to assert it had that right
because promotions and salary increases are mandatory subjects of negotiation.
While promotions and salary increases in general may be mandatory subjects of
negotiation, the timing of termination of the suspension of promotions and step increases,
which was determined by the addenda to the 2009 MOU, was not. County had no right
in 2011 to implement its final offer on that subject, both because the statutory
requirements for implementation never arose and because County clearly and
unmistakably waived any such right by entering into a binding, express agreement on the
subject in 2009.
When the parties were negotiating in 2009 and 2011, the right of the employer to
implement its final offer arose only after the parties met and conferred in good faith,
31.
failed to reach agreement, and exhausted any applicable impasse procedures. (Gov.
Code, §§ 3505, 3505.7 [former 3505.4].) Consequently, if the parties reached agreement
on terms of an MOU, the employer had no statutory right to implement an offer to which
the union did not agree.
The parties negotiated and reached agreement on termination of the freeze on
promotions and step increases when they agreed to the 2009 MOU. They memorialized
that agreement in addenda B and C to the 2009 MOU. Both parties ratified the
agreement. The addenda remained in effect and operative at the time the parties
attempted to negotiate a successor MOU in 2011. They imposed an affirmative
obligation on County to restore the employees’ promotions and step increases in the first
pay period after expiration of the MOU. Thus, the statutory prerequisites to a right to
unilaterally implement terms governing continuation or termination of the freeze on
promotions and step increases were not met in 2011, because the parties had already
bargained to agreement on the subject in 2009.
Additionally, the parties’ execution and ratification of the 2009 MOU and its
addenda clearly and unmistakably waived any right County might otherwise have had to
implement at impasse in 2011 a final offer that continued the freeze on promotions and
step increases. The terms of the 2009 MOU, including the addenda, “‘constitute[d] a
waiver for the term of the agreement of the right to bargain over issues expressly covered
therein.’” (Fountain Valley, supra, PERB Dec. No. 625 [1987 Cal. PERB LEXIS 39,
p. 23].) The parties having struck a bargain, reduced it to writing, and executed and
ratified it, neither party was required by statute to bargain anew about matters the
contract had settled for its duration. (Id. at pp. 26–27.) The effect of reaching, executing,
and ratifying an express and binding agreement covering termination of the suspension of
promotions and step increases was a clear and unmistakable waiver by County of its right
to renegotiate that subject in 2011 and a corresponding waiver of any right to change the
termination date by implementing a final proposal that purported to continue the
32.
suspension during the term of the successor MOU. In negotiating for a successor MOU
in 2011, the starting point for the parties should have been the positions they would have
been in after all obligations imposed by the 2009 MOU had been performed. In other
words, they should have begun negotiations with the assumption the promotions and step
increases would be awarded in the first pay period of August 2011, consistent with the
obligation imposed by the addenda.
Union’s proposals in the 2011 negotiations, to the extent they suggested Union
might be willing to renegotiate termination of the freeze of promotions and step
increases, did not reopen that subject or convert it into a mandatory subject of
negotiation. (Herman Brothers, supra, 273 NLRB at p. 126.) They constituted
discussion of a nonmandatory subject of bargaining, which could not give rise to a right
to implement terms on that subject after impasse.
We emphasize again the limited scope of this decision. The subject of termination
of the 2009 MOU’s freeze of promotions and step increases and granting those
promotions and step increases was a nonmandatory subject of negotiation in 2011. It was
nonmandatory because the parties had already bargained it to a binding agreement in
2009. The Board did not, and we do not, hold that because of addenda B and C to the
2009 MOU the subjects of promotions and step increases in general were forever
removed from the process of negotiating MOUs. The only things the parties were
precluded from renegotiating, in the absence of a mutual agreement to renegotiate, were
the finite promises contained in addenda B and C that, in the first pay period after
expiration of the 2009 MOU, employees who had already qualified for promotions or
step increases during the term of the 2009 MOU would be placed at the step which they
would have reached absent the freeze on promotions and step increases. County was
bound by those express promises. Our opinion should not be construed as a
determination that any other subject, such as future promotions and step increases, is a
nonmandatory subject of negotiation.
33.
III. Discussion of Vested Rights
Before the administrative law judge, Union argued parties can include in an MOU
provisions that create obligations that are not to be performed until after the term of the
MOU. Before the Board, it maintained this position, citing in support cases discussing
vested pension and retirement rights that survive the expiration of an MOU. In its
responsive argument before the Board, County argued those cases were not applicable; it
described the issue in this case as: “whether an alleged vested right trumps an
employer’s statutory right under the MMBA to implement its LBFO upon impasse.”
Because of these references to “vested” rights, after concluding the addenda
imposed binding contractual obligations on County that survived expiration of the
remainder of the MOU, the Board included in its decision a section in which it attempted
to harmonize its interpretation of the MMBA with the law governing vested rights. A
portion of the discussion, however, relied on cases addressing pensions and other
longevity based benefits. The Board appeared to conclude this case was governed by the
rules applicable to pensions, and therefore the rights claimed by Union were vested and
enforceable like pension rights. County and amici curiae object to that discussion,
arguing it was not necessary to the Board’s decision and the reasoning it contains is
flawed. We conclude the contractual obligation in issue in this case is not governed by
the rules applicable to pensions, and the Board’s attempt to apply those rules to this case
was in error.
Generally, “vested” means: “Having become a completed, consummated right for
present or future enjoyment; not contingent; unconditional; absolute.” (Black’s Law
Dictionary (9th ed. 2009) p. 1699, col. 2.) We note that cases have not applied the term
in a uniform manner when discussing it in connection with different types of employment
benefits.
In Kern v. City of Long Beach (1947) 29 Cal.2d 848 (Kern), when the petitioner
began his employment with the city, the city charter provided that, after 20 years of
34.
service, he would receive a pension equal to 50 percent of his salary. A month before he
completed 20 years of service, the city repealed the pension provisions in the city charter,
purporting to eliminate pensions for all persons not yet eligible for retirement. The court
phrased the issue presented as: “whether petitioner acquired a vested right to a pension
which the city could not abrogate by repealing the charter provisions without impairing
its obligation of contract.” (Id. at p. 850.)
Although a public employee has no right to continued employment, “public
employment gives rise to certain obligations which are protected by the contract clause of
the Constitution, including the right to the payment of salary which has been earned.
Since a pension right is ‘an integral portion of contemplated compensation’ [citation], it
cannot be destroyed, once it has vested, without impairing a contractual obligation.”
(Kern, supra, 29 Cal.2d at p. 853.) Regarding the time in which a pension right vests, the
court stated:
“It is true that an employee does not earn the right to a full pension until he
has completed the prescribed period of service, but he has actually earned
some pension rights as soon as he has performed substantial services for his
employer. [Citations.] He is not fully compensated upon receiving his
salary payments because, in addition, he has then earned certain pension
benefits, the payment of which is to be made at a future date. While
payment of these benefits is deferred, and is subject to the condition that the
employee continue to serve for the period required by the statute, the mere
fact that performance is in whole or in part dependent upon certain
contingencies does not prevent a contract from arising, and the employing
governmental body may not deny or impair the contingent liability any
more than it can refuse to make the salary payments which are immediately
due. Clearly, it cannot do so after all the contingencies have happened, and
in our opinion it cannot do so at any time after a contractual duty to make
salary payments has arisen, since a part of the compensation which the
employee has at that time earned consists of his pension rights.” (Kern, at
p. 855.)
The fact that a pension right has vested does not prevent its loss by lawful
termination of employment before completion of the required period of service; nor does
35.
it prevent subsequent changes in the terms and conditions of the pension, since “[t]he
employee does not have a right to any fixed or definite benefits, but only to a substantial
or reasonable pension.” (Kern, supra, 29 Cal.2d at p. 855.)
Similarly, in Betts v. Board of Administration of Public Employees’ Retirement
System (1978) 21 Cal.3d 859, the court concluded: “A public employee’s pension
constitutes an element of compensation, and a vested contractual right to pension benefits
accrues upon acceptance of employment. Such a pension right may not be destroyed,
once vested, without impairing a contractual obligation of the employing public entity.”
(Id. at p. 863.)
Some cases have held that employment benefits based on longevity in
employment are also vested rights that may not be impaired. A salary increase at the end
of nine, 12, 15, and 18 years of employment, a fifth week of vacation after 10 years of
service, and a four-month fully paid sabbatical at the end of each six years of service,
which were all provided pursuant to the district’s policies and procedures, were held to be
forms of compensation earned over time. (California League of City Employee
Associations v. Palos Verdes Library Dist. (1978) 87 Cal.App.3d 135, 137, 140
(California League).) The employer could not simply eliminate them, because “it would
be grossly unfair to allow [the employer] to eliminate such benefits and reap the rewards
of such long-time service without payment of an important element of compensation for
such service.” (Id. at p. 140.) In Thorning v. Hollister School Dist. (1992) 11
Cal.App.4th 1598, the court followed California League and found health and welfare
benefits for retirees were vested rights that could not be denied to retired public officers
who had been in office while the provisions for those benefits were in effect. (Thoring v.
Hollister School Dist., at pp. 1605–1609.)
In contrast, in Fontana, the court rejected the union’s claims that the employees it
represented possessed vested, contractual rights to personal leave accrual, longevity pay,
and retirement health benefits, which could not be altered through collective bargaining.
36.
(Fontana, supra, 67 Cal.App.4th at p. 1218.) These longevity-based benefits had been
agreed upon in successive MOUs. In negotiations for a new MOU in 1995, the city
proposed reducing the benefits. The court found California League unpersuasive and
concluded the protection that applied to pension rights did not apply to the longevity-
based benefits because the benefits were negotiated periodically under an MOU.
(Fontana, at pp. 1221–1223.) The MOUs were of fixed duration; once they expired, the
employees had no legitimate expectation the benefits included in them would continue
unless they were renegotiated as part of a new MOU. (Id. at p. 1223.) “The benefits at
issue could not have become permanently and irrevocably vested as a matter of contract
law, because the benefits were earned on a year-to-year basis under previous MOU’s that
expired under their own terms.” (Id. at p. 1224.)
In its decision, the Board broadly overstated the rule derived from cases
addressing pensions and longevity-based benefits: “Under California law, an employee
acquires an irrevocable or ‘vested’ interest in a benefit when the employment contract is
formed, even if the benefit does not ‘mature’ until later. A ‘statute fixing government
payments may amount to an offer which, when accepted by performance, culminates in a
contract between the government and the offeree.’ [Citation.] Once vested, the right to
compensation cannot be reduced or eliminated without unconstitutionally impairing the
contract obligation.… Thus, the rules governing the employment contract, on the first
day of employment, are protected against changes that detrimentally affect the public
employee’s ‘fundamental’ rights, including the right to compensation for services
rendered.” (Fn. omitted.)
To the extent this language suggests that a public employee’s benefits of any type
become permanently and irrevocably vested on the day the employee begins performing
services for the public employer, it is not an accurate statement of the law. To the extent
the Board suggests this rule, derived from cases addressing pension rights and some
longevity-based benefits, applies to the issues in this case, it is in error.
37.
The cases discussing pension rights, and stating they vest upon acceptance of
employment, generally stress the distinction between pension rights and other
employment benefits. In Miller v. State of California (1977) 18 Cal.3d 808, a state civil
service employee challenged a statutory amendment that reduced the age of mandatory
retirement from 70 to 67, asserting it impaired his vested contractual right to qualify for a
larger pension by working longer. (Id. at pp. 811, 813.) The court rejected the
employee’s claims: “On the contrary it is well settled in California that public
employment is not held by contract but by statute and that, insofar as the duration of such
employment is concerned, no employee has a vested contractual right to continue in
employment beyond the time or contrary to the terms and conditions fixed by law.
[Citations.] Nor is any vested contractual right conferred on the public employee because
he occupies a civil service position since it is equally well settled that ‘[the] terms and
conditions of civil service employment are fixed by statute and not by contract.’” (Id. at
p. 813.) Additionally, “[p]laintiff’s reliance upon decisions concerning the pension rights
of public employees is misplaced. This court has held, as will be explained hereafter, that
pension rights involve ‘obligations which are protected by the contract clause of the
Constitution.’ … Pension rights, unlike tenure of civil service employment, are deferred
compensation earned immediately upon the performance of services for a public
employer ‘[and] cannot be destroyed ... without impairing a contractual obligation.’” (Id.
at p. 814.)
In United Firefighters of Los Angeles v. City v. City of Los Angeles (1989) 210
Cal.App.3d 1095, the court explained: “[A]ll terms of public employment other than
pension rights, including hours to be compensated, are wholly a matter of statute.
[Citation.] These aspects of public employment ripen into obligations protected by the
contract clause of the federal and state Constitutions only upon an employee’s actual
performance. [Citation.] In contrast, deferred compensation in the form of pension rights
38.
has the status of a contractual obligation from the moment one accepts public
employment.” (Id. at p. 1105.)
The import of the pension cases is that pension benefits vest with the acceptance
of employment based on the nature of those benefits and how they are earned.
Enjoyment of pension benefits is deferred, often until many years after the employment
commenced; the benefits are earned gradually, by performing services over the span of
many years and multiple MOUs. Because the employee begins to earn the pension
benefit as soon as he or she begins performing services for the employer, some portion of
the employee’s right to that deferred compensation vests at that time. Consequently,
completely denying an employee a pension after he has already performed services in
exchange for the promise of a pension would retroactively deny the employee
compensation for work performed and would constitute an impairment of contract under
the California and federal constitutions.
In contrast, different rules apply to other employment benefits. In Olson v. Cory
(1980) 27 Cal.3d 532, the court held unconstitutional as an impermissible impairment of
vested contractual rights a statutory amendment that placed limits on cost of living
increases of judge’s salaries. The court concluded a judge’s contractual salary rights
could not be changed during the judge’s term of office. “A judge entering office is
deemed to do so in consideration of—at least in part—salary benefits then offered by the
state for that office. If salary benefits are diminished by the Legislature during a judge’s
term…, the judge is nevertheless entitled to the contracted-for benefits during the
remainder of such term.” (Id. at p. 539.) However, “[a] judge who completes one term
during which he was entitled to unlimited cost-of-living increases and elects to enter a
new term has impliedly agreed to be bound by salary benefits then offered by the state for
the different term.” (Id. at p. 540.) Thus, a judge’s salary benefits under the original
statute were vested for the judge’s unexpired term of office; when he commenced a new
39.
term after the effective date of the statutory amendment, or when a new judge entered
office after that date, the judge was not entitled to the benefits of the prior statute.
In Fontana, the court concluded employees did not have vested, contractual rights
to personal leave accrual, longevity pay, and retirement health benefits, and those
benefits could be altered through collective bargaining. (Fontana, supra, 67 Cal.App.4th
at p. 1218.) The benefits were provided for in successive MOUs. They were reduced in
the most recent MOU. Under the MMBA, the collective bargaining process properly
included the benefits in issue; those benefits “could not have become permanently and
irrevocably vested as a matter of contract law, because the benefits were earned on a
year-to-year basis under previous MOU’s that expired under their own terms.” (Id. at
p. 1224.) The court distinguished retirement rights, which become vested under the
contract clause upon retirement, from employment rights, which may pertain to future
retirement, but may be modified prior to retirement. (Ibid.)
Thus, nonpension employment benefits do not follow the same rule of vesting as
pension rights. Pension rights vest at the outset of employment and may be modified
thereafter only on a limited basis. (California Assn. of Professional Scientists v.
Schwarzenegger (2006) 137 Cal.App.4th 371, 383.) Other employment rights4 vest (i.e.,
become complete, binding, and enforceable) only for the period the statute or MOU
establishing them remains in effect, or for the term of office of a public official.
Generally, employment benefits conferred by MOU are negotiable in bargaining the
terms of a subsequent MOU.
Retired Employees, on which the Board relied in its discussion of vested rights, is
of limited relevance because it addressed the rights of retirees, not current employees,
and the question whether an implied contract could confer vested rights on the retirees.
4 With the possible exception of some longevity based benefits. (See California League,
supra, 87 Cal.App.3d at p. 140.)
40.
There, the California Supreme Court answered a question posed by the United States
Court of Appeals for the Ninth Circuit: “‘Whether, as a matter of California law, a
California county and its employees can form an implied contract that confers vested
rights to health benefits on retired county employees.’” (Retired Employees, supra, 52
Cal.4th at p. 1176.) For more than 20 years, the county had calculated premiums for
medical insurance for active employees and retirees by combining the employees and
retirees into a single pool. This resulted in lower premiums for retirees than if they had
been treated as a separate pool. The county then negotiated MOUs with the active
employees and passed a resolution that split the pool. (Id. at p. 1177.) The retirees
sought to enjoin splitting the pool.
The retirees conceded the past MOUs were silent as to the duration of the unified
pool. They alleged the county’s long-standing practice of pooling created an implied
contractual right to continuation of the unified pool, and the county’s action in splitting
the pool constituted an impairment of contract in violation of the California and federal
constitutions. (Retired Employees, supra, 52 Cal.4th at pp. 1177–1178.) The court
concluded a resolution or ordinance approving an MOU could give rise to implied terms
conferring contract rights. (Id. at pp. 1180–1187.) It rejected the county’s argument that,
even if contractual rights could be implied from legislation, vested contractual rights
could not; it noted that neither the county nor amici curiae had offered any legal authority
for this distinction. (Id. at p. 1189.) Further, in the cases the county cited, “the courts
found that the particular benefits at issue were not vested, not that vesting was
categorically barred. Vesting remains a matter of the parties’ intent.” (Ibid.)
Regarding the retirees’ assertion that the unified pool was a form of deferred
compensation that vested when they retired, the court noted that whether the retirees’
claim was valid and whether they had a vested right to a unified pool was beyond the
scope of the question posed by the Ninth Circuit. It added: “However, as with any
contractual obligation that would bind one party for a period extending far beyond the
41.
term of the contract of employment, implied rights to vested benefits should not be
inferred without a clear basis in the contract or convincing extrinsic evidence.” (Retired
Employees, supra, 52 Cal.4th at p. 1191.)
The Board appears to interpret this final quote as authorizing a finding of vested
rights when the contractual obligation would not “bind one party for a period extending
far beyond the term of the contract of employment” or when there is a clear basis in the
contract or convincing extrinsic evidence to support vesting of implied rights. (Retired
Employees, supra, 52 Cal.4th at p. 1191.) In that statement, however, the court was not
deciding any issue; it was cautioning restraint in finding vested rights impliedly arising
out of public employment MOUs. The court’s decision addressed a situation that was
similar to the pension cases in that the retirees claimed a vested interest in alleged
deferred compensation, earned over time. It differed from the pension cases in that the
retirees claimed their rights vested on retirement; they explicitly disavowed any claim the
benefits vested when the retirees commenced their service. (Id. at p. 1189, fn. 3.) The
Retired Employees court discussed vesting only in the context of a claim that an alleged
element of deferred compensation vested on retirement, when the retirees had fully
performed their employment obligations, and the county would therefore be bound to
continue providing the benefit throughout the retirees’ retirement.
The issue in this case does not concern pension rights or a claim of earned, but
long-deferred, compensation. There was no contention by any party that the employees’
right under the addenda to be placed in the steps they would have achieved during the
two-year MOU period in the absence of the suspension of promotions and step increases
vested for each employee at the time the employee was hired or continued throughout his
or her employment. As the Board recognized, Union sought only a one-time adjustment
of the promotions and step increases suspended during the term of the 2009 MOU. The
issue presented by the unfair practices charge involved consideration exchanged between
the parties within the term of a single MOU and its addenda: suspension of promotions
42.
and step increases for two years and granting the promotions and step increases in the
first full pay period after expiration of the two-year period. At the time the MOU was
ratified and put into effect, the parties were bound by the contractual obligations imposed
by the MOU and its addenda, for the term of that agreement. (See Fountain Valley,
supra, PERB Dec. No. 625 [11 PERC ¶ 18115, pp. 23, 26–27].) During the first pay
period after expiration of the MOU, the employees’ right to have their promotions and
step increases reinstated became vested in the sense that County’s obligation was
contractually binding, enforceable, unconditional, and not contingent. It was not vested
in the sense in which a pension right becomes vested when an employee’s employment
commences, and remains vested throughout the employee’s employment. Consequently,
the rules set out in the Board’s discussion of cases concerning vested pension rights do
not apply to this matter. The suggestion that the pension rules apply and that the rights in
issue in this case vested at the commencement of employment are inaccurate and should
be excluded from the Board’s decision.
43.
DISPOSITION
The petition for a writ of extraordinary relief from the decision of the Board is
denied. Pursuant to Government Code section 3509.5, subdivision (b), however, we
modify the Board’s decision by deleting from it the section headed: “Prohibiting
Retroactive Imposition of Terms Containing Economic Concessions is Consistent with
California Judicial Authority Regarding Vested Rights of Public Employees,” beginning
on page 35 of the decision and ending on page 42. The Union is awarded its costs on
appeal. (Cal. Rules of Court, rule 8.493(a)(1)(B).)
_____________________
HILL, P.J.
WE CONCUR:
_____________________
LEVY, J.
_____________________
GOMES, J.
44.
|
Slip Op. 02-66
UNITED STATES COURT OF INTERNATIONAL TRADE
____________________________________
:
ALTX, INC., AMERICAN EXTRUDED :
PRODUCTS, CORP., DMV STAINLESS :
USA, INC., SALEM TUBE, INC., :
SANDVIK STEEL CO., PENNSYLVANIA :
EXTRUDED TUBE COMPANY, and :
UNITED STEEL WORKERS OF :
AMERICA, AFL-CIO/CLC, :
:
Plaintiffs, :
:
v. :
:
THE UNITED STATES, and THE :
UNITED STATES INTERNATIONAL :
TRADE COMMISSION, :
: Court No. 00-09-00477
Defendants, :
:
and :
:
SUMITOMO METAL INDUSTRIES, :
NIPPON STEEL CORPORATION, :
KAWASAKI STEEL CORPORATION, :
NKK CORPORATION, KOBE STEEL :
LTD., and SANYO SPECIAL STEEL :
COMPANY, :
:
:
Defendant-Intervenors. :
____________________________________:
[Motion for preliminary injunction denied.]
Dated: July 12, 2002
Collier Shannon Scott, PLLC (David A. Hartquist, Jeffrey S. Beckington, and R. Alan
Luberda) for plaintiffs.
Lyn M. Schlitt, General Counsel, Marc A. Bernstein, Assistant General Counsel, United
COURT NO . 00-09-00477 PAGE 2
States International Trade Commission (Rhonda M. Hughes), for defendants.
Wilmer, Cutler & Pickering (John D. Greenwald, Robert C. Cassidy, Jr., Leonard
Shambon, Jason Kearns and Lynn M. Fischer) for defendant-intervenors.
OPINION
RESTANI, Judge:
Plaintiffs Altx, Inc., American Extruded Products Corp., DMV Stainless USA, Inc.,
Salem Tube, Inc., Sandvik Steel Co., Pennsylvania Extruded Tube Company, and United
Steelworkers of America, AFL-CIO/CLC (collectively, “Altx”) move this court for the entry of a
preliminary injunction that: (1) enjoins the U.S. Customs Service (“Customs”) from liquidating
entries of circular seamless stainless steel hollow products (“CSSSHP”) from Japan which have
been entered or withdrawn from warehouse on or after May 1, 2000 – the date of the preliminary
determination of sales at less than fair value, see Circular Seamless Stainless Steel Hollow
Products from Japan, 65 Fed. Reg. 25,305 (May 1, 2000) – and that remain unliquidated as of the
date of the court’s issuance of the requested injunction; and (2) orders the Department of
Commerce (“Commerce” or “the Department”) to issue instructions to Customs suspending
liquidation on all such entries or withdrawals from warehouse, pending the final resolution of
this action and any appeals thereto. See CIT Rule 65.
Background
On August 30, 2000, the United States International Trade Commission (“ITC” or “the
Commission”) published its final determination by a 4-2 vote that the domestic CSSSHP industry
was neither materially injured nor threatened with material injury by reason of dumped imports
2
COURT NO . 00-09-00477 PAGE 3
of CSSSHP from Japan. See Circular Seamless Stainless Steel Hollow Products from Japan, 65
Fed. Reg. 52,784 (Aug 30, 2000). Accordingly, Customs ceased collecting duty deposits on
entries of CSSSHP from Japan and refunded all deposits that had been collected between the date
of publication of Commerce’s preliminary determination (i.e., May 1, 2000) and the publication
of the Commission’s final determination.
On September 19, 2001, the court remanded the determination to the Commission to
reconsider its findings with respect to the volume of imports, the effect of subject imports on
domestic prices, and impact of imports on the domestic industry, and to reevaluate its
determinations regarding present material injury and threat of material injury. See Altx, Inc. v.
United States, 167 F. Supp. 2d 1353 (Ct. Int’l Trade 2001). On December 3, 2001, the
Commission returned a remand determination reflecting a 3-3 affirmative determination based on
the original minority opinion.
Discussion
Pursuant to 19 U.S.C. § 1516a(c)(2), the court has the authority to render preliminary
injunctive relief “upon a request by an interested party for such relief and a proper showing that
the requested relief should be granted under the circumstances.” A preliminary injunction,
however, is an extraordinary remedy which may issue only upon a clear showing by the moving
party that they are entitled to such relief. See Trent Tube Div., Crucible Materials Corp. v.
United States, 744 F. Supp. 1177 (1990). “Only a viable threat of serious harm which cannot be
undone authorizes exercise of a court's equitable power to enjoin before the merits are fully
determined. A preliminary injunction will not issue simply to prevent a mere possibility of
3
COURT NO . 00-09-00477 PAGE 4
injury, even where prospective injury is great.” S. J. Stile Assocs. v. Snyder, 646 F.2d 522, 525
(1981) (citation omitted). Plaintiffs must establish the following four factors in order to obtain a
preliminary injunction: (1) the threat of immediate irreparable harm; (2) the likelihood of success
on the merits; (3) the public interest would be better served by the requested relief; and (4) the
balance of hardship on all the parties favors plaintiffs. See Zenith Radio Corp. v. United States,
710 F.2d 806, 809 (Fed. Cir. 1983).
A. The ITC’s Affirmative Decision does not Establish Irreparable Harm
Altx relies on Zenith for the proposition that because, following initial remand, the
Commission has rendered an affirmative determination of injury under the antidumping laws, the
court must find irreparable harm to the domestic industry. Altx’s reliance on Zenith is
misplaced. The Federal Circuit in Zenith held that during an appeal of an administrative review
of an antidumping order, liquidation of entries constituted irreparable harm. The Federal Circuit
reasoned that liquidation of entries was of particular concern in the case of an administrative
review because liquidation under such circumstances “would eliminate the only remedy available
to [the petitioner] for an incorrect review determination.” Zenith, 710 F.2d at 810. Clearly,
Zenith does not apply here because the instant case involves an appeal of injury determination in
an investigation, rather than an administrative review. See also Sandoz Chemicals Corp. v.
United States, 17 CIT 1061, 1063 (1993) (“Unlike an annual review, a negative injury
determination affects liquidation of all future entries, not just those made within a specific time
period. In such a situation, liquidation does not substantially curtail available judicial
4
COURT NO . 00-09-00477 PAGE 5
remedies.”).
Altx attempts to distinguish the holding in Standoz on the ground that it involved an
appeal from a negative injury determination pursuant an investigation. In Trent Tube, however,
the court extended the Sandoz holding to an investigation where, as here, the Commission had
made an initial negative injury determination, and subsequently made an affirmative injury
determination on remand. The court denied the motion for a preliminary injunction, reasoning
that liquidation of entries is not per se irreparable harm in the context of determinations in
investigations. Trent Tube, 744 F. Supp. at 1177 (“Plaintiffs must show additional evidence to
prevail on the motion for preliminary injunction.”). The court ultimately found that liquidated
entries, supplemented by speculative evidence of harm, was insufficient to establish that denial of
an injunction would cause irreparable harm. Trent Tube, 744 F. Supp. at 1179. Thus, to support
a finding of irreparable harm, Altx must present additional evidence establishing irreparable
injury.
B. Evidence of Lost CDO Revenue does not Establish Irreparable Harm
Altx argues that the loss of duty revenue under the Continued Dumping and Subsidy
Offset Act (“CDO”) constitutes irreparable harm. See 19 U.S.C. 1675c (2001); 19 C.F.R. §
159.61. Under the CDO, assessed duties received by Customs during the fiscal year will be
disbursed to affected domestic producers that have incurred qualifying expenditures subsequent
to the issuance of an antidumping or countervailing duty order. See 19 C.F.R.§ 159.61(a).
Under the CDO, all duties collected by Customs are placed in a Special Account to be distributed
5
COURT NO . 00-09-00477 PAGE 6
to “affected producers” with “qualifying expenditures.” Id. at § 159.64(b). If the Special
Account figure is larger than the qualifying expenditures, the domestic producers will be paid for
their full claim of qualified expenditures. Id. at § 159.61(c). If the Special Accout is less than
the qualified expenditures, however, the domestic industries will be paid on a pro rata basis. Id.
Thus, in order to establish irreparable injury, Altx has the burden of showing that the
affected producers’ qualified expenditures will be greater than the amount that will be distributed
from the Special Account. Altx has not met this burden. First, Exhibit 1 (“Continued Dumping
and Subsidy Offset”) indicates that Sandvik Steel incurred qualifying expenditures of
$14,790,198 in calendar year 2001 against which domestic industry might claim disbursement
under the CDO. Qualifying expenditures, however, “must be incurred after the issuance, and
prior to the termination, of the antidumping duty order . . . .” 19 C.F.R. 159.61(c). Altx fails to
show that evidence of qualifying expenditures for the year 2001 will correspond to qualifying
expenditures following the antidumping order. Furthermore, in Attachment 8 (“U.S. Imports of
Circular Seamless Stainless Steel Hollow Products from Japan”), Altx provides evidence of
volume and value of imports for the period from August 2001 to February 2002. This serves
merely as an indicator of revenues that Customs could collect for the Special Account if there
was a suspension of liquidated entries. This does not indicate the portion of that revenue the
affected producers would receive. At a minimum, Altx must produce affidavits or other evidence
showing, with more specificity, expected lost antidumping duties on liquidated entries, the
amount of antidumping duties to be raised in the event of the issuance of an antidumping duty
order, and the amount of qualified expenditures to be expected following an order. Further,
6
COURT NO . 00-09-00477 PAGE 7
because the effects of any order will continue in the future, Altx must establish that there is a
likelihood that it will suffer economically because of the liquidation of particular entries.
Without such specific showings, it is left to speculation whether liquidating entries will have any
impact on the domestic industry.
Although the court has not sustained the remand affirmative injury finding, but has again
remanded the case, because Altx failed to meet the burden of proving irreparable harm, the court
need not reach its arguments with respect to the other three factors assessed in determining
whether to grant an preliminary injunction. See Trent Tube, 744 F. Supp. 1177 (“If any one of
the requisite factors has not been established by plaintiffs, the motion for a preliminary injunction
must be denied.”). The court notes, however, that it cannot predict at this time whether the final
remand injury determination will be affirmative or negative. Thus, further attempts to show
irreparable harm are unlikely to satisfy Altx’s overall burden under the four-part test.
7
COURT NO . 00-09-00477 PAGE 8
Accordingly, Altx’s motion for a preliminary injunction is DENIED.
____________________________
Judge of the United States
Court of International Trade
Dated: New York, New York
This ___ day of July, 2002.
8
|
857 F.2d 1472
Guajardov.Serna*
NO. 88-2223
United States Court of Appeals,Fifth Circuit.
SEP 23, 1988
1
Appeal From: S.D.Tex.
2
DISMISSED.
*
Fed.R.App.P. 34(a); 5th Cir.R. 34.2
|
IN THE SUPREME COURT OF IOWA
No. 15–1350
Filed May 19, 2017
Amended August 1, 2017
DANIEL KLINE, FRANK SORIES, and AMARIS McCANN,
Appellees,
vs.
SOUTHGATE PROPERTY MANAGEMENT, LLC,
Appellant.
Appeal from the Iowa District Court for Johnson County, Patrick R.
Grady, Judge.
A landlord appeals a district court’s ruling on summary judgment
that certain lease provisions are prohibited under the Iowa Uniform
Residential Landlord and Tenant Act and that certified a class of tenants.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
James W. Affeldt and Nicholas J. Kilburg of Elderkin & Pirnie,
P.L.C., Cedar Rapids, until withdrawal, and then Stephen J. Holtman
and Lisa A. Stephenson of Simmons Perrine Moyer Bergman, PLC, Cedar
Rapids, for appellant.
Christopher Warnock of The Iowa Tenants’ Project, Iowa City, and
Christine Boyer of The Iowa Tenants’ Project, Iowa City, for appellees.
2
Thomas H. Walton and Matthew R. Eslick of Nyemaster Goode,
P.C., Des Moines, for amici curiae Landlords of Iowa, Inc. and Greater
Iowa Apartment Association.
3
HECHT, Justice.
Three tenants brought this action against their landlord after their
leases expired. The tenants, alleging they represent a class of similarly
situated residential tenants, claim the landlord is liable for damages
under the Iowa Uniform Residential Landlord and Tenant Act (the Act)
because the landlord’s leases included several provisions known by the
landlord to be prohibited provisions. The district court granted summary
judgment in favor of the tenants, declaring that the challenged lease
provisions violate the Act and certifying a class of tenants. On
interlocutory appeal, the landlord contends (1) the lease provisions are
not prohibited under the Act; (2) the tenants have no claim for damages
because even if the lease provisions are prohibited, the landlord did not
enforce them; and (3) the district court erred in certifying the class of
tenants. Upon review, we conclude some, but not all, of the challenged
lease provisions are prohibited under the Act, and the district court’s
certification of a class of plaintiff tenants is procedurally flawed.
Accordingly, we affirm in part, reverse in part, and remand.
I. Background Facts and Proceedings.
Daniel Kline, Frank Sories, and Amaris McCann are former
residential tenants of properties owned or managed by SouthGate
Property Management, LLC. Kline and Sories entered into a rental
agreement with SouthGate on July 27, 2012, for a lease term that ended
on July 28, 2013. McCann entered into a residential agreement with
SouthGate on August 1, 2012, for a lease term that ended on July 28,
2014.
SouthGate’s leases included provisions imposing fees, charges, and
liquidated damages against the tenants in the event of various
occurrences. Paragraph 3 prescribed a charge of $25 if a tenant’s check
4
was returned for insufficient funds. Paragraph 4 established a charge of
$50 per month for each new tenant added after the term of the lease
began. Paragraph 9 assessed a handling fee of $50 for each utility bill
received or paid by SouthGate as a consequence of a tenant’s failure to
take responsibility for the obligation and established a $50 utility
reconnection charge in the event the tenant’s delinquency precipitated a
termination of utility service. Paragraph 12 set a charge for maintenance
calls caused by a tenant’s negligence at the “current rate per hour plus
trip charge” as determined by SouthGate. A liquidated damage
assessment of $500 was prescribed in paragraph 15 for keeping an
unauthorized pet on the premises. An administrative fee of $300 was
imposed in paragraph 19 if a tenant assigned or sublet the premises.
Paragraph 22 of the lease established a daily rate of $300 per day for
tenants holding over and also required the tenants to pay “any damages”
resulting from the holdover. An acceleration clause in paragraph 27
provided the tenant would immediately owe rent for the entire term of the
lease in the event of an early termination.
Additional fees were prescribed by SouthGate’s Building and
Property Rules. 1 Rule 10 charged tenants for “lockout service calls” at
the rate of $45 per call during business hours and $85 per call at other
times. Rule 11 established a fee of $15 for replacement keys and rule 12
imposed a charge of $25 for each violation of the lease or the building
and property rules.
1Paragraphs 33 and 37 of SouthGate’s leases incorporated several attachments
including “Building and Property Rules” consisting of twelve paragraphs on a single
page. Iowa Code section 562A.18 authorizes landlords to adopt written rules
concerning use and occupancy of the premises. Iowa Code § 562A.18 (2015).
5
The leases also limited a tenant’s remedies in the event SouthGate
was unable to deliver possession on the first day of the lease term.
Paragraph 11 provided as follows:
Subject to other remedies at law, if Landlord, after making a
good faith effort, is unable to give Tenant possession at the
beginning of the term, the rent shall be abated on a pro rata
basis until possession can be given. The rebated rent shall
be accepted by Tenant as full settlement of all damages
occasioned by the delay, and if possession cannot be
delivered within ten (10) days of the beginning of the term,
this Rental Agreement may be terminated by either party
given five (5) days written notice.
The subject of carpet cleaning was also addressed in SouthGate’s
leases. Property rule 9 provided as follows:
All carpets are professionally cleaned at the end of each
tenancy. The departing tenant had professionally cleaned
carpet at move-in and the tenant will be charged for
professionally cleaned carpet at termination. Any extra
painting or carpet cleaning needed to be done will be
deducted from Tenant’s Rental Deposit.
Paragraph 30 of the lease established a checklist detailing the
condition of the dwelling at the commencement of the lease. This
provision provided,
Within three (3) days of the commencement of occupancy,
Tenant shall complete and return to Landlord the Apartment
Inspection Checklist, Smoke Alarm and Fire Extinguisher
checklists (if applicable). If tenant does not within three (3)
days complete and return those checklists, Tenant shall be
presumed as acknowledging that there are no defects or
damages in the Dwelling Unit. Landlord agrees to review the
checklists and notify Tenant of any objections within seven (7)
days of receipt of completed checklists. If Landlord does not
notify Tenant of Landlord’s objections within seven (7) days of
receipt of completed checklists, Tenant’s evaluation shall be
deemed accepted by Landlord. These checklists and
objections (if any) shall be retained by Landlord.
The tenants filed this action against SouthGate seeking a
declaration that each of the lease provisions mentioned above violated
6
the Act. The tenants’ petition requested actual and punitive damages,
injunctive relief, and attorney fees. SouthGate’s answer denied the
leases’ provisions violate the Act and raised the statute of limitations as
an affirmative defense.
A. Motion for Partial Summary and Declaratory Judgment.
The tenants filed a motion for partial summary and declaratory
judgment. The motion sought a declaration that the above-mentioned
lease provisions imposing charges, fines, penalties, liquidated damages,
or other fees are prohibited because SouthGate can recover only actual
damages from tenants under the Act. The tenants urged the court for
the same reason to enter summary judgment declaring that the lease
provision imposing an automatic carpet-cleaning charge violates the Act.
The tenants further urged the court to enter judgment declaring
paragraphs 11 and 30 of the lease violate section 562A.11(1) of the Act
because they purport to waive tenants’ rights or remedies pertaining to
possession and to a clean, sanitary, and habitable dwelling. In addition,
the tenants’ motion sought a determination that they did not have to
prove the landlord actually attempted to enforce these provisions against
them.
In its resistance to the tenants’ motion for partial summary
judgment, SouthGate contended the contested provisions are not
prohibited under the Act. In the alternative, SouthGate asserted that
even if the challenged provisions are prohibited under the Act, the
tenants suffered no damages because the provisions were not enforced
against them. The landlord further asserted it did not willfully use any
prohibited lease provision in violation of section 562A.11(2) because it
had no knowledge of the claimed prohibition prior to the execution of the
leases at issue in this case. Based on these assertions, SouthGate’s
7
resistance to the motion asserted that the tenants’ petition presented no
justiciable controversy supporting a declaratory judgment.
SouthGate also filed a motion for summary judgment. It urged
dismissal of the petition because all of the challenged lease provisions
are compatible with the Act and the tenants therefore suffered no
compensable injury as a matter of law.
B. Motion for Class Certification. The tenants also filed a
motion requesting they be certified as representatives of a class
consisting of all tenants who signed a substantially similar version of
SouthGate’s standard lease. They requested the court adjudicate for the
entire class (1) whether the challenged provisions of SouthGate’s
standard lease are prohibited by the Act, and (2) whether SouthGate
willfully used the lease knowing it contained prohibited provisions.
SouthGate resisted the certification of the proposed class of tenants,
contending the named plaintiffs are not proper representatives of the
class because the challenged lease provisions were not enforced against
them and individual questions of fact dominate over common questions
across the proposed class.
C. District Court’s Summary Judgment Ruling. The district
court granted the tenants’ motion for partial summary judgment. The
court declared that the three categories of lease provisions challenged by
the tenants are prohibited under the Act. The court further concluded
the lease provisions imposing the fees and charges detailed above were
prohibited under the Act because they were set “without any
consideration of what [SouthGate’s] actual damages and fees would be in
each situation.” The court also decided SouthGate’s carpet-cleaning
provision was prohibited under the Act because it automatically imposed
a fee on tenants without regard to whether the carpet was clean at the
8
end of the lease term and authorized SouthGate to withhold the expense
from the tenants’ security deposit without proof that such cleaning was
necessary to restore the dwelling unit to its condition at the
commencement of the tenancy, ordinary wear and tear excepted.
The district court’s summary judgment ruling also concluded two
other lease provisions challenged by the tenants are prohibited under
Iowa Code section 562A.11 (2015). First, the court concluded paragraph
11—the rule limiting the tenants’ remedy to a pro rata abatement of rent
in the event of a delay of possession at the beginning of the lease term—
was a prohibited term under section 562A.11(1)(d). Second, the court
determined paragraph 30—the rule waiving the tenants’ claims of defects
in the condition of the dwelling not identified on an apartment-condition
checklist and delivered to SouthGate within three days of move-in—
constituted a waiver of the tenants’ rights prohibited under section
562A.11(1)(a). The court reasoned that these two lease provisions
violated the Act because they purported to limit SouthGate’s obligations
under section 562A.14 (landlord’s obligation to supply possession of
dwelling unit) and section 562A.15 (landlord’s obligation to maintain fit
premises). The court also concluded paragraph 30 of the lease was
prohibited under the Act because it was calculated to limit SouthGate’s
liability under the common law for failing to satisfy its duty to protect
tenants from reasonably foreseeable harm. 2 The court certified a class of
2The district court concluded the question of whether SouthGate willfully used
lease provisions known to be prohibited would have to be tried. See Caruso v. Apts.
Downtown, Inc., 880 N.W.2d 465, 474 (Iowa 2016) (interpreting Iowa Code section
562A.11(2) as requiring “actual knowledge” that a lease provision was illegal). Having
concluded the tenants’ motion for summary judgment should be granted, the district
court denied SouthGate’s motion for summary judgment.
9
plaintiffs consisting of all of SouthGate’s tenants with the same or
substantially similar standard leases and lease rules.
In reaching its summary judgment conclusions, the district court
relied on an unpublished decision of our court of appeals in Staley v.
Barkalow, No. 12–1031, 2013 WL 2368825 (Iowa Ct. App. May 30, 2013).
In Staley, the plaintiffs were tenants who alleged their landlord used
several lease provisions prohibited under Iowa Code section 562A.11(1).
Staley, 2013 WL 2368825, at *2. The tenants challenged the lease
provisions on the grounds they constituted illegal indemnity and
exculpatory clauses, required tenants to pay rent even if the landlord
failed to deliver possession of the premises at the commencement of the
lease term, and illegally required tenants to pay for maintenance and
repair of the premises, carpet cleaning, and property damages caused by
third-party vandals. Id. at *2–3. The defendant landlord contended it
had no liability to the tenants under chapter 562A for lease provisions
that were included in the lease but not enforced. Id. at *4–5. The district
court denied the Staley tenants’ motion for partial summary judgment,
concluding the landlord had no liability to the tenants under section
562A.11(2) for including any lease provisions that were not enforced
against them, and denied a motion to certify a class of similarly situated
plaintiffs. Id. at *5–6. Our court of appeals reversed, concluding a
landlord “willfully uses” a lease provision prohibited under the Act by
willfully including it in a lease. Id. at *8. The court of appeals also found
the district court abused its discretion in refusing to certify the class of
tenants. Id. at *12.
We granted SouthGate’s application for interlocutory review.
10
II. Scope and Standards of Review.
Generally, our standard of review for a declaratory judgment ruling
depends on whether the action was tried at law or in equity in the district
court. When we review a declaratory ruling entered on summary
judgment, however, our scope of review is for correction of errors at law.
Shelby Cty. Cookers, L.L.C. v. Util. Consultants Int’l., Inc., 857 N.W.2d
186, 189 (Iowa 2014). Summary judgment rulings based on statutory
interpretation are reviewed for correction of errors at law. Estate of
McFarlin v. State, 881 N.W.2d 51, 56 (Iowa 2016).
We review a district court’s rulings on certification of a class for an
abuse of discretion. Kragnes v. City of Des Moines, 810 N.W.2d 492, 498
(Iowa 2012). The district court “enjoys broad discretion in the
certification of class action lawsuits.” Legg v. W. Bank, 873 N.W.2d 756,
758 (Iowa 2016) (quoting Vos v. Farm Bureau Life Ins., 667 N.W.2d 36, 44
(Iowa 2003)). Iowa’s “class-action rules are remedial in nature and
should be liberally construed to favor the maintenance of class actions.”
Anderson Contracting, Inc. v. DSM Copolymers, Inc., 776 N.W.2d 846, 848
(Iowa 2009) (quoting Comes v. Microsoft Corp., 696 N.W.2d 318, 320
(Iowa 2005)). A district court abuses its discretion when its “grounds for
certification are clearly unreasonable.” Id.
III. Analysis.
We first address SouthGate’s contention that the district court
erred in interpreting the word “uses” in section 562A.11(2) in a way that
permits a tenant to recover damages against a landlord who knowingly
included, but did not attempt to enforce, a prohibited provision in a
rental agreement. We then turn to SouthGate’s alternative contention
that even if the district court correctly interpreted section 562A.11(2), we
must still reverse the summary judgment ruling because none of the
11
rental agreement provisions challenged by the tenants in this case are
prohibited under section 562A.11(1). Lastly, we address SouthGate’s
assertion that the district court abused its discretion in certifying a class
of tenants in this action.
A. Standing. SouthGate casts its challenge to the district court’s
interpretation of the word “uses” in section 562A.11(2) as a question of
standing. 3 Noting that the lease terms of Kline, Sories, and McCann
ended before this litigation was commenced, SouthGate posits that the
tenants can assert no imminent threat of future injury arising from the
enforcement of any lease provision. Because it is undisputed that
SouthGate made no attempt to enforce the challenged lease provisions
against the named plaintiffs, SouthGate argues the summary judgment
record is devoid of evidence of any injurious effect necessary to sustain
standing to sue. Accordingly, SouthGate suggests, the tenants’ claims in
this case are purely hypothetical or academic—not concrete and
justiciable.
The tenants take a distinctly different view. They claim their
standing to sue SouthGate under section 562A.11(2) does not turn on
the landlord’s attempt to enforce prohibited provisions of their rental
agreements or on proof of actual damages. The tenants contend they
have standing to sue SouthGate under the statute as a consequence of
SouthGate’s alleged inclusion of known prohibited provisions in their
rental agreements—even if SouthGate made no attempt to enforce those
provisions.
3The standing argument is alternatively pressed by SouthGate under theories of
ripeness and mootness. Because we conclude the theories of ripeness and mootness
are unmeritorious for the same reasons as the argument based on standing, we do not
address them separately in this opinion.
12
We have characterized the standing doctrine as a self-imposed rule
of judicial restraint. Hawkeye Bancorporation v. Iowa Coll. Aid Comm’n,
360 N.W.2d 798, 802 (Iowa 1985). The doctrine limits the work of courts
to those cases in which plaintiffs have a “sufficient stake in an otherwise
justiciable controversy to obtain judicial resolution of [their] controversy.”
Citizens for Responsible Choices v. City of Shenandoah, 686 N.W.2d 470,
475 (Iowa 2004) (quoting Birkhofer ex rel. Johannsen v. Birkhofer, 610
N.W.2d 844, 847 (Iowa 2000)). The sufficiency of the tenants’ stake in
this case therefore turns on (1) whether they assert a specific personal or
legal interest in the litigation and (2) whether that interest has been
injuriously affected. See id.
Typically, we have applied the doctrine of standing in public rights
cases, where we require the citizen to demonstrate “some personal
injury.” Godfrey v. State, 752 N.W.2d 413, 424 (Iowa 2008). This case
does not involve litigation against the state or a political subdivision, but
rather against a private party based on a statutory cause of action. Our
assessment of the nature of the tenants’ right to proceed with the
litigation therefore must focus on the scope of the cause of action as
enacted by the legislature in section 562A.11(2). 4 The parties offer
4The landlord cites us to the recent United States Supreme Court decision in
Spokeo, Inc. v. Robins, 578 U.S. ___, 136 S. Ct. 1540 (2016), which it urges us to follow.
In Spokeo, someone ran a search under the plaintiff’s name on the defendant’s “people
search engine” and received inaccurate information. Spokeo, 578 U.S. at __, 136 S. Ct.
at 1544. The plaintiff thereafter brought a putative class action against the defendant
under the Federal Fair Credit Reporting Act (FCRA). Id. The district court dismissed
the plaintiff’s case for lack of Article III standing, but the Ninth Circuit reversed, finding
that a violation of the plaintiff’s statutory rights under the FCRA was sufficient in and of
itself to confer standing. Id. at ___, 136 S. Ct. at 1544–45. The Supreme Court reversed
and remanded, reasoning,
Congress’[s] role in identifying and elevating intangible harms does not
mean that a plaintiff automatically satisfies the injury-in-fact
requirement whenever a statute grants a person a statutory right and
purports to authorize that person to sue to vindicate that right. Article
13
distinctly divergent interpretations of the word “uses” in section
562A.11(2). The tenants assert a landlord “uses” a rental agreement
including a prohibited provision when the agreement forms the basis of a
landlord–tenant relationship. Thus, under the tenants’ interpretation,
SouthGate used rental agreements containing prohibited provisions
within the meaning of section 562A.11(2) even though it took no
affirmative steps to enforce them. In sharp contrast, SouthGate
contends a landlord “uses” a rental agreement for purposes of the statute
only if it attempts to enforce a prohibited provision against a tenant and
thereby causes actual damages. Because it did not attempt to enforce
any of the challenged provisions against Kline, Sories, or McCann,
SouthGate contends the tenants were not injuriously affected and
therefore have no standing to sue in this case.
We conclude section 562A.11(2) is ambiguous because reasonable
persons could disagree as to the meaning of “uses” in this context. See
IBP, Inc. v. Harker, 633 N.W.2d 322, 325 (Iowa 2001). In interpreting a
statute, our primary objective is to determine the legislature’s intent.
Branstad v. State ex rel. Nat. Res. Comm’n, 871 N.W.2d 291, 295 (Iowa
2015). We determine the legislature’s intent by assessing the language
used in the statute, the statute’s purpose, and the consequences of
possible interpretations. Des Moines Flying Serv., Inc. v. Aerial Servs.
___________________________
III standing requires a concrete injury even in the context of a statutory
violation.
Id. at ___, 136 S. Ct. at 1549.
The Supreme Court instructed the Ninth Circuit to determine on remand
“whether the particular procedural violations alleged in this case entail a degree of risk
sufficient to meet the concreteness requirement.” Id. at ___, 136 S. Ct. at 1550. We are
not persuaded that the Article III limit on Congress’s power to authorize private
litigation in the federal courts identified in Spokeo applies to the same extent when the
general assembly authorizes private litigation in Iowa courts.
14
Inc., 880 N.W.2d 212, 220 (Iowa 2016). When interpreting a statute, we
consider a statute in its entirety, not just isolated words or phrases.
Schadendorf v. Snap–On Tools Corp., 757 N.W.2d 330, 337 (Iowa 2008).
Because the word “uses” is undefined in the Act, we assign it its
common, ordinary meaning in the context in which it is used. Bank of
Am., N.A. v. Schulte, 843 N.W.2d 876, 880 (Iowa 2014).
The Act—a comprehensive reform of residential landlord–tenant
law—was adopted in 1978. 1978 Iowa Acts, ch. 1172 (codified as
amended at Iowa Code ch. 562A). 5 In adopting the landmark reform
measure, the general assembly prescribed in some detail the obligations
owed by landlords and tenants to each other. See Iowa Code
§§ 562A.12–.15 (landlord obligations); id. §§ 562A.17–.20 (tenant
obligations). The reform measure also delineated the remedies that are
available to landlords and tenants for breaches of their respective
obligations. Id. §§ 562A.27–.33 (landlord remedies); id. §§ 562A.21–.26
(tenant remedies).
The general assembly included in the Act a statement of the
purposes and policies underlying the new Code chapter:
a. To simplify, clarify, modernize and revise the law
governing the rental of dwelling units and the rights and
obligations of landlord and tenant; and
b. To encourage landlord and tenant to maintain and
improve the quality of housing.
c. To ensure that the right to the receipt of rent is
inseparable from the duty to maintain the premises.
Iowa Code § 562A.2(2).
5The history of landlord–tenant law antedating the adoption of the Act was well-
chronicled in De Stefano v. Apts. Downtown, Inc., 879 N.W.2d 155 (Iowa 2016), and will
not be repeated here.
15
Professor Lovell published an exhaustive review of the Act shortly
after its adoption. See Russell E. Lovell, The Iowa Uniform Residential
Landlord and Tenant Act and the Iowa Mobile Home Parks Residential
Landlord and Tenant Act, 31 Drake L. Rev. 253 (1981) [hereinafter
Lovell]. He noted that the Act provided needed specifics for implementing
the warranty of habitability recognized earlier by this court in Mease v.
Fox, 200 N.W.2d 791 (Iowa 1972), and provided additional rights and
protections for tenants as well. Lovell, 31 Drake L. Rev. at 263. Included
among those additional protections for tenants is section 562A.11, a
provision expressly prohibiting certain categories of rental agreement
provisions and authorizing remedies for its violation. It states,
1. A rental agreement shall not provide that the
tenant or landlord:
a. Agrees to waive or to forego rights or remedies
under this chapter provided that this restriction shall not
apply to rental agreements covering single family residences
on land assessed as agricultural land and located in an
unincorporated area;
b. Authorizes a person to confess judgment on a claim
arising out of the rental agreement;
c. Agrees to pay the other party’s attorney fees; or
d. Agrees to the exculpation or limitation of any
liability of the other party arising under law or to indemnify
the other party for that liability or the costs connected
therewith.
2. A provision prohibited by subsection 1 included in
a rental agreement is unenforceable. If a landlord willfully
uses a rental agreement containing provisions known by the
landlord to be prohibited, a tenant may recover actual
damages sustained by the tenant and not more than three
months’ periodic rent and reasonable attorney fees.
Iowa Code § 562A.11. This provision is a remedial feature of the reform
legislation that was designed, as Professor Lovell has explained, “to
ensure that the new protections afforded . . . tenants [were] not lost
16
through the contracting process.” Lovell, 31 Drake L. Rev. at 288.
SouthGate advances an interpretation of section 562A.11(2) that would
require tenants to prove actual damages arising from attempted
enforcement of a prohibited provision. Under this interpretation, the
tenants’ remedy for mere inclusion of a prohibited provision in a rental
agreement is the defense of unenforceability under section 562A.11(1).
Because the general assembly authorized the more consequential
remedy of actual damages in the second sentence of section 562A.11(2)
against a landlord who “uses” a rental agreement including a prohibited
provision, SouthGate contends we should conclude “uses” refers to more
culpable conduct than mere inclusion of a prohibited term. In
particular, SouthGate posits that the second sentence means a landlord
“uses” a rental agreement with a prohibited provision only by attempting
to enforce the prohibited provision and causing a tenant’s actual
damage. We are not convinced.
It seems unlikely to us that the availability of the distinct remedial
alternatives authorized in the first and second sentences of section
562A.11(2) turns on whether the landlord has attempted to enforce a
prohibited provision. The defense of unenforceability granted in the first
sentence of the section seems to presuppose that the general assembly
was contemplating a scenario in which a landlord has attempted to
enforce a prohibited provision.
We think it more likely that the general assembly prescribed
different remedies in the first and second sentences of section 562A.11(2)
as a means of addressing the degree of a landlord’s subjective culpability.
The defense of unenforceability was chosen as the remedy in the first
sentence for tenants against landlords who mistakenly or innocently
include prohibited provisions in their rental agreements. The
17
consequence-of-damage remedies authorized in the second sentence is
reserved for the more culpable conduct of landlords who willfully and
knowingly use prohibited provisions.
We also think it apparent that the general assembly’s choice of the
word “uses” in the second sentence of section 562A.11(2) was intended to
address a broader range of landlord conduct than is reached by the word
“included” in the previous sentence. Although “uses” in this context
obviously subsumes the conduct of attempting to enforce a prohibited
provision, we believe it also encompasses the separate egregious act of
inserting such a provision in a rental agreement with knowledge that it is
prohibited. In his early exegesis of the Act, Professor Lovell presaged
that section 562A.11 would authorize a remedy at law “against a
landlord who include[s] a prohibited provision in the lease, whether or
not the landlord [sought] to enforce that provision against the tenant.”
Lovell, 31 Drake L. Rev. at 292–93. Standing alone, the defense of
unenforceability will not accomplish excision of prohibited provisions
from residential rental agreements. See id. at 291–92. “There was
further concern that without the prospect of other remedial sanctions,
there would be some unscrupulous landlords who would continue to
insert prohibited provisions in their leases and exploit those provisions
against unsuspecting tenants.” Id. at 292. For these reasons, we
conclude section 562A.11(2) authorizes a claim for damages against a
landlord, even in the absence of an attempt to enforce a prohibited
provision. This interpretation best comports with the general assembly’s
directive that we liberally construe chapter 562A. 6
6It is noteworthy that Iowa’s language is similar to that in the 1972 Uniform
Residential Landlord and Tenant Act, which provided, “If a landlord deliberately uses a
rental agreement containing provisions known by him to be prohibited, the tenant may
18
In furtherance of its standing argument, SouthGate also contends
proof of actual damages is a prerequisite for the recovery of additional
damages of “not more than three months’ periodic rent” under section
562A.11(2). SouthGate focuses here on the phrase “a tenant may
recover actual damages . . . and not more than three months’ periodic
rent” within the second sentence of the section and asserts it means a
tenant may not recover the latter without the former. We reject this
interpretation of the phrase, however, because we have already
determined the section authorizes a damage remedy against landlords
who knowingly include prohibited provisions in their leases even in the
absence of any attempt to enforce them. Consistent with this
understanding, we conclude the conjunctive connection in the subject
phrase permits a recovery of not more than three months’ periodic rent
even if no actual damages are pled and proved.
Analogizing the “not more than three months’ periodic rent”
formulation to a punitive damage award, SouthGate calls our attention to
___________________________
recover in addition to his actual damages an amount up to [3] months’ periodic rent
and reasonable attorney’s fees.” Unif. Residential Landlord & Tenant Act § 1.403, 7B
U.L.A. 313 (2006). The official comment explains,
Such provisions, even though unenforceable at law may nevertheless
prejudice and injure the rights and interests of the uninformed tenant
who may, for example, surrender or waive rights in settlement of an
enforceable claim against the landlord for damages arising from the
landlord’s negligence.
Id. § 1.403 cmt., 7B U.L.A. 314.
This language suggests that the drafters of the uniform act understood the term
“uses” to have a relatively broad meaning. In fact, when Oregon enacted its version of
the uniform act, it modified this sentence seemingly to achieve the meaning sought by
the landlord in this case: “If a landlord deliberately uses a rental agreement containing
provisions known by the landlord to be prohibited and attempts to enforce such
provisions, the tenant may recover in addition to the actual damages of the tenant an
amount up to three months’ periodic rent.” Or. Rev. Stat. Ann. § 90-245(2) (West,
Westlaw current through emergency legis. through ch. 13 of 2017 Reg. Sess.) (emphasis
added).
19
the principle that punitive damages are generally not recoverable in the
absence of actual damages. See Syester v. Banta, 257 Iowa 613, 627,
133 N.W.2d 666, 675 (Iowa 1965). Although that principle is well-
established, we conclude it does not constrain the general assembly’s
choice to provide a remedy other than actual damages as an alternative
for tenants who have suffered no actual damage arising from an
attempted enforcement of a prohibited provision, but nonetheless seek a
remedy for their landlord’s egregious inclusion of the provision.
SouthGate contends our decision in D.R. Mobile Home Rentals v.
Frost, 545 N.W.2d 302 (Iowa 1996) (per curiam), should lead us to
conclude the tenants claims must fail because they cannot prove actual
damages. In that case, a tenant abandoned a rented dwelling. Id. at
303. The landlord sued for damages under Iowa Code section 562A.32
after the rental agreement was terminated, seeking a judgment for
unpaid rent for the period between the abandonment and termination
and for the cost of removing debris left on the premises by the tenant.
Id. at 303–04, 306. The district court entered judgment for the landlord
and the tenant appealed. Id. at 304. On appeal, we reversed the
judgment for rent because the landlord failed to prove it made any effort
to rent the dwelling as required under Iowa Code section 562A.29(3) after
the tenant abandoned it. Id. at 305. We also reversed the judgment for
the cost of removing the debris because the landlord “did not present
evidence that Frost’s debris was removed.” Id. at 306.
SouthGate’s contention that Frost supports its position that proof
of actual damages is a prerequisite for tenants seeking a damage remedy
under section 562A.11(2) is off the mark. Although we reversed the
judgment for damages in Frost for lack of proof of actual damages, we did
so because the landlord brought that action under section 562A.32. Id.
20
at 306; see also Iowa Code § 562A.32 (“If the rental agreement is
terminated, the landlord may have a claim for possession and for rent
and a separate claim for actual damages for breach of the rental
agreement and reasonable attorney fees . . . .”). That section makes no
provision for a remedial alternative to actual damages in posttermination
actions brought by landlords like the one available to tenants under
section 562A.11(2). Accordingly, Frost is distinguishable and not helpful
to our analysis.
For all of these reasons, we reject SouthGate’s contention that the
tenants lack standing to press their statutory claims for damages under
section 562A.11(2). Thus, we now turn to SouthGate’s argument that
the district court erred in concluding that provisions in the rental
agreement assessing the challenged charges and fees are prohibited
provisions.
B. Fees, Charges, and Liquidated Damages Provisions. The
district court concluded all of the challenged fees, charges, and
liquidated damage provisions in the leases are prohibited under the Act
“because they were set without any consideration of what the landlord’s
actual damages and fees would be in each situation.” The court reached
this conclusion because it believed our decision in Frost required it.
SouthGate asserts reversal is required on this issue because the fees,
charges, and liquidated damages provisions challenged by the tenants in
this case are not prohibited under either chapter 562A or law
supplementing the chapter. See id. § 562A.3.
Although chapter 562A imposes some specific restraints on the
content of residential rental agreements, the statute does not completely
displace freedom of contract. This is made evident in section 562A.9(1),
which provides,
21
The landlord and tenant may include in a rental agreement,
terms and conditions not prohibited by this chapter or other
rule of law including rent, term of the agreement, and other
provisions governing the rights and obligations of the parties.
Iowa Code § 562A.9(1).
As we have already noted, some specific categories of provisions
are expressly prohibited under the Act. For example, provisions waiving
rights and remedies established in chapter 562A are banned, as are
those confessing judgment, those exculpating, limiting, or indemnifying
another party’s liability, and those agreeing to pay another party’s
attorney fees. See Iowa Code § 562A.11(1). Unconscionable provisions
are also prohibited. Id. § 562A.7. Beyond these express prohibitions,
however, landlords and tenants are free to form residential rental
contracts consistent with chapter 562A and the principles of law and
equity supplementing it. Id. § 562A.3.
Upon review, we conclude the district court erred in declaring that
the fees, charges, and liquidated damages provisions in paragraphs 3
(charge for checks returned for insufficient funds), 4 (charge for new
tenants added to the lease after term begins), 9 (fee for utility bill
received or paid by landlord because tenant failed to arrange transfer of
account), 12 (charge for maintenance calls caused by tenant’s
negligence), 15 (liquidated damages for unauthorized pet), 19 (fee for
assigning or subletting), 22 (per diem fee for holding over), and 27 (rent
acceleration clause for early termination) of the rental agreement and
rules 10 (charge for lockout service calls), 11 (fee for replacement keys),
and 12 (charge for lease violations) are categorically prohibited as a
matter of law. We find no basis for determining these provisions are
categorically prohibited under section 562A.11(1). Accordingly, they are
22
appropriately classified as “other provisions governing the rights and
obligations of the parties” under section 562A.9(1). Id. § 562A.9(1).
The tenants nonetheless urge affirmance of the district court’s
declaration because the challenged fees, charges, and liquidated damage
amounts are not “actual damages” recoverable by landlords. In support
of this argument, the tenants cite our decision in Frost. Frost, 545
N.W.2d 302. But as our discussion of Frost in our analysis of the
standing issue reveals, the landlord’s posttermination action in that case
was not brought to enforce fees, charges, or liquidated damage
provisions. The landlord in Frost instead brought a posttermination
action under section 562A.32 for unpaid rent and damages for the cost of
removing debris left by the tenant who had abandoned the dwelling
before the end of the lease term. Id. at 303–04. We reversed the
judgment against the tenant because the landlord failed to prove it met
its statutory obligation to attempt to rent the dwelling during the interim
between the tenant’s abandonment of the property and the end of the
lease term, and because the record lacked substantial evidence of the
expense, if any, incurred by the landlord in removing the tenant’s debris.
Id. at 305. Thus, we reject the tenants’ contention that our decision in
Frost established a rule that fees, charges, or liquidated damage
provisions in rental agreements are categorically prohibited.
We conclude the summary judgment declaring the fees, charges,
and liquidated damages are categorically prohibited provisions must be
reversed. We emphasize, however, that the district court did not decide
whether any of the fees, charges, and liquidated damage provisions
challenged in this case by the tenants are unconscionable under section
562A.7 or unenforceable penalties under any other principle of law or
23
equity supplementing the Act. See id. §§ 562A.7, .9(1). Accordingly,
those issues remain for resolution in proceedings on remand.
C. Delayed Possession Provision. Paragraph 11 of the rental
agreements provides,
Subject to other remedies at law, if Landlord, after making a
good faith effort, is unable to give Tenant possession at the
beginning of the term, the rent shall be rebated on a pro rata
basis until possession can be given. The rebated rent shall
be accepted by Tenant as full settlement of all damages
occasioned by the delay, and, if possession cannot be
delivered within ten (10) days of the beginning of the term,
this Rental Agreement may be terminated by either party
giving five (5) days written notice.
The district court found this provision is prohibited under section
562A.11(1)(d) because it constitutes an exculpation or limitation of the
landlord’s liability arising under law.
SouthGate contends the district court erred in concluding this is a
prohibited provision. Noting the provision commences with “subject to
other remedies at law,” SouthGate posits the tenants’ right to refuse the
rent abatement as a make-whole remedy and instead file an action for
damages is not foreclosed. Although the provision does track section
562A.11(1)(d) in abating the obligation to pay rent during the delay and
permitting the tenants to terminate the rental agreement upon five days’
written notice, we find it falls completely off the statutory rails in limiting
SouthGate’s damage exposure to the abatement remedy “as full
settlement of all damages.” The provision cannot be saved in our view by
the ambiguous introductory phrase “[s]ubject to other remedies at law”
as it otherwise clearly purports to attempt to limit SouthGate’s liability
and the tenants’ remedy for damages sustained as a consequence of the
delay under section 562A.22. See id. § 562A.22(1)(b) (allowing tenants to
elect to sue for possession and recover damages); id. § 562A.22(2)
24
(authorizing recovery of actual damages and reasonable attorney fees if
landlord’s failure to deliver possession is willful and not in good faith).
We conclude the district court correctly declared paragraph 11 is a
prohibited provision under section 562A.11.
D. Carpet-Cleaning Provision. The district court concluded the
carpet-cleaning provision found in rule 9 of SouthGate’s rental
agreement is prohibited because it provides for automatic cleaning
whether the carpet needs cleaning or not and because the rule permits
the landlord to avoid its obligations under section 562A.12(3). See id.
§ 562A.12(3) (requiring landlord within thirty days to return the rental
deposit or furnish to the tenant a written statement showing the specific
reason for withholding any portion of the rental deposit and detailing the
reasons for which withholding is permitted). SouthGate contends the
district court erred on this issue because the record demonstrates that
the provision is not automatically invoked against tenants. The
summary judgment record reveals, for example, that no amount was
withheld from the security deposits of Kline, Sories, or McCann for carpet
cleaning. SouthGate further contends that even if the carpet-cleaning
provision were invoked against a tenant, no violation of section
562A.12(3)(a)(2) would occur because the cleaning of carpets is a
measure calculated to restore the dwelling unit to its condition at the
commencement of the tenancy. See id. § 562A.12(3)(a)(2) (authorizing
withholding from the rental deposit such amounts as are reasonably
necessary “[t]o restore dwelling unit to its condition at the
commencement of the tenancy, ordinary wear and tear excepted”).
We recently addressed the enforceability of a carpet-cleaning
provision in a residential rental agreement. See De Stefano v. Apts.
Downtown, Inc., 879 N.W.2d 155 (Iowa 2016). In De Stefano, we
25
acknowledged that Iowa Code section 562A.12 “clearly authorizes the
deduction of carpet-cleaning costs from rental deposits if necessary to
restore the dwelling unit to the condition at the commencement of the
tenancy, beyond the ordinary wear and tear.” Id. at 186. We clarified,
however, that a landlord cannot “impose an automatic carpet-cleaning
fee and deduct such charges from a rental deposit.” Id.
We conclude the district court erred in declaring SouthGate’s rule
9 is a prohibited provision under section 562A.12(3). The rule is not
reasonably understood as a provision for effecting an automatic
withholding of the cost of carpet cleaning from security deposits. It is
instead a provision establishing a benchmark for the condition of the
carpet—a clean carpet—at the commencement of each tenancy from
which subsequent assessments of ordinary wear and tear can be
measured. We believe it is significant that the first two sentences of rule
9 do not purport to authorize the automatic withholding of the cost of
such regular cleaning from the tenant’s security deposit. See id. (leaving
room for the possibility that “a landlord may be able to impose a
nonrefundable charge on tenants for automatic carpet cleaning” not
affecting the rental deposit). Indeed, as we have already indicated, the
summary judgment record reveals no withholding for regular carpet
cleaning was claimed by SouthGate from the security deposits of Kline,
Sories, or McCann.
We acknowledge that the third sentence of rule 9 authorizes a
deduction from the rental deposit for any “extra painting or carpet
cleaning needed to be done.” This sentence does not render the rule
categorically infirm in our view because the word “extra” distinguishes
the cleaning referenced here from the regular carpet cleaning described
in the preceding two sentences. Any attempted withholding of the cost of
26
such “extra” cleaning from the rental deposit would be subject to the
requirement that SouthGate prove the cleaning was reasonably
necessary “[t]o restore the dwelling unit to its condition at the
commencement of the tenancy, ordinary wear and tear excepted.” Iowa
Code § 562A.12(3)(a)(2).
We conclude rule 9 is not categorically prohibited under the Act.
Accordingly, we reverse on this issue.
E. The Apartment-Inspection Checklist. The district court
declared paragraph 30 of the lease is a prohibited provision because it
constitutes a limitation or exculpation of SouthGate’s liability to exercise
ordinary care for the safety of its tenants and its statutory obligation to
provide and maintain a fit dwelling under section 562A.15(1). SouthGate
contends the district court erred in interpreting the apartment-checklist
provision in paragraph 30 as an agreement to waive or forego rights or
remedies or an agreement to exculpate or limit the landlord’s liability for
defects in the premises. The provision accomplishes none of those
prohibited ends, SouthGate asserts, and it instead serves a protective
function for tenants. In documenting defects of the dwelling at the
outset of the tenancy, tenants diminish the risk that they will be blamed
for any preexisting damages. Furthermore, SouthGate contends, the
checklist provision advances the salutary interests of both parties to the
lease in documenting the condition of the premises and facilitating the
prompt repair of any defects from the outset of the tenancy.
The tenants contend the district court got it right because the
consequence of a failure to timely complete and return the form is
onerous—a presumption arises under paragraph 30 that the tenant
acknowledges there are no defects or damage in the dwelling unit at the
outset of the tenancy. The tenants characterize the checklist provision
27
as a thinly veiled device calculated by SouthGate to avoid liability for
defects in the dwelling in violation of section 562A.11(1)(a) and (d) in the
event tenants overlook a defect and fail to list it or fail to return the form
to SouthGate within three days after occupancy of the dwelling begins.
We find SouthGate’s arguments more persuasive on this point. We
view paragraph 30 as a procedural device to promote documentation of
the condition of the dwelling at the outset of the landlord–tenant
relationship. The checklist is a means of focusing the attention of both
parties on any defects when occupancy begins so that any documented
defects may be known and repaired if necessary by SouthGate. We find
persuasive SouthGate’s assertion that the checklist device serves in part
to shield tenants from responsibility for preexisting conditions or defects
in the dwelling. Although the contents of the checklist—or the absence
of a checklist if the tenant fails to prepare and return it—might well have
evidentiary significance in the event SouthGate claims the tenant caused
damage to the dwelling, we conclude the evidence falls short of an
agreement to waive or forego rights or remedies prohibited under section
562A.11(1)(a) or an agreement to exculpate or limit SouthGate’s liability
under the law. Accordingly, we conclude the district court erred in
declaring paragraph 30 of the rental agreement is a prohibited provision.
F. Certification of the Class. SouthGate argues the district
court made both procedural and substantive errors in certifying the class
of tenants. In ruling on the tenants’ motion to certify the class, the
district court cited the decision of the court of appeals in Staley. In that
case, discussed above in this opinion, the appellate court directed the
district court to certify a class of tenants challenging provisions of a
residential rental agreement. Staley, 2013 WL 2368825, at *10.
SouthGate contends the district court in this case relied solely on the
28
certification decision in Staley and assumed—without performing an
independent analysis and making findings of fact as to the substantive
criteria for class certification—that certification is appropriate in this
case.
The tenants have the burden of establishing that the proposed
class meets the prerequisites for certification. Vos, 667 N.W.2d at 45.
An order certifying a class “shall state the reasons for the court’s ruling
and its findings on the facts listed in rule 1.263(1).” Iowa R. Civ. P.
1.264(2). In summary fashion, the district court found this case
presents “nearly identical class certification facts” to those in Staley and
ordered certification here. SouthGate contends the court’s summary
disposition of the certification issue without the predicate factual
determinations mandated by our procedural rules constitutes an abuse
of discretion.
SouthGate also criticizes the district court’s description of the class
“consisting of all of the Defendants’ tenants with the same or
substantially similar standard leases and lease rules.” SouthGate
contends this description is flawed because it lacks a time limitation and
leaves too much ambiguity arising from the phrase “substantially
similar.” These uncertainties are so profound, in SouthGate’s view, as to
constitute an abuse of discretion.
We conclude the class certification is procedurally flawed in the
absence of the required findings and must be reversed. Our ruling
should not be understood, however, as a determination that the grounds
for certification of a class cannot be established in this case. On
remand, the court should make the findings required under rule
1.263(1). At that time, if the court’s findings support the certification of
a class, the court will also have an opportunity to address any issues
29
raised by SouthGate with respect to uncertainty in the description of the
class.
IV. Conclusion.
We affirm the district court’s declaration that paragraph 11 of
SouthGate’s rental agreement constitutes a prohibited provision. We
reverse the district court’s declaration that the other lease and rule
provisions are categorically prohibited. We also reverse the class
certification ruling and remand for further proceedings.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
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<P><SPAN STYLE="font-size: 14pt"><STRONG><CENTER>TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN</STRONG></SPAN></CENTER>
</P>
<BR WP="BR1"><BR WP="BR2">
<BR WP="BR1"><BR WP="BR2">
<P><STRONG><CENTER></CENTER>
</STRONG></P>
<P><STRONG><CENTER>NO. 03-96-00368-CR</CENTER>
</STRONG></P>
<P><STRONG><CENTER></CENTER>
</STRONG></P>
<BR WP="BR1"><BR WP="BR2">
<BR WP="BR1"><BR WP="BR2">
<P><STRONG><CENTER>Billy Ray Hibdon, Appellant</CENTER>
</STRONG></P>
<BR WP="BR1"><BR WP="BR2">
<P><STRONG><CENTER>v.</CENTER>
</STRONG></P>
<BR WP="BR1"><BR WP="BR2">
<P><STRONG><CENTER>The State of Texas, Appellee</CENTER>
</STRONG></P>
<BR WP="BR1"><BR WP="BR2">
<BR WP="BR1"><BR WP="BR2">
<P><STRONG><CENTER></CENTER>
</STRONG></P>
<P><SPAN STYLE="font-family: CG Times" STYLE="font-size: 11pt"><STRONG><CENTER>FROM THE DISTRICT COURT OF WILLIAMSON COUNTY, 26TH JUDICIAL DISTRICT</CENTER>
</STRONG></SPAN></P>
<P><SPAN STYLE="font-family: CG Times" STYLE="font-size: 11pt"><STRONG><CENTER>NO. 95-236-K26, HONORABLE BILLY RAY STUBBLEFIELD, JUDGE PRESIDING</STRONG></SPAN><SPAN STYLE="font-family: CG Times"><STRONG></CENTER>
</STRONG></SPAN></P>
<P><SPAN STYLE="font-family: CG Times"><STRONG><CENTER></CENTER>
</STRONG></SPAN></P>
<BR WP="BR1"><BR WP="BR2">
<BR WP="BR1"><BR WP="BR2">
<P><SPAN STYLE="font-family: CG Times"><STRONG>PER CURIAM</STRONG></SPAN></P>
<BR WP="BR1"><BR WP="BR2">
<P><SPAN STYLE="font-family: CG Times"> A jury found appellant guilty of driving while intoxicated, third offense. Tex. Penal Code
Ann. §§ 49.04(a), 49.09(b) (West Supp. 1997). The jury assessed punishment at imprisonment for ten
years.</SPAN></P>
<P><SPAN STYLE="font-family: CG Times"> In his only point of error, appellant contends the evidence is legally insufficient to sustain
the conviction because the State failed to prove that he intentionally, knowingly, or recklessly drove while
intoxicated. Appellant argues that proof of a culpable mental state was required under the terms of Penal
Code section 6.02(b) because section 49.04 does not plainly dispense with a mental element. Tex. Penal
Code Ann. § 6.02(b) (West 1994). Appellant points out that this offense occurred before the effective
date of Penal Code section 49.11, which exempts intoxication offenses from the terms of section 6.02(b).
Tex. Penal Code Ann. § 49.11 (West Supp. 1997).</SPAN></P>
<P><SPAN STYLE="font-family: CG Times"> We recently held that the State is not required to plead or prove a culpable mental state
in a prosecution under section 49.04. <EM>Sanders v. State</EM>, No. 03-96-00055-CR (Tex. App.--Austin Dec.
19, 1996, no pet. hist.). All of the arguments advanced by appellant were considered and rejected in that
opinion. For the reasons stated in <EM>Sanders</EM>, appellant's point of error is overruled. The judgment of
conviction is affirmed.</SPAN></P>
<BR WP="BR1"><BR WP="BR2">
<P><SPAN STYLE="font-family: CG Times">Before Chief Justice Carroll, Justices Kidd and B. A. Smith</SPAN></P>
<P><SPAN STYLE="font-family: CG Times">Affirmed</SPAN></P>
<P><SPAN STYLE="font-family: CG Times">Filed: January 9, 1997</SPAN></P>
<P><SPAN STYLE="font-family: CG Times">Do Not Publish</SPAN></P>
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947 F.2d 939
Whaley (Fred)v.Boyle (Officer, Badge #1224), Philadelphia PoliceDepartment, 35th Police District, Broad andChamplost Street, Philadelphia, PA.
NO. 91-1383
United States Court of Appeals,Third Circuit.
OCT 22, 1991
1
Appeal From: E.D.Pa.
2
AFFIRMED IN PART, REVERSED IN PART.
|
984 F.2d 85
24 Fed.R.Serv.3d 841
Orlando ROLDAN, Petitioner-Appellant,v.James RACETTE, Superintendent, Adirondack CorrectionalFacility, and U.S. Immigration & NaturalizationService, Respondents-Appellees.
No. 1684, Docket 91-2544.
United States Court of Appeals,Second Circuit.
Argued June 11, 1992.Decided Jan. 22, 1993.
Randolph Z. Volkell, North Merrick, NY, for petitioner-appellant.
William C. Pericak, Asst. U.S. Atty. for the N.D. of N.Y., Albany, NY (Gary L. Sharpe, U.S. Atty. for the N.D. of N.Y., Albany, NY, of counsel), for respondent-appellee U.S. I.N.S.
Robert Abrams, Atty. Gen. of the State of N.Y. John McConnell, Asst. Atty. Gen. of the State of NY, Albany, NY, for respondent-appellee James Racette, Superintendent, Adirondack Correctional Facility.
Before: CARDAMONE, WINTER, and MAHONEY, Circuit Judges.
MAHONEY, Circuit Judge:
1
Petitioner-appellant Orlando Roldan appeals from a judgment entered October 29, 1991 in the United States District Court for the Northern District of New York, Howard G. Munson, Judge, that dismissed Roldan's application for a writ of habeas corpus. The district court, adopting a report-recommendation of Ralph W. Smith, Jr., Magistrate Judge, entered September 10, 1991, ruled that Roldan was not "in custody" within the meaning of 28 U.S.C. § 2241(c)(3) (1988), thus precluding habeas corpus jurisdiction.
2
We dismiss the appeal for lack of subject matter jurisdiction.
Background
3
Roldan, a native and citizen of Colombia, entered the United States in 1981 without inspection by any representative of the United States Immigration and Naturalization Service ("INS"). His petition asserts that on September 4, 1987, he was convicted in the Dutchess County Court in the State of New York of assault in the first degree and sentenced to an indeterminate prison term of two to six years.1 In August 1988, Roldan was released from state prison on parole and placed in the custody of the INS.
4
Following a deportation hearing, Roldan was deported from the United States to Colombia on August 12, 1988. According to Roldan, the INS failed to notify him at that hearing of his legal rights, including the possibility of defending against the deportation based upon his 1983 marriage to an American citizen, or of the fact that subsequent reentry into the United States would constitute a violation of his parole.
5
In October 1989, Roldan reentered the United States without inspection. He was subsequently arrested for driving while intoxicated ("DWI"). The DWI offense and reentry into the United States were considered violations of his parole. Accordingly, Roldan's parole was revoked and he was recommitted to state prison to serve an additional twenty-four months of his state prison sentence.
6
On June 20, 1990, while Roldan was incarcerated, the INS began a proceeding to deport him by issuance of an order to show cause and warrant of arrest. The grounds for the proposed deportation were his reentry into the United States without inspection and his 1987 state conviction. In support of that proceeding, the INS lodged a detainer against Roldan with the state prison officials so that Roldan could be released into INS custody at the expiration of his state sentence.
7
On March 22, 1991, Roldan filed a petition for a writ of habeas corpus pursuant to 28 U.S.C. § 2254 (1988). The named respondents were the INS and James Racette, superintendent of the Adirondack Correctional Facility, where Roldan was then imprisoned. The petition did not challenge the underlying state conviction, but rather "the miscarriage of justice and the violation of [Roldan's] rights which occurred at the 1988 INS proceedings against [him]."
8
The matter was referred to Magistrate Judge Smith. Thereafter, respondents moved to dismiss the petition for lack of subject matter jurisdiction. The INS contended that although Roldan was challenging the procedures employed in his earlier deportation hearing, he was not in the custody of the INS because the mere filing of a detainer did not satisfy the custody requirement for habeas corpus jurisdiction. The state respondent argued that because Roldan was in custody pursuant to a determination that he violated his parole and did not challenge either that determination or the underlying state conviction, there was no claim that his imprisonment met the requirements of federal law for the provision of habeas relief to a state prisoner.
9
Addressing these motions, the magistrate judge entered a report-recommendation on September 10, 1991 that proposed dismissal of the petition for failure to satisfy the "in custody" requirement of 28 U.S.C. § 2241(c)(3). The magistrate found that Roldan's incarceration in state prison was not determined by the allegedly defective 1988 deportation hearing, and that the INS detainer did not "place [Roldan] within INS custody for purposes of this action."
10
The report-recommendation was served upon the parties by certified mail. It included the following notice:
11
Pursuant to 28 U.S.C. § 636(b)(1), the parties have ten days within which to lodge written objections to the foregoing report.... FAILURE TO OBJECT TO THIS REPORT WITHIN TEN DAYS WILL PRECLUDE APPELLATE REVIEW. Small v. Secretary of Health and Human Services, 892 F.2d 15 (2d Cir.1989); 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72, 6(a), 6(e).
12
Roldan acknowledged his receipt of the magistrate's report on September 9, 1991. No objections were filed. On October 29, 1991, Judge Munson entered an order that approved the report-recommendation and dismissed Roldan's petition. A corresponding judgment was entered on that date. Roldan filed a notice of appeal on November 12, 1991, and the district court issued a certificate of probable cause on December 9, 1991.
13
In December 1991, Roldan was released from state custody and was taken into custody by the INS. In January 1992, Roldan was deported to Colombia. The INS subsequently filed a motion, joined by Racette, which sought dismissal of the appeal pursuant to Small v. Secretary of Health & Human Services, 892 F.2d 15 (2d Cir.1989) (per curiam), for Roldan's failure to object to the report-recommendation of the magistrate judge.
Discussion
14
Roldan's habeas petition named as respondents both the superintendent of the New York correctional facility where he was incarcerated and the INS, which had lodged a detainer regarding Roldan with the state prison authorities prior to Roldan's application for habeas relief. We accordingly address Roldan's challenges to (1) his state custody, and (2) the INS detainer.
15
A. Roldan's State Custody.
16
The magistrate judge's report-recommendation regarded Roldan as effectively seeking relief only "against the INS even though he is not in INS custody." The magistrate judge was certainly justified in that view.
17
Roldan's petition "challenge[d] proceedings of the INS, Buffalo office, with respect to a deportation hearing," and further contended that his state confinement was "illegal in that it was predicated upon the miscarriage of justice and the violation of my rights that occurred at the 1988 INS proceedings against me." There was no claim that there was any infirmity in the state proceedings that led to Roldan's initial conviction for assault.
18
Further, we cannot conclude that his subsequent imprisonment as a parole violator by New York State constituted "custody in violation of the Constitution or laws or treaties of the United States" within the meaning of 28 U.S.C. §§ 2241(c)(3) and 2254(a) simply because the INS allegedly failed to advise him at his 1988 deportation proceeding that illegal reentry would constitute a violation of his state parole. In any event, Roldan could hardly contend that his DWI conviction, an additional basis for his parole revocation, was attributable to the 1988 deportation proceeding.
19
We conclude that Roldan presented no significant challenge to his state custody. Considerations of mootness regarding this issue accordingly need not be addressed.
20
B. The INS Detainer.
21
Construing Roldan's pro se habeas petition liberally, see Williams v. Kullman, 722 F.2d 1048, 1050 (2d Cir.1983), it is possible to read it as challenging the INS detainer. The magistrate judge took this view of Roldan's petition, but concluded that the filing of the INS detainer did not place Roldan within INS custody, with the result that Roldan did not satisfy the "in custody" predicate of §§ 2241(c)(3) and 2254 for habeas relief against the INS. In so ruling, the magistrate judge relied upon Orozco v. INS, 911 F.2d 539, 541 (11th Cir.1990) (per curiam), and Campillo v. Sullivan, 853 F.2d 593, 595 (8th Cir.1988), cert. denied, 490 U.S. 1082, 109 S.Ct. 2105, 104 L.Ed.2d 666 (1989).
22
These cases express the clear majority view that an INS detainer constitutes (1) a notice that future INS custody will be sought at the conclusion of a prisoner's pending confinement by another jurisdiction, and (2) a request for prior notice regarding the termination of that confinement, and thus does not result in present confinement by the INS. See Orozco, 911 F.2d at 540-41 (following Campillo ); Campillo, 853 F.2d at 595 (INS detainer "merely notifies prison officials that a decision regarding [a prisoner's] deportation will be made by the INS at some future date"); see also Prieto v. Gluch, 913 F.2d 1159, 1162-64 (6th Cir.1990) (following Campillo ), cert. denied, --- U.S. ----, 111 S.Ct. 976, 112 L.Ed.2d 1061 (1991); Lepez-Mejia v. INS, 798 F.Supp. 625, 627 (C.D.Cal.1992) (detainer "merely notifies the prison that the INS has some interest in a particular inmate, and asks prison officials to advise the INS when the inmate is about to be released"); Severino v. Thornburgh, 778 F.Supp. 5, 6 (S.D.N.Y.1991) ("mere filing of an INS detainer notice fails to establish the requisite custody under the habeas corpus statute"); Paulino v. Connery, 766 F.Supp. 209, 210-11 (S.D.N.Y.1991) (INS detainer did not result in INS custody); Soler v. INS, 749 F.Supp. 1011, 1012 (D.Ariz.1990) (same); Garcia v. INS, 733 F.Supp. 1554, 1555 (M.D.Pa.1990) (same); Cabezas v. Scott, 717 F.Supp. 696, 697 (D.Ariz.1989) (same); D'Ambrosio v. INS, 710 F.Supp. 269, 270 (N.D.Cal.1989) (same); Fernandez-Collado v. INS, 644 F.Supp. 741, 743-44 (D.Conn.1986) (same), aff'd mem., 857 F.2d 1461 (2d Cir.1987).
23
Two older cases, however, state that the filing of an INS detainer results in "technical custody" of the affected prisoner by the INS. See Chung Young Chew v. Boyd, 309 F.2d 857, 865 (9th Cir.1962) ("Where ... a warrant is obtained by the [INS] while the person named is in a penal institution, and on the basis thereof a detainer is lodged with that institution, the [INS] gains immediate technical custody. This is retained until the individual is released from the institution at which time actual custody is obtained."); Slavik v. Miller, 89 F.Supp. 575, 576 (W.D.Pa.) ("The petitioner unquestionably is in the technical custody of the immigration authorities since a detainer has been lodged for the body of the petitioner at the time that the fulfillment of the state sentence has expired."), aff'd on another ground, 184 F.2d 575 (3d Cir.1950) (per curiam), cert. denied, 340 U.S. 955, 71 S.Ct. 566, 95 L.Ed. 688 (1951); cf. Campillo, 853 F.2d at 596 (distinguishing Boyd and Slavik on the basis that in those cases, the "courts acted to ensure that an already existing deportation order would be subject to judicial review"). But see Mohammed v. Sullivan, 866 F.2d 258, 260 (8th Cir.1989) ("the filing of an INS detainer with prison officials does not constitute the requisite 'technical custody' for purposes of habeas jurisdiction"); Fernandez-Collado, 644 F.Supp. at 743 (court "not persuaded" by rationale of Boyd and Slavik ).
24
In Vargas v. Swan, 854 F.2d 1028 (7th Cir.1988), the Seventh Circuit remanded for a determination whether an INS detainer would be treated as a simple notice of INS interest in a prisoner, or as a request "to hold an inmate at the end of his sentence until the INS can take him into custody," id. at 1033, in which event INS custody would be established. In Prieto, however, the Sixth Circuit rejected the Vargas rationale, concluding that an INS detainer notice "does not claim the right to take a petitioner into custody in the future nor does it ask the warden to hold a petitioner for that purpose." Prieto, 913 F.2d at 1164. In Guti v. INS, 908 F.2d 495, 496 (9th Cir.1990), the Ninth Circuit ruled, citing Vargas, that an assertion of INS custody resulting from an INS detainer was not a frivolous contention within the meaning of 28 U.S.C. § 1915(d) (1988). See also Payo v. Hayes, 754 F.Supp. 164, 166 (N.D.Cal.1991) (same).
25
The record on appeal in this case does not include the INS detainer regarding Roldan that was filed with the New York authorities. We are not faced, however, with a choice between affirming on the basis that INS detainers serve only a notice function, following the majority view, or remanding, in accord with Vargas, for a particularized determination whether the detainer in this case constituted a request that Roldan be held for the benefit of the INS at the conclusion of his state prison term. Events occurring subsequent to the magistrate judge's report-recommendation preclude our consideration of this issue.
26
In the first place, the rule in this circuit is that "failure to object timely to a magistrate's report operates as a waiver of any further judicial review of the magistrate's decision." Small, 892 F.2d at 16 (collecting cases). In Small, we clarified the application of this rule to pro se litigants, holding that their failure to object to a magistrate's report and recommendation would operate as a waiver of appellate review only if the document "explicitly states that failure to object to the report within ten (10) days will preclude appellate review and specifically cites 28 U.S.C. § 636(b)(1) and rules 72, 6(a) and 6(e) of the Federal Rules of Civil Procedure." Small, 892 F.2d at 16; see also Frank v. Johnson, 968 F.2d 298, 300 (2d Cir.1992) (pro se litigant barred from review of magistrate's proposed ruling despite immaterial variation from notice language required by Small ), cert. denied, --- U.S. ----, 113 S.Ct. 825, 121 L.Ed.2d 696 (1992). The report-recommendation provided to Roldan plainly satisfies the Small requirements, and additionally referred to the Small decision. Notwithstanding this notification, Roldan filed no objections.
27
On this record, accordingly, we would have a clear basis for affirmance without considering Roldan's contention that the INS detainer resulted in habeas corpus "custody." Further, although the Small rule is a nonjurisdictional waiver provision whose violation we may excuse in the interests of justice, see Thomas v. Arn, 474 U.S. 140, 155, 106 S.Ct. 466, 475, 88 L.Ed.2d 435 (1985); Frank, 968 F.2d at 300, we perceive no basis in this record for such a departure.
28
This appeal, furthermore, encounters an even more fundamental difficulty. 8 U.S.C. § 1105a(c) (1988) provides in pertinent part that: "An order of deportation ... shall not be reviewed by any court if the alien ... has departed from the United States after the issuance of the order." The INS contends, in its brief on appeal, that "[o]nce Roldan was deported in 1988, 8 U.S.C. § 1105a(c) operated to divest the courts of jurisdiction to entertain any challenge to the deportation order." It seems to us that the deportation order presently under review is the one that resulted in Roldan's 1992 deportation, with the result that his 1992, rather than 1988, deportation is the proper basis for the invocation of § 1105a(c) on this appeal.
29
Notwithstanding the unambiguous language of the statute, there is some conflict among the circuits as to the meaning of the provision of § 1105a(c) at issue in this case. The seminal case is Mendez v. INS, 563 F.2d 956 (9th Cir.1977), in which the Ninth Circuit expressed "the opinion that 'departure' in the context of 8 U.S.C. § 1105a cannot mean 'departure in contravention of procedural due process.' We hold that 'departure' means 'legally executed' departure when effected by the government." Mendez, 563 F.2d at 958 (citing Delgadillo v. Carmichael, 332 U.S. 388, 391, 68 S.Ct. 10, 12, 92 L.Ed. 17 (1947)). The INS was ordered to admit Mendez into the United States with the same status he had prior to deportation because its failure to notify Mendez' counsel prior to Mendez' deportation violated a pertinent statute and regulation. Id. at 959.
30
Subsequent Ninth Circuit rulings have followed Mendez. See, e.g., Zepeda-Melendez v. INS, 741 F.2d 285, 289 (9th Cir.1984) (basing jurisdiction upon failure of INS to notify alien's counsel of deportation); Thorsteinsson v. INS, 724 F.2d 1365, 1367 (9th Cir.) (examining record of deportation hearing upon claim of ineffective assistance of counsel), cert. denied, 467 U.S. 1205, 104 S.Ct. 2386, 81 L.Ed.2d 345 (1984); Estrada-Rosales v. INS, 645 F.2d 819, 820-21 (9th Cir.1981) (allowing attack upon deportation order based on conviction set aside after alien's deportation). In addition, the Sixth Circuit endorsed Mendez in Juarez v. INS, 732 F.2d 58, 59-60 (6th Cir.1984), and the Third Circuit cited Mendez favorably in Newton v. INS, 622 F.2d 1193, 1195 (3d Cir.1980), although concluding that the Mendez claim was not supported by the record in that case. Id.
31
Other circuits, however, have responded less hospitably to the Mendez gloss on § 1105a(c). In Umanzor v. Lambert, 782 F.2d 1299 (5th Cir.1986), the Fifth Circuit expressed "serious reservations" about Mendez, id. at 1303, describing it as "a sinkhole that has swallowed the rule of § 1105a(c)" in the Ninth Circuit, 782 F.2d at 1303 n. 5, but concluded that there was no basis in the Umanzor record for the application of the Mendez rule in any event. Id. at 1303. This criticism was reiterated in Ortez v. Chandler, 845 F.2d 573, 575 (5th Cir.1988), another case in which Mendez considerations were not dispositive. The Fifth Circuit squarely rejected Mendez in Quezada v. INS, 898 F.2d 474, 476 (5th Cir.1990) (citing Asai v. Castillo, 593 F.2d 1222 (D.C.Cir.1978) (per curiam)), and declined to exercise jurisdiction in reliance upon § 1105a(c). Id. at 477.
32
Asai granted an unopposed motion to dismiss an appeal by deported aliens, citing § 1105a(c). 593 F.2d at 1224 & n. 1. More recently, the District of Columbia Circuit "venture[d] no opinion upon the validity of [the Mendez ] exception," Joehar v. INS, 957 F.2d 887, 890 (D.C.Cir.1992), which was inapplicable to the voluntary departure in that case, but indicated an attitude of hostility to it, including quotation of the Umanzor "sinkhole" appraisal. Joehar, 957 F.2d at 889 (quoting Umanzor, 782 F.2d at 1303 n. 5). The Tenth Circuit has ruled that the command of § 1105a(c) is "unequivocal" and that a petitioner's deportation "eliminates our jurisdiction to review his deportation order," Saadi v. INS, 912 F.2d 428, 428 (10th Cir.1990) (per curiam) (citing Quezada, 898 F.2d at 476-77; Umanzor, 782 F.2d at 1303; Asai, 593 F.2d at 1223-24), but without mentioning Mendez. The Seventh Circuit "express[ed] no opinion" on the Ninth Circuit rule in Terrado v. Moyer, 820 F.2d 920, 922 (7th Cir.1987), a case in which there was no factual basis for application of the Mendez exception. Id.
33
We agree with the courts that have criticized Mendez. The pertinent language of § 1105a(c) constitutes a clear jurisdictional bar, and admits of no exceptions. See Connecticut Nat'l Bank v. Germain, --- U.S. ----, ----, 112 S.Ct. 1146, 1149, 117 L.Ed.2d 391 (1992) ("courts must presume that a legislature says in a statute what it means and means in a statute what it says there") (collecting cases).
34
The critical flaw in the Mendez rule is especially evident in Thorsteinsson. That case characterized the jurisdictional bar of § 1105a(c) as a "general rule," 724 F.2d at 1367, and allowed an allegation of ineffective assistance of counsel to open the door to at least a partial review of the petitioner's deportation hearing. Id. Although the petitioner's claim was ultimately found to be without merit, id., the decision nonetheless establishes that an alien need only allege a defective deportation hearing to obtain review of that hearing. To allow the clear intent of Congress expressed in § 1105a(c)--that "[a]n order of deportation ... shall not be reviewed" once the alien has departed--to be so easily circumvented is to render the statute virtually without effect, clearly validating Umanzor 's "sinkhole" assessment. Umanzor, 782 F.2d at 1303 n. 5; see also Marsano v. Laird, 412 F.2d 65, 70 (2d Cir.1969) ("an interpretation which emasculates a provision of a statute is not to be preferred").
35
We also agree with Umanzor that Congress had ample constitutional authority to enact the jurisdictional limitation at issue in this case. See Umanzor, 782 F.2d at 1304 ("Congress is constitutionally empowered to curtail the habeas jurisdiction of the lower federal courts if it so chooses"). As the Supreme Court recently reiterated:
36
Article I, § 8, cl. 9 ... authorizes Congress "[t]o constitute Tribunals inferior to the supreme Court" and Article III, § 1, states that "[t]he judicial Power of the United States, shall be vested in one supreme Court, and in such inferior Courts as the Congress may from time to time ordain and establish." The Court's cases state the rule that "if inferior federal courts were created, [Congress was not] required to invest them with all the jurisdiction it was authorized to bestow under Art. III." Palmore v. United States, 411 U.S. 389, 401, 93 S.Ct. 1670, 1678, 36 L.Ed.2d 342 (1973).
37
This position has held constant since at least 1845, when the Court stated that "the judicial power of the United States ... is (except in enumerated instances, applicable exclusively to this court) dependent for its distribution and organization, and for the modes of its exercise, entirely upon the action of Congress, who possess the sole power of creating the tribunals (inferior to the Supreme Court) ... and of investing them with jurisdiction either limited, concurrent, or exclusive, and of withholding jurisdiction from them in the exact degrees and character which to Congress may seem proper for the public good." Cary v. Curtis, [44 U.S.] 3 How. 236, 245, 11 L.Ed. 576. See Sheldon v. Sill, [49 U.S.] 8 How. 441, 12 L.Ed. 1147 (1850); Plaquemines Tropical Fruit Co. v. Henderson, 170 U.S. 511, 18 S.Ct. 685, 42 L.Ed. 1126 (1898); Kline v. Burke Constr. Co., 260 U.S. 226, 43 S.Ct. 79, 67 L.Ed. 226 (1922); Lockerty v. Phillips, 319 U.S. 182, 63 S.Ct. 1019, 87 L.Ed. 1339 (1943).
38
Ankenbrandt v. Richards, --- U.S. ----, ----, 112 S.Ct. 2206, 2212, 119 L.Ed.2d 468 (1992).
Conclusion
39
The appeal is dismissed for want of subject matter jurisdiction.
1
While Roldan and the State of New York assert that Roldan was convicted of assault, the INS claims that Roldan was convicted of a drug offense. The exact nature of the offense is not material to the issues presented by this appeal
|
932 A.2d 1037 (2007)
In re Maynard A. HAMILTON, Jr., Magisterial District Judge In and For Magisterial District 02-3-03, Lancaster County.
No. 2 JD 06.
Court of Judicial Discipline of Pennsylvania.
July 27, 2007.
ORDER
PER CURIAM.
AND NOW, this 27th day of July, 2007, after hearing on the question of sanctions held on July 18, 2007 before the full Court, it is hereby ORDERED:
1. that Respondent be suspended without pay from the performance of his duties of Magisterial District Judge for a period of nine (9) months;
2. that the suspension from office shall commence August 1, 2007;
3. that Respondent shall be on probation for one (1) year following his suspension. Said probation shall be subject to the supervision of this Court and shall be subject to the condition that Respondent report monthly to the Chief Counsel of the Judicial Conduct Board or his designee, at the times prescribed by the Judicial Conduct Board, and the Judicial Conduct Board shall file a written report monthly with this Court advising that, to its knowledge the Respondent has, or has not, been in compliance with the Rules Governing Standards of Conduct of Magisterial District Judges and the provisions of Article V of the Pennsylvania Constitution pertaining to the conduct of Magisterial District Judges;
4. in the event Respondent fails to comply with the conditions of probation, the Court may proceed forthwith to consider the imposition of other sanctions.
MUSMANNO, J., files a dissenting statement in which STREIB, J., joins.
DISSENTING STATEMENT OF Judge MUSMANNO.
I respectfully dissent from the sanction order imposed by the Court in the above-captioned matter.
While I certainly do not countenance the conduct of Respondent in this case and joined in the Court's opinion which expressed strong disapproval of the conduct, I believe the Court, in imposing the sanction of nine months suspension without pay was unduly harsh and did not give sufficient weight to the testimony at the sanction hearing which established the following.
1. Respondent has served as a judge since 1988almost 20 yearsand this is the sole episode of non-judicial conduct during those years.
2. There is no pattern of violent conduct or of Respondent losing his temper.
3. Respondent has always conducted his courtroom with decorum, and with respect for litigants, witnesses, lawyers and all who come before him.
4. Respondent has apologized to Sergeant Buser, the victim of his assault, as well as to his wife.
5. Sergeant Buser and Respondent have a friendly relationship, more so now *1038 than before this incident. Further, Sergeant Buser testified on Respondent's behalf at the sanction hearing.
6. Respondent cooperated with the Board by stipulating to the essential facts here at issue.
7. Respondent has expressed remorse for his conduct which gave rise to the Board's charges.
Accordingly, I believe the sanction of nine months suspension without pay followed by probation for one year is too severe.
STREIB, J., joins in this dissenting statement.
|
766 P.2d 1173 (1989)
Matt Eric REDLAND, Appellant (Defendant),
v.
The STATE of Wyoming, Appellee (Plaintiff).
No. 87-199.
Supreme Court of Wyoming.
January 6, 1989.
Julie D. Naylor, Appellate Counsel, and Steven E. Weerts, Sr. Asst. Public Defender (argued), for appellant.
Joseph B. Meyer, Atty. Gen., John W. Renneisen, Deputy Atty. Gen., Sylvia Lee Hackl, Sr. Asst. Atty. Gen., and Jerry Williams, Student Intern, Prosecution Assistance Clinic (argued), for appellee.
Before CARDINE, C.J., and THOMAS, URBIGKIT and MACY, JJ., and BROWN, J., Retired.[*]
CARDINE, Chief Justice.
Appellant was tried and convicted by a jury of aggravated homicide by vehicle, in violation of W.S. 6-2-106(b). On appeal to this court, he contends that he was prejudiced by an erroneous jury instruction which was an incorrect statement of the law. We agree, and the judgment entered must be reversed.
On the evening of November 26, 1986, appellant went to the Tensleep Bar in Tensleep, Wyoming, and met Sharon Kay Meyers. During the course of the evening, appellant consumed a substantial amount of alcohol. Between 1:30 and 2:00 the following morning, appellant and Ms. Meyers left the Tensleep Bar to go to a private party out of town. While driving to this *1174 party, appellant lost control of his vehicle, an accident occurred, and Ms. Meyers was ejected from the vehicle. She required emergency medical treatment. Appellant was taken into custody for driving while under the influence of alcohol in violation of W.S. 31-5-233. A breath test and a blood alcohol test were administered, the breath analysis test indicating a.139 blood alcohol content, and the blood test indicating a .1638 blood alcohol content. As a result of the injuries sustained in the accident, Ms. Meyers later died. Appellant was charged with aggravated homicide by vehicle. The statute in effect at the time of this incident read in pertinent part:
"(b) A person is guilty of aggravated homicide by vehicle and shall be punished by imprisonment in the penitentiary for not more than twenty (20) years, if:
"(i) While driving a motor vehicle in violation of W.S. 31-5-233, he causes the death of another person and the violation is the proximate cause of the death * * *." W.S. 6-2-106 (Cum.Supp. 1986).
Section 31-5-233 read in pertinent part:
"(a) It is unlawful for any person who is under the influence of intoxicating liquor, to a degree which renders him incapable of safely driving a motor vehicle, to drive or have actual physical control of any vehicle within this state." (emphasis added) W.S. 31-5-233 (Cum. Supp. 1986).
At trial, over appellant's objection, the court gave the following instruction to the jury:
"Instruction 13
"The phrase `under the influence of intoxicating liquor,' as used in statute making it an offense to operate a motor vehicle while under the influence of intoxicating liquor means a condition, caused by the consumption of intoxicants, that makes a person less able, either mentally or physically, or both, to exercise clear judgment, and with steady hands and nerves, operate an automobile with safety to himself and to the public." (emphasis added)
Three other instructions contained the statutory standard of "incapable of safely driving."
Appellant maintains that Instruction 13 incorrectly lowered the standard from "incapable of safely driving" to "less able * * * to exercise clear judgment * * * with steady hands and nerves." (emphasis added) We agree that it was error for the court to give the challenged instruction, as there is obviously a substantial difference between a standard of "less able" to safely drive a motor vehicle and "incapable" of safely driving a motor vehicle.
Appellee contends that when read with all the other instructions and considered as a whole, the giving of Instruction 13 did not cause prejudice to appellant. We cannot agree. Inconsistent instructions may confuse a jury. As we stated in State v. Berger, 72 Wyo. 422, 265 P.2d 1061, 1067-68 (1954):
"Where a charge of the court to the jury has contradictory elements in it this puts upon the jury the burden of determining which Instruction they should follow. As said in State v. Vliet, 120 N.J.L. 23, 197 A. 894, 895:
"`Where the law is thus incorrectly charged, although it has been correctly stated elsewhere in the court's charge, it puts the burden upon the jury to determine which part of a contradictory charge is correct, and this is not, and cannot be, a jury's duty under any circumstances.'"
Because there is a reasonable possibility that the jury may not have convicted appellant if it had not considered Instruction 13, appellant must have a new trial. Jones v. State, 735 P.2d 699 (Wyo. 1987).
The appellant's conviction is reversed, and this case is remanded to the district court for further proceedings consistent with this opinion.
THOMAS, J., files a dissenting opinion and partially joined with BROWN, J., Retired.
BROWN, J., Retired, files a dissenting opinion.
THOMAS, Justice, dissenting.
I disagree with the result of the majority's opinion in this case, and I must dissent. *1175 I join in the dissent of Justice Brown, Retired, insofar as he would find any error to be harmless. I am not so readily persuaded that error exists, but if it does, I agree that it is harmless.
A consideration of the instructions read together discloses that the trial court instructed the jury on the elements of § 31-5-233, W.S. 1977 (Nov. 1984 Repl.), because that section is referred to in § 6-2-106(b), W.S. 1977 (Cum.Supp. 1987), the criminal statute which Redland was convicted of violating. The court stated the third element of the offense described in § 31-5-233, W.S. 1977 (Nov. 1984 Repl.), to be:
"3. The defendant was under the influence of intoxicating liquor."
In the accused instruction then, the court chose to define the phrase "under the influence of intoxicating liquor," one of the elements of the offense referred to in § 6-2-106(b), W.S. 1977 (Cum.Supp. 1987), the criminal statute. As Justice Brown, Retired, points out, these instructions repeatedly advised the jury that they must find that the defendant was under the influence of intoxicating liquor to a degree which rendered him incapable of safely driving a motor vehicle. In context, while the instruction may not have been necessary, I cannot discern error in offering a definition of a phrase used in one of the elements of the offense which the jury must find to have been committed in order to convict of a violation of the statute under which Redland was charged.
I am willing to concede that the instruction was not necessary because the thrust of Morad v. Wyoming Highway Department, 66 Wyo. 12, 203 P.2d 954 (1949), is that the phrase "under the influence of intoxicating liquor" simply means "while intoxicated," citing authorities which equate the phrase with intoxication or drunkenness. Since that is a concept about which lay witnesses may offer their opinion when testifying, State v. Cantrell, 64 Wyo. 132, 186 P.2d 539 (1947), the concept must be one with which lay people are sufficiently familiar that it requires no definition.
Were I a member of the jury which convicted Redland, however, I would take umbrage at the assumption by the majority that I was so impercipient, or uncomprehending, or foolish as to have been misled by this instruction. Defense counsel established the relationship between Instruction 13 and the elements of the offense of driving while under the influence of intoxicating liquor in his closing argument. The case is summed up by the testimony of the arresting officer, who in the course of discussing his advice of rights to Redland, said that Redland agreed to the appropriate test for intoxication. The officer went on to testify, quoting Redland as follows:
"He says I don't see that there is any reason to do so, you know I'm drunk and I know I'm drunk."
The jury knew that Redland was drunk, too, i.e., he was "under the influence of intoxicating liquor, to a degree which render[ed] him incapable of safely driving a motor vehicle, * * *." Section 31-5-233, W.S. 1977 (Nov. 1984 Repl). Under the circumstances, any possible error in the instruction was harmless beyond a reasonable doubt.
BROWN, Retired Justice, dissenting, with whom THOMAS, Justice, partially joins.
Instruction Number 13 served no purpose and should not have been given. However, if it was an error to give the instruction, it was harmless beyond a reasonable doubt.
In the bundle of instructions given, the court consistently told the jury that the state must prove beyond a reasonable doubt that the defendant was under the influence of intoxicating liquor to a degree which rendered him incapable of safely driving a motor vehicle. The degree of intoxication that must be proved was repeated three times in Instruction No. 9, three times in Instruction No. 11 and mentioned for the seventh time in Instruction No. 14.
After the focus and stress placed on the key phrase, "to a degree which rendered him incapable of safely driving," it is inconceivable that the jury was misled into considering *1176 a lesser degree of intoxication than the statute required.
This court examines instructions in their entirety when it is called upon to decide whether instructions are erroneous. They must be considered as a whole and not according to isolated phrases and paragraphs.
Scheikofsky v. State, 636 P.2d 1107, 1111 (Wyo. 1981) (citation omitted).
Instruction No. 13 does no more than attempt to explain or define the term "under the influence." It does not dilute or change in any way the definition of degree of intoxication required to be proved, that is, "to a degree which rendered him [appellant] incapable of safely driving a motor vehicle." This unfortunate instruction does no more than "gild the lily."
I would affirm the conviction.
NOTES
[*] Retired June 29, 1988.
|
UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 08-7442
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
ERIC SHAWN WALKER,
Defendant - Appellant.
Appeal from the United States District Court for the Eastern
District of Virginia, at Richmond. Richard L. Williams, Senior
District Judge. (3:02-cr-00161-RLW-1)
Submitted: May 15, 2009 Decided: June 10, 2009
Before MOTZ and SHEDD, Circuit Judges, and HAMILTON, Senior
Circuit Judge.
Affirmed by unpublished per curiam opinion.
Eric Shawn Walker, Appellant Pro Se. Olivia N. Hawkins, OFFICE
OF THE UNITED STATES ATTORNEY, Richmond, Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Eric Shawn Walker appeals the district court’s order
denying his motion for reduction of sentence under 18 U.S.C.
§ 3582(c)(2) (2006). 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. Walker, No. 3:02-
cr-00161-RLW-1 (E.D. Va. July 9, 2008). 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
|
220 F.2d 756
Melvin VON BEHREN, Appellant,v.UNITED STATES of America.
No. 15121.
United States Court of Appeals Eighth Circuit.
March 11, 1955.
Appeal from the United States District Court for the Eastern District of Missouri.
Wayne C. Smith, Jr., Clayton, Mo., for appellant.
Harry Richards, U. S. Atty., Wayne Bigler, Jr., Asst. U. S. Atty., and Forrest Boecker, Asst. U. S. Atty., St. Louis, Mo., for appellee.
PER CURIAM.
1
Appeal from District Court dismissed for want of prosecution, on motion of counsel for appellee in open court.
|
IN THE SUPREME COURT OF PENNSYLVANIA
IN RE: : NO. 140
:
AMENDMENT OF RULE : DISCIPLINARY RULES
219 OF THE PENNSYLVANIA :
RULES OF DISCIPLINARY : DOCKET
ENFORCEMENT :
:
ORDER
PER CURIAM
AND NOW, this 12th day of April, 2016, upon the recommendation of the
Disciplinary Board of the Supreme Court of Pennsylvania; the proposal having been
published for public comment in the Pennsylvania Bulletin, 46 Pa.B. 978 (February 27,
2016):
IT IS ORDERED pursuant to Article V, Section 10 of the Constitution of
Pennsylvania that Rule 219 of the Pennsylvania Rules of Disciplinary Enforcement is
amended in the attached form.
This ORDER shall be processed in accordance with Pa.R.J.A. No. 103(b), and
shall be effective in 30 days. The amendments relating to mandatory electronic
registration shall be applicable beginning with the 2016-2017 assessment year.
Material to be added is bolded and underlined.
Material to be deleted is bolded and in brackets
|
Opinions of the United
2006 Decisions States Court of Appeals
for the Third Circuit
11-8-2006
Russo v. Glass Real Estate
Precedential or Non-Precedential: Non-Precedential
Docket No. 05-4894
Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2006
Recommended Citation
"Russo v. Glass Real Estate" (2006). 2006 Decisions. Paper 218.
http://digitalcommons.law.villanova.edu/thirdcircuit_2006/218
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NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 05-4894
FRANCIS PAUL RUSSO;
ESTATE OF DEAN ANTHONY RUSSO;
CITY DINING CORP.
v.
GLASS REAL ESTATE COMP.; ESTATE HERB GLASS;
STEVEN GLASS; HAZZARD COMPANY; PAUL J. FELIXON;
STEERMAN & FELIXON, PC; BAINBRIDGE LAW CENTER;
ESQ. ALAN M. BREDT, Esquire; JUDGE JOHN GREEN, Sheriff;
JOHN WINTER, Esquire, Wachovia SBC; WACHOVIA SBC;
AL FIORILLI, Wachovia SBC Credit; JOHN GREEN, Sheriff;
ESQ. JAMES J. ZWOLAK, Esquire;
CITY OF PHILADELPHIA REVENUE DEPARTMENT;
GERALD KOSINSKI, Esquire, Undersheriff;
JOHN GREEN, County of Philadelphia Sheriff;
SHARON HUMBLE, Esquire; WACHOVIA BANK, Bondholder Trustee;
JACK M. BERNARD, Esquire; PETER ANTIPAS; SUSANNA ANTIPAS;
JOHN GREEN, Sheriff, Phila County;
RCS SEARCHERS, Distribution Title Company; PERRY J. COCCO;
CITY OF PHILADELPHIA, South District Building Inspector;
TOM SCIULLI; CITY OF PHILADELPHIA, Chief Dept. of License & Inspections;
ALEXANDER; CITY OF PHILADELPHIA, Police Dept. Patrol Officer
Francis Paul Russo,
Appellant
On Appeal from the United States District Court
for the Eastern District of Pennsylvania
D.C. Civil Action No. 03-cv-6577
(Honorable Petrese B. Tucker)
Submitted Pursuant to Third Circuit LAR 34.1(a)
November 2, 2006
Before: SCIRICA, Chief Judge, FUENTES and SMITH, Circuit Judges
(Filed November 8, 2006)
OPINION OF THE COURT
PER CURIAM.
Francis Russo appeals the District Court’s order dismissing his complaint. The
procedural history of this case and the details of Russo’s claims are well-known to the
parties, set forth in the District Court’s thorough opinions, and need not be discussed at
length. Briefly, Russo filed a complaint alleging several claims arising from the Sheriff’s
sale of two properties he had owned. The District Court granted the motions to dismiss
filed by several defendants. After the District Court entered an order dismissing the
remaining claims, Russo filed a timely notice of appeal. We have jurisdiction pursuant to
28 U.S.C. § 1291.
On appeal, Russo argues that there were procedural irregularities in the Sheriff’s
sale of the properties. However, he already raised these arguments in his petition to set
aside the sale which he filed in state court. The state court denied his petition. We agree
with the District Court that Russo is not entitled to relief on these claims. Moreover, the
Rooker-Feldman doctrine deprives a District Court of jurisdiction to review, directly or
2
indirectly, a state court adjudication. See D.C. Court of Appeals v. Feldman, 460 U.S.
462 (1983); Rooker v. Fidelity Trust Co., 263 U.S. 413, 416 (1923); In re Knapper, 407
F.3d 573 (3d Cir. 2005). The Supreme Court has explained that this doctrine applies to
“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 (2005). Thus, to the extent that the relief Russo
requests would require rejection of the state court’s judgments, the District Court lacked
jurisdiction over those claims.
Russo also argues on appeal that his due process rights were violated by his prior
counsel’s ineffective assistance. However, Russo has no right to effective counsel in a
civil case. Kushner v. Winterthur Swiss Ins. Co., 620 F.2d 404, 408 (3d Cir. 1980). We
agree with the District Court that Russo was not entitled to any relief under the
Gramm-Leach-Bliley Act. Russo’s due process rights were not violated when a police
officer and housing inspector allegedly entered the property after it was sold.
For the above reasons, as well as those set forth by the District Court, we will
affirm the District Court’s judgment. The motion to dismiss the appeal filed by Jack
Bernard and Peter and Susanna Antipas on April 10, 2006, is denied as moot. The motion
to dismiss the appeal filed by RCS Searchers is denied as moot.
3
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NOT RECOMMENDED FOR PUBLICATION
File Name: 04a0074n.06
Filed: November 8, 2004
No. 03-1420
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
UNITED STATES OF AMERICA, )
)
Plaintiff-Appellee, )
)
v. ) ON APPEAL FROM THE UNITED
) STATES DISTRICT COURT FOR THE
RICHARD M. FOLEY, ) EASTERN DISTRICT OF MICHIGAN
)
Defendant-Appellant. )
) OPINION
Before: CLAY and GILMAN, Circuit Judges; and O’MALLEY, District Judge.*
RONALD LEE GILMAN, Circuit Judge. Richard M. Foley, an individual doing business
as Environmental First, filed for bankruptcy in 1997 under Chapter 7 of the United States
Bankruptcy Code. He subsequently received a discharge of his liabilities, including a total of
$334,251 in unsecured debt, from the bankruptcy court. Following an FBI investigation, Foley was
indicted on ten counts of bankruptcy fraud on June 13, 2002. Count One charged Foley with making
$19,000 in transfers to his girlfriend shortly before he filed for bankruptcy, in violation of 18 U.S.C.
§ 152(7). Foley was charged in Counts Two and Three with fraudulent concealment, in violation
of 18 U.S.C. § 152(1), based on his failure to disclose the receipt of a $5,000 payment by check and
a $7,500 account receivable. Counts Four, Five, Seven, and Ten concerned Foley’s false
*
The Honorable Kathleen M. O’Malley, United States District Judge for the Northern District of Ohio, sitting
by designation.
No. 03-1420
United States v. Foley
declarations regarding transfers he executed and income he concealed, including his omission of
$350,000 that had been deposited in his account, in violation of 18 U.S.C. § 152(3). Finally, Foley
was charged with making false oaths in Counts Six, Eight, and Nine, a violation of 18 U.S.C.
§ 152(2), based on his false testimony about his assets at a meeting of his creditors. A jury
convicted Foley on all but Count Nine.
Foley filed a motion for a new trial based upon two grounds. First, Foley contended that the
district court erred in excluding the testimony of his expert witness, Dr. Michael Abramsky, who
planned to opine that Foley’s alleged dyslexia hampered his ability to comprehend his bankruptcy
schedules. In a thoroughly reasoned order denying Foley’s motion, the district court pointed out that
Foley had violated the plain language of Rules 12.2(b) and 16(b)(1)(C) of the Federal Rules of
Criminal Procedure by not filing, in a timely manner, either his notice of intent to call an expert or
his expert-witness summary. In addition, the court expressed doubts as to whether the untimely
expert-witness summary would satisfy the requirements of Rule 16. Reviewing the pretrial
proceedings as fully recounted in the district court’s order, we agree that the court did not abuse its
discretion in excluding the testimony of Dr. Abramsky.
Foley’s second basis for a new trial was that the government committed prosecutorial
misconduct during the examination of the FBI agent who investigated Foley and in making its
closing and rebuttal arguments. The district court’s order sets forth the proper standard to evaluate
the claim of prosecutorial misconduct and correctly concludes that neither the FBI agent’s testimony
nor the prosecutor’s comments were improper. It therefore held that a new trial was unwarranted.
We agree for the reasons set forth in the district court’s order.
-2-
No. 03-1420
United States v. Foley
Foley also filed a motion for a judgment of acquittal on Counts 2-7 in the court below. In
its order denying the motion, the district court articulated the governing rule, which 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.” Jackson v.
Virginia, 443 U.S. 307, 319 (1979) (emphasis in original). The court went through each contested
count and determined that there was sufficient, if not overwhelming, evidence of Foley’s guilt. We
conclude that the district court’s analysis is not only correct, but amply borne out by the record.
Having reviewed the record, the applicable law, the parties’ briefs, and counsels’ arguments,
we are convinced that the district court did not err in denying both of Foley’s motions. Because the
issuance of a full opinion by this court would be unduly duplicative and would serve no useful
purpose, we AFFIRM the judgment of the district court on the basis of the orders below.
-3-
|
806 F.2d 258Unpublished Disposition
NOTICE: Fourth Circuit I.O.P. 36.6 states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Fourth Circuit.William H. SHECKLER, Petitioner,v.CLINCHFIELD COAL COMPANY and Director, Office of Workers'Compensation Programs, U.S. Department of Labor,Respondents.
No. 84-1756.
United States Court of Appeals, Fourth Circuit.
Argued Oct. 10, 1986.Decided Nov. 28, 1986.
On Petition for Review of an Order of the Benefits Review Board.
Gerald F. Sharp on brief, for appellant.
Michael F. Blair (Penn, Stuart, Eskridge & Jones on brief), for appellee.
Ben.Rev.Bd.
AFFIRMED.
Before WINTER, Chief Judge, CHAPMAN, Circuit Judge, and HAYNSWORTH, Senior Circuit Judge.
PER CURIAM:
1
An administrative law judge awarded black lung benefits to Sheckler. Among several x-rays, one had been read positively for simple pneumoconiosis, and, on the basis of that reading, the ALJ invoked the interim presumption under 20 C.F.R. 727.203(a)(1). He considered the results of ventilatory function studies and blood gas tests, and concluded that their values were too high to invoke the interim presumption. Having invoked the interim presumption, however, the ALJ focused his attention upon the deposition of Dr. Abernathy who had examined Sheckler. He rejected Dr. Abernathy's conclusion that Sheckler could still do his usual coal mine work as a trackman because of what he considered to be an internal inconsistency and found that the interim presumption had not been rebutted under 20 C.F.R. 727.203(b).
2
The Benefits Review Board reversed on the ground that the interim presumption had been rebutted as a matter of law. It found that there was no contradiction between the physician's conclusion and the results of the blood gas test, as reported by him.
3
We affirm.
4
A before-exercise test of blood gas produced low values, but an after-exercise test showed improved figures. The physician attributed the low values from the before-exercise test to Sheckler's obesity, and explained that exercise resulted in aeration of all parts of the lungs and produced the improvement in ventilation. The ALJ recognized that the results of the after-exercise test were more significant, but he thought them inconsistent with the physician's conclusion because they were abnormal by the physician's own standards.
5
The results of the blood gas tests were reported on a printed form from the Clinch Valley Community Hospital. It contained a column in which the range of values for normal, healthy persons was printed. Sheckler's after-exercise test produced values well above those fixed in the regulations for invocation of the interim presumption, but, as to the partial pressure of oxygen, the value found was somewhat below that for the normal range printed on the form.
6
Sheckler had been a heavy smoker for many years. Some impairment of his ventilatory function should be expected because of the smoking. The test results indicate that his lungs are not functioning as well as those of a vigorous, healthy non-smoker, but that does not suggest inconsistency with the conclusion that he does not have pneumoconiosis and could still perform his regular coal mine employment. There is a wide gap between absolute normalcy and total disability. Evidence of slight impairment in the breathing function, but at values far above those necessary to trigger a presumption of disability, is not inconsistent with the physician's general conclusion that the patient can still do his accustomed coal mine work.
7
The Benefits Review Board properly concluded that the interim presumption had been rebutted as a matter of law.
8
AFFIRMED.
|
760 F.2d 1039
56 A.F.T.R.2d 85-5121, 53 USLW 2620, 85-1USTC P 9400
Joseph R. BOLKER, Petitioner-Appellee,v.COMMISSIONER OF INTERNAL REVENUE, Respondent-Appellant.
No. 84-7357.
United States Court of Appeals,Ninth Circuit.
Argued and Submitted Feb. 7, 1985.Decided May 17, 1985.
Gilbert Dreyfuss, Richards, Watson, Dreyfuss & Gershon, Los Angeles, Cal., for petitioner-appellee.
Raymond Hepper, Dept. of Justice, Washington, D.C., for respondent-appellant.
On appeal from the United States Tax Court.
Before BOOCHEVER and BEEZER, Circuit Judges, and HARDY,* District Judge.
BOOCHEVER, Circuit Judge:
1
Bolker was the sole shareholder of the Crosby Corporation (Crosby) which owned the Montebello property. For tax purposes associated with the anticipated development of the property, Bolker decided to liquidate Crosby and distribute Montebello to himself. Before Crosby carried out the liquidation, problems in financing convinced Bolker to dispose of the Montebello property rather than developing it himself. On the day the Crosby liquidation actually occurred, Bolker contracted to exchange Montebello with Southern California Savings & Loan (SCS) for other like-kind investment property to be designated. This exchange took place three months later. Bolker asserted, and the Tax Court agreed, that the exchange qualified for nonrecognition treatment under I.R.C. Sec. 1031(a).1 Bolker v. Commissioner, 81 T.C. 782 (1983). The Commissioner appeals. Because we believe that Bolker held the Montebello property for investment within the meaning of section 1031(a), we affirm.
2
The transaction was consummated as follows. In March 1972, Bolker commenced the liquidation of Crosby. On March 13, 1972, all of the following occurred:
3
(1) Crosby transferred all its assets and liabilities to Bolker in redemption of all Crosby stock outstanding;
4
(2) Bolker as president of Crosby executed the Internal Revenue Service liquidation forms;
5
(3) A deed conveying Montebello from Crosby to Bolker was recorded;
6
(4) Bolker and Parlex, a corporation formed by Bolker's attorneys to facilitate the exchange, executed a contract to exchange Montebello for properties to be designated by Bolker;
7
(5) Parlex contracted to convey Montebello to SCS in coordination with the exchange by Bolker and Parlex; and
8
(6) Bolker, Crosby, Parlex, and SCS entered into a settlement agreement dismissing a breach of contract suit pending by Crosby against SCS in the event that all the other transactions went as planned.2
9
On June 30, 1972, all the transactions closed simultaneously, SCS receiving Montebello and Bolker receiving three parcels of real estate which he had previously designated.
10
Bolker reported no gain on the transaction, asserting that it qualified for nonrecognition under then-current I.R.C. Sec. 1031(a):
11
No gain or loss shall be recognized if property held for productive use in trade or business or for investment (not including stock in trade or other property held primarily for sale, nor stocks, bonds, notes, choses in action, certificates of trust or beneficial interest, or other securities or evidences of indebtedness or interest) is exchanged solely for property of a like kind to be held either for productive use in trade or business or for investment.
12
The Commissioner sent Bolker statutory notices of deficiency on the ground that the transaction did not qualify under section 1031(a). In the Tax Court, the Commissioner argued two theories: that Crosby, not Bolker, exchanged Montebello with SCS, and in the alternative, that Bolker did not hold Montebello for productive use in trade or business or for investment.3 The Tax Court rejected both arguments. The Commissioner does not appeal the decision that Bolker individually made the exchange. The Commissioner does not challenge any of the Tax Court's findings of fact; review of the Tax Court's decisions of law is de novo. California Federal Life Insurance Co. v. Commissioner, 680 F.2d 85, 87 (9th Cir.1982).
I. STOCK FOR PROPERTY
13
Section 1031(a) specifically excludes from eligibility for nonrecognition an exchange involving stock. The Commissioner argues that Bolker's transactions should properly be viewed as a whole, under the step transaction doctrine, see Commissioner v. Court Holding Co., 324 U.S. 331, 334, 65 S.Ct. 707, 708, 89 L.Ed. 981 (1945) (court may view transaction as a whole even if taxpayer accomplishes result by series of steps), and that so viewed, Bolker exchanged his Crosby stock for property. The Commissioner did not argue this theory in the Tax Court.
14
As a general rule, we will not consider an issue raised for the first time on appeal, United States v. Greger, 716 F.2d 1275, 1277 (9th Cir.1983) (taxpayer argued for first time on appeal that statute prohibiting assistance in preparation of false return cannot apply if preparer is innocent), cert. denied, --- U.S. ----, 104 S.Ct. 1002, 79 L.Ed.2d 234 (1984), although we have the power to do so, see Hormel v. Helvering, 312 U.S. 552, 557-59, 61 S.Ct. 719, 721-22, 85 L.Ed. 1037 (1941). This circuit has recognized three exceptions to this rule: in the "exceptional" case in which review is necessary to prevent a miscarriage of justice or to preserve the integrity of the judicial process, see Greger, 716 F.2d at 1277, when a new issue arises while appeal is pending because of a change in the law, see United States v. Whitten, 706 F.2d 1000, 1012 (9th Cir.1983) (objection to plain view search first raised on appeal), cert. denied, --- U.S. ----, 104 S.Ct. 1593, 80 L.Ed.2d 125 (1984), or when the issue presented is purely one of law and either does not depend on the factual record developed below, or the pertinent record has been fully developed, see United States v. Patrin, 575 F.2d 708, 712 (9th Cir.1978) (on appeal of conviction for assaulting federal officers in performance of their duties, government could not rely on a different statute defining federal officers than at trial because defendants might have tried their case differently in response). If one of the exceptions is applicable, we have discretion to address the issue.
15
The Commissioner contends that the third exception applies in this case. Although a determination based on the step transaction doctrine would require reliance on the factual record, the Commissioner argues that the record is fully developed and that we could decide the issue on appeal without prejudice to Bolker's right at trial to present relevant facts. See id. at 712-13. Application of the step transaction doctrine requires a detailed factual inquiry, however, and there may be facts relevant to the issue which were not developed in the record. Moreover, Bolker's tactics, presentation of the facts, and legal arguments at trial might have been different if the Commissioner had argued the step transaction issue below.4 We therefore decline to address the issue on appeal.
II. THE HOLDING REQUIREMENT
16
The Commissioner argued unsuccessfully in the Tax Court that because Bolker acquired the property with the intent, and almost immediate contractual obligation, to exchange it, Bolker never held the property for productive use in trade or business or for investment as required by section 1031(a). Essentially, the Commissioner's position is that the holding requirement has two elements: that the taxpayer own the property to make money rather than for personal reasons, and that at some point before the taxpayer decides to exchange the property, he have intended to keep that property as an investment.
17
Bolker argues that the intent to exchange investment property for other investment property satisfies the holding requirement. Bolker's position also in essence posits two elements to the holding requirement: that the taxpayer own the property to make money, and that the taxpayer not intend to liquidate his investment.
18
Authority on this issue is scarce. This is not surprising, because in almost all fact situations in which property is acquired for immediate exchange, there is no gain or loss to the acquiring taxpayer on the exchange, as the property has not had time to change in value. Therefore, it is irrelevant to that taxpayer whether section 1031(a) applies. See, e.g., D. Posin, Federal Income Taxation 180 & n. 46 (1983); Rev.Rul. 77-297, 1977-2 C.B. 304, 305. The cases generally address the taxpayer's intent regarding the property acquired in an exchange, rather than the property given up. The rule of those cases, e.g., Regals Realty Co. v. Commissioner, 127 F.2d 931, 933-34 (2d Cir.1942), is that at the time of the exchange the taxpayer must intend to keep the property acquired, and intend to do so with an investment purpose. That rule would be nonsense as applied to the property given up, because at the time of the exchange the taxpayer's intent in every case is to give up the property. No exchange could qualify.
19
The Commissioner cites two revenue rulings to support his position, Rev.Rul. 77-337, 1977-2 C.B. 305, and Rev.Rul. 77-297. Revenue rulings, however, are not controlling. Ricards v. United States, 683 F.2d 1219, 1224 & n. 12 (9th Cir.1981) (revenue rulings not binding although entitled to consideration as "body of experience and informed judgment"). Moreover, neither ruling is precisely on point here. In Revenue Ruling 77-337, A owned X corporation, which owned a shopping center. Pursuant to a prearranged plan, A liquidated X to acquire the shopping center so that he could immediately exchange it with B for like-kind property. A never held the shopping center, and therefore section 1031(a) did not apply. This case differs from 77-337 in two ways. First, the liquidation was planned before any intention to exchange the properties arose, not to facilitate an exchange. Second, Bolker did actually hold Montebello for three months.
20
In Revenue Ruling 77-297, B wanted to buy A's ranch, but A wanted to exchange rather than sell. A located a desirable ranch owned by C. Pursuant to a prearranged plan, B purchased C's ranch and immediately exchanged it with A for A's ranch. As to A, the exchange qualifies under section 1031(a). As to B, it does not, since B never held C's ranch, and acquired it solely to exchange. The same distinctions as in 77-337 apply between this ruling and the facts in Bolker. Neither ruling cites case authority for its holdings.
21
Bolker cites two cases that support his position. In each case, the Tax Court gave section 1031(a) nonrecognition to a transaction in which the property given up was acquired with the intention of exchange. However, neither case actually considered the holding issue, which diminishes the persuasiveness of the authority. In 124 Front Street, Inc. v. Commissioner, 65 T.C. 6 (1975), taxpayer owned an option to purchase real estate. Firemen's Fund Insurance Co. (Firemen's) wanted the property, but taxpayer preferred an exchange to a sale. Firemen's advanced taxpayer the money to exercise its option under a contract providing that taxpayer would exchange the property for property to be acquired by Firemen's. Id. at 8-11. Taxpayer exercised its option, and the exchange was consummated five months later when Firemen's had acquired property satisfactory to taxpayer. Id. at 12. The issue in the case was whether the transaction was the sale of the option to Firemen's, or an exchange of the property with Firemen's. The court held that it was an exchange, and therefore qualified under section 1031(a). Id. at 15. The court apparently never considered whether the fact that the optioned property was acquired solely for exchange meant that it was not held for investment under section 1031(a). Even without an explicit holding, however, the case does support Bolker's theory that an intent to exchange for like-kind property satisfies the holding requirement.
22
Rutherford v. Commissioner, T.C.M. 1978-505, 37 T.C.M. (CCH) 1851-77, is an unusual case with a holding similar to 124 Front Street. W, a cattle breeder, agreed with R, another breeder, to exchange W's twelve half-blood heifers for twelve three-quarter blood heifers to be bred from the half-blood heifers. W gave R the twelve half-blood heifers. R bred them to a registered bull and gave W the first twelve three-quarter blood heifers produced. Id. at 1851-77 to 1851-78. At stake in the case were depreciation deductions. En route to determining R's basis in the half-blood heifers for depreciation purposes, the Tax Court held that the exchange of heifers qualified for nonrecognition under section 1031(a). Id. at 1851-79. Although the court did not even mention the point, the facts indicate that when by virtue of their birth R "acquired" the three-quarter blood heifers, the property he gave up, he had already contracted to exchange them. Thus, Rutherford also supports Bolker's position, albeit tacitly.
23
The Tax Court's holding in this case is based on its recent opinion in Magneson v. Commissioner, 81 T.C. 767 (1983) (court reviewed), aff'd, 753 F.2d 1490 (9th Cir.1985). In Magneson, taxpayers exchanged property for like-kind property and then by prearrangement contributed the property they acquired to a partnership. Each transaction viewed separately was admittedly tax-free, but in combination raised the issue whether contribution to a partnership satisfies the holding requirement for the acquired property. The Bolker Tax Court interpreted Magneson as holding that an intent to continue the investment rather than selling it or converting it to personal use satisfied the holding requirement, even if the taxpayer never intended to keep the specific property acquired. In both Bolker and Magneson, the Tax Court emphasized the admitted nonrecognition treatment accorded each individual step in the transactions, and reasoned that if each step were tax-free, in combination they should also be tax-free, so long as the continuity of investment principle underlying section 1031(a) is respected. See Bolker, 81 T.C. at 805-06; Magneson, 81 T.C. at 771.
24
We recently affirmed Magneson but our rationale differed from that of the Tax Court. While we recognized the importance of continuity of investment as the basic purpose underlying section 1031(a), see H.R.Rep. No. 704, 73d Cong., 2d Sess. 12, reprinted in 1939-1 C.B. (pt. 2) 554, 564, we did not hold that that principle justifies the failure to address the specific requirements of section 1031(a). Rather, we based affirmance on our holding that the Magnesons intended to and did continue to hold the acquired property, the contribution to the partnership being a change in the form of ownership rather than the relinquishment of ownership. Magneson, at 1495-96. Thus the Magnesons satisfied the specific requirements of section 1031(a). Nothing in Magneson relieves Bolker of his burden to satisfy the requirement that he have held the property given up, Montebello, for investment.
25
Finally, there is nothing in the legislative history which either supports or negates Bolker's or the Commissioner's position. In sum, the Commissioner is supported by two revenue rulings which are neither controlling nor precisely on point. Bolker is supported by two Tax Court decisions which did not explicitly address this issue. In the absence of controlling precedent, the plain language of the statute itself appears our most reliable guide.
26
The statute requires that the property be "held for productive use in trade or business or for investment." Giving these words their ordinary meaning, see Greyhound Corp. v. United States, 495 F.2d 863, 869 (9th Cir.1974) (if Code does not define term, court should give words their ordinary meaning), a taxpayer may satisfy the "holding" requirement by owning the property, and the "for productive use in trade or business or for investment" requirement by lack of intent either to liquidate the investment or to use it for personal pursuits. These are essentially the two requirements courts have placed on the property acquired in a section 1031(a) exchange, see, e.g., Regals Realty, 127 F.2d at 933-34 (intent to sell disqualifies exchange); Click v. Commissioner, 78 T.C. 225, 233-34 (1982) (intent to give as gift disqualifies exchange), so this interpretation would yield the symmetry the use of identical language seems to demand.
27
The Commissioner's position, in contrast, would require us to read an unexpressed additional requirement into the statute: that the taxpayer have, previous to forming the intent to exchange one piece of property for a second parcel, an intent to keep the first piece of property indefinitely. We decline to do so. See Starker v. United States, 602 F.2d 1341, 1352-53 (9th Cir.1979) (refusing to read unexpressed additional requirement of simultaneous exchange into Sec. 1031(a)).5 Rather, we hold that if a taxpayer owns property which he does not intend to liquidate or to use for personal pursuits, he is "holding" that property "for productive use in trade or business or for investment" within the meaning of section 1031(a). Under this formulation, the intent to exchange property for like-kind property satisfies the holding requirement, because it is not an intent to liquidate the investment or to use it for personal pursuits. Bolker acquired the Montebello property with the intent to exchange it for like-kind property, and thus he held Montebello for investment under section 1031(a). The decision of the Tax Court is therefore
28
AFFIRMED.
*
Honorable Charles L. Hardy, United States District Judge for the District of Arizona, sitting by designation
1
All references to the Internal Revenue Code are to the Internal Revenue Code of 1954 as amended and in force in 1972
2
Crosby had filed a breach of contract suit against SCS in 1971 based upon SCS' failure to fulfill a prior contract to purchase Montebello. We do not discuss whether the settlement of this lawsuit as part of the transaction was an exchange of non-like-kind property, because the Commissioner did not raise the argument at trial or on appeal. See discussion Part I below
3
The Commissioner concedes that the real estate received by Bolker was of like kind to the Montebello property
4
At trial, the Commissioner argued that in substance the exchange of Montebello was negotiated and carried out by the corporation, and that the corporation, not Bolker, should be taxed on any gain realized. The Commissioner's evidence was directed toward proving that the exchange was the continuation and culmination of the 1969 corporate plan to sell Montebello, disguised as a liquidation and exchange to avoid tax consequences to the corporation. Bolker's evidence was directed toward proving that the corporate plan to sell Montebello had been abandoned, and that the 1971 negotiations were by Bolker as an individual despite the fact that Crosby still owned Montebello
5
Starker's specific holding that section 1031(a) does not require simultaneous exchange, 602 F.2d at 1354-55, has been limited by a revision of section 1031(a). Deficit Reduction Act of 1984, Pub.L. No. 98-369, Sec. 77, 98 Stat. 494, 595 (effective July 19, 1984; requiring that property acquired be designated and exchanged within 180 days after taxpayer transfers the property given up). The addition of this requirement, specifically drafted in response to Starker, see H.R.Rep. No. 432, 98th Cong., 2d Sess. 1231, reprinted in 6B 1984 U.S.Code Cong. & Ad.News 1, 201, does not affect the validity of Starker's refusal to read unexpressed requirements into the then-current version of section 1031(a)
|
18-595
Sherpa v. Barr
BIA
Tsankov, IJ
A202 078 593
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER
FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF
APPELLATE PROCEDURE 32.1 AND THIS COURT=S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER
IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING TO A SUMMARY
ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
1 At a stated term of the United States Court of Appeals
2 for the Second Circuit, held at the Thurgood Marshall United
3 States Courthouse, 40 Foley Square, in the City of New York,
4 on the 18th day of December, two thousand nineteen.
5
6 PRESENT:
7 DENNIS JACOBS,
8 JOSÉ A. CABRANES,
9 ROBERT D. SACK,
10 Circuit Judges.
11 _____________________________________
12
13 SANGE SHERPA, AKA SHERPA SANGE,
14 Petitioner,
15
16 v. 18-595
17 NAC
18 WILLIAM P. BARR, UNITED STATES
19 ATTORNEY GENERAL,
20 Respondent.
21 _____________________________________
22
23 FOR PETITIONER: Jason Schaffer, Mungoven &
24 Assoc., P.C., New York, NY.
25
26 FOR RESPONDENT: Joseph H. Hunt, Assistant
27 Attorney General; Anthony P.
28 Nicastro, Assistant Director;
29 Tracey N. McDonald, Trial
30 Attorney, Office of Immigration
31 Litigation, United States
32 Department of Justice, Washington,
33 DC.
1 UPON DUE CONSIDERATION of this petition for review of a
2 Board of Immigration Appeals (“BIA”) decision, it is hereby
3 ORDERED, ADJUDGED, AND DECREED that the petition for review
4 is DENIED.
5 Petitioner Sange Sherpa, a native and citizen of Nepal,
6 seeks review of a January 30, 2018, decision of the BIA
7 affirming a February 28, 2017, decision of an Immigration
8 Judge (“IJ”) denying his application for asylum, withholding
9 of removal, and relief under the Convention Against Torture
10 (“CAT”). In re Sange Sherpa, No. A202 078 593 (B.I.A. Jan.
11 30, 2018), aff’g No. A202 078 593 (Immig. Ct. N.Y. City Feb.
12 28, 2017). We assume the parties’ familiarity with the
13 underlying facts and procedural history.
14 Under the circumstances, we have considered both the IJ’s
15 and the BIA’s opinions “for the sake of completeness.”
16 Wangchuck v. Dep’t of Homeland Security, 448 F.3d 524, 528
17 (2d Cir. 2006). The applicable standards of review are well
18 established. See 8 U.S.C. § 1252(b)(4)(B); Hong Fei Gao v.
19 Sessions, 891 F.3d 67, 76 (2d Cir. 2018).
20 “Considering the totality of the circumstances, and all
21 relevant factors, a trier of fact may base a credibility
22 determination on . . . the consistency between the
2
1 applicant’s or witness’s written and oral statements . . . ,
2 the internal consistency of each such statement, the
3 consistency of such statements with other evidence of
4 record . . . without regard to whether an inconsistency,
5 inaccuracy, or falsehood goes to the heart of the applicant’s
6 claim, or any other relevant factor.” 8 U.S.C.
7 § 1158(b)(1)(B)(iii); Xiu Xia Lin v. Mukasey, 534 F.3d 162,
8 163-64 (2d Cir. 2008). Substantial evidence supports the
9 agency’s determination that Sherpa was not credible as to his
10 claim that Maoists attacked him in Nepal on account of his
11 membership in the Nepal Student Union.
12 The agency reasonably relied on Sherpa’s inconsistent
13 evidence regarding whether he was attacked in October or
14 November 2013; when he was attacked in relation to his
15 departure from Nepal; whether he was injured during the first
16 or second of two incidents; and when and how he obtained his
17 corroborating evidence. See 8 U.S.C. § 1158(b)(1)(B)(iii).
18 Sherpa did not provide compelling explanations for these
19 inconsistencies. See Majidi v. Gonzales, 430 F.3d 77, 80 (2d
20 Cir. 2005) (“A petitioner must do more than offer a plausible
21 explanation for his inconsistent statements to secure relief;
22 he must demonstrate that a reasonable fact-finder would be
3
1 compelled to credit his testimony.” (internal quotation marks
2 omitted)).
3 Given the inconsistency findings, the agency’s adverse
4 credibility determination is supported by substantial
5 evidence. See 8 U.S.C. § 1158(b)(1)(B)(iii). That
6 determination was dispositive of asylum, withholding of
7 removal, and CAT relief because all three claims were based
8 on the same factual predicate. See Paul v. Gonzales, 444
9 F.3d 148, 156-57 (2d Cir. 2006).
10 For the foregoing reasons, the petition for review is
11 DENIED. All pending motions and applications are DENIED and
12 stays VACATED.
13 FOR THE COURT:
14 Catherine O’Hagan Wolfe,
15 Clerk of Court
4
|
719 S.W.2d 662 (1986)
CONTAINER PORT SERVICES, INC. and William Leroy Rayburn, Appellants,
v.
Kenneth GAGE and Thomas Hayre, Appellees.
No. 08-86-00248-CV.
Court of Appeals of Texas, El Paso.
November 5, 1986.
Second Rehearing Denied December 3, 1986.
Elizabeth Ray, Scott L. Franck, Calvin, Dylewski, Gibbs, Maddox, Russell & Verner, Houston, for appellants.
Guy D. Choate, Webb, Stokes, Sparks, Parker, Junell & Choate, San Angelo, for appellees.
Before OSBORN, C.J., and SCHULTE and ARMENDARIZ, JJ.
OPINION ON MOTION
OSBORN, Chief Justice.
We grant the Appellant's motion for rehearing, withdraw our prior opinion on motion in this case, and the following is our opinion on motion.
The Appellants have filed a motion to extend the time for filing the transcript and statement of facts in this case. The Appellants' motion for new trial was overruled as a matter of law on August 5, 1986. The cost bond for appeal was timely filed on August 20, 1986. Rule 377(a), Tex.R. Civ.P., now Rule 53(a), Tex.R.App.P., required the appellant to make a written request of the official reporter designating the portion of the evidence and other proceedings to be included in the statement of facts. This written request was required to be made at or before the time prescribed *663 for perfecting the appeal, and a copy was required to be filed with the trial court and a copy served on the appellee or counsel for the appellee.
In this case, no written request was filed on August 20, 1986. Instead, an oral request was made with the official court reporter on August 27, 1986. According to the court reporter's affidavit, on September 9, 1986, a written request for the statement of facts had still not been received from counsel for the Appellants. Attached as Appendix "A" is the relevant part of an affidavit of counsel for Appellant concerning the request for the Statement of Facts. An affidavit from the court reporter states that he could not have timely filed the record even if a timely request had been made in accordance with Rule 377(a), Tex. R.Civ.P.
Several opinions have been written concerning the failure to comply with the provisions of Rule 377(a), Tex.R.Civ.P., which requires a written request to the court reporter at or before the time prescribed for perfecting the appeal. In Odom v. Olafson, 675 S.W.2d 581 (Tex.App.San Antonio 1984), the court in a per curiam opinion said that the rule apparently was amended with the intention of compelling appellants to request their statement of facts at a time in the appellate process which would insure that more statements of facts would be completed within the time allowed. The court noted the goal of the new rule was to eliminate the all-too-frequent occurrence of an appellant waiting to request the statement of facts until its due date. In denying a motion to extend the time for filing the statement of facts, the court said:
As the rule now reads, we have no discretion to permit the filing of a statement of facts by an appellant who has not complied with the mandate of the rule. The statement of facts may not be presented on appeal.
The Amarillo Court of Appeals, sitting en banc, split on whether it might follow the Odom decision. In Interest of Phillips, 691 S.W.2d 714 (Tex.App.Amarillo 1985).
The Dallas Court of Appeals in Monk v. Dallas Brake and Clutch Service Company, Inc., 683 S.W.2d 107 (Tex.App.Dallas 1984), refused to follow the holding in the Odom case. The court in an opinion by Chief Justice Guittard held that the failure to make the written request within the time prescribed by Rule 377(a) may be excused by a reasonable explanation presented in accordance with Rule 21c. In reaching that result, the court recognized that the time for requesting preparation of the statement of facts is not included in Rule 21c as one of those periods which may be extended on proper motion. The court concluded that there was a reasonable explanation where it was shown that the delay in making the request for the statement of facts did not, in fact, delay its preparation and filing.
The following year, the San Antonio Court of Appeals, sitting en banc, chose to disregard its earlier opinion in the Odom case and follow the holding of the Dallas court in the Monk case. Adams v. H.R. Management and LaPlaza Ltd., 696 S.W.2d 256 (Tex.App.San Antonio 1985). In reaching that decision, it said:
It is apparent in the instant case that compliance with Rule 377(a) would not have resulted in the timely filing of the statement of facts. Both reporters were so encumbered with pending work that even if they had received a timely written request in accordance with Rule 377(a), they would not have been able to prepare the statement of facts in this case by the time it was due. A rigid adherence to a mandatory interpretation of Rule 377(a) in every case will not further the purpose of the rulethe prompt and efficient disposition of appeals. In cases where that goal is not advancedsuch as the instant caserigid adherence to Rule 377(a) will not promote the efficiency of the appellate process.
Justice Reeves in a dissenting opinion noted that he would adhere to the interpretation of the rule as set out in Odom. He concluded that it was the duty of the intermediate *664 appellate court to apply and enforce the rules as they are written and not to redraft the rule to conform to one's own perception of propriety and fair play.
Also in 1985, the Houston Court of Appeals (14th District), sitting en banc, in an opinion by Chief Justice Brown, concluded that the rule is clear, unambiguous and unequivocal and that in order to present a statement of facts on appeal, the appellant, at or before the time prescribed for perfecting the appeal, shall make a written request to the official reporter designating the portion of the evidence and other proceedings to be included therein. Caldwell & Hurst v. Myers, 705 S.W.2d 703 (Tex. App.Houston [14th Dist.] 1985). In his opinion, Chief Justice Brown noted the contrary holdings by the Dallas and San Antonio courts and said, "we are intellectually uneasy with the reasoning in those cases." In denying the request to extend the time for filing the statement of facts, he said:
Unlike other mandatory appellate rulesfor perfecting appeal, filing the transcript and statement of facts, and filing briefsnothing in Rule 377(a) allows us to extend the mandatory timetable. See TEX.R.CIV.APP. 21c, 356, 385, 386, 414.
Rule 377(a), as it is written, simply gives us no discretion, not even the limited discretion of Rule 21c, to grant an extension for a reasonable failure to comply with its mandate.
We cannot rewrite the rule. We must reluctantly follow its clear mandate until the Supreme Court clarifies it to the contrary.
In McKellips v. McKellips, 712 S.W.2d 540 (Tex.App.El Paso 1986), this Court denied a motion to extend the time to file the statement of facts where the appellant had not complied with Rule 377(a). In that case, the record did not reflect that had a timely request been made the record could not have been prepared timely.
In April, 1986, the Supreme Court adopted the Texas Rules of Appellate Procedure which became effective September 1, 1986. The Appellants' motion was filed on September 5, 1986, and we believe it must be decided under the new appellate rules. Delta Brands, Inc. v. Borden Metal Products Company, 570 S.W.2d 1 (Tex.Civ. App.Beaumont 1978), writ ref'd n.r.e., 570 S.W.2d 876; Cavitt v. Jetton's Greenway Plaza Cafeteria, 563 S.W.2d 319 (Tex. Civ.App.Houston [1st Dist.] 1978, no writ).
Rule 53(a), Tex.R.App.P., provides:
In order to present a statement of facts on appeal, the appellant, at or before the time prescribed for perfecting the appeal, shall make a written request to the official reporter designating the portion of the evidence and other proceedings to be included therein. A copy of such request shall be filed with the clerk of the trial court and another copy served on the appellee.
That rule contains no provision for an extension of time to file the required written request with the court reporter. But, Rule 54(c), Tex.R.App.P., which is a rule on motions for extension of time to file a transcript or statement of facts, provides in the last sentence as follows: "Such motion shall also reasonably explain any delay in the request required by Rule 53(a)." We conclude such sentence was added to remedy the problem the Houston court discussed in its opinion in Caldwell & Hurst v. Myers, supra.
Accordingly, we hold that a party who has not timely requested a statement of facts as required by Rule 53(a), Tex.R. App.P., may "reasonably explain" any delay when filing a motion to extend the time for filing the statement of facts. We also conclude that the explanation given in this case meets the standards required by the rule. See: Zimmerman v. Boyce, 660 S.W.2d 837 (Tex.App.El Paso 1983). Apparently some effort was made to contact the court reporter prior to the time the appeal was perfected. The failure to timely make a written request for the statement of facts resulted from the lack of attention and carelessness of counsel handling the appeal. Such conduct can be classified as inadvertence under the holding *665 in Meshwert v. Meshwert, 549 S.W.2d 383 (Tex.1977).
We do have serious doubts as to whether the issue of whether the court reporter could have timely prepared this statement of facts had a timely request been made has anything to do with a "reasonable explanation" for not timely requesting the statement of facts as required by Rule 53(a), Tex.R.App.P. See: Dillard v. Freeland, 714 S.W.2d 378 (Tex.App.Corpus Christi 1986, no writ); Adams v. H.R. Management and LaPlaza Ltd., supra; Monk v. Dallas Brake and Clutch Service Company, Inc., supra. That issue relates to a timely filing of the statement of facts and not to the issue of a timely request for the statement of facts. To hold otherwise would really make Rule 53(a), Tex.R. App.P., meaningless because there is probably not a court reporter anywhere who could not make an affidavit that on any given day such reporter did not have other records being prepared which would have delayed the preparation of the record if a timely request for a statement of facts had been made in a particular case.
The Appellant's motion for rehearing is granted and the statement of facts is ordered filed with the Clerk of this Court on or before December 5, 1986.
APPENDIX "A"
"On August 15, 1986 I contacted the District Clerk of Upton County, Texas to discuss a number of matters involving perfection of an appeal on the Trial Court's decision in this matter, including the necessary steps for the filing of a Cost Bond and Supersedeas Bond, the preparation of a transcript, and the location of Mr. McLaughlin, the court reporter, for purposes of requesting the Statement of Facts. The District Clerk advised that the best way to contact Mr. McLaughlin would be to call his office in Alpine, Brewster County, Texas at (915) 837-5311. I placed numerous telephone calls to Mr. McLaughlin's office in Alpine, Texas at various times on a daily basis from August 15, 1986, through August 26, 1986. No one ever answered the telephone at his office during that time period. On August 26, 1986 I placed a telephone call to Judge Gonzales' office in Fort Stockton, Texas in an effort to determine Mr. McLaughin's [sic] location. Judge Gonzales' secretary stated that she would attempt to get a message to Mr. McLaughlin. On August 27, 1986, in response to the message on August 26, 1986, Mr. McLaughlin called me and I advised him that the appellants required the preparation of the Statement of Facts for this appeal. Mr. McLaughlin stated that he would require an advance payment in an unspecified sum prior to beginning preparation of the Statement of Facts for this appeal. On September 4, 1986, I received a letter from Mr. McLauglin [sic] dated August 27, 1986, stating that he would require the payment of the sum of $1,720.00 prior to beginning preparation of the Statement of Facts. I placed a telephone call to in-house counsel for appellants and after discussing the matter with client on Tuesday, September 9, 1986, I submitted a check request to this law firm's accounting department for the issuance of a check in the amount of $1,720.00 payable to Mr. McLaughlin. The next day I was advised by the accounting department that they required Mr. McLaughlin's tax identification number before the check could be forwarded to him. On September 10 or 11, 1986, I contacted Judge Gonzales' office and left a message requesting Mr. McLaughlin's tax identification number. On September 17, 1986, I received a telephone call from Judge Gonzales' office advising me of Mr. McLaughlin's tax identification number. The check was forwarded to Mr. McLaughlin that afternoon and was received by him on Friday, September 19, 1986. On September 22, 1986, I discussed this matter with Mr. McLaughlin and confirmed that he had received my firm's check in the amount of $1,720.00. He also stated that he would forward to the Court an affidavit stating that even if a request for preparation of the transcript had been received on or before September 20, 1986, he still would have been unable to prepare the Statement of Facts by September 2, *666 1986. Therefore, the late request for preparation of the Statement of Facts, in no way affected Mr. McLaughlin's ability to prepare the Statement of Facts within the time period prescribed by the Rules."
|
168 Cal.App.4th 640 (2008)
CHARLES JOSEPH TUCKER, JR., Plaintiff and Respondent,
v.
GROSSMONT UNION HIGH SCHOOL DISTRICT, Defendant and Appellant.
No. D050266.
Court of Appeals of California, Fourth District, Division One.
October 28, 2008.
*642 Stutz Artiano Shinoff & Holtz, Daniel R. Shinoff and Paul V. Carelli IV for Defendant and Appellant.
Patrick F. O'Connor; Boudreau Williams and Jon R. Williams for Plaintiff and Respondent.
*643 OPINION
O'ROURKE, J.
Grossmont Union High School District (District) appeals an order granting an extraordinary writ to require District to reemploy Charles Joseph Tucker, Jr., in preference to new applicants for any available position with District for which Tucker applies and for which he is qualified. District contends under the plain meaning of relevant statutes Tucker does not have reemployment rights to positions outside of the class from which he was laid off. We affirm the judgment.
FACTUAL AND PROCEDURAL BACKGROUND
Tucker began working for District in 1982 as a general maintenance worker and after one and one-half years was promoted to maintenance supervisor. He left District's employ from 1988 until 1996 during which time he worked for another school district and earned an MBA. In 1996 Tucker returned to work for District and held the position of director of maintenance and operations. He later assumed additional responsibilities in connection with the building of a new high school and compliance with the Americans with Disabilities Act of 1990 (Pub.L. No. 101-336 (July 26, 1990) 104 Stat. 327), and some of his former responsibilities were delegated to others. His job title became director of operations, safety and special projects.
District's former assistant superintendent stated that in 2004 District asked a state agency, the County Office Fiscal Crisis and Management Assistance Team (FCMAT), to review its classified management structure. FCMAT recommended eliminating Tucker's position and combining his duties with those of other positions to reduce expenditures. On January 13, 2005, District's board of trustees voted to eliminate Tucker's position because of lack of work and/or lack of funds. He was laid off effective April 2005.
In April 2005 Tucker applied for the position of maintenance manager with District. According to District's human resources director, this position was of a lower class and had different job responsibilities than Tucker's previous position. Although Tucker was qualified for the position, District hired someone else, an individual who had never before worked for District.
Tucker petitioned for a writ of mandate. He alleged District illegally laid him off; it did not comply with his "bumping rights," which he claimed gave him the right to move into a job held by a current employee; and it violated his right to reemployment under Education Code section 45298,[1] which gives *644 employees laid off for lack of work or lack of funds reemployment preference over new applicants. He also petitioned for declaratory relief.
The superior court granted Tucker's petition in part and denied it in part. The court found District had legitimately laid off Tucker for lack of work and/or lack of funds and Tucker had no "bumping rights." The court also found Tucker had and continues to have the right to be reemployed in preference to new applicants under section 45298, and this right was violated when he was not reemployed in April 2005 as maintenance manager. The court found section 45298 does not limit reemployment to a job only within a particular classification. It stated in order to exercise his right to reemployment, Tucker must apply for an available position and satisfy the qualifications promulgated by District for the position sought. The court declined to award damages without prejudice to Tucker seeking damages in a separate action.
DISCUSSION
District contends the court erred by finding section 45298 provides Tucker with the right to be reemployed by District in preference to new applicants for any position for which he applies and for which he is qualified. It argues section 45298 must be read together with section 45308, and analyzing the two statutes together leads to the conclusion that Tucker has preference to reemployment only for a position within the class from which he was laid off.
(1) Because the resolution of this issue involves a question of law where the facts are not in dispute, we are not bound by the trial court's decision, but may make our own determination. (Rodriguez v. Solis (1991) 1 Cal.App.4th 495, 502 [2 Cal.Rptr.2d 50].) In deciding the proper interpretation of statutes, the primary goal is to determine the intent of the Legislature when the law was enacted. The goal of statutory construction is to ascertain the Legislature's intent to effectuate the purpose of the law. (Torres v. Automobile Club of So. California (1997) 15 Cal.4th 771, 777 [63 Cal.Rptr.2d 859, 937 P.2d 290].) (2) "`[E]very statute should be construed with reference to the whole system of law of which it is a part so that all may be harmonized and have effect.'" (Landrum v. Superior Court (1981) 30 Cal.3d 1, 14 [177 Cal.Rptr. 325, 634 P.2d 352].)
(3) The reviewing court seeks to give the statute a reasonable construction and to promote rather than defeat the policy underlying the legislation. (County of Alameda v. Johnson (1994) 28 Cal.App.4th 259, 263 [33 *645 Cal.Rptr.2d 483].) We first look at the language of the statute, attributing to the words their plain, usual, ordinary and commonsense meaning. (Garcia v. McCutchen (1997) 16 Cal.4th 469, 476 [66 Cal.Rptr.2d 319, 940 P.2d 906]; Torres v. Automobile Club of So. California, supra, 15 Cal.4th at p. 777.) When the statutory language is clear and unambiguous, judicial construction is neither necessary nor proper. (Cortez v. Purolator Air Filtration Products Co. (2000) 23 Cal.4th 163, 179 [96 Cal.Rptr.2d 518, 999 P.2d 706].)
(4) The governing board of a school district prescribes written rules and regulations governing the personnel management of the classified service. (§ 45113, subd. (a).) However, "the governing board may lay off and reemploy classified employees only in accordance with procedures provided by Sections 45298 and 45308...." (§ 45114.)
We thus examine the pertinent language of these statutes. Section 45298 provides: "Persons laid off because of lack of work or lack of funds are eligible to reemployment for a period of 39 months and shall be reemployed in preference to new applicants."
Section 45308 provides in part: "Classified employees shall be subject to layoff for lack of work or lack of funds. Whenever a classified employee is laid off, the order of layoffs within the class shall be determined by length of service. The employee who has been employed the shortest time in the class, plus higher classes, shall be laid off first. Reemployment shall be in the reverse order of layoff."
District asserts because sections 45298 and 45308 must be read together and section 45308 refers to classes of classified employees and designates the orders for laying off and reemploying members of a class, an employee's rights to preference for reemployment are for reemployment only within the class in which he or she was formerly employed. District argues the rights do not include any preference for reemployment in a lower or different class even if the laid-off employee is qualified for the position.
(5) This argument is not persuasive. Section 45298 describes the rights of a laid-off employee in relation to new applicants and specifies the laid-off employee has a right to reemployment in preference to a new applicant. Section 45308 explains the order in which members within a class must be laid off and rehired. The language of section 45308 is relevant to the rights of the individual members of a class vis-a-vis each other. It is not relevant to the rights of laid-off employees versus new applicants. To take the language of section 45308 regarding the rights of class members in relation to each other *646 and interject it into the language of section 45298 that describes the reemployment rights of laid-off employees versus new applicants would change the plain meaning of section 45298.
(6) If the Legislature had intended to limit a laid-off employee's right to reemployment, it easily could have stated the former employee "shall be reemployed within the same class from which the employee was laid off in preference to new applicants." It did not do so, and the language of the statute has remained essentially the same since it was first enacted in 1935 as section 5.798 of the former School Code. (Stats. 1935, ch. 618, § 1, p. 1745.) In other sections of the code the Legislature has included language relating to classes of employees. Section 45195, which applies to classified employees in elementary and secondary schools, states an employee who returns to work after a leave "shall be restored to a position within the class .... and, if at all possible, to his or her position...." (Italics added.) Section 88127 and 88195, which apply to classified employees in community colleges, refer respectively to the order of layoff of classified employees within a class and of returning to work to a position within a class after a leave of absence. In enacting section 45298, however, the Legislature did not specify that the laid-off employee's preference to reemployment over a new employee was restricted to reemployment only in the same class from which he was laid off. Because the Legislature did not include this language, we conclude it did not intend to so restrict a laid-off employee's preference to reemployment versus a new applicant.
(7) District's suggestion that language in the second paragraph of section 45298 supports its interpretation is not convincing. The second paragraph of section 45298 states: "Employees who take voluntary demotions ... shall be granted the same rights as persons laid off ... provided, that the same tests for fitness under which they qualified for appointment to a class shall still apply." These words simply mean that employees who took voluntary demotions and laid-off persons have the same rights vis-a-vis each other to reemployment as long as they are still qualified for the class of employment. The language does not suggest that a laid-off employee's reemployment rights versus a new applicant are restricted to the same class from which he or she was laid off.
District's argument that reemployment preferences under the Government Code support its argument is also flawed. Rules for reemployment found in Government Code sections 18904, 18905, 19054 and 19056 that refer to placement on reemployment lists for classes of employees are like the rights *647 referred to in section 45308 and the second paragraph of section 45298. They are relevant to the rights of former employees in relation to each other. They do not support District's argument that would restrict an employee's preference for reemployment against new applicants to the class from which he or she was laid off.
Our California Supreme Court's analysis of another section of the Education Code is instructive. Although, as District points out, California Teachers Assn. v. Governing Bd. of Rialto Unified School Dist. (1997) 14 Cal.4th 627, 632 [59 Cal.Rptr.2d 671, 927 P.2d 1175] (Rialto) involved interpretation of a different statute, the court's reasoning is useful. Section 44919, subdivision (b), provides that a limited assignment supervising pupils in an athletic activity "`shall first be made available to teachers presently employed by the district.'" (Rialto, at p. 632, italics omitted.) The school district had asserted the hiring preference provided by the statute only required it to make the application and interview process available to current credentialed teachers. The court, however, observed this would in effect give current teachers no advantage over other applicants. The court ruled by section 44919, subdivision (b), the Legislature intended to give preference to employment in coaching positions to credentialed teachers currently employed by a district over noncredentialed employees or nonemployees. (Rialto, at p. 634.) The court noted because the district has the authority to set the criteria it uses to determine the qualifications for the position Section 44919, subdivision (b), does not provide a guarantee of employment, but the preference is limited to those applicants qualified for the coaching position based on the criteria that the district itself creates. A teacher applying for a coaching position would have to show he or she meets the qualifications promulgated by the district before the district would be prohibited from hiring a noncredentialed employee or nonemployee in preference to the teacher. (Rialto, at p. 644.)
Here, also, section 45298 provides a preference for a laid-off employee vis-a-vis new applicants for reemployment in a position for which the laid-off employee is qualified. District's contrived reading of sections 45298 and 45303 together could eliminate any advantage for the laid-off employee versus a new applicant. By requiring that the preference be available only if the laid-off employee is applying for a position within the exact same class from which he or she was laid off, a district would be free to simply eliminate the position or class after laying off the employee, thereby doing away with the benefit the Legislature intended to afford to the laid-off employee by enacting section 45298. District has broad discretion to define the qualifications required for any position for which it seeks applicants, thus it may ensure that only applicants who meet the prerequisites of a given *648 position will be hired. Providing a preference for laid-off employees who can fulfill the qualifications of a position protects both the interests of the laid-off employee as intended by the Legislature and the interests of the District in having an employee qualified for the position.
(8) District's fears that an employee laid off for lack of work and/or lack of funds will have inappropriate priority over other employees are unfounded. Nothing in the statutory provisions gives the laid-off employee the right to a position currently held by another employee. District's worries that a laid-off employee would have an unjustifiable preference over a much better qualified new applicant are also unwarranted. Section 45298 does not provide a guarantee of reemployment. A district has the ability to set its own hiring criteria for any given position to ensure that it may hire a well-qualified individual to fill the position.
We also find unpersuasive District's arguments in its reply brief regarding Gately v. Cloverdale Unified School Dist. (2007) 156 Cal.App.4th 487 [67 Cal.Rptr.3d 377] (Gately). In Gately the court ruled the facts supported a finding that an individual who had been employed as a business manager had been laid off for legitimate fiscal and organizational reasons. (Id. at p. 497.) The court also ruled the former business manager was not entitled to special notice when the position of chief financial operations officer (CFO) became available although she could have applied for the CFO position had she chosen to do so. (Ibid.)
In Gately the former employee's position had been eliminated and her former duties were assumed by a CFO, the highest ranking executive after the superintendent, and whose duties were more demanding and required skills that the laid-off employee lacked. (Gately, supra, 156 Cal.App.4th at p. 497.) Thus, she was not qualified for the CFO position and would not have a right of preference over a new applicant. By contrast, the record indicated Tucker, who had been laid off from a position that was eliminated, director of operations, safety and special projects, would presumably have met the qualifications for the position of maintenance manager since he earlier had been employed as director of maintenance and operations. He should have been afforded a preference over a new applicant. The holding of Gately does not support District's position.
(9) Under the provisions of sections 45298 and 45308, Tucker has preferential reemployment rights over any new applicants to available positions for which he is qualified.
*649 DISPOSITION
The judgment is affirmed.
McConnell, P. J., and Haller, J., concurred.
NOTES
[1] Statutory references are to the Education Code unless otherwise specified.
|
854 F.Supp. 464 (1994)
John F.R. SMILGIN, III, Jack Reese, James Grissen, Individually and d/b/a Jack Reese Associates
v.
NEW YORK LIFE INSURANCE COMPANY and William J. Booher.
Civ. A. No. G-94-197.
United States District Court, S.D. Texas, Galveston Division.
June 7, 1994.
*465 Robert G. Taylor, II, Taylor & Cire, Houston, TX, for John F.R. Smilgin, III, Jack Reese and James Grissen, Individually and d/b/a Jack Reese Associates.
Alfred John Harper, II, Nancy Lynne Patterson, and Teri L. Danish, Fulbright & Jaworski, Houston, TX, for New York Life Ins. Co.
Walter T. Weathers, Jr., Houston, TX, for William J. Booher.
ORDER DENYING REMAND
KENT, District Judge.
Plaintiffs Reese and Grissen brought this action in state court for breach of contract against Defendant New York Life. These Plaintiffs allege that New York Life breached an agreement to sell insurance to the Plaintiffs' clients, and therefore New York Life owes them certain commissions and costs. Additionally, the Plaintiffs seek a declaration that Defendant Booher is not entitled to share their recovery of these commissions based on any alleged agreement between the Plaintiffs and Booher. Finally, Plaintiff Smilgin asserts his rights as an assignee of a portion of the other Plaintiffs' claims.
New York Life removed this action based on diversity of citizenship. Although there is no diversity between New York Life and Plaintiff Smilgin, and Defendant Booher did not join the removal, New York Life argues that the status of these parties should be ignored for purposes of removal. The Plaintiffs counter that their status commands remand. Finding the New York Life's arguments more persuasive, Plaintiffs' motion to remand is DENIED.
Lack of Joinder
Generally, of course, all defendants are required to join in a notice of removal. Chicago, Rock Island, & Pacific Ry. Co. v. Martin, 178 U.S. 245, 20 S.Ct. 854, 44 L.Ed. 1055 (1900); Johnson v. Helmerich & Payne, Inc., 892 F.2d 422, 423 (5th Cir.1990). However, federal law determines who is a plaintiff and who is a defendant for purposes of applying the removal statute, and the Court may realign the parties according to their real interests before deciding whether a true "defendant" is petitioning for removal. Chicago, Rock Island, & Pacific Ry. Co. v. Stude, 346 U.S. 574, 580, 74 S.Ct. 290, 294, 98 L.Ed. 317 (1954). In determining the proper alignment of the parties, a federal court must look to the "principal purpose of the suit" and the "primary and controlling matter in dispute." City of Indianapolis v. Chase Nat'l Bank, 314 U.S. 63, 69, 62 S.Ct. 15, 16, 86 L.Ed. 47 (1941) (internal quotes and citations omitted). In other words, the Court must determine the Plaintiffs' "principal purpose for filing its suit." Zurn Indus. v. Acton Constr. Co., 847 F.2d 234, 237 (5th Cir.1988).
Clearly, the principal question in this suit is whether New York Life owes commissions and costs to the Plaintiffs. The Plaintiffs' declaratory claims against Booher are entirely separate and distinct in terms of the legal and factual issues and, conversely, Booher's ability to recover on his alleged claims is entirely dependent on the Plaintiffs' right to recovery against New York Life. Therefore, Booher's and the Plaintiffs' interest in *466 the primary thrust of this lawsuit are the same. Booher wants the Plaintiffs to be entitled to a recovery, so that he can share in it. As a practical matter, then, Booher should not be considered a "defendant" for the purpose of joinder in removal, but rather should be considered an intervening (albeit unwillingly) Plaintiff. Therefore, Defendant New York Life was not required to obtain Booher's joinder prior to removal.
The Non-Diverse Plaintiff
Defendant New York Life and Plaintiff Smilgin are both residents of New York. Again, generally, this fact would destroy the basis for diversity removal. Again, there is an exception applicable to this case, where the only interest of the allegedly non-diverse Plaintiff is a partial assignment of the co-Plaintiffs' cause of action.
A federal district court has "both the authority and the responsibility, under 28 U.S.C. §§ 1332 and 1441, to examine the motives underlying a partial assignment which destroys diversity and to disregard the assignment in determining jurisdiction if it be found to have been made principally to defeat removal." Grassi v. Ciba-Geigy, Ltd., 894 F.2d 181, 185 (5th Cir.1990). This determination is a simple question of fact. Id. at 186. The Grassi court found that the district court, in denying a motion to remand for lack of diversity, properly disregarded the citizenship of a "partial-assignment" plaintiff where (1) the assigned interest was only 2%; (2) the plaintiff had had no interest in the litigation prior to assignment; (3) both assigned and "real" plaintiffs shared the same attorney; (4) the assignment occurred shortly before suit was filed; (5) the assignment essentially represented a contingency fee for collection work, which could have been effectuated without an assignment; and (6) there was a strong likelihood of local prejudice against the defendant. Id.
These facts are almost identical to those of the case at bar. The "real" Plaintiffs assigned Smilgin only 1% of their claim. The assignment occurred only four days prior to the filing of suit, and Smilgin had no interest in the litigation prior to that time. All Plaintiffs are represented by the same counsel. The Plaintiffs only vaguely assert that they made the assignment "in an effort to help defray financial costs," as "Smilgin will provide Reese and Grissen various financial and tax services in connection with [their] continuing efforts to sell [the policies at issue]." Of course, this arrangement could have as easily been made by way of a contingency fee agreement. Finally, because 99% of this action remains owned by local residents, the substance of this action remains that of in-state Plaintiffs against an out-of-state Defendant, creating precisely the danger of local prejudice which the diversity removal provisions are designed to protect against. Id. at 185. Therefore, the Court finds that the "real" Plaintiffs made the assignment to Smilgin solely for the purpose of defeating removal jurisdiction, and that Smilgin's interest is too inconsequential for this assignment to have that effect. Accordingly, Smilgin's citizenship should be ignored in the jurisdictional equation, and consequently complete diversity attains.
* * * * * *
For these reasons, the Plaintiffs' motion to remand is DENIED. If the parties can present to the Court compelling and relevant new evidence or legal authority affecting this issue, which they could not through the exercise of due diligence have presented on original submission of this motion, the parties are, of course, invited to bring these to the Court's attention. Otherwise, the parties are further ORDERED to file no further pleadings on this issue in this Court, including motions to reconsider and the like. Instead, the parties are instructed to seek any further relief to which they feel themselves entitled in the United States Court of Appeals for the Fifth Circuit, as may be appropriate in due course.
IT IS SO ORDERED.
|
188 Mich. App. 54 (1991)
469 N.W.2d 4
PEOPLE
v.
WILLIAMS
Docket No. 114790.
Michigan Court of Appeals.
Decided March 18, 1991, at 9:40 A.M.
Frank J. Kelley, Attorney General, Gay Secor Hardy, Solicitor General, John D. O'Hair, Prosecuting Attorney, Timothy A. Baughman, Chief of Research, Training, and Appeals, and Jeffrey Caminsky, Assistant Prosecuting Attorney, for the people.
Susan F. Reed, for the defendant on appeal.
Before: GRIBBS, P.J., and REILLY and NEFF, JJ.
NEFF, J.
Following a bench trial, defendant was convicted of possession of less than fifty grams of cocaine, MCL 333.7403(2)(a)(iv); MSA 14.15(7403)(2) (a)(iv), and possession of a firearm during the commission of a felony, MCL 750.227b; MSA 28.424(2). Defendant was sentenced to the mandatory two-year consecutive term of imprisonment for the felony-firearm conviction and to two to four years' imprisonment for the possession of cocaine *56 conviction. Defendant now appeals as of right, and we affirm.
I
Defendant's convictions arose out of events that occurred on August 26, 1987, in the City of Detroit. Two officers from the Detroit Police Department were on routine patrol when they noticed two men on the porch of an abandoned house.
The officers entered the house and went up a flight of stairs, shouting that they were police officers. Upon entering the upstairs living room, the officers encountered defendant and another man. Defendant was spraying lighter fluid into a small can on the floor. The other man, Xavier Fielder, was sitting on a milk crate, holding matches. When Fielder stood up, a plastic bag containing suspected cocaine dropped onto the floor from his lap. The officers confiscated this bag, as well as thirty-four similar packets from the can on the floor. One of these packets was later tested and found to contain cocaine.
When defendant was searched, the officer found a revolver in the rear pocket of defendant's pants and a plastic bag containing powder in another pocket. The officers also confiscated $263 from a small table located about two feet from defendant and Fielder.
II
Defendant first contends that the prosecution failed to prove beyond a reasonable doubt that he had possessed the cocaine. We disagree.
In reviewing the sufficiency of the evidence presented at a criminal bench trial, this Court must *57 view that evidence in a light most favorable to the prosecution and determine whether a rational trier of fact could have found that the essential elements of the crime were proven beyond a reasonable doubt. People v Petrella, 424 Mich 221, 268-270; 380 NW2d 11 (1985). The trier of fact may draw reasonable inferences from the evidence, but may not indulge in inferences unsupported by direct or circumstantial evidence. Id., p 275.
Defendant argues that the prosecution failed to prove that the packets in the can contained cocaine because the officer combined those packets with the one that had fallen from Fielder's lap. However, the laboratory analysis stipulated to by defendant states that the evidence envelope contained thirty-five packets, each containing a lumpy, off-white material. There is no indication that the one packet from Fielder's lap was anything but a part of this larger lot. Here, a sample of thirty-five indistinguishable packets was tested and found to contain cocaine. An inference that the entire lot contained cocaine was appropriate, regardless of whether the tested packet came from Fielder's lap or the can on the floor. See People v Kirchoff, 74 Mich App 641, 647; 254 NW2d 793 (1977).
Defendant also argues that his presence in the room with the cocaine is not enough to prove possession. Something more than mere association must be shown to establish joint possession. The prosecution must show an additional independent factor linking the defendant with the drugs. People v Davenport, 39 Mich App 252, 257; 197 NW2d 521 (1972). Here, defendant was discovered by police officers in an abandoned home, crouching over a can containing packets of cocaine in an apparent attempt to destroy them. There was sufficient evidence presented to allow the trial *58 court to find that defendant had possessed the cocaine.
Defendant also suggests that the prosecution did not prove that he was not merely trying to destroy the contraband drugs. Defendant did not present this argument to the trial court, and it is therefore waived for appellate review. In any event, the issue is without merit. The possession of contraband for the mere purpose of destroying it is not unlawful. People v Germaine, 234 Mich 623, 626; 208 NW 705 (1926). Such destruction, however, must not be undertaken, "aroused by the presence of officers, to make away with evidence." Id. Had defendant presented this theory to the trial court, the court would have been justified in inferring that the attempt to burn the cocaine was an attempt to destroy evidence, not a civic-minded effort to destroy contraband.
III
Defendant next contends that the prosecutor's failure to provide defendant or his counsel with a witness list thirty days before trial, as required by MCL 767.40a(3); MSA 28.980(1)(3), requires dismissal of the charges against him. We disagree.
MCL 767.40a(3); MSA 28.980(1)(3) provides:
Not less than 30 days before the trial, the prosecuting attorney shall send to the defendant or his or her attorney a list of the witnesses the prosecuting attorney intends to produce at trial.
Defendant cites no authority for his argument that noncompliance with § 40a(3) requires automatic dismissal, and we can find none.
A trial court must exercise discretion in fashioning a remedy for noncompliance with a discovery *59 statute, rule, order, or agreement. People v Clark, 164 Mich App 224, 229; 416 NW2d 390 (1987). If indeed there was noncompliance with the statute, the trial court did not abuse its discretion in denying defendant's motion to dismiss, because defendant has failed to show any prejudice from such noncompliance. MCL 769.26; MSA 28.1096.
On October 24, 1988, the day of trial, defense counsel moved to have the case against defendant dismissed because she claimed that neither she nor defendant was served with a copy of the list of witnesses the prosecution intended to call at trial. It is noteworthy that counsel did not request an adjournment or any other relief short of dismissal to cure any perceived prejudice resulting from the failure to have the witness list in a timely fashion.
The prosecutor responded that he had given a witness list to counsel and the court on September 9, 1988, and that he had not been informed earlier that defense counsel had not received a copy of that list. In denying defendant's motion to dismiss the case, the trial judge noted that all of the witnesses were police officers and that because defendant was not denied discovery she did not see how defendant could have been prejudiced. We also note that a copy of the prosecutor's witness list, dated September 9, 1988, is contained in the lower court file.
Although she maintained that she had not received a witness list, defense counsel admitted that she had received discovery materials from the prosecutor. Moreover, all of the prosecutor's witnesses were police officers who had participated in the arrest. Defendant clearly had access to the police report filed in this case, because it was used to cross-examine one of the police officers. Under these circumstances, even if there was noncompliance with the statute, we fail to see how defendant *60 could have suffered prejudice. The trial court did not abuse its discretion in denying defendant's motion to dismiss.
IV
Defendant also contends that he is entitled to resentencing because the trial court erred in scoring offense variable sixteen. Defendant claims that there is no indication of drug trafficking in the record which would have supported a score of fifteen for offense variable sixteen. We disagree.
A sentencing judge has discretion in determining the number of points to be scored for any offense variables in the sentencing guidelines provided that there is evidence in the record which adequately supports a particular score. People v Day, 169 Mich App 516, 517; 426 NW2d 415 (1988).
The evidence in the record is sufficient to uphold the court's finding that circumstances indicated drug trafficking. When defendant was arrested, he was in joint possession of thirty-five packages of cocaine, a cutting agent, and a large amount of cash. The trial court did not err in scoring offense variable sixteen.
Affirmed.
|
Pursuant to Ind.Appellate Rule 65(D),
this Memorandum Decision shall not be
regarded as precedent or cited before
any court except for the purpose of
establishing the defense of res judicata,
collateral estoppel, or the law of the case.
Dec 02 2014, 10:07 am
APPELLANT PRO SE:
CYNDI L. TURNPAUGH
Columbia City, Indiana
IN THE
COURT OF APPEALS OF INDIANA
CYNDI L. TURNPAUGH )
)
Appellant- Respondent, )
)
vs. ) No. 92A04-1404-DR-170
)
DOUGLAS W. TURNPAUGH )
)
Appellee-Petitioner. )
APPEAL FROM THE WHITLEY CIRCUIT COURT
The Honorable James R. Heuer, Judge
Cause No. 92C01-1007-DR-512
December 2, 2014
MEMORANDUM DECISION - NOT FOR PUBLICATION
VAIDIK, Chief Judge
Case Summary
Cyndi Turnpaugh (“Wife”) appeals the trial court’s denial of her Trial Rule 60(B)
motion for relief from judgment. She argues that the challenged trial-court order—which
permitted her former husband, Douglas Turnpaugh (“Husband”), to begin therapeutic
visitation with their children—was based upon a mistake of fact or, in the alternative,
cannot be justified based on newly discovered evidence. Because we find no merit in
Wife’s claims, we affirm the trial court.
Facts and Procedural History
The parties were divorced in 2012. They have five children; the youngest is nine
and the oldest is twenty. When the parties divorced, they agreed that Wife would have
custody of four of the children.1 See Appellant’s App. p. 38-39. Husband’s parenting
time had previously been suspended based on allegations that he had molested two of the
children and physically abused another.2 The trial court ordered Husband to complete the
Sexual Offenders Monitoring and Treatment (SOMAT) program before parenting time
could resume. Specifically, the trial court provided:
4. Husband shall voluntarily submit to a polygraph examination through
Phoenix Associates, Inc.
5. Husband shall complete the SOMAT Program at Phoenix Associates,
Inc., and follow their recommendations.
6. Husband shall sign an Authorization for Release of Information
authorizing release of information from Phoenix Associates, Inc., to the
Court.
7. The parties shall participate in the children’s counseling with the Bowen
Center as recommended by counselor(s).
1
The parties’ fifth child was in foster care for reasons not disclosed by the record.
2
Although the record shows that Husband later admitted that he committed some offense, it does
not disclose what Husband admitted doing, nor does it indicate that Husband was ever charged with any
crime.
2
8. Upon the recommendation of the children’s counselor(s) at the Bowen
Center that initiation of therapeutic visitation is appropriate, Husband and
the children shall participate in the Bowen Center’s Therapeutic Visitation
Program.
9. The parties shall follow the recommendations of the children’s
counselor(s) at the Bowen Center.
10. Regardless of the recommendations of Phoenix Associates, Inc.,
Husband shall have no parenting time rights except as recommended by the
children’s counselor(s) at the Bowen Center.
Id. at 39.
The court ordered therapeutic visitation to begin in May 2013. Id. at 123. In early
2014 Wife filed a Trial Rule 60(B) motion for relief from judgment. Id. at 15-36. In her
motion, Wife alleged that Husband was not in compliance with the trial court’s order—
and thus, therapeutic visitation should not have begun—because he had failed a
polygraph examination. The trial court held a hearing on the motion in March 2014.
At the hearing, Husband responded to Wife’s claims by citing a letter written by
Mary Rose, a social worker from Phoenix Associates, Inc., stating that he had
successfully completed the SOMAT program. See Tr. p. 5. In full, the letter provided
that Husband:
[C]ompleted all SOMAT program assignments. He shared his details of the
offense. [Husband] demonstrated an understanding of how his behavior
impacted others. [Husband] expressed empathy for his victim and remorse
for his hurtful actions. He has made plans for how to keep himself safe
from re-offending in the future. He also worked with his treatment group
on communication skills and coping with difficult emotions. [Husband]
has demonstrated overall stability in the community while in treatment,
including attendance and participation at group and individual sessions and
maintaining employment. He will be participating in maintenance
counseling to discuss the reunification process with his children.
Appellant’s App. p. 79. Wife, however, argued that Husband could only be considered to
have completed the SOMAT program when he passed a polygraph examination. Tr. p. 9
3
(“[I]sn’t the purpose of a polygraph to be passed? I mean, what’s the purpose of him
taking a polygraph that the court’s ordered and failing that polygraph?”). After taking the
matter under advisement, the trial court denied Wife’s motion. See Appellant’s App. p.
14. In doing so, the court cited the letter from “Mary Rose of Phoenix Associates
indicating that [Husband] has completed all SOMAT program assignments,” and noted
that the letter was written after Husband failed the polygraph examination. Id. The court
therefore concluded that Husband was in compliance with its order regarding the
SOMAT program. Id.
Wife now appeals.
Discussion and Decision
Wife appeals the trial court’s denial of her motion for relief from judgment. “The
decision of whether to grant or deny a Trial Rule 60(B) motion for relief from judgment
is within the sound, equitable discretion of the trial court.” Stonger v. Sorrell, 776
N.E.2d 353, 358 (Ind. 2002) (citation omitted). We will only reverse where the trial court
has abused its discretion. Id. (citation omitted). An abuse of discretion occurs if the trial
court’s decision is against the logic and effect of the facts and circumstances before the
court or the reasonable inferences therefrom. Shane v. Home Depot USA, Inc., 869
N.E.2d 1232, 1232 (Ind. Ct. App. 2007). Husband, however, has not filed an appellee’s
brief. Under that circumstance, we will not develop the appellee’s arguments. Branham
v. Varble, 952 N.E.2d 744, 746 (Ind. 2011). Rather, we will reverse upon an appellant’s
prima facie showing of reversible error. Id.
4
Wife seeks relief from the trial court’s May 2013 order permitting Husband to
begin therapeutic visitation with the children. She argues that “the trial court had based
its [previous] decision upon a mistake of fact – or in the alternative, [] the decision could
not be justified on the basis of the new evidence.”3 Appellant’s Br. p. 15. According to
Wife, because Husband failed a polygraph examination after the May 2013 order, the
trial court was mistaken about Husband’s compliance with the court’s orders. She
continues: “Since [Husband] failed the [polygraph] examination, it is clear that, contrary
to what the trial court believed when it issued the Visitation Order, [Husband] never
complied with the order requiring him to complete the SOMAT program.” 4 Id. at 16.
We disagree.
In its order denying Wife’s motion for relief from judgment, the court cited a letter
from a Phoenix Associates social worker clearly stating that Husband had completed all
the SOMAT program assignments, and noted that the letter was written after Husband
failed a polygraph examination. From this evidence, the trial court reasonably concluded
3
Trial Rule 60(B) allows a party to seek relief from judgment on numerous grounds, including:
(B) Mistake—Excusable neglect—Newly discovered evidence—Fraud, etc. On
motion and upon such terms as are just the court may relieve a party or his legal
representative from a judgment, including a judgment by default, for the following
reasons:
(1) mistake, surprise, or excusable neglect;
(2) any ground for a motion to correct error, including without limitation newly
discovered evidence, which by due diligence could not have been discovered in
time to move for a motion to correct errors . . . .
Ind. Trial Rule 60(B)(1), (2).
4
Wife also argues that the children’s best interests are not served by permitting therapeutic
visitation because Husband has not completed the SOMAT program. See Appellant’s Br. p. 28-32.
Again, we must disagree based on the evidence before us: a SOMAT provider told the trial court—in no
uncertain terms—that Husband had successfully completed the program, and we are not in a position to
second-guess the requirements of that program.
5
that Husband completed the requirements of the SOMAT program, and we find no error
in that conclusion.
Wife does not challenge the evidence cited by the trial court. Instead, she devotes
the majority of her brief to explaining why it is necessary for Husband to pass a
polygraph examination, and she contends that because he has not, he simply cannot have
satisfied the SOMAT program protocol. She provides no evidence, however, that passing
a polygraph examination is a requirement of the SOMAT program, and the evidence cited
by the trial court—a letter provided by those who run the program—suggests that it is
not. In light of this, we cannot say that the trial court erred in denying Wife’s motion for
relief from judgment.5
Affirmed.
FRIEDLANDER, J., and MAY, J., concur.
5
Wife also argues that the trial court failed to make the necessary findings of fact. See
Appellant’s Br. p. 22-25. We disagree; the trial court’s findings of fact are sufficient and address the
relevant legal issues.
6
|
705 S.W.2d 19 (1986)
STATE of Missouri, Respondent,
v.
Marvin C. JONES, Appellant.
No. 66697.
Supreme Court of Missouri, En Banc.
February 18, 1986.
Rehearing Denied March 25, 1986.
*20 C.J. Larkin, Columbia, for appellant.
William L. Webster, Atty. Gen., John M. Morris, Asst. Atty. Gen., Jefferson City, for respondent.
WELLIVER, Judge.
Appellant was convicted of capital murder, § 565.001, RSMo 1978 (repealed October 1, 1984, now first degree murder § 565.020, RSMo Cum.Supp.1984), and sentenced to death, and he was also convicted of armed criminal action, § 571.015.1, RSMo 1978, and sentenced to three years in the Missouri State Penitentiary. Original appellate jurisdiction vests in this Court. Mo. Const. art. V, § 3. We affirm.
The evidence presented at trial is not at issue on appeal. The victim, Dorothy Fienhold, was fifty-eight years old at the time of her death. Appellant, who was sixty-three at the time of the trial, had been involved in a stormy relationship with the victim during the couple of years preceding her death. Both appellant and the victim lived in Illinois. By August of 1983, the victim indicated a desire to end the relationship. On Saturday, August 20, appellant and his ex-wife, Iris Jones, observed the victim in the company of another man, and appellant became enraged with jealousy. At 9:00 a.m. the next morning, the victim received a telephone call from the appellant, and the victim's granddaughter overheard the victim exclaim that she was not going to go to Missouri with appellant. The victim told her granddaughter that she was afraid of the appellant. Dorothy Fienhold was not seen alive past 5:00 p.m. that day, August 21, 1983.
The following morning, August 22, Mr. Ousley noticed an abandoned car on his property near Interstate 44 here in Missouri. He watched the vehicle for a little under an hour, and then he went home and called the police. Officers arrived about ten minutes later, at 11:55 a.m. One of the investigating officers, Officer Wilhoit, looked inside the car and observed a "heap of clothes" and "what looked like a white cord that looped out from underneath the clothes that had what appeared to be speckledblood specks on it." The vehicle was locked, but Wilhoit managed to open the door with a coat-hanger. On the floor mat, he noticed some drops of blood and called for additional assistance. An expanded search of the area turned up a bloody pair of pants and two bloody sheets lying in the brush some fifty to seventy-five feet from the car. He went back to the car and found the victim's purse, with her driver's license and some letters. Wilhoit also found a temporary Illinois registration for the vehicle in the name of appellant. While Wilhoit was searching the car, other officers at the scene located the victim's body in the brush off the side of the road in a wooded area. Officers also located military papers belonging to appellant near the scene of the murder. Two witnesses placed appellant near the scene of the crime.
When the victim's body was found, it was badly mutilated and the face was unrecognizable. Death was caused by two contact gunshot wounds at the point of each *21 eyeball, either one of which was fatal. The coroner testified that prior to her death, the victim was badly beaten and suffered a number of broken ribs. Although it was not the cause of her death, she also was manually strangled. There were other contusions and abrasions, which occurred after her death. Further testimony indicated that she had been killed closer to the road and then dragged into the woods.
Appellant raises four arguments on appeal. Initially, appellant asserts error in the manner in which the jury rendered its decision to impose the death sentence. During the punishment phase of the trial, the jury was instructed in Instruction No. 20 that it could impose a sentence of death only if it found one or more of the following aggravating circumstances:
1. Whether the defendant has a substantial history of serious assaultive convictions.
2. Whether the murder of Dorothy J. Fienhold involved torture or depravity of mind and that as a result thereof it was outrageously or wantonly vile, horrible or inhuman.
Instruction No. 24 further provided that if the jury decided to impose the death sentence, it must write onto its verdict from the aggravating circumstance or circumstances submitted in Instruction No. 20 which it found beyond a reasonable doubt. The jury decided to impose the death sentence and returned the following verdict form, with the italicized portion representing the handwritten findings by the jury:
VERDICT
JURORS: Use this form only if the punishment fixed by you is death. See Instruction No. 24 for directions as to what must be written into the verdict form if the death penalty is imposed. Use the reverse side of this form if necessary. The foreman's signature must appear at the end of the matter which you designate in writing as the aggravating circumstance or circumstances which all twelve jurors found beyond a reasonable doubt.
As to Count I, we, the jury, having found the defendant guilty of the capital murder of Dorothy J. Fienhold, fix the defendant's punishment at death, and we designate the following aggravating circumstance or circumstances which we find beyond a reasonable doubt:
1. Physical torture of victim by strangulation of neck, broken ribs, various bruises and contusions to body previous to death.
2. Placement of weapon in contact with eye when fatal bullet was discharged.
3. Deliberate mutilation of victim by discharging an additional bullet into other eye.
After determining that the form was not in exact compliance with the instructions, the trial judge resubmitted the case to the jury with directions to follow the instructions. Twenty minutes later the jury sent a note to the trial judge requesting "some clarification of Instructions # 24 and # 20 to proceed." The Judge replied in writing that "I can't instruct further." Shortly thereafter the jury returned its verdict form with the following changes:
As to Count I, we, the jury, having found the defendant guilty of the capital murder of Dorothy J. Fienhold, fix the defendant's punishment at death, and we designate the following aggravating circumstance or circumstances which we find beyond a reasonable doubt:
Physical torture of victim by strangulation of neck, broken ribs, various bruises and contusions to body previous to death.
Placement of weapon in contact with eye when fatal bullet was discharged.
3. Deliberate mutilation of victim by discharging an additional bullet into other eye.
2. We the jury find that the murder of Dorthy [sic] Fienhold involved torture, was wantonly vile, and inhuman for the above reasons.
Appellant contends that this second verdict is defective because it fails to track the language of the statute and Instruction No. 20, it contains non-statutory aggravating *22 circumstances and indicates some jury confusion.
This Court recognizes that the written findings by the jury did not track the language in Instruction No. 20. The jury was asked only to write the aggravating circumstance or circumstances which it found justifying the imposition of the death penalty. Instead, the verdict form as accepted by the trial judge included the jury's apparent reasons for finding that the murder involved torture and was wantonly vile and inhuman.[1] We do not agree with appellant's characterization of these first three handwritten lines as non-statutory aggravating circumstances; they are nothing more than the reasons the jury considered in finding the aggravating circumstance recited in the last handwritten line following the number "2," with the number "2" reflecting the aggravating circumstance submitted in Instruction No. 20. This Court was presented with a similar situation in State v. Nave, 694 S.W.2d 729 (Mo. banc 1985), where we found no error because the jury clearly expressed its intent in the verdict form and "sufficiently recited all of the essential elements of the statutory aggravating circumstances submitted." State v. Nave, supra, at 737. Explanatory language indicating the reasons for the jury's finding did not taint the verdict. The same holds true in the case at bar. It should be beyond dispute that the jury clearly intended to impose the death sentence and that it found the second aggravating circumstance submitted in Instruction No. 20. We, therefore, find no error in the verdict.
Ancillary to appellant's argument on this point is the claim that the reasons stated by the jury are insufficient to establish the jury's finding that the murder involved "torture." In its first handwritten line, reprinted above, the jury indicated some of the reasons why it found the murder involved torture. A review of the record indicates that there is sufficient evidence establishing multiple injuries to the body, including a number of broken ribs and an attempt to manually strangle the victim, all occurring prior to the two gunshot wounds to the eyes and other post-mortem injuries. It is also likely, although surely not necessary, that the jury considered the gruesome mutilation of the body, whether occurring post or pre-morten, as indicative of appellant's state of mind and actions prior to the victim's death while she was being strangled and badly beaten. We cannot say that there is insufficient evidence establishing the jury's finding that the murder involved torture.
Next, appellant argues that certain statements made by appellant should have been suppressed because they were obtained after an illegal arrest. Officers at the scene of the murder found military papers with appellant's name and determined that the abandoned car alongside the road was registered to appellant in Illinois,[2] and they contacted officers in the Mt. Pulaski Police Department in Illinois. They explained the situation and indicated that they wanted appellant for questioning. Late that afternoon, on August 22, Illinois authorities conducted an inquiry and learned that appellant and the victim were acquaintances and that they had been seen together numerous times and had been last seen toward the end of that previous week. Appellant's ex-wife was also contacted. Between 9:00 p.m. and 9:30 p.m. that evening, appellant voluntarily arrived at one of the police departments in Illinois. At first, he was not placed under arrest. Appellant was informed that his vehicle had been found in Missouri, and appellant indicated that he had loaned the car to a friend. Another Illinois officer stayed with appellant while Officer Larry Ball contacted Missouri highway authorities. Sergeant Aytes, here in *23 Missouri, asked Ball to hold appellant for investigation of the homicide until Aytes could go to Illinois to question appellant. Appellant was then placed under arrest and read his Miranda rights and subsequently transported to the Logan County Safety Complex in Illinois. Officer Aytes, along with Sheriff Giles of Crawford County, Missouri, drove to the Logan County jail in Lincoln, Illinois. They arrived around 3:30 a.m. to 3:45 a.m., during the early morning on August 23rd. Appellant was again advised of his rights and volunteered a statement. Among other things, appellant stated that he did not "know anything about Dorothy being shot" before appellant was told that the victim had been shot. The interview lasted about an hour, and appellant was released around 10:00 a.m. that morning of August 23rd. A further investigation ensued and a Missouri arrest warrant was issued at 11:00 p.m. that night, on August 23rd.
Illinois held an extradition hearing on October 20, 1983, at which time appellant was ordered extradited. Officer Aytes and Sheriff Giles transported appellant from Illinois to Missouri. They advised appellant of his Miranda rights, and, while en route, appellant gave both a written and oral statement concerning the facts surrounding the victim's death. Appellant claimed that he was present during the shooting, but told the officers that he was wrestling with the victim and the gun went off.
Appellant argues that two of his statements, the one on August 23rd, and the one on October 20th, should have been suppressed.[3] Appellant contends that these statements were obtained pursuant to an illegal arrest on August 22nd and therefore should have been excluded as the "fruit of a poisonous tree." The arrest is said to be illegal because the Illinois authorities failed to comply with Ill.Rev.Stat. ch. 60, § 31 (1971), the Illinois Uniform Extradition Act. This section is the same in substance as § 548.141, RSMo 1978, which authorizes an arrest without a warrant if there is "reasonable information" that the "accused stands charged in the courts of a state with a crime punishable by death or imprisonment for a term exceeding one year." Appellant contends that the Illinois authorities lacked any reasonable information that appellant had been charged with such an offense in Missouri. We do not believe that this statute has any bearing on this issue. Appellant had his right to an extradition hearing and he is not now challenging the propriety of the extradition order entered by an Illinois court. Rather, the question is whether Illinois authorities could detain and then arrest appellant on the night of August 22nd. When appellant voluntarily entered the Illinois police station, even without probable cause appellant could have been detained. See United States v. Hensley, 469 U.S. 221, 105 S.Ct. 675, 83 L.Ed.2d 604 (1985). Appellant was then arrested in order to detain him for questioning. There was probable cause to believe that he had committed a crime and, therefore, supporting his arrest. See generally Whitely v. Warden, 401 U.S. 560, 91 S.Ct. 1031, 28 L.Ed.2d 306 (1971); Ledesma v. State, 251 Ga. 487, 306 S.E.2d 629 (1983); Ostrowik v. State, 665 P.2d 471 (Wyo.1983). A car registered in his name was found abandoned near the victim's body, and appellant's name was on papers found at the scene. Blood-stained pants belonging to a man were found near the scene of the murder and appellant and the victim were known acquaintances having a hostile love affair. Additionally, the statement made on October 20th, which was after appellant's extradition hearing, is so far attenuated from the arrest on August 22nd that it could not have been "tainted" by the events two months earlier.
Third, appellant avers that the trial court improperly excused for cause a venireperson who unequivocally stated that she could not, under any circumstances, impose a death sentence during the punishment phase of the trial. Appellant argues that *24 this resulted in an improper death-qualification of the jury in violation of his rights under the United States Constitution, Mo. Const. art. I, § 5, and § 546.130, RSMo 1978. This same issue has been presented to this Court on a number of occasions, and we have held that a venireperson may be excused for cause if he or she indicates that they would not impose a death sentence under any circumstances. See e.g., State v. Gilmore, 697 S.W.2d 172, 175 (Mo. banc 1985); State v. Nave, 694 S.W.2d 729, 735-36 (Mo. banc 1985); State v. Malone, 694 S.W.2d 723, 726-27 (Mo. banc 1985); State v. Kenley, 693 S.W.2d 79, 82 (Mo. banc 1985); State v. Johns, 679 S.W.2d 253, 265 (Mo. banc 1984). We decline to overrule our prior cases and the point, therefore, is denied.
Appellant's last assignment of error is that his death sentence is excessive and disproportionate to the punishment imposed in similar cases. When the death penalty is imposed, it is this Court's statutorily mandated duty to review independently the sentence imposed by the jury. § 565.014, RSMo 1978 (repealed, now § 565.035, RSMo Cum.Supp.1984). There is no substantial evidence in the record to suggest that the sentence was imposed under the influence of passion, prejudice or any other arbitrary factor. § 565.014.3(1). Nor do we find that the sentence in this case is excessive or disproportionate to other cases, considering both the crime and the defendant. See e.g., State v. Battle, 661 S.W.2d 487 (Mo. banc 1983); State v. Smith, 649 S.W.2d 417 (Mo. banc 1983); State v. LaRette, 648 S.W.2d 96 (Mo. banc 1983), cert. denied, 464 U.S. 908, 104 S.Ct. 262, 78 L.Ed.2d 246 (1983).
The judgment is affirmed.
HIGGINS, C.J., BILLINGS, DONNELLY and RENDLEN, JJ., and SNYDER, Special Judge, concur.
BLACKMAR, J., concurs in part and dissents in part in separate opinion filed.
ROBERTSON, J., not sitting.
BLACKMAR, Judge, concurring in part and dissenting in part.
The statutes require us to compare death sentences in the interest of uniformity. It is not sufficient to hold that the jury's findings of guilt and of statutory aggravating circumstances are supported by the evidence. It is our duty to make an independent review of each case and to make diligent comparisons.
Most statutory aggravating circumstances are framed in terms of willfulness, deliberation, and hope of tangible benefit. The present offense appears to me to be a crime of passion. No motive appears. It is ironical that the Attorney General, who has often stressed the element of willfulness in some death sentence cases, now argues that the lack of motive in the present case is a circumstance to be considered.
The finding of "torture" is strained in the present case. It is based solely on the presence of antecedent violence. The record is sufficient to support a finding of capital murder, but the finding of torture borders on the speculative. I find little indication of pain inflicted for pain's sake.
The principal opinion cites State v. Battle, 661 S.W.2d 487 (Mo. banc 1983); State v. Smith, 649 S.W.2d 417 (Mo. banc 1983), and State v. LaRette, 648 S.W.2d 96 (Mo. banc 1983) as examples in deciding that the sentencing in this case was not excessive or disproportionate. Battle and Smith, along with State v. Mercer, 618 S.W.2d 1 (Mo. banc 1981), are easily distinguishable because the intent to kill the victim was clear before the murder took place. In LaRette, the intent of the defendant is less clear. However, it is easier to infer such an intent in LaRette than in the present case. In LaRette, there was no prior relationship between the parties that would explain the defendant's presence at the scene. In the present case, it is likely that the victim and defendant had gone off together and that an unplanned confrontation took place, even though she had expressed fear of him. She had previously driven off with him despite earlier statements that she feared him.
*25 Smith is definitely distinguishable. In that case, the defendant had announced his intention to hurt the victim before the murder. He later admitted the murder, stating that he had wanted the victim to suffer. The murder was particularly brutal since the victim must have been alive and fearful throughout a long struggle. Smith chased the victim two and one-half blocks with an iron bar causing numerous injuries. These include: six head lacerations, multiple skull fractures, and contusions and abrasions of the brain. Indeed, the victim's skull was caved in.
In LaRette, the injuries similarly appear to be more aggravated than in the present case. There was evidently a struggle blood was found throughout the apartment. Additionally, there were multiple stab wounds. The victim was stabbed in the lung and in the heart. A third knife wound cut across her throat, nearly decapitating her. The victim was alive throughout the ordeal, could see that she was bleeding, and clearly could anticipate her death. There was evidence of attempted sexual assault. There was also evidence that the defendant had earlier slowly circled the victim's apartment complex.
In Battle, an eighteen year old and his associate robbed and raped an eighty year old woman. Battle decided the woman had to die because she had seen them. He tried stabbing her with a butcher knife. The knife kept bending, so he stabbed her in the eye. When Battle left, the woman was still alive with the knife still stuck in her eye. She was saying prayers. She died later. The suffering involved is obvious.
Mercer is also distinguishable. There were not multiple wounds in Mercer. The woman was strangled. However, before her death, she was forced into a bedroom in Mercer's house and was raped by Mercer and some of his friends, in a scene of debauched brutality. She had time to fear for her life. Mercer purposefully planned on killing the victim explaining to a friend that he should have killed an earlier rape victim (at the time of the murder, he was faced with rape charges from the earlier incident).
I do not believe that this case is comparable to others in which the death penalty has been decreed. There are numerous, more aggravated cases in which the jury has decreed life imprisonment.[1]
I would affirm the judgment of conviction but would remand for resentencing to life imprisonment with a mandatory sentence of fifty years.
NOTES
[1] In State v. Lashley, 667 S.W.2d 712 (Mo. banc 1984), this Court held that if a jury returns an improper verdict, the trial court must refuse to accept the verdict and require further deliberations until the jury returns a verdict in the proper form.
[2] There is some dispute in the record concerning whether the officers knew that the vehicle was actually registered in both appellant's name and that of his ex-wife, Iris Jones.
[3] The first statement was not introduced at trial.
[1] See, e.g., State v. Lawrence, 700 S.W.2d 111 (Mo.App.1985) (Defendant and two others robbed an apartment looking for drugs. In that process, they shot two people to death and wounded another by shooting her four or five times.); State v. Williams, 678 S.W.2d 845 (Mo. App.1984) (victim killed by being beaten with bricks and being run over five times by a car). I will not encumber this opinion with other cases in which the reported opinions do not discuss details available to the Court's statutory assistant. See § 565.035.6, RSMo Supp.1984.
|
NUMBER 13-08-00111-CV
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI - EDINBURG
MICHAEL W. WILLIAMS, Appellant,
v.
COMMISSION FOR
LAWYER DISCIPLINE, Appellee.
On appeal from the 117th District Court of Nueces County, Texas.
MEMORANDUM OPINION
Before Justices Rodriguez, Garza, and Vela
Memorandum Opinion by Justice Garza
Appellee, Commission for Lawyer Discipline (the “Commission”), filed disbarment
proceedings against appellant, Michael W. Williams, in district court. After a bench trial,
the court rendered a final judgment of disbarment. Williams appeals this judgment by
three issues. We affirm the judgment of the trial court.
I. BACKGROUND
The Commission filed its third amended disciplinary petition on September 13, 2007.
In this petition, the Commission alleged that Williams violated several disciplinary rules in
representing Mary L. Franklin, Robert Corder, and Jean V. Albe.
Regarding Franklin, the Commission stated that Williams represented Franklin in
a debt collection suit on a credit card account and alleged that he: (1) failed to
communicate with Franklin; (2) failed to respond to her reasonable requests for information
pertaining to the case; (3) failed to take any action on Franklin’s behalf; and (4) made a
false statement of material fact to an investigator for the Office of Chief Disciplinary
Counsel. See TEX . DISCIPLINARY R. PROF’L CONDUCT 1.01(b)(1), 8.01(a), 8.04(a)(3),
reprinted in TEX . GOV’T CODE ANN ., tit. 2, subtit. G app A (Vernon 2007) (TEX . STATE BAR
R. art. X, § 9). With respect to the latter, the Commission alleged that Williams
represented to the investigator that he had sent a letter on Franklin’s behalf to Jay A.
Taylor, the attorney for the creditor; however, Williams could not verify the letter’s creation
or existence.
Based on a separate complaint, the Commission further alleged that Williams was
hired by Corder to expunge records in three criminal matters. Corder gave Williams three
checks, each in the amount of $242, for the filing fees associated with each of the criminal
matters. The Commission asserted that Williams: (1) cashed two of the checks and
misplaced the third check; (2) failed to keep the funds paid by Corder separate from his
own funds; (3) failed to communicate with Corder; (4) failed to file any of the requested
expunction actions; and (5) did not return the filing fees to Corder. See id. at R. 1.01(b)(1),
1.14(a), 1.15(d).
Finally, the Commission contended that Williams represented Albe in a case filed
2
against Albe’s insurance company. The Commission argued that Williams failed to: (1)
obtain service of process on the insurance company; (2) prosecute the case; and (3) keep
Albe informed of the status of the case. See id. at R. 1.01(b)(1), 1.03(a). As a result of
Williams’s inaction, Albe’s case was dismissed for want of prosecution and, ultimately,
barred by the statute of limitations.
On October 9, 2007, the trial court conducted a bench trial of the Commission’s
allegations against Williams.1 On November 30, 2007, the trial court entered a judgment
of disbarment and assessed: (1) reasonable attorney’s fees in the amount of $6,460
against Williams; and (2) court costs in the amount of $4,000 for an appeal to this Court
and $2,000 for an appeal to the Texas Supreme Court. On the same day, the trial court
issued findings of fact and conclusions of law.2
Williams filed a pro se motion for new trial on December 28, 2007. The motion was
overruled by operation of law. See TEX . R. CIV. P. 329b(c). Williams filed a pro se notice
of appeal on February 19, 2008.
II. ANALYSIS
In his first two issues, Williams challenges the sufficiency of the evidence supporting
the trial court’s judgment of disbarment. Specifically, Williams argues that the trial court’s
findings that: (1) he never mailed a letter to Taylor on behalf of Franklin; and (2) he failed
to hold Corder’s funds in a trust or escrow account separate from his own funds are not
supported by competent evidence. In his third issue, Williams asserts that the trial court
erred by considering the Franklin and Corder complaints, which Williams contends are not
1
W illiam s did not file a reporter’s record of the trial court proceedings for our review; however,
W illiam s did file the clerk’s record.
2
In its findings of fact, the trial court noted that W illiam s “has an extensive disciplinary history
including num erous findings of professional m isconduct.”
3
supported by legally and factually sufficient evidence, in determining the proper sanction
to impose. The Commission counters by arguing that, because Williams’s arguments on
appeal depend on the review of the evidence presented at trial, and because Williams
failed to have a reporter’s record filed, his issues should be overruled. We agree.
Williams was responsible for making arrangements to pay for the preparation of the
reporter’s record. See TEX . R. APP. P. 35.3(b)(3), 37.3(c)(2). Williams has neither paid the
reporter’s fee, made satisfactory arrangements with the reporter to pay the fee, nor
established entitlement to appeal without paying the fee.3 See id. at R. 20.1, 35.3(b)(3),
37.3(c)(2). This Court notified Williams of this deficiency on November 3, 2008, and
afforded him a reasonable opportunity to cure it, but he has failed to do so. On February
27, 2009, this Court informed Williams that it would proceed in this matter without the
reporter’s record.
In challenging the sufficiency of the evidence supporting a judgment, at least a
partial reporter’s record is necessary. See TEX . R. APP. P. 34.6(c)(4); Hiroms v. Scheffey,
76 S.W.3d 486, 489 (Tex. App.–Houston [14th Dist.] 2002, no pet.) (holding that appellant
has the burden to present to the appellate court a record that shows the error about which
appellant complains); see also Gardner v. Comm’n for Lawyer Discipline, No. 03-97-00275-
CV, 1998 Tex. App. LEXIS 2094, at *7 (Tex. App.–Austin Apr. 9, 1998, no pet.) (not
designated for publication). When a reporter’s record is necessary for an appeal but is not
filed through the fault of appellant, the appellate court must presume that the evidence
supports the trial court’s judgment. Travelers Indem. Co. v. Starkey, 157 S.W.3d 899, 905
(Tex. App.–Dallas 2005, pet. denied). Moreover, after a bench trial, a trial court’s findings
3
The record does not reflect that W illiam s established indigence within the context of rule 20.1 of the
appellate rules. See T EX . R. A PP . P. 20.1.
4
of fact are conclusive unless the appellate court has a complete reporter’s record. Catalina
v. Blasdel, 881 S.W.2d 295, 297 (Tex. 1994); In re J.C., 250 S.W.3d 486, 489 (Tex.
App.–Fort Worth 2008, pet. denied).
We cannot review Williams’s first two issues pertaining to the Franklin and Corder
complaints on the scant record—one clerk’s record with no volumes of trial exhibits or
testimony—he caused to be filed in this Court. See TEX . R. APP. P. 34.6(c)(4), 37.3(c);4 In
re Spiegel, 6 S.W.3d 643, 646 (Tex. App.–Amarillo 1999, no pet.) (“Simply put, if the
reporter’s record is absent because the appellant did not satisfy rule 35.3(b), we will not
only continue to presume that the missing record supports the trial court’s determination
but also forego reviewing the dispute as authorized under appellate rule 37.3(c).”); see also
Douglass v. Torrez, No. 2-08-189-CV, 2009 Tex. App. LEXIS 3035, at *4 (Tex. App.–Fort
Worth Apr. 30, 2009, no pet.) (mem. op.). Therefore, the trial court’s findings of fact are
conclusive and support the judgment of disbarment. See Catalina, 881 S.W.2d at 297; In
re J.C., 250 S.W.3d at 489; see also Starkey, 157 S.W.3d at 905. Accordingly, we
overrule Williams’s first two issues.
Furthermore, Williams’s third issue is premised on an assumption that the trial
4
Rule 37.3(c) of the rules of appellate procedure provides:
If No Reporter’s Record Filed Due to Appellant’s Fault. Under the following circum stances,
and if the clerk’s record has been filed, the appellate court m ay— after first giving the
appellant notice and a reasonable opportunity to cure— consider and decide those issues or
points that do not require a reporter’s record for a decision. The court m ay do this if no
reporter’s record has been filed because:
(1) the appellant failed to request a reporter’s record; or
(2)(A) appellant failed to pay or m ake arrangem ents to pay the reporter’s fee to
prepare the reporter’s record; and
(B) the appellant is not entitled to proceed without paym ent of costs.
Id. at R. 37.3(c).
5
court’s findings with respect to the Franklin and Conder complaints were erroneous.5
Moreover, in arguing his third issue, Williams has not cited to any evidence in the record
supporting his contentions. See TEX . R. APP. P. 38.1(i). Because we cannot review the
sufficiency of the evidence pertaining to the Franklin and Conder complaints based on the
record before us, and because Williams has not cited to evidence in the record supporting
his contentions, we conclude that Williams’s third issue was waived. See id.; see also
Dolenz v. State Bar of Tex., 72 S.W.3d 385, 388 (Tex. App.–Dallas 2001, no pet.)
(concluding, in a disciplinary proceeding, that a failure to cite to any record references
waives an issue on appeal). Accordingly, we overrule Williams’s third issue.
IV. CONCLUSION
We affirm the judgment of the trial court.
________________________
DORI CONTRERAS GARZA,
Justice
Memorandum Opinion delivered and
filed this the 16th day of July, 2009.
5
As part of his third issue, W illiam s references the Albe com plaint and adm its to the Com m ission’s
allegations; however, he argues, in a conclusory fashion, that his transgressions in the Albe case should not
result in his disbarm ent. Regardless, W illiam s’s adm ission, in and of itself, would likely be enough to support
disbarm ent because the trial court has broad discretion to determ ine whether an attorney guilty of professional
m isconduct should be reprim anded, suspended, or disbarred and W illiam s has an extensive disciplinary
history. See T EX . D ISC IPLIN AR Y R. P R O F ’L C O N D U C T 3.10, reprinted in T EX . G O V ’T C OD E A N N ., tit. 2, subtit. G
app A (Vernon 2007) (T EX . S TATE B AR R. art. X, § 9) (providing that in determ ining the appropriate sanction
for attorney m isconduct, a trial court m ust consider the nature and degree of the professional m isconduct, the
seriousness of and circum stances surrounding the m isconduct, the loss or dam age to clients, the dam age
to the profession, the assurance that those who seek legal services in the future will be insulated from the type
of m isconduct found, the profit to the attorney, the avoidance of repetition, the deterrent effect on others, the
m aintenance of respect for the legal profession, the trial of the case, and other relevant evidence concerning
the attorney’s personal and professional background); State Bar of Tex. v. Kilpatrick, 874 S.W .2d 656, 659
(Tex. 1994) (holding that disbarm ent can be an appropriate sanction even for a single act of m isconduct); see
also Favaloro v. Comm’n for Lawyer Discipline, 13 S.W .3d 831, 840-41 (Tex. App.–Dallas 2000, no pet.);
Butler v. Comm’n for Lawyer Discipline, 928 S.W .2d 659, 666 (Tex. App.–Corpus Christi 1996, no writ).
6
|
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 01-60756
Summary Calendar
MICHAEL A. BOLTON,
Plaintiff-Appellant,
versus
SHELIA FANCHER; C. DAVID TURNER; ROBERT L. JOHNSON,
Defendants-Appellees.
--------------------
Appeal from the United States District Court
for the Southern District of Mississippi
USDC No. 2:01-CV-183-PG
--------------------
April 17, 2002
Before JONES, SMITH, and EMILIO M. GARZA, Circuit Judges.
PER CURIAM:*
Michael Bolton, Mississippi prisoner # R4716, appeals the
district court’s dismissal of his 42 U.S.C. § 1983 suit as
frivolous. He argues that his constitutional rights were
violated because 1) he was transferred from Parchman to the
Southern Mississippi Correctional Institution and placed in
segregated confinement; 2) he was deprived of personal property;
3) the defendant prison officials refused to correct his
classification; 4) the conditions of his cell are inhumane (he
has only a toilet and the bed on which to sit; he cannot control
*
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.
No. 01-60756
-2-
the lighting in his cell; he does not have thermal underwear or a
coat without holes to report for yard calls); and 5) he cannot
obtain certain food and personal hygiene items from the
commissary, though other prisoners in the same type of custody
can. He also argues that the district court dismissed the case
without allowing Bolton the opportunity to further develop the
facts of his claims.
A complaint is frivolous “if it lacks an arguable basis in
law or fact.” Talib v. Gilley, 138 F.3d 211, 213 (5th Cir.1998).
“‘A complaint lacks an arguable basis in law if it is based on an
indisputably meritless legal theory, such as if the complaint
alleges the violation of a legal interest which clearly does not
exist.’” Harper v. Showers, 174 F.3d 716, 718 (5th Cir.1999)
(citation omitted). We review the dismissal of a prisoner’s
complaint as frivolous for an abuse of discretion. Id. at 718.
Though the district court could have forwarded Bolton a
questionnaire or conducted a hearing under Spears v. McCotter,
766 F.2d 179 (5th Cir. 1985), a review of Bolton’s claims, as
alleged in the district court and on appeal, reveal that they
lack an arguable basis in law. The district court’s dismissal
was not an abuse of discretion. Bolton’s appeal lacks arguable
merit, and is DISMISSED AS FRIVOLOUS. See 5TH CIR. R. 42.2;
Howard v. King, 707 F.2d 215, 219-20 (5th Cir. 1983). The
dismissal of his appeal as frivolous and the district court’s
dismissal count as two strikes under 28 U.S.C. § 1915(g).
Adepegba v. Hammons, 103 F.3d 383, 387-88 (5th Cir. 1996).
Bolton is warned that if he accumulates three strikes, he may not
No. 01-60756
-3-
proceed IFP in any civil action or appeal while he is
incarcerated in any facility unless he is in imminent danger of
serious physical injury. See id.
Bolton’s motions for the appointment of an attorney and to
supplement the record are denied.
DISMISSED AS FRIVOLOUS. MOTIONS DENIED. SANCTION WARNING
ISSUED.
|
56 F.3d 67NOTICE: Seventh Circuit Rule 53(b)(2) states unpublished orders shall not be cited or used as precedent except to support a claim of res judicata, collateral estoppel or law of the case in any federal court within the circuit.
Jorge ORTIZ, Petitioner-Appellant,v.D.R. McBRIDE, Respondent-Appellee.
No. 93-3187.
United States Court of Appeals, Seventh Circuit.
Submitted March 29, 1995.*Decided May 26, 1995.
Before Cummings, Easterbrook and Ripple, Circuit Judges.
ORDER
1
Jorge Ortiz, an Indiana inmate, was disciplined for an infraction of prison rules by the Indiana Prison Conduct Adjustment Board. He filed a petition for a writ of habeas corpus in federal district court alleging a variety of constitutional violations concerning his disciplinary hearing at the Westville Correctional Center.
2
We do not reach the claims raised in Ortiz' petition, however, because Ortiz presented another issue during the course of this litigation. Ortiz alleges that prison officials violated his right of access to the courts because he was not allowed unfettered assistance from another inmate with the preparation of his petition and other court documents. Ortiz enlisted the assistance of Fabio Diaz, a "writ writer" who has experience in preparing legal documents for prisoners. Ortiz did not present his right of access claim in a formal complaint pursuant to 42 U.S.C. Sec. 1983, or even as an amendment to his habeas corpus petition. Instead, Ortiz filed a motion asking that Diaz, or legal counsel, be appointed to assist him. In response, the district court sent Ortiz a questionnaire to determine whether appointment of an attorney was appropriate. Ortiz never responded.
3
Ortiz repeated his request for appointment of counsel in a "Motion for Extension of Time" in which he requested more time to file a reply to the government's response. Ortiz requested appointment of counsel and cited lack of counsel as the reason that an extension of time was necessary. Ortiz did not mention Diaz in the motion. The court extended Ortiz' deadline. Two months later Ortiz filed another document asking the court for more time because Diaz did not have access to the law library to photocopy and mail Ortiz' reply. The reply was filed the next day. Two weeks later Ortiz filed another document appointing Diaz to act on his behalf to file further documents with the district court. The document did not call for any court action, so none was taken.
4
The United States Supreme Court held that states could not unreasonably interfere with an inmate's fundamental right of access to the courts. Johnson v. Avery, 393 U.S. 483, 485 (1969). A prisoner's access must be "meaningful" and prison officials bear the burden of proving the adequacy of the access provided. Shango v. Jurich, 965 F.2d 289, 292 (7th Cir. 1992); Casteel v. Pieschek, 3 F.3d 1050 (7th Cir. 1993). The right of access extends to inmate assistance in the absence of other "access" alternatives. In Johnson, the state disciplined the petitioner for violating a prison rule against aiding other prisoners in seeking post-conviction relief. The state did not, however, provide any alternative to inmate assistance, such as access to attorneys, law students, or the use of adequate law libraries. Id.; Bounds v. Smith, 430 U.S. 817, 828 (1977).
5
To prove a violation of his right of access, Ortiz must show that he was harmed by either an interruption or delay of the pending or contemplated litigation. Jenkins v. Lane, 977 F.2d 266, 268 (7th Cir. 1992) (citing Shango, 965 F.2d at 292). Ortiz is not required to show harm if he alleges a direct, substantial and continuous limit of access to legal materials, which is "any restriction on counsel or legal materials that completely prevents the prisoner, or a person acting in the prisoner's behalf, from performing preliminary legal research." Jenkins, 977 F.2d at 268; Shango, 965 F.2d at 292 (citing cases). A restriction that impinges a constitutional right is valid if it is reasonably related to legitimate penological interests. See Johnson, 393 U.S. at 489 (limits on time and location of prisoner meetings are reasonable restraints); Shango, 965 F.2d at 293.
6
The district court order denying Ortiz' petition did not address the right of access allegations. Ortiz has not alleged denial of access to anyone other than Diaz; but the prison has not advanced even the slightest reason for preventing correspondence between Ortiz and Diaz. That requires a remand, so that each side may attempt to make its essential showing: Ortiz that this deprivation cut off essential tools of access to the courts, and the prison that it had a good reason for blocking the Ortiz-Diaz correspondence. If the district court determines that Ortiz' right of access to Diaz was unconstitutionally prohibited, the alleged violation may affect the arguments and legal analysis supporting Ortiz' disciplinary claims. We leave for another day the merits of Ortiz' habeas corpus claims.
7
The district court cited Jackson v. County of McLean, 953 F.2d 1070 (7th Cir. 1992), when it considered Ortiz' motion for legal assistance (from Diaz or a court-appointed attorney). The district court may have relied on Jackson when it failed to rule on Ortiz' right of access claim. Jackson was a 42 U.S.C. Sec. 1983 civil rights action in which we held that a prisoner seeking appointment of counsel must show that he or she made reasonable efforts to secure counsel independently. The Jackson reasoning is based on the possibility of compensation pursuant to the fee shifting provisions of 42 U.S.C. Sec. 1988(b). In contrast, attorney compensation in habeas corpus actions is provided by the Criminal Justice Act, that allows only a minimal fee. 18 U.S.C. Secs. 3006A(d)(1)-(2); 3006A(g). Jackson, therefore, does not apply to section 2254 actions.
8
REVERSED AND REMANDED.
*
After preliminary examination of the briefs, the court notified the parties that it had tentatively concluded that oral argument would not be helpful to the court in this case. The notice provided that any party might file a "Statement as to Need of Oral Argument." See Fed. R. App. P. 34(a); Cir. R. 34(f). No such statement having been filed, the appeal is submitted on the briefs and the record
|
72 So.2d 414 (1953)
AMERICAN LIFE INS. CO.
v.
MORRIS.
6 Div. 746.
Court of Appeals of Alabama.
December 8, 1953.
Rehearing Denied January 19, 1954.
*415 F. Raymond Ingram, Birmingham, for appellant.
Rogers, Howard & Redden, Birmingham, for appellee.
CARR, Presiding Judge.
This cause was submitted to the jury on count three of the complaint. The count is based on an accident policy insuring against the "result of bodily injury effected solely through violent, external and accidental means during the time said policy was in force."
Pertinent to this review the policy contains this clause: "This Policy does not cover death caused * * * (2) from participation in an assault or felony * * *."
The cause was submitted to the jury and a verdict in favor of the plaintiff was returned.
Appellant presents two questions for our review: Failure of the court to give the general affirmative charge in defendant's behalf, and the action of the court in overruling the motion for a new trial.
The insistence is made that the death of the insured was not accidental within the terms of the policy. This urgency is anchored more forcibly because of the limitation or exclusion clause noted above.
The facts and circumstances relating to the death of the insured are disclosed primarily by the testimony of one witness, Eddie Gilmore.
The insured, Barbara Pope, was a Negro girl, sixteen years of age.
It appears that Gilmore had been going with Barbara for some time and their relationship had become very intimate. On the night of instant concern Gilmore went to Barbara's room between the hours of three and four A.M. The latter was displeased because the former had just previously visited the room of another girl in the same house.
Barbara got up out of bed and an argument ensued. At this point we quote from the record:
"Q. Tell the jury what happened? A. We tussled and she slapped me and when she slapped me is when I stuck her with the knife. We started tussling, and I stuck her with the knife. I told the police I didn't intend to.
"Q. Now, she hadtell the jury what she had in her hand. A. She had a knife in her hand but didn't have it on me.
"Q. What is that? A. She had a knife in her hand, but she didn't have it drawed on me.
"Q. When she slapped you, then you stuck the knife in her? A. Yes, sir."
On cross-examination the witness stated:
"Q. Where was it you stuck her? A. In the leg.
"Q. Down in the thigh of the leg? A. Yes, sir.
"Q. She wasn't cut up about the heart or the neck or arms? A. No, sir.
"Q. The cut was down here on her leg?
A. Yes, sir.
"Q. You mean then, you were not cutting at her at the time the knife stuck her?
A. I was cutting at her, but I wasn't intending to cut her that bad. I thought she would move back but she didn't.
*416 "Q. You thought what? A. I thought she would move back, but she didn't.
"Q. You thought she would move back?
"The court: But she didn't? A. Yes, sir."
The witness testified also that they had "petted and tussled lots of times." There is no proof that the deceased knew that Gilmore had a knife or any other lethal weapon.
The county coroner testified that the insured was dead when he reached the scene and that she bled to death from the effects of a knife stab wound in the right leg.
The courts recognize the right of insurance companies to limit the coverage of a policy by imposing conditions in the nature of exceptions or limitations. These conditions must not run counter to statutory provisions; must not be inconsistent with public policy; and must be "explicit in terms and plain of meaning." It is the duty of the courts to enforce these agreements. Loveman, Joseph & Loeb v. New Amsterdam Casualty Co., 233 Ala. 518, 173 So. 7; Rodgers v. Commercial Casualty Ins. Co., 237 Ala. 301, 186 So. 684; Day v. Home Insurance Co., 177 Ala. 600, 58 So. 549, 40 L.R.A., N.S., 652.
Confessedly our task is made more difficult by reason of the stipulation of the excluding clause set out herein above.
The decided weight of authority is stated in 29 Am.Jur., Insurance, Sec. 981, p. 738: "Moreover, it has been held that the aggression or assault on the part of the insured which will relieve the insurer from liability under its policy must be such as would justify the person assaulted, acting as a reasonably prudent person, in injuring or taking the life of the insured."
In the case of Eminent Household of Columbian Woodmen v. Payne, 18 Ala.App. 23, 88 So. 454, this court held that a limitation in a contract of insurance which stipulated that there should be no liability if the insured died as a result of a combat should be taken to mean a combat in which the insured was at fault.
Clearly this authority contemplates a consideration of the facts and circumstances incident to an assault or combat although as a matter of fact the insured was participating therein when death ensued.
The case of Gilman v. New York Life Ins. Co., 190 Ark. 379, 79 S.W.2d 78, 97 A.L.R. 755, has been cited with approval in several authorities. The policy contained this limiting clause: "That such double indemnity shall not be payable if the insured's death resulted from * * * committing an assault or felony."
The pertinent facts are: In attempting to collect a debt the insured, Gilman, took hold of the clothing of the debtor, Walker, demanding in a profane way that the debt be paid, whereupon Walker shot Gilman.
In response to the review the court held:
"The word assault as here used refers to such an assault as would justify the person assaulted in taking his life. In other words, before appellee would be exempted from liability under its policy, Gilman must have been guilty of such an assault as justified Walker, acting as a reasonably prudent person, in firing the fatal shot. Whether Gilman made such an assault upon Walker was a question for the jury under proper instructions from the court."
In the case of Accident Insurance Co. of North America v. Bennett, 90 Tenn. 256, 16 S.W. 723, the policy contained this clause: "If death occurs from assault provoked by quarreling, no recovery can be had". The insured was killed by his mistress during a quarrel. The court held in effect that the exception stipulation must be given a reasonable construction, and that the quarrel must not only be provoked by the insured, but it must have been of so serious a nature that the insured might reasonably have expected that anger would have been aroused thereby and injury inflicted. The court approved this instruction which was given to the jury by the trial judge:
"If you believe deceased provoked such a serious quarrel with her as that he might *417 reasonably have expected bodily injury, then plaintiff cannot recover; but you are not to refuse to find in favor of plaintiff merely because the woman may have provoked a quarrel with the insured, and then killed him, or he provoked a frivolous or seemingly safe dispute with her,a quarrel of a nature in which he could not reasonably have expected anger to be provoked and injury therefrom,and was killed by her, having no reason to anticipate violence."
In the case of Riggins v. Equitable Life Assurance Soc. of the U. S., 64 Ga.App. 834, 14 S.E.2d 182, 183, the policy upon which suit was based had this provision: "The insurance under this policy shall not cover accidental injury, death * * * caused directly or indirectly * * * by participating in or in consequence of having participated in the commission of an assault or felony."
The insured was killed by his wife. It appears that the relations between the couple were often inharmonious, in fact to the extent of personal encounters. The wife testified: "Andy (the insured) and I had fought many times before, and my brothers got mixed up in it a couple of times too. He has beaten me many times and cut my arm and knocked me through a window once and blackened my eyes several times."
A short time prior to the killing the husband had assaulted his wife at a carnival. There he struck her several severe blows and threatened to kill her. The wife preceded her husband to their home. When the latter arrived he had to break the door before he could enter. He reached in his pocket for his knife and threatened to cut his wife. The immediate trouble was quelled by the appearance of an officer whom the wife had called. The husband agreed to stay away the rest of the night. Instead, in about ten or fifteen minutes, he returned and again demanded entrance, which was refused. As he was in the act of breaking in through the door his wife fired the fatal shot.
We have set out the circumstances somewhat in detail. We think it is accurate to
observe that the insured in this instance was much more responsible for his death than the insured was in the case at bar. Even so, the Court of Appeals of Georgia predicated error and ordered a reversal of the judgment at nisi prius because of the action of the lower court in directing a verdict for the defendant.
In the opinion the court made an illustration which certainly fits the facts in the case at bar. It is:
"To illustrate: If A, without provocation, slapped B, or merely jerked him around, having nothing but his hand with which to injure B, and B then pulled from his pocket a pistol and killed A, A not knowing that B had a pistol or any other lethal weapon, and A having no cause to reasonably anticipate that he would be killed, or that they would otherwise engage in anything but a fist fight, a recovery by the beneficiary could be had under the double indemnity (or accident) feature of this policy."
We do not think it will be helpful to extend this opinion to greater length by the citation and discussion of authorities.
In the instant case, when all the facts and circumstances are considered, we are not authorized to hold that as a matter of law a recovery under the policy should be disallowed.
We are bound, of course, by the familiar rules relating to the giving and refusal of the general affirmative charge. Many of these rules are recited in McMillan v. Aiken, 205 Ala. 35, 88 So. 135.
It is our view also that we would be out of harmony with the authorities to declare that the verdict was contrary to the great weight of the evidence. Cobb v. Malone, 92 Ala. 630, 9 So. 738.
The judgment below is ordered affirmed.
Affirmed.
|
In The
Court of Appeals
Ninth District of Texas at Beaumont
____________________
NO. 09-17-00472-CR
NO. 09-17-00473-CR
NO. 09-17-00474-CR
NO. 09-17-00475-CR
NO. 09-17-00476-CR
NO. 09-17-00477-CR
____________________
EX PARTE CALVIN GARY WALKER
__________________________________________________________________
On Appeal from the Criminal District Court
Jefferson County, Texas
Trial Cause Nos. 14-19970, 14-19969, 14-19968, 14-19967, 14-19966, 14-19965
__________________________________________________________________
MEMORANDUM OPINION
These are accelerated appeals from the trial court’s order denying habeas
relief in six separate cases. In his sole issue in each case, appellant Calvin Gary
Walker contends that the trial court erred by issuing his writ for habeas relief in each
case and then quashing his subpoenas seeking evidence in support of his applications
and by denying his request for an evidentiary hearing. We affirm the trial court’s
order denying habeas relief in trial cause numbers 14-19965, 14-19966, 14-19967,
14-19968, 14-19969, and 14-19970.
1
BACKGROUND
In September 2017, Walker filed an application for writs of habeas corpus in
six criminal cases, seeking the dismissal of the indictments against him based on
double jeopardy grounds. In his applications, Walker argued that double jeopardy
applies in all six cases because he was previously prosecuted in federal court for the
same conduct that these pending state cases are based upon. According to Walker’s
applications, the “separate sovereigns exception” to the Double Jeopardy Clause
should be abolished.
Walker acknowledged that he filed applications for a writ of habeas corpus in
these cases in 2014, this Court affirmed the trial court’s denial of his 2014
applications, the Texas Court of Criminal Appeals denied his petitions for
discretionary review, and the United States Supreme Court also denied his petitions
for certiorari without stating a reason. See Ex parte Walker, 489 S.W.3d 1, 14 (Tex.
App.—Beaumont 2016, pet. ref’d), cert. denied, 137 S.Ct. 1813 (2017) (affirming
the trial court’s orders denying Walker a formal evidentiary hearing and habeas relief
on double jeopardy grounds, and concluding that no exception to the dual
sovereignty doctrine applied). Walker’s 2014 applications focused on the “Bartkus
exception” to the dual sovereignty doctrine, which prevents successive prosecutions
by separate sovereigns when one prosecuting sovereign acts as a tool for the other
or when a prosecution by one sovereign amounts to a sham for a second prosecution
2
by another sovereign. See id. at 9, 11-12; see also Bartkus v. Illinois, 359 U.S. 121,
123-24 (1959).
Walker contends that after his 2014 applications were denied, the Supreme
Court decided a case in which two of the justices suggested that the Court should
conduct a fresh examination of the separate sovereigns exception to the Double
Jeopardy Clause. See Puerto Rico v. Sanchez Valle, 136 S.Ct. 1863, 1877 (2016)
(Ginsburg, J. and Thomas, J., concurring). According to Walker, the Supreme Court
may have previously denied certiorari because he did not clearly raise the
constitutionality of separate sovereigns exception in his 2014 applications, having
conceded that the dual sovereignty doctrine was valid. In his 2017 applications,
Walker argued that “[t]he separate sovereigns exception harms criminal defendants
in the precise ways the Double Jeopardy Clause seeks to avoid[,]” and that these
cases present an excellent opportunity for the Supreme Court to reconsider the
separate sovereigns exception.
In its response to Walker’s applications, the State asserted that Walker is not
entitled to relief because double jeopardy does not apply to the pending State
prosecutions and because the separate sovereigns exception to double jeopardy
remains the law and is not unconstitutional. The State further argued that Walker’s
applications failed to present any new arguments for the trial court to consider. In
October 2017, the trial court issued six pretrial writs of habeas corpus and concluded
3
that Walker’s claims for habeas corpus relief based on the double jeopardy
provisions in the United States and Texas Constitutions should be denied on the
merits.
Walker filed a motion to set aside the trial court’s order denying the merits of
his applications, requesting that the trial court abide by its oral pronouncement at the
pretrial hearing and withhold ruling on the merits until both parties have had an
opportunity to file supplemental information. Walker attached a copy of the
reporter’s record of the hearing which reflects that the trial court agreed to give
Walker time to supplement his applications. In November 2017, the trial court
vacated and set aside its October 2017 order denying Walker’s applications on the
merits and ordered that he supplement the applications by December 4, 2017. Walker
issued two subpoenas duces tecum in relation to his applications, one for Jefferson
County District Attorney, Bob Wortham, and one for former United States Attorney,
John Malcolm Bales. Walker requested that Wortham and Bales provide, among
other things, copies of all records of communications between former District
Attorney Corey Crenshaw or the Jefferson County’s District Attorney’s office and
former United States Attorney Bales or any member of the United States Attorney’s
Office regarding Walker or the State’s prosecution of Walker.
The State filed a motion to quash Walker’s subpoenas duces tecum. In its
amended motion to quash, the State argued that Walker’s subpoenas are premised
4
on the State’s decision to prosecute Walker, but Walker’s current applications make
a “facial” challenge to the constitutionality of the doctrine of dual sovereignty and
are not based on double jeopardy. The State argued that in his 2014 applications,
Walker tried to claim that based upon the surrounding circumstances related to the
State’s prosecution, the Bartkus exception to the general rule of dual sovereignty
applied because the Jefferson County District Attorney’s Office was being used as a
mere tool of federal authorities who were dissatisfied with the outcome of Walker’s
federal trial. The State further argued that the legality of the State’s prosecution of
Walker was resolved in Walker’s 2014 applications when the trial court determined
that the federal prosecution was not used as a “‘cover or tool’” for Walker’s
subsequent state prosecutions on separate charges.
According to the State, even if the Supreme Court were to declare the doctrine
of dual sovereignty unconstitutional, Walker still would not be entitled to relief
because the State prosecutions at issue are unrelated to the federal prosecution and
do not constitute double jeopardy. The State maintained that Walker’s 2017
applications delve into circumstances that have no relevance to the constitutionality
of the doctrine of dual sovereignty, and that Walker should not be allowed to seek
evidence that involves matters that were resolved in his 2014 applications.
According to the State, Walker is asking the trial court to revisit the separate
5
sovereigns exception without regard to Bartkus and to declare it unconstitutional
despite the fact that it remains the law.
On December 4, 2017, the trial court conducted a status conference hearing,
during which Walker’s counsel stated that Walker’s efforts to supplement had been
frustrated by the State’s motions to quash. Walker’s counsel requested a factual
hearing to make a record, explaining that in the 2014 applications, Walker was never
given an opportunity to develop the record. The State maintained that it stood by its
motions to quash because Walker was attempting to discover evidence to re-litigate
matters that had been resolved in Walker’s 2014 applications. The State asked that
the trial court limit Walker’s discovery to the issue raised in his 2017 applications,
asking the trial court to declare the doctrine of dual sovereignty unconstitutional, and
to deny Walker relief. The State requested that the trial court take judicial notice that
Walker had been prosecuted and convicted in federal court for failing to pay federal
taxes when due. The State also requested that the trial court rule that no double
jeopardy applies because the State’s charges are different from the federal offense
for which Walker was convicted.
The trial court granted the State’s motions to quash, denied Walker’s request
for a factual hearing, and denied Walker’s 2017 applications, finding that his new
claim for relief is without merit. In its written order, the trial court took judicial
notice of the legal claims that Walker presented in his 2014 applications, of its 2014
6
orders denying Walker habeas relief, and of this Court’s opinion affirming the trial
court’s denial of relief. The trial court determined that from the face of Walker’s
2017 applications and the arguments that Walker’s counsel made during the
December 2017 hearing, Walker’s “lone ‘new’ legal claim” amounts to the assertion
that “as an exception to a defendant’s double-jeopardy protections, the dual
sovereignty doctrine should not exist.” The trial court noted that it is well established
that an individual may be prosecuted separately by two different sovereigns for the
commission of the same act and that the separate prosecutions do not violate federal
due process or constitutional prohibitions against double jeopardy. The trial court
further noted that the Texas Court of Criminal Appeals, various intermediate
appellate courts in Texas, and the Fifth Circuit have all applied the dual sovereignty
doctrine to preclude double jeopardy claims based on successive prosecutions
brought by the state and federal authorities for the same act or conduct.
The trial court found that Walker’s remaining arguments in his 2017
applications are an attempt to re-litigate the claims in his 2014 applications that have
been “fully, fairly, and finally litigated, and the legal merits of said claims have been
rejected by this Court and by the Ninth Court of Appeals[.]”The trial court found
that it “is constrained by the ‘law of the case’ doctrine from ruling any further on
[Walker’s 2014] claims.” The trial court concluded that “[b]ecause the dual-
sovereignty doctrine is recognized as a valid and viable theory of law by numerous
7
courts of superior jurisdiction, . . . [the trial court] is duty-bound to also recognize
and apply said doctrine[.]” Because the legal viability of the dual sovereignty
doctrine presents a question of law, the trial court determined that “it was not
necessary for [the trial court] to hear testimony from witnesses at an evidentiary
hearing.”
Analysis
In a single appellate issue, Walker contends that the trial court erred by issuing
his six writs of habeas relief, quashing Walker’s subpoenas seeking evidence in
support of his applications, and refusing Walker’s request for a factual hearing to
make a record. We review the granting or denial of an application for writ of habeas
corpus under an abuse of discretion standard. Ex parte Klem, 269 S.W.3d 711, 718
(Tex. App.—Beaumont 2008, pet. ref’d); see also Ex parte Craft, 301 S.W.3d 447,
448 (Tex. App.—Fort Worth 2009, no pet.) (mem. op. on reh’g). We consider the
entire record and review the facts in the light most favorable to the trial court’s
ruling. Ex parte Klem, 269 S.W.3d at 718. We afford almost total deference to the
trial court’s determination of historical facts supported by the record, especially
findings that are based on an evaluation of credibility and demeanor. Id. We afford
the same deference to the trial court’s rulings on application of law to fact questions
when resolution of those questions turns on an evaluation of credibility and
demeanor. Id. We review the determination de novo when resolution of those
8
questions turns on an application of legal standards. Id.; see also Ex parte Aguilar,
501 S.W.3d 176, 178 (Tex. App.—Houston [1st Dist.] 2016, no pet.).
Facial constitutional challenges are cognizable on application for pretrial writ
of habeas corpus. See Ex parte Perry, 483 S.W.3d 884, 896 (Tex. Crim. App. 2016).
Whether the separate sovereigns exception is facially constitutional is a question of
law that is subject to de novo review. See Ex parte Lo, 424 S.W.3d 10, 14 (Tex.
Crim. App. 2013). Based on Walker’s 2017 applications and the arguments that
Walker’s counsel made during the December 2017 hearing, the trial court
determined that Walker’s sole legal claim challenged the viability of the dual
sovereignty doctrine, despite the doctrine being well established and having been
applied by courts of superior jurisdiction. Viewing the entire record in favor of the
trial court’s ruling, we conclude that the trial court did not abuse its discretion by
declining to declare the dual-sovereignty doctrine unconstitutional. See id.; Ex parte
Klem, 269 S.W.3d at 718.
We further conclude that the trial court did not abuse its discretion by
determining that the legal viability of the dual sovereignty doctrine presents a
question of law that did not require an evidentiary hearing, and that Walker was not
entitled to develop a factual record concerning Walker’s 2014 claims that have been
finally litigated. See Ware v. State, 736 S.W.2d 700, 701 (Tex. Crim. App. 1987)
(stating that the legal principle of the “law of the case” provides that an appellate
9
court’s resolution of a question of law in a previous appeal of the same case will
govern the disposition of the same issue in a subsequent appeal); Ex parte Walker,
489 S.W.3d at 13-14 (concluding that Walker failed to allege facts showing that the
Bartkus exception to the dual sovereignty doctrine applied to the State’s
indictments). We overrule Walker’s issue and affirm the trial court’s order denying
Walker’s applications for writ of habeas corpus in trial cause numbers 14-19965, 14-
19966, 14-19967, 14-19968, 14-19969, and 14-19970.
AFFIRMED.
______________________________
STEVE McKEITHEN
Chief Justice
Submitted on March 21, 2018
Opinion Delivered April 18, 2018
Do Not Publish
Before McKeithen, C.J., Horton and Johnson, JJ.
10
|
IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA18-900
Filed: 4 June 2019
Iredell County, No. 17CRS51248
STATE OF NORTH CAROLINA
v.
KEVIN JAMES GAMBRELL, Defendant.
Appeal by Defendant from order entered 7 February 2018 by Judge Joseph
Crosswhite in Iredell County Superior Court. Heard in the Court of Appeals 10 April
2019.
Attorney General Joshua H. Stein, by Special Deputy Attorney General Sonya
Calloway-Durham, for the State.
Appellate Defender Glenn Gerding, by Assistant Appellate Defender Wyatt
Orsbon, for the Defendant.
DILLON, Judge.
Defendant Kevin James Gambrell appeals from an order requiring him to
submit to satellite-based monitoring (“SBM”) for the rest of his natural life.
I. Background
Defendant was charged with and pleaded guilty to taking indecent liberties
with a child. Defendant was sentenced in the presumptive range. The State also
sought to have Defendant register as a sex-offender and to enroll in SBM. Defendant
motioned to dismiss the State’s petition for SBM and to declare such program
STATE V. GAMBRELL
Opinion of the Court
unconstitutional. The trial court denied Defendant’s motion to dismiss and, in turn,
ordered him to submit to SBM for the rest of his natural life. Defendant timely
appealed.
II. Analysis
In his appeal, Defendant argues that the State’s SBM program is both
unreasonable as applied to him and facially unconstitutional. We review a trial
court’s determination that SBM is reasonable de novo. State v. Bare, 197 N.C. App.
461, 464, 677 S.E.2d 518, 522 (2009), disc. review denied, 364 N.C. 436, 702 S.E.2d
492 (2010). We also review alleged constitutional violations de novo. Piedmont Triad
Airport Auth. v. Urbine, 354 N.C. 336, 338, 554 S.E.2d 331, 332 (2001).
The United States Supreme Court has determined that the monitoring of an
individual under North Carolina’s SBM program constitutes a continuous
warrantless search of that individual. Grady v. North Carolina, ___ U.S. ___, ___,
135 S. Ct. 1368, 1371 (2015). That Court did not state that monitoring an individual
under the program was per se unconstitutional, recognizing that “the Fourth
Amendment prohibits only unreasonable searches.” Id. (emphasis in original).
Rather, that Court stated that whether the enrollment of a particular individual for
monitoring under the program constitutes a reasonable search “depends on the
totality of the circumstances, including the nature and purpose of the search and the
-2-
STATE V. GAMBRELL
Opinion of the Court
extent to which the search intrudes upon reasonable privacy expectations.” Id.
(emphasis added).
The “totality of the circumstances” calculus includes whether the sexual
offender poses a threat to reoffend. The calculus also includes whether an SBM
search would be effective in furthering the State interest in deterring the offender
from reoffending. See State v. Bowditch, 364 N.C. 335, 351, 700 S.E.2d 1, 12 (2010)
(“The SBM program is concerned with protecting the public against recidivist
tendencies of convicted sex offenders.”).
In the present case, Defendant motioned to dismiss the State’s petition to
enroll him in SBM. A hearing was held on Defendant’s motion. At the hearing, the
only evidence presented by the State was testimony from a probation officer
regarding Defendant’s criminal record and the logistics and procedure of SBM,
namely that SBM would track the movement of Defendant. While Defendant’s status
as a recidivist was not disputed, Defendant argued that the State failed to meet its
burden to show that SBM was a reasonable method to reduce recidivism in his case.
Indeed, preventing recidivism among sex offenders is a government interest.
And while SBM is not 100% reliable to prevent recidivism, it certainly acts as a
deterrent to further criminal conduct. See Bowditch, 364 N.C. at 351, 700 S.E.2d at
12 (acknowledging that the SBM program does not prevent crime but does act as a
deterrent); Bare, 197 N.C. App. at 476, 677 S.E.2d at 519 (stating that “SBM could
-3-
STATE V. GAMBRELL
Opinion of the Court
have a deterrent effect. Presumably, sex offenders would be less likely to repeat
offenses since they would be aware their location could be tracked and it would be
easier to catch them.”).
Thus, it could be argued that the probation officer’s testimony that SBM would
track the movements of Defendant constituted some evidence that Defendant would
be less likely to reoffend or to go where he should not go, since he would know that
his movements were being tracked. It follows that a trial judge, making a
reasonableness determination, may not need further evidence, such as empirical data
or expert testimony, in a particular case to conclude that SBM would be reasonable,
based on the totality of the circumstances. Indeed, we have found such deterrents,
like traffic checkpoints, reasonable without the aid of expert testimony, determining
that a checkpoint “deter[s] driver’s license violations” and that this “deterrence goal
was a reasonable one.” State v. Jarrett, 203 N.C. App. 675, 679-80, 692 S.E.2d 420,
425 (2010) (internal citations omitted).
However, our Court has recently held that to show the efficacy of SBM in
deterring recidivism, the State may never rely on an assumption that an offender
would be less likely to reoffend if he knew he was being watched: the State must
produce other evidence to show the efficacy of SBM in general, e.g., empirical studies
or expert testimony. See State v. Griffin, ___ N.C. App. ___, ___, 818 S.E.2d 336, 340-
42 (2018). In Griffin, the panel relied on the decision of our Court in Grady handed
-4-
STATE V. GAMBRELL
Opinion of the Court
down after the matter had been remanded from the United States Supreme Court,
see State v. Grady, ___ N.C. App. ___, 817 S.E.2d 18 (2018), and on the reasoning of a
Fourth Circuit Court of Appeals opinion analyzing the constitutionality of an order
restricting the travel of a sex offender, see Doe v. Cooper, 842 F.3d 833, 846-47 (4th
Cir. 2016). While Griffin and some of its progeny are currently before our Supreme
Court, the mandates of those cases have not been stayed by that Court. We are,
therefore, compelled to continue following Griffin. Accordingly, we conclude that the
State failed to meet its burden of showing the reasonableness of the SBM program in
this case by failing to produce separate evidence concerning the efficacy of the SBM
program.
We note that Defendant also facially challenges the constitutionality of the
SBM program. However, as we have concluded that the order requiring Defendant
to submit to SBM was unreasonable as applied to him, we decline to address this
argument.
III. Conclusion
As the State failed to prove the reasonableness of the SBM program as applied
to Defendant, we reverse the order requiring him to submit to SBM for the remainder
of his natural life.
REVERSED.
Judges MURPHY and HAMPSON concur.
-5-
|
312 F.3d 568
Dean KENT, Plaintiff-Appellee,v.Jared KATZ, individually and as a Police Officer for the Town of Colchester, Defendant-Appellant.
Docket No. 01-7832.
United States Court of Appeals, Second Circuit.
Argued: April 2, 2002.
Decided: December 10, 2002.
Thomas C. Nuovo, Burlington, VT (Bauer, Anderson & Gravel, Burlington, VT, on the brief), for Plaintiff-Appellee.
Joseph A. Farnham, Burlington, VT (McNeil, Leddy & Sheahan, Burlington, VT, on the brief), for Defendant-Appellee.
Before: WALKER, Chief Judge, NEWMAN and KEARSE, Circuit Judges.
KEARSE, Circuit Judge.
1
Defendant Jared Katz, an officer in the Colchester, Vermont Police Department, challenges so much of an order of the United States District Court for the District of Vermont, William K. Sessions III, Judge, as denied his motion pursuant to Fed.R.Civ.P. 56 for summary judgment dismissing the claims of plaintiff Dean Kent brought under 42 U.S.C. § 1983 and state law for false arrest, on the ground that Katz has qualified immunity from suit on those claims because a state court found probable cause for Kent's arrest, thereby collaterally estopping Kent from proving an essential element of his false arrest claims. In the district court, Katz had moved to dismiss all of Kent's claims; the district court denied the motion in part, stating that as to certain claims, including the claims of false arrest, the presence of genuine issues of material fact precluded the granting of summary judgment.
2
After Katz filed a notice of appeal, Kent moved to dismiss the appeal for lack of appellate jurisdiction. This Court granted the motion in part, noting that we have jurisdiction to entertain an interlocutory appeal from the denial of summary judgment based on an immunity defense only to the extent that the defense can be decided as a matter of law. See, e.g., Behrens v. Pelletier, 516 U.S. 299, 313, 116 S.Ct. 834, 133 L.Ed.2d 773 (1996); Johnson v. Jones, 515 U.S. 304, 313, 115 S.Ct. 2151, 132 L.Ed.2d 238 (1995); In re State Police Litigation, 88 F.3d 111, 124 (2d Cir.1996). Accordingly, we dismissed so much of the appeal as dealt with (a) Kent's claims other than those for false arrest, and (b) the false arrest claims themselves except to the extent that Katz asserted qualified immunity as a matter of law on the basis of collateral estoppel as to the issue of probable cause. For the reasons that follow, we conclude that Kent's contention that he was arrested without probable cause is not precluded by collateral estoppel, and that Katz has not shown that he is entitled to qualified immunity as a matter of law. We therefore affirm the denial of summary judgment.
I. BACKGROUND
3
Except as indicated, the following facts pertaining to the claims of false arrest are essentially undisputed. On the afternoon of June 20, 1996, Kent and two assistants, Keith Shappy and Aaron Sterling, were clearing brush and burning it on Kent's property in the Town of Colchester, Chittenden County, Vermont. At some point, Kent drove off on an errand, leaving Shappy and Sterling to tend the fire. While Kent was gone, Katz arrived, responding to a complaint of a fire on the property. Kent shortly returned, parked his Jeep, and walked toward Katz.
4
Katz informed Kent that there had been a complaint; Kent asked who had complained. This exchange occurred several times. Katz asked whether Kent had a permit for the fire. Kent said they had been burning brush for 18 days, and he shrugged; the parties differ as to the meaning of the shrug.
5
At some point, Katz stated that Kent's eyes were red, and he asked whether Kent had been drinking. Kent said he had not, but his response included the statement, "[n]ot very much." According to Kent, his first response was "no"; when he was asked how much alcohol he had drunk, he said "[n]ot very much" sarcastically; and he reiterated to Katz that he had not been drinking that day.
6
Katz also asserts that Kent was walking unsteadily as he approached Katz; that Kent swayed as he stood before Katz; that Kent's speech was slurred; and that there was a strong odor of intoxicants on Kent's breath. Disputing these assertions, Kent submitted affidavits from Shappy, Sterling, and others who had been with Kent on June 20, stating that Kent had not been drinking alcohol that day. Shappy and/or Sterling, both of whom witnessed the encounter between Katz and Kent, stated that Kent had not staggered, swayed, appeared intoxicated, or smelled of alcohol.
7
There is no dispute that Katz asked Kent to take a sobriety test and that Kent refused; Kent argued that he was on his own property and not driving. Katz arrested Kent for suspicion of driving while under the influence of alcohol ("DWI") in violation of 23 V.S.A. § 1201 (1996). Katz asked Kent to turn around and place his hands behind his back; Kent complied. Katz attempted to force Kent's hand and wrist up behind his back and eventually kicked Kent's feet out from under him. At some point, Kent's wrist was broken.
8
On June 24, 1996, in connection with a State of Vermont ("State") summary procedure for civil suspension of the driver's license of a person whom a law enforcement officer had "reasonable grounds" to believe was violating § 1201, see 23 V.S.A. § 1205 (1996), Katz filed an affidavit in the State's District Court for Chittenden County, giving his version of the June 20 events and stating that he "ha[d] probable cause" to believe that Kent had driven while intoxicated, in violation of § 1201. (Affidavit of Jared Katz dated June 24, 1996 (" § 1205 Affidavit"), at 1.) The affidavit was submitted ex parte; and although § 1205(c) requires that the accused be given prompt notice of the summary civil suspension and a copy of the officer's affidavit, Kent apparently did not receive Katz's notice and affidavit until much later.
9
On July 11, 1996, the State filed an information against Kent. It alleged that Kent, in Colchester "on the 20 day of June 1996 did then and there operate a motor vehicle on a public highway while under the influence of intoxicating liquor, to wit; a Jeep, on Macrae Road, in violation of 23 VSA § 1201(a)(2)." (Information dated July 11, 1996 ("Original Information" or "Information").) On July 16, 1996, a Chittenden County District Judge subscribed to the following statement at the foot of the Information: "This information has been presented to me and I have found probable cause, this 16th day of July 1996[.]" See generally Vt. R.Crim. P. 5(c) ("If the defendant was arrested without a warrant ... and the prosecution is upon information, the judicial officer shall determine... whether there is probable cause to believe that an offense has been committed and that the defendant has committed it."). See also Vt. R.Crim. P. 5(h) (allowing the defendant to challenge such a finding).
10
Kent was arraigned on the DWI charge on July 16, 1996. He pleaded not guilty and subsequently moved for a "Good Cause Hearing" on that charge. Kent's motion was adjourned several times and was never heard because in January 1997, he and the State agreed to settle the case. The State reduced the charge against Kent from DWI, 23 V.S.A. § 1201(a)(2), to careless and negligent operation of a motor vehicle, in violation of 23 V.S.A. § 1091(a)(1) (1996) ("C & N" or "Negligent Operation"); and Kent pleaded nolo contendere to the Negligent Operation charge. In addition, the State agreed not to pursue the civil suspension of Kent's driver's license under 23 V.S.A. § 1205. The agreement was reflected in the following colloquy before the state court:
11
STATE:.... Judge, we have a resolution in this case. The State's going to amend the DWI to a C & N and we are going to concede the civil to the defendant. And we're going to recommend a three hundred dollar fine. The State's entering this agreement after reviewing it[]s case. As the Court knows, the defendant's arm was injured in this incident and the State is not taking that into consideration. What we're taking into consideration is the evidence we would have if went we to trial....
12
....
13
COURT:.... I would understand the State's going to reduce the charge to careless and negligent driving, the court is going to enter judgment for the defendant in the civil matter and the defendant will pay a three hundred dollar fine.
14
(State v. Kent, No. 2810-7-96Cncr, Chittenden County, Vermont District Court, Hearing Transcript, January 15, 1997 ("State Tr."), at 2-3.)
15
The State informed the court that it would submit an affidavit from someone other than Katz to support the Negligent Operation charge, because the conduct underlying that charge had not been observed by Katz:
16
STATE: Your Honor, the State's going to provide the Court with an affidavit because we are basing this on the operation which Officer Katz did not view, but somebody else did, so I will be providing you with an affidavit on that.
17
COURT: Today?
18
STATE: Yes, with — yes.
19
COURT: Along with the amendment?
20
STATE: Yes.
21
....
22
COURT: All right, the State's Attorney has amended the information and reduced the charge so that the information reads as follows, Mr. Kent. That Dean Kent at Colchester on the 20th day of June, 1996, did then and there operate a motor vehicle on a public highway in a negligent manner, to wit, a Jeep on the Macrae Road by turning his steering wheel back and forth within his lane.
23
(State Tr. 4-6.) The charge against Kent was duly amended. Hand-editing the Original Information, the State crossed out the words "while under the influence of intoxicating liquor," inserted instead the words "in a negligent manner by turning his steering wheel back & forth within his lane," and changed the statutory section under which Kent was charged from "1201(a)(2)" to "1091(a)." (Information as amended on January 15, 1997 ("Amended Information").)
24
After reading the Amended Information to Kent and noting the statutory penalties associated with the substituted charge, the court determined that Kent understood the amendment, and it accepted Kent's plea:
25
COURT: Do you understand the amended charge?
26
KENT: No contest, sir.
27
COURT: And you wish to plead no contest to that. And to support that charge, I have an affidavit of Robert Miller which does contain some facts regarding the turning of the steering wheel back and forth a few times. So unless there's anything further you want to say or [your attorney] wants to say, I'll accept your plea.
28
....
29
.... All right, the Court will enter a finding and judgment of guilty on defendant's no contest plea of careless and negligent driving.
30
(State Tr. 6-7.)
31
The State's concession with respect to the civil suspension of Kent's license was apparently made in recognition that the license had been summarily suspended even though notice of the § 1205 proceeding was sent to Kent belatedly, if at all. (See State Tr. 3 ("DEFENSE [COUNSEL]:.... [T]he notification never got through."); id. at 4 ("DEFENSE [COUNSEL]: ... [I]t just kind of never made it. STATE: Right. COURT: It just never got addressed until a later date.").) The court stated that the State's concession resulted in a "finding for the defendant." (Id.)
32
In June 1999, Kent commenced the present action in state court against Katz and others, principally asserting § 1983 claims for false arrest, malicious prosecution, and use of excessive force in violation of his rights under the First, Fourth, Fifth, and Fourteenth Amendments to the Constitution and in violation of state law. The defendants removed the case to federal court and moved for summary judgment.
33
To the extent pertinent here, the district court denied Katz's motion with respect to Kent's § 1983 claims for false arrest and excessive force and his state-law claims for false arrest, assault, and battery. The court ruled that there were genuine issues of material fact to be tried as to whether Katz was entitled to qualified immunity with respect to those claims.
34
Katz appealed. As set forth above, this Court dismissed part of the appeal for lack of appellate jurisdiction, leaving only the question of whether Katz was entitled to qualified immunity as a matter of law on the false arrest claims, on the basis that the Vermont District Court's July 16, 1996 finding of probable cause constituted collateral estoppel, precluding Kent from establishing an essential element of a claim for false arrest. For the reasons that follow, we conclude that Katz was not entitled to summary judgment as a matter of law on his defense of qualified immunity.
II. DISCUSSION
35
A qualified immunity defense is established if (a) the defendant's action did not violate clearly established law, or (b) it was objectively reasonable for the defendant to believe that his action did not violate such law. See, e.g., Anderson v. Creighton, 483 U.S. 635, 641, 107 S.Ct. 3034, 97 L.Ed.2d 523 (1987); Harlow v. Fitzgerald, 457 U.S. 800, 818-19, 102 S.Ct. 2727, 73 L.Ed.2d 396 (1982). The objective reasonableness test is met if "officers of reasonable competence could disagree" on the legality of the defendant's actions. Malley v. Briggs, 475 U.S. 335, 341, 106 S.Ct. 1092, 89 L.Ed.2d 271 (1986). Since the principle that a warrantless arrest without probable cause violates the Fourth Amendment was clearly established prior to Katz's arrest of Kent in 1996, Katz may be found entitled to qualified immunity only if he actually had probable cause to arrest Kent for driving while intoxicated or if it was objectively reasonable for him to believe he had probable cause for that arrest. The question for this appeal is whether, on the present record, such an entitlement can be determined as a matter of law. We conclude that it cannot.
36
A. Katz's Claim of Qualified Immunity Via Collateral Estoppel
37
A § 1983 claim of false arrest based on the Fourth Amendment right to be free from unreasonable seizures may not be maintained if there was probable cause for the arrest. See, e.g., Weyant v. Okst, 101 F.3d 845, 852 (2d Cir.1996); Singer v. Fulton County Sheriff, 63 F.3d 110, 118 (2d Cir.1995) ("There can be no federal civil rights claim for false arrest where the arresting officer had probable cause."), cert. denied, 517 U.S. 1189, 116 S.Ct. 1676, 134 L.Ed.2d 779 (1996). It appears to be undisputed that this principle applies as well to a claim of false arrest under Vermont law. Where a court has already determined the issue of probable cause to make an arrest that is the subject of a claim of false arrest, a party may, in appropriate circumstances, be estopped from relitigating that issue. See generally Golino v. City of New Haven, 950 F.2d 864, 868-69 (2d Cir.1991), cert. denied, 505 U.S. 1221, 112 S.Ct. 3032, 120 L.Ed.2d 902 (1992).
38
In considering Katz's claim of qualified immunity based on the contention that Kent is collaterally estopped because of the Vermont District Court's July 16, 1996 finding of probable cause, we look to Vermont law and give that court's finding whatever preclusive effect it would be given under Vermont law. See, e.g., Migra v. Warren City School District Board of Education, 465 U.S. 75, 81, 104 S.Ct. 892, 79 L.Ed.2d 56 (1984); Kremer v. Chemical Construction Corp., 456 U.S. 461, 481-83, 102 S.Ct. 1883, 72 L.Ed.2d 262 (1982). Under Vermont law, collateral estoppel is not appropriate unless, inter alia, an issue was actually litigated and was necessary to the final judgment in the prior case, and the party against whom estoppel is asserted had adequate opportunity and incentive to litigate the issue:
39
Collateral estoppel, or issue preclusion, bars the subsequent relitigation of an issue that was actually litigated and decided in a prior case between the parties, so long as there was a final judgment on the merits and the issue was necessary to resolution of the action.... The elements of issue preclusion are the following:
40
(1) preclusion is asserted against one who was a party or in privity with a party in the earlier action; (2) the issue was resolved by a final judgment on the merits; (3) the issue is the same as the one raised in the later action; (4) there was a full and fair opportunity to litigate the issue in the earlier action; and (5) applying preclusion in the later action is fair.
41
Bull v. Pinkham Engineering Assocs., Inc., 170 Vt. 450, 461, 752 A.2d 26, 35 (2000) (quoting Trepanier v. Getting Organized, Inc., 155 Vt. 259, 265, 583 A.2d 583, 587 (1990)).
42
In determining whether collateral estoppel should apply, courts must look to the circumstances of each case, including, among other things, the incentive for the party (against whom estoppel is claimed) to litigate the issue.
43
Bull v. Pinkham Engineering Assocs., Inc., 170 Vt. at 462, 752 A.2d at 35.
44
Applying these principles to the present case, we conclude that collateral estoppel is inapplicable for several reasons. First, the Vermont judge's July 16 finding of probable cause inscribed on the Original Information was not a final judgment. Such a finding was required as a threshold matter in order to permit the prosecution to proceed because there had been no warrant and no indictment, see Vt. R.Crim. P. 5(c); but that finding was open to reconsideration, see Vt. R.Crim. P. 5(h) ("Upon request of the defendant, the judicial officer shall review the finding of probable cause.").
45
Second, although there eventually was a final judgment in the criminal proceeding against Kent, that judgment did not decide the issue of whether Katz had probable cause to arrest Kent for DWI. The DWI charge was changed by the State to one of Negligent Operation, alleging simply that Kent had "turn[ed] his steering wheel back and forth within his lane" (Amended Information); Kent pleaded nolo contendere to the latter charge; and Negligent Operation, not DWI, is the charge that was resolved by the final judgment. Further, the affidavit of Kent's friend Robert Miller, submitted by the State to support the Negligent Operation charge, could not have supported a finding of DWI. Miller indicated that he and Kent had been on Macrae Road driving toward each other on June 20, 1996, and that Kent had turned his steering wheel back and forth a few times to signal Miller to slow down and stop for a quick chat (see Affidavit of Robert Miller dated September 13, 1996, ¶¶ 13); but Miller also stated that, in that chat, Kent had "appeared normal" and that Miller "did not detect any alcohol on his breath." (Id. ¶ 4.) In sum, there was no final judgment that decided the question of probable cause to believe that Kent had driven while under the influence of alcohol.
46
Nor, given the amendment of the Information to charge Kent with Negligent Operation rather than with DWI, could it be said that a decision as to whether Katz had probable cause to arrest Kent on suspicion of DWI was necessary to the resolution of the criminal case. Intoxication is not an element of the offense of Negligent Operation.
47
Further, the issue of probable cause to arrest Kent was not actually litigated. As discussed above, the Vermont judge's initial finding of probable cause was, under the Vermont Rules of Criminal Procedure, subject to review if so requested by Kent. Kent did move for a "Good Cause Hearing," but his motion was adjourned several times and was never heard because in January 1997, he and the State agreed to settle the case, eliminating the DWI charge on which Katz had arrested him.
48
Moreover, given the State's substitution of the Negligent Operation charge for that of DWI, Kent plainly no longer had any incentive to litigate in the criminal case the existence of probable cause to arrest him for DWI. Nor, since the conduct that formed the basis for the Negligent Operation charge was not witnessed by Katz, did Kent have any incentive to seek an adjudication as to what Katz had actually observed before placing him under arrest.
49
Finally, we note that the summary proceeding ostensibly initiated pursuant to § 1205 when Katz filed his § 1205 Affidavit, asserting that he had "probable cause" to believe that Kent was guilty of DWI in violation of § 1201, did not result in any estoppel of Kent. A § 1205 proceeding "is not a criminal prosecution," but rather is a proceeding "to determine whether there should be a suspension of an operator's driving privilege because of his refusal to carry through his implied consent to submit to a sobriety test." State v. District Court, 129 Vt. 212, 214, 274 A.2d 685, 686 (1971) (discussing prior version of § 1205). Consequently, the issues are different, and the driver may well have less of an incentive to contest a temporary loss of driving privileges than he would have to challenge a criminal charge. More importantly, although § 1205 requires the officer to file an affidavit in order to initiate a § 1205 proceeding, it does not require him to show probable cause. It requires a showing only of "reasonable grounds" to believe the person was driving under the influence of an intoxicant. 23 V.S.A. §§ 1205(a) and (b)(3). Thus, a license may be suspended even if the driver persuades the § 1205 court that the officer had less than probable cause to suspect him of being intoxicated, so long as the officer met the statutory standard of "reasonable grounds." Accordingly, even had the § 1205 proceeding been properly commenced or conducted against Kent, Kent would have had no incentive in that proceeding to litigate Katz's inflated assertion that there existed probable cause. And finally, the state court did not adjudicate under § 1205 even the question of "reasonable grounds," much less Katz's assertion that he had "probable cause" to believe Kent was intoxicated. As described in Part I above, the State conceded in favor of Kent on the suspension issue.
50
In sum, although the Vermont District Court stated on July 16, 1996, that it had found "probable cause," that was not a final decision; Kent had not theretofore had an opportunity to litigate the issue of the probable cause for his arrest for DWI; the probable cause issue was not thereafter actually litigated; Kent had no incentive to litigate that issue after the DWI charge was dropped; and no finding of probable cause to arrest Kent for DWI was either encompassed in or necessary to the final judgment convicting him of Negligent Operation. We conclude that the Vermont District Court's finding does not collaterally estop Kent from asserting in this action for false arrest that Katz arrested him for DWI without probable cause.
B. Katz's Alternative Contention
51
Alternatively relying on Salim v. Proulx, 93 F.3d 86, 89-90 (2d Cir.1996), Katz contends that he had qualified immunity as a matter of law because it was objectively reasonable for him to believe Kent was intoxicated based on two facts that are undisputed: that Kent was "red-eyed," and that when asked if he had been drinking alcohol Kent said "[n]ot very much," which "amounted to an admission of alcohol consumption." (Katz brief on appeal at 13.) We reject this contention for several reasons.
52
To begin with, the two undisputed facts on which Katz relies, especially in the circumstances here, are not sufficient indicia of intoxication to permit a conclusion that Katz's belief was objectively reasonable as a matter of law. While relying on the redness of Kent's eyes as a basis for his inference of intoxication, Katz concedes that he had been informed that Kent had been burning brush on the property for 18 days — surely a circumstance that could account for ocular discoloration. And while Katz contends that Kent's "[n]ot very much" statement, regardless of the intention that lay behind those words, constituted an admission of alcohol consumption, even taken at face value the words "[n]ot very much" would not ordinarily seem to imply "enough to be intoxicated." Thus, what inferences were objectively reasonable from the two facts that are undisputed are factual issues to be resolved by a factfinder.
53
Further, the existence of probable cause is to be determined on the basis of the totality of the circumstances, see, e.g., Illinois v. Gates, 462 U.S. 213, 230-32, 103 S.Ct. 2317, 76 L.Ed.2d 527 (1983), and we cannot conclude that it would have been objectively reasonable as a matter of law for Katz to infer intoxication solely from the redness of Kent's eyes, while ignoring as a possible cause of discoloration the fact that Kent had been burning brush for the past 18 days, and from Kent's statement that he had not been drinking very much, while ignoring all other comportment that might reflect on the state of Kent's sobriety. And indeed, Katz himself, in his § 1205 Affidavit in support of his assertion that he had "probable cause to believe" that Kent had been intoxicated, did not ignore other circumstances. He included the assertions that he had observed Kent walking unsteadily, swaying, slurring his speech, and smelling of alcohol. A factfinder, however, would not be required to credit Katz's assertions as to his observations and could instead believe Kent and his witnesses whose evidence as to Kent's actions and appearance was squarely to the contrary. Thus, the totality of the circumstances cannot be determined as a matter of law but must await resolution of the factual issues.
54
Finally, Katz's reliance on Salim v. Proulx is misplaced. To the extent pertinent here, that case stands for the proposition that when the defendant accepts, for purposes of a qualified-immunity-based summary judgment motion, the plaintiff's version of the facts, the defendant may immediately appeal the denial of that motion because the objective reasonableness of the undisputed actions may then be susceptible to resolution as a matter of law. See 93 F.3d at 91 ("Officer Proulx's claim is that the undisputed facts set forth in plaintiff's own 9(c) Statement entitle him to the defense of qualified immunity as a matter of law.... We need to determine only whether, on plaintiff's version, an immunity defense is established as a matter of law."). Katz does not, however, accept Kent's version of the facts. According to Kent and the affidavits or depositions of other witnesses describing his condition and conduct at the time of the encounter with Katz, Kent was not walking unsteadily; he did not sway; his speech was not slurred; there was no odor of alcohol on his breath; and he appeared normal and not intoxicated. Plainly on Kent's version of the facts it cannot not be said that Katz's belief that there was probable cause to infer that Kent was intoxicated was objectively reasonable as a matter of law.
CONCLUSION
55
We have considered all of Katz's arguments on this appeal and have found them to be without merit. For the reasons discussed above, the district court's order denying Katz's qualified-immunity-based motion for summary judgment is affirmed.
JON O. NEWMAN, Circuit Judge, concurring:
56
The Court rules that a police officer does not have immunity as a matter of law from a claim under 42 U.S.C. § 1983 for false arrest on a criminal charge even though the person arrested was found guilty on his plea of nolo contendere to a lesser charge. I join the Court's opinion, which thoroughly explains why the false arrest claim is not barred by collateral estoppel, but I write to consider briefly the separate issue of whether the claim is barred by a common law immunity that has been absorbed into federal civil rights jurisprudence.
57
As Judge Kearse's opinion explains, Vermont police officer Jared Katz arrested Dean Kent for suspicion of driving while under the influence of alcohol ("DWI"). Pursuant to a plea agreement, the State reduced the charge to careless and negligent operation of a motor vehicle, and Kent entered a plea of nolo contendere and was found guilty.
58
In Cameron v. Fogarty, 806 F.2d 380 (2d Cir.1986), this Court ruled that even though a conviction does not always preclude a claim for false arrest under principles of res judicata or collateral estoppel, the "common law defense of conviction" does afford an arresting police officer immunity and that such an immunity precludes liability under section 1983 for claims of false arrest and malicious prosecution. Id. at 386-89. See Menard v. Mitchell, 430 F.2d 486, 491 n. 26 (D.C.Cir. 1970); Pouncey v. Ryan, 396 F.Supp. 126, 127 (D.Conn.1975). Cf. Haring v. Prosise, 462 U.S. 306, 317-23, 103 S.Ct. 2368, 76 L.Ed.2d 595 (1983) (conviction does not preclude section 1983 claim for unlawful search). In Cameron, however, we described the common law immunity as available in situations where a person "has been convicted of the crime for which he was arrested." Id. at 387, 388, 389.
59
I am not certain whether the common law in general or Vermont's version of it would extend the defense of conviction to situations where the person arrested is convicted of a lesser charge. There are considerations cutting both ways. On the one hand, it seems somewhat anomalous for the person whose conviction (whether by plea or trial) lawfully subjects him to loss of liberty by imprisonment to obtain damages from an arresting police officer for the usually brief deprivation of liberty caused by an arrest alleged to lack probable cause. On the other hand, if the defense of conviction were not limited to conviction of the crime for which the arrest was made, an arresting officer, anticipating ultimate conviction for a minor offense, could with impunity arrest for major charges that might sometimes subject the person arrested to prolonged pretrial detention. This latter consideration prompted us to rule, in a somewhat analogous context, that a finding of probable cause to arrest on a minor charge does not preclude a section 1983 claim for malicious prosecution on a more serious charge. See Posr v. Doherty, 944 F.2d 91, 100-01 (2d Cir.1991).
60
In any event, because Cameron so explicitly stated that the conviction defense applies where a person has been convicted of the crime for which he was arrested, I agree that Kent's conviction for careless and negligent operation of a motor vehicle does not preclude his claim for false arrest on the DWI charge. What this case illustrates is that prosecutors consenting to reduce criminal charges in exchange for a defendant's plea should consider including in their agreements at least a settlement, and sometimes a complete release, of related civil liability claims against law enforcement officers. Cf. Newton v. Rumery, 480 U.S. 386, 416, 107 S.Ct. 1187, 94 L.Ed.2d 405 (1987) (rejecting per se invalidity of agreements to release civil claims in exchange for dismissal of all criminal charges); Schloss v. Bouse, 876 F.2d 287, 292 (2d Cir.1989) ("[O]btaining a release, which is somewhat analogous to plea bargaining, may be a valid part of the government attorney's function, even when demanded in exchange for the dropping of criminal charges.").
|
15 F.3d 1093NOTICE: 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.
UNITED STATES of America, Plaintiff-Appellee,v.Peter MACDONALD, Defendant-Appellant.
No. 92-10717.
United States Court of Appeals, Ninth Circuit.
Argued and Submitted Dec. 16, 1993.Decided Jan. 6, 1994.
1
Before: SKOPIL, THOMPSON, RYMER, Circuit Judges
2
MEMORANDUM*
3
Peter MacDonald was convicted by a jury on charges of Racketeering ("RICO"), 18 U.S.C. Sec. 1962(c); Racketeering Conspiracy, 18 U.S.C. Sec. 1962(d); Extortion by an Indian Tribal Official, 18 U.S.C. Sec. 666(a)(1)(B); Mail Fraud, 18 U.S.C. Sec. 1341; Wire Fraud, 18 U.S.C. Sec. 1343; and Interstate Transportation in Aid of Racketeering ("Travel Act"), 18 U.S.C. Sec. 1952. On appeal, MacDonald challenges the sufficiency of the indictment and of the evidence on the RICO, mail fraud, and wire fraud charges. He also argues that he was denied a fair trial, based on the admission of evidence of an uncharged crime, inflammatory and improper closing arguments by the prosecuting attorney, and the prosecutor's comment on MacDonald's failure to testify. We reject all of MacDonald's arguments, and we affirm.
DISCUSSION
1. Sufficiency of the Indictment
4
MacDonald challenges the sufficiency of the indictment as to Counts 1 and 2 (RICO and RICO conspiracy), Counts 12 and 14 (mail fraud), and Counts 13 and 15 (wire fraud). An indictment must present a description of the charges sufficient to enable a defendant to prepare his defense, to insure that the defendant is prosecuted on the basis of facts presented to the grand jury, to enable him to plead double jeopardy against a later prosecution, and to inform the court of the facts alleged so it can determine the sufficiency of the charges. United States v. Lane, 765 F.2d 1376, 1380 (9th Cir.1985). In addition to alleging the elements of the offense charged, an indictment must include some indication of the factual activity on which the allegations are based. Id.
5
MacDonald argues that the indictment's factual allegations concerning the loan from the tribe were insufficient because the indictment failed to allege that he breached a duty to disclose material information to the tribe. We disagree. Count 1 of the indictment alleges that "Morelli, acting ... under Peter MacDonald's political power as Chairman of the Navajo Tribal Council, persuaded the EDC members to loan NTI $2,250,000. Had the Navajo Tribal Council known at the time that Peter MacDonald was to be given NTI stock money, it would not have approved the loan request." The indictment thus adequately informed MacDonald that he was charged with failing to disclose to the tribe his connections with NTI. See United States v. Givens, 767 F.2d 574, 584 (9th Cir.) (indictment should be interpreted to include allegations that are necessarily implied), cert. denied, 474 U.S. 953 (1985).
6
MacDonald also argues that the indictment failed to allege sufficient facts regarding the XSELL contract, because it did not allege facts that would show that either XSELL or NTI were defrauded. Count 1 of the indictment alleges that 1) MacDonald was to receive money from NTI after NTI obtained a multi-million dollar loan from the Navajo Tribe; 2) MacDonald demanded $120,000 a year, to be paid through his son Rocky's position as a consultant; 3) to conceal the source of this money, the defendants had NTI pay XSELL $11,000 a month, $10,000 of which went to Rocky; and 4) the intention was to defraud NTI of $33,000. Taken together, these allegations sufficiently apprised MacDonald of this charge. See id. (indictment should be read in its entirety and construed according to common sense).
7
Count 2 expressly incorporates the factual allegations of Count 1, and thus is also sufficient. Although the fraudulent schemes are not described in Counts 12-15 (mail and wire fraud), these counts allege exactly the same mailings and telephone calls and the same fraudulent objects as alleged in Count 1. Because Count 1 adequately described the fraudulent scheme, MacDonald was left with no doubt as to the activity that he was charged with in the mail and wire fraud counts. MacDonald does not argue that he in fact did not receive adequate notice of the charges that were proven at trial, and it is apparent that the grand jury intended to indict on the same facts as those laid out in Count 1. The criminal activity for which he was tried is perfectly clear, and thus no potential difficulties in arguing double jeopardy appear. In these circumstances, reading the factual allegations in Count 1 together with Counts 12-15 is appropriate. See United States v. Thomas, 893 F.2d 1066, 1070 (9th Cir.), cert. denied, 498 U.S. 826 (1990). Read in light of the Count 1 allegations, Counts 12-15 were also adequate.
8
2. Variance Between the Indictment and the Evidence
9
MacDonald argues that evidence of schemes and misrepresentations not mentioned in the indictment was introduced at trial, and thus he may have been convicted of acts that were not charged in the indictment. "A defendant cannot be convicted of a count charging participation in a fraudulent scheme Y where the grand jury indicted based on his participation in a fraudulent scheme X, even if the schemes themselves overlap ..." United States v. Mastelotto, 717 F.2d 1238, 1248-49 (9th Cir.1983).
10
Although MacDonald argues that the convictions may have been based on any one of several schemes, what he characterizes as schemes are actually misrepresentations. The evidence at trial related directly to the schemes alleged in the indictment, and did not introduce additional schemes. MacDonald thus was not convicted for devising fraudulent schemes that were not identified in the indictment.
11
Nor did the government's evidence of misrepresentations not alleged in the indictment amount to a fatal variance. The elements of mail or wire fraud are (1) use of the mail or telephone in interstate commerce, (2) in furtherance of a scheme to defraud, (3) with the intent to defraud. United States v. Bonanno, 852 F.2d 434, 440 (9th Cir.1988), cert. denied, 488 U.S. 1016 (1989). The making of misrepresentations is not a necessary element of the crime. United States v. Bohanus, 628 F.2d 1167, 1172 (9th Cir.), cert. denied, 447 U.S. 928 (1980). Rather, misrepresentations are evidence that the defendant devised a scheme to defraud. See United States v. Amrep Corp., 560 F.2d 539, 546 (2d Cir.1977) (citing Simons v. United States, 119 F.2d 539, 549 (9th Cir.), cert. denied, 314 U.S. 616 (1941)), cert. denied, 434 U.S. 1015 (1978). If the scheme is adequately alleged, the indictment need not allege the specific misrepresentations that are used to prove that scheme. See United States v. Begnaud, 783 F.2d 144, 148 (8th Cir.1986); cf. United States v. Musacchio, 968 F.2d 782, 788 (9th Cir.1991) ("the government is not required to allege its supporting evidence in the indictment"). Because the misrepresentations proven at trial relate to the same scheme that the grand jury delineated in the indictment, the evidence did not amount to a variance requiring reversal.
12
3. Sufficient Evidence of Fraud Based on the XSELL Contract
13
MacDonald argues that the evidence was insufficient to convict him of mail and wire fraud pursuant to the XSELL contracts (Count 1, Act 3 and Counts 14 and 15), because it did not establish that he made any affirmative misrepresentations to NTI, or that he breached a duty to disclose material information to NTI. See United States v. Dowling, 739 F.2d 1445, 1449 (9th Cir.1984), rev'd on other grounds, 473 U.S. 207 (1985). The government's theory, however, was that defendants entered the contracts with XSELL for no reason other than to hide payments from NTI to MacDonald. This is not a case where defendants merely failed to give pertinent information regarding a contract; they affirmatively entered the contract as a means of deceit.
14
Sufficient evidence was introduced to allow the jury to find that the XSELL contract was in itself an affirmative act of "false or fraudulent pretenses, representations, or promises," 18 U.S.C. Secs. 1341, 1343. The government introduced evidence from which the jury could have concluded that the contract purported to be for services that defendants never intended NTI to receive, and that as such the contract was an affirmative misrepresentation. Cf. United States v. Rasheed, 663 F.2d 843, 848-49 (9th Cir.1981), cert. denied, 454 U.S. 1157 (1982); United States v. O'Malley, 707 F.2d 1240, 1247 (11th Cir.1983).
4. RICO Convictions
15
MacDonald challenges his RICO convictions, arguing that there was insufficient evidence to convict him of the predicate crimes of mail and wire fraud charged in Racketeering Acts 1 and 3. Because we have determined that there is sufficient evidence of fraud relating to the XSELL contract, on which Act 3 is based, only the challenge to Act 1 remains.
16
Because the jury returned a general verdict, MacDonald argues that we cannot know which of the charged racketeering acts the jury found he had committed, and that the jury might have based his conviction on Act 1, for which there was insufficient evidence. However, the jury did not convict MacDonald on any of the separate counts that correspond with the predicate crimes charged in Racketeering Act 1. Failure to convict on a separate count corresponding to a RICO predicate crime indicates that the jury did not base a RICO conviction on that predicate crime. See United States v. Riccobene, 709 F.2d 214, 229-30 (3d.Cir.), cert. denied, 464 U.S. 849 (1983).
17
To hold otherwise would be to assume that the jury may have irrationally returned inconsistent verdicts. Id.; see also, United States v. Brennan, 867 F.2d 111, 115 (2d Cir.), cert. denied, 490 U.S. 1022 (1989); United States v. Anderson, 809 F.2d 1281, 1284 (7th Cir.1987). Here, since the jury was unable to reach a verdict as to the mail and wire fraud charges in Counts 10 and 11, it is safe to assume that the jury also failed to agree that MacDonald had committed the mail or wire fraud charged in Racketeering Act 1, which alleged exactly the same conduct and the same crimes. Accordingly, we can surmise that the jury did not base the RICO convictions on Act 1. Cf. United States v. Lopez, 803 F.2d 969, 974-75 (9th Cir.1986) (jury conviction based on particular predicate crimes inferred from conviction of codefendant on the same predicate crimes), cert. denied, 481 U.S. 1030 (1987). As the sufficiency of the evidence as to the other acts is not at issue, we affirm the RICO convictions.
5. Rule 404(b) Evidence
18
MacDonald argues that the district court should not have admitted evidence of his submission of phoney rental receipts to the tribe for payment under Federal Rule of Evidence 404(b). Although evidence of prior bad acts is admissible under Rule 404(b) to prove intent, the government must first show that the acts were similar to the crimes charged. United States v. Ayers, 924 F.2d 1468, 1473 (9th Cir.1991).
19
Although the similarity between the submission of phoney rental receipts and the crimes charged is questionable at best, any error was harmless. The district court properly instructed the jury that it was to use the evidence only to determine whether MacDonald had the requisite intent to commit the crimes charged. As MacDonald points out, the government introduced overwhelming evidence of similar crimes to show that MacDonald did have that intent. In the light of this other evidence, the admission of the challenged evidence did not likely affect the verdict. See United States v. Bishop, 1 F.3d 910, 911 (9th Cir.1993); United States v. Arambula-Ruiz, 987 F.2d 599, 605 (9th Cir.1993).
6. Improper Prosecutorial Argument
20
MacDonald argues that he was denied a fair trial due to the closing arguments of the prosecuting attorney, which MacDonald claims implied that he was more culpable because he held high political office and had a lavish lifestyle, in contrast to the poverty-stricken residents of the Navajo Reservation. MacDonald also argues that the prosecutor should not have alluded to the Tribe's change of governmental structure, as that change was irrelevant to this case.
21
Because defense counsel failed to object to the arguments at trial, we review for plain error. United States v. Young, 470 U.S. 1, 6 (1985). Under the plain error standard, "[w]e reverse only if, viewing the error in the context of the entire record, the impropriety seriously affects the fairness, integrity or public reputation of judicial proceedings, or where failing to reverse a conviction would amount to a miscarriage of justice." United States v. Necoechea, 986 F.2d 1273, 1276 (9th Cir.1993) (internal quotations omitted).
22
In this case, any error committed by the prosecuting attorney in his closing arguments did not amount to plain error. While the prosecutor's statements may have been close to the line separating permissible "hard blows" from impermissible "foul blows," see id. at 1282, subsequent statements by both defense counsel and prosecutor clarified any misleading characterization of the issues. See United States v. Monaghan, 741 F.2d 1434, 1443 (D.C.Cir.1984) (improper comments mitigated in part by prosecutor's later statements), cert. denied, 470 U.S. 1085 (1985). Under these circumstances, and given the substantial evidence of MacDonald's guilt, it is unlikely that the prosecutor's statements led the jury to a guilty verdict that it otherwise would not have reached. Cf. United States v. Williams, 989 F.2d 1061, 1072 (9th Cir.1993); United States v. Makhlouta, 790 F.2d 1400, 1403 (9th Cir.1986).
23
Assuming that the evidence as to the change in the tribe's governmental structure was irrelevant, and therefore should not have been mentioned in closing arguments, it was not so prejudicial as to require reversal as plain error.
24
7. Prosecutorial Comment on MacDonald's Failure to Testify
25
MacDonald argues that his convictions should be reversed because the prosecuting attorney commented on his failure to testify. "The Fifth Amendment prohibits the prosecutor from commenting on a defendant's decision not to testify." Lincoln v. Sunn, 807 F.2d 805, 809 (9th Cir.1987). Such a comment warrants reversal, however, "only if it appears that the comment may possibly have affected the verdict." Id. Reversal is mandatory if the comments are extensive, if an inference of guilt is stressed to the jury based on the defendant's silence, and if the evidence could have supported acquittal. United States v. Kennedy, 714 F.2d 968, 976 (9th Cir.1983), cert. denied, 465 U.S. 1034 (1984).
26
Here, the prosecutor made but one isolated comment. Although the comment might be read to stress an inference of guilt from the idea that MacDonald had put on witnesses who might be prone to lie on his behalf when he could have put on no witnesses at all, it does not stress such an inference from MacDonald's silence.
27
Even where a prosecutor directly refers to a defendant's failure to testify, this court has been reluctant to reverse in the absence of the above factors if the court gave curative instructions. United States v. Soulard, 730 F.2d 1292, 1307 (9th Cir.1984). Although MacDonald argues that no curative instructions were given at the time that the comment was made, defense council apparently agreed with the district court's assessment that such instructions would do more harm than good. Furthermore, cautionary instructions given in a general charge to the jury stating that no adverse inferences could be drawn from a defendant's failure to testify can act as curative instructions. See Lincoln, 807 F.2d at 809, 810-11; Soulard, 730 F.2d at 1307. Such an instruction was given in this case. We find that MacDonald's right to a fair trial was not prejudiced by this error, either standing alone or in combination with other errors.
28
AFFIRMED.
*
This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3
|
J-S72043-14
NON-PRECEDENTIAL DECISION – SEE SUPERIOR COURT I.O.P. 65.37
COMMONWEALTH OF PENNSYLVANIA, : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellee :
:
v. :
:
DANIEL L. SPUCK, :
:
Appellant : No. 917 WDA 2014
Appeal from the PCRA Order Entered April 14, 2014
in the Court of Common Pleas of Clearfield County
Criminal Division at No(s): CP-17-CR-0000396-1995
BEFORE: BENDER, P.J.E., SHOGAN, and STRASSBURGER,* JJ.
MEMORANDUM BY STRASSBURGER, J.: FILED JANUARY 12, 2015
Daniel L. Spuck (Appellant) appeals pro se from the April 14, 2014
order dismissing his serial petition filed pursuant to the Post Conviction
Relief Act (PCRA), 42 Pa.C.S. §§ 9541-9546. We affirm.
As a prior panel of this Court explained,
On March 22, 1996, a jury found [Appellant] guilty of third
degree murder, two counts of recklessly endangering another
person, aggravated assault, and simple assault in connection
with the stabbing death of Michael Allen Cramer in DuBois[,
Pennsylvania,] on February 23, 1995. [Appellant] also stabbed
his ex-wife during the attack. Judgment of sentence was
imposed on April 19, 1996, with [Appellant] receiving an
aggregate term of 11 to 22 years’ imprisonment. This [C]ourt
affirmed the judgment of sentence on February 27, 1998, and
our [S]upreme [C]ourt denied appeal on October 1, 1998.
Commonwealth v. Spuck, 86 A.3d 870, 872, reconsideration denied (Mar.
26, 2014), reargument denied (Apr. 16, 2014), appeal denied, 99 A.3d 77
* Retired Senior Judge assigned to the Superior Court.
J-S72043-14
(Pa. 2014) (citations omitted). Appellant did not seek further review of his
direct appeal by the United States Supreme Court.
Since 1998, Appellant has sought collateral review by this Court on
nearly a dozen occasions. Id. at 871-72 n. 2. His latest PCRA petition, the
one at issue herein, was filed on April 14, 2014. As we have repeatedly
explained to Appellant, the timeliness of a post-conviction petition is
jurisdictional. Commonwealth v. Robinson, 12 A.3d 477, 479 (Pa.
Super. 2011). Generally, a petition for relief under the PCRA, including a
second or subsequent petition, must be filed within one year of the date the
judgment of sentence is final. 42 Pa.C.S. § 9545.
Relying on a letter from the United States Supreme Court dated March
26, 2014, which apparently accompanied the return of certain documents to
Appellant and confirms that his case at docket number 13-1633 is closed,
Appellant categorizes this latest PCRA petition as a “first” petition on the
basis that the Supreme Court has just now finalized its review of his direct
appeal issues. Appellant’s Brief at 5; Appellant’s Exhibit C. Thus, Appellant
contends that his judgment of sentence is now final, the instant petition is
timely and all prior PCRAs were “premature.” Id. at 6.
Appellant’s attempt to circumvent the jurisdictional prerequisites of the
PCRA is unavailing. “The plain language of the PCRA provides that a
judgment of sentence becomes final at the conclusion of direct review or
when the time for seeking direct review expires.” Commonwealth v.
-2-
J-S72043-14
Callahan, 101 A.3d 118, 122 (Pa. Super. 2014) (emphasis added; citation
omitted). The Rules of the Supreme Court of the United States provide that
[u]nless otherwise provided by law, a petition for a writ of
certiorari to review a judgment in any case, civil or criminal,
entered by a state court of last resort or a United States court of
appeals (including the United States Court of Appeals for the
Armed Forces) is timely when it is filed with the Clerk of this
Court within 90 days after entry of the judgment. A petition for a
writ of certiorari seeking review of a judgment of a lower state
court that is subject to discretionary review by the state court of
last resort is timely when it is filed with the Clerk within 90 days
after entry of the order denying discretionary review.
U.S. Sup. Ct. R. 13.
As discussed above, Appellant did not seek discretionary review by the
United States Supreme Court following our Supreme Court’s October 1, 1998
denial of his petition for allowance of appeal. Accordingly, Appellant’s
judgment of sentence became final 90 days later, on December 30, 1998, at
the expiration of the period in which he was permitted to seek discretionary
review in the first instance. Id.
As this Court has explained, “[i]n fixing the date upon which a
judgment of sentence becomes final, the PCRA does not refer to the
conclusion of collateral review or the time for appealing a collateral review
determination. Thus, the plain language of the PCRA statute shows that a
judgment of sentence becomes final immediately upon expiration of the time
for seeking direct review, even if other collateral proceedings are still
ongoing.” Callahan, 101 A.3d at 122.
-3-
J-S72043-14
A review of the United States Supreme Court docket reveals that
Appellant has filed numerous petitions with the Court since his conviction.
However, none of those petitions acted to stay or extend the 90-day
timeframe set forth above. Additionally, the fact that one of Appellant’s
many pending cases is now considered closed by the High Court does not
serve to alter this conclusion.
As the instant petition is patently untimely, it is time-barred unless
Appellant is able to plead and prove one of the timeliness exceptions set
forth at 42 Pa.C.S. § 9545(b)(3).
The exceptions to the timeliness requirement are:
(i) the failure to raise the claim previously was the result of
interference of government officials with the presentation of the
claim in violation of the Constitution or laws of this
Commonwealth or the Constitution or laws of the United States.
(ii) the facts upon which the claim is predicated were unknown
to the petitioner and could not have been ascertained by the
exercise of due diligence; or
(iii) the right asserted is a constitutional right that was
recognized by the Supreme Court of the United States or the
Supreme Court of Pennsylvania after the time period provided in
this section and has been held by that court to apply
retroactively.
42 Pa.C.S. § 9545(b)(1)(i), (ii), and (iii). A PCRA petition invoking one of
these statutory exceptions must “be filed within 60 days of the date the
claims could have been presented.” Robinson, 12 A.3d at 480.
-4-
J-S72043-14
Appellant claims that he has produced newly-discovered facts
unknown to him at the time of trial in the form of affidavits from Fred Dick,
dated January 13, 2014, and Mark Cowder, dated April 27, 2012, the
content of which warrant a new trial. Appellant’s Brief at 9-10. Mr. Dick
purports to be an eyewitness, as well as a character witness, Appellant’s
Exhibit D; while Mr. Cowder claims he has been in touch with a woman who
served on Appellant’s jury and who “struggled” with the facts of his case.
Appellant’s Exhibit E.
Appellant does not assert that he filed the instant petition within 60
days of being informed of the existence of Mr. Dick or Mr. Cowder. In fact,
Appellant admits that he located Mr. Dick in 2012. Appellant’s Brief at 9.1
Because Appellant is not reserved about filing all manner of petitions with
this Court, we can conclude that, with the exercise of due diligence, he could
have raised this claim more than 60 days before April 14, 2104.
With respect to Mr. Cowder, Appellant has failed to allege facts that
would warrant a hearing. Appellant does not name the alleged juror, nor
does he detail when he learned this information from Mr. Cowder. Moreover,
such evidence is inadmissible. Commonwealth v. Patrick, 206 A.2d 295,
297 (Pa. 1965) (“Our Courts have repeatedly held for over 150 years that
after a verdict is recorded, and after the jury has separated and been
discharged, jurors may not invalidate or impeach a verdict by their own
1
Mr. Dick’s affidavit, in which he claims to have known Appellant since the
mid-1980s, is dated April 27, 2012.
-5-
J-S72043-14
testimony.”); Commonwealth v. Abu-Jamal, 720 A.2d 79, 115 (Pa. 1998)
(“the law of this Commonwealth … forbids the post-verdict testimony of
jurors which would tend to impeach the verdict.”)
Accordingly, because Appellant failed to satisfy a PCRA timeliness
exception, we conclude that the PCRA court lacked jurisdiction to entertain
the merits of Appellant’s claims, and dismissal of his serial PCRA petition was
proper.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 1/12/2015
-6-
|
93 Ariz. 127 (1963)
379 P.2d 118
Nellie Chavez MARTINEZ, Appellant,
v.
Dent L. COOMBS, Appellee.
No. 7088.
Supreme Court of Arizona. In Division.
February 27, 1963.
*128 Charles Christakis, Phoenix, for appellant.
Christy, Kleinman, Peterson & Hoyt, Phoenix, for appellee.
BERNSTEIN, Chief Justice.
Appellant was plaintiff in a suit for assault and battery, false imprisonment, malicious prosecution, and libel and slander. Plaintiff appeals from a summary judgment for defendant.
Defendant made a motion for summary judgment and subsequently filed affidavits in support of the motion. Although the affidavits were filed two weeks prior to the hearing, plaintiff's counsel was not served with them until he appeared at the hearing on October 16, 1959. At the hearing and in opposition to the motion, plaintiff's counsel asked the trial judge to take judicial notice of the transcript of testimony in a previous criminal trial of plaintiff out of which the causes of action stemmed. The trial judge asked counsel if he wanted to file a copy of the transcript and counsel said he would do so if the court wanted him to, but that he would prefer to have the court take judicial notice of it. The trial judge agreed to take judicial notice of the transcript and took the motion under advisement and on October 29, 1959 the trial judge granted the motion for summary judgment on the ground that plaintiff had not complied with Rule 56(e), Rules of Civil Procedure, 16 A.R.S.
Subsequently, plaintiff filed the transcript and affidavits in opposition to defendant's affidavits, but the court struck these documents on motion of defendant on the ground that summary judgment had already been entered. After numerous motions for rehearing, to set aside the judgment, final judgment was entered on January 11, 1960.
Rule 56(e), Rules of Civil Procedure reads in applicable part:
"When a motion for summary judgment is made and supported as provided in this Rule, an adverse party may not rest upon the mere allegations or denials *129 of his pleading, but must answer in detail as specific as that of the moving papers, setting forth the material facts as he believes and intends to prove them to be. If he does not so answer under oath, summary judgment shall be entered against him." (Emphasis supplied)
We have held that a summary judgment is mandatory under this rule where the party opposing the judgment does not file affidavits in opposition to affidavits filed by the moving party, Perez v. Tomberlin, 86 Ariz. 66, 340 P.2d 982. We do not think that a request that a trial judge take judicial notice of a transcript of testimony in another case meets the burden placed on the party opposing a summary judgment supported by affidavits.
Plaintiff complains that he was not served with the affidavits until the day of the hearing and that they were not served in accordance with Sec. 56(c). The trial judge took the motion under advisement and did not render judgment until more than ten days from the time plaintiff was served with defendant's affidavits. We are of the opinion that plaintiff was given ample time under Rule 56(c) in which to answer in the manner prescribed by Rule 56(e). Having failed to do so the judgment is affirmed.
STRUCKMEYER and LOCKWOOD, JJ., concur.
|
40 B.R. 767 (1984)
In re GIBSON DISTRIBUTING CO., INC.-PERMIAN BASIN, Debtor.
Chuck HAYNIE, Plaintiff,
v.
GIBSON DISTRIBUTING CO., INC.-PERMIAN BASIN, Defendant.
Bankruptcy No. 783-01392, Adv. 783-1496.
United States Bankruptcy Court, W.D. Texas, Midland-Odessa Divisions.
June 7, 1984.
Robert Truitt, Jr., Midland, Tex., for plaintiff.
*768 Joel B. Locke, Odessa, Tex., for defendant-debtor.
MEMORANDUM AND ORDER
BILL H. BRISTER, Bankruptcy Judge.
The debtor-in-possession, Gibson Distributing Co., Inc. ("Gibson") challenges the proof of claim filed by Chuck Haynie ("Haynie"). The amount of the claim is not contested. However Haynie contends that the claim should be allowed as an administrative priority claim or, in the alternative, as a secured claim while Gibson argues that the claim should be allowed as an unsecured claim only. Closely related to those issues is the above adversary proceeding filed by Haynie, seeking to reclaim property which he had delivered to Gibson less than ten days before bankruptcy proceedings were initiated by Gibson. The following summary constitutes findings of fact and conclusions of law after nonjury trial on the consolidated issues on May 16, 1984.
The facts substantially are uncontroverted. At all times relevant to this memorandum Gibson had been engaged in retail sales of, among other items, sporting equipment in the vicinity of Midland, Texas. Haynie, a city fireman, had a sideline business whereby he sold a line of knives at wholesale. On July 7, 1983, Gibson issued its purchase order number 332808 to Haynie for two displays of knives which it referred to as the "Parker Knife Test Program", the cost to Gibson being reflected at $1,448.00[1]
Haynie delivered the two displays to Gibson on July 25, 1983. Eight days later on August 2, 1983, Gibson filed petition for order for relief under Chapter 11 of Title 11, United States Code. On August 11, 1983, nine days after the bankruptcy petition was filed but seventeen days after the knives had been delivered to Gibson, Haynie delivered to Gibson his letter demanding reclamation under the provisions of § 2.702 of the Texas Business and Commerce Code. Gibson refused to return the displays of knives to Haynie and has failed to pay Haynie the contracted price of $1,448.00, contending in effect that Haynie is merely an unsecured creditor to that extent of $1,448.00.
Gibson's challenge to the reclamation demand and to the claim by Haynie that he is entitled to either an administrative priority claim or a secured claim is based on the fact that the reclamation demand was not made within ten days of the date of delivery of the knives on July 25, 1983. Haynie argues that he is not bound by the strict ten day demand requirement, because Gibson had made a false statement in writing to Haynie regarding its solvency within the meaning of § 2.702(b)[2] of the Texas Business and Commerce Code when the Gibson purchasing agent, in filling in the "payment terms" on the purchase order, wrote "net ten". Thus he posits that the notation of "net ten" was a written assertion by Gibson that it was solvent and would make the payment to Haynie ten days after delivery.
Section 2-702 of the Uniform Commercial Code (substantially identical to § 2.702 of the Texas Business and Commerce Code) had generated much preCode litigation, confusion, and divergent decisions in different circuits. In the bankruptcy context the reason for the confusion is apparent . . . the section effectively created a lien under state law which conflicted with bankruptcy provisions striking down disguised priorities. See Deephouse Equipment Company, Inc., 22 B.R. 255, 257 (Bkrtcy.D.Conn. *769 1982). In its enactment of the Code, Congress sought to alleviate that conflict with its inclusion of § 546(c) which states:
(c) The rights and powers of the trustee under §§ 544(a), 545, 547 and 549 of this title are subject to any statutory right or common-law right of a seller, in the ordinary course of such seller's business, of goods to the debtor to reclaim such goods if the debtor has received such goods while insolvent, but
(1) such a seller may not reclaim any such goods unless such seller demands in writing reclamation of such goods before ten days after receipt of such goods by the debtor . . .
The courts construing the issue have held consistently that § 546(c) represents the exclusive remedy and that unless a seller meets the strict ten day prior notice condition imposed by § 546(c) he retains no other common law or statutory right of action. See In re Jeanes Mechanical Contractors, Inc., 32 B.R. 657 (Bkrtcy.W.D.Ky. 1983); In re HRT Industries, Inc., 29 B.R. 861 (Bkrtcy.S.D.N.Y.1983); Matter of Deephouse Equipment Co., Inc., supra.
The argument is persuasive that the reclamation statutory scheme of relief is the sole remedy for an unpaid vendor when the buyer has filed for bankruptcy, precluding any other common law rights which might have been available to a seller. Section 546(c) constitutes the sole available remedy for a creditor seeking to reclaim goods where, as here, there is no compliance with the strict ten day provision for making written reclamation demand.
I conclude that Haynie's claim in this bankruptcy case should be allowed as an unsecured claim, but that his contentions that the claim should be allowed as an administrative priority claim or as a secured claim should be denied. Further I conclude that the adversary proceeding filed by Haynie against Gibson, seeking reclamation, should be denied.
It is, therefore, ORDERED by the Court that the complaint by Chuck Haynie against Gibson Distributing Co., Inc.-Permian Basin, wherein Haynie seeks to recover two displays of knives be, and it is hereby, denied.
LET JUDGMENT BE ENTERED ACCORDINGLY.
NOTES
[1] According to notations on the purchase order the aggregate retail price of the knives on the two displays was $2,517.12.
[2] § 2.702.
(b) Where the seller discovers that the buyer has received goods on credit while insolvent he may reclaim the goods upon demand made within ten days after the receipt, but if misrepresentation of solvency has been made to the particular seller in writing within three months before delivery the ten day limitation does not apply. Except as provided in this subsection the seller may not base a right to reclaim goods on the buyer's fraudulent or innocent misrepresentation of solvency or of intent to pay. (Emphasis Added)
|
Case: 10-50856 Document: 00512410956 Page: 1 Date Filed: 10/17/2013
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
October 17, 2013
No. 10-50856 Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA,
Plaintiff - Appellee
v.
JOHN THOMAS SHIPLEY,
Defendant - Appellant
Appeal from the United States District Court
for the Western District of Texas
USDC No. 3:09-CR-1867
Before DENNIS, CLEMENT, and SOUTHWICK, Circuit Judges.
PER CURIAM:*
Defendant-appellant John Thomas Shipley was convicted at trial of
illegally dealing firearms without a license in violation of 18 U.S.C.
§ 922(a)(1)(A) (count one), causing a firearms dealer to maintain false records in
violation of 18 U.S.C. § 924(a)(1)(A) (counts two through five), and making a
false statement in a matter within the jurisdiction of the federal government in
violation of 18 U.S.C. § 1001(a)(3) (count six). In this appeal, Shipley contends
*
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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that his convictions should be set aside for a number of reasons: the transcript
for one day of the eight-day trial is missing, thus frustrating adequate appellate
review; there was insufficient evidence at trial to support the convictions; the
statute criminalizing conduct that causes a lawful firearms dealer to maintain
false records should be declared unconstitutionally void for vagueness; the
district court abused its discretion in excluding a witness’s testimony relating
to Shipley’s good character and in refusing to instruct the jury on such character
evidence; and, the government’s prosecutor made improper statements at trial.
He also contends that the district court’s order forfeiting his interest in certain
firearms and ammunition seized by the government should be reversed. We
affirm.
I.
This case involves unlawful dealing in firearms. Under federal law,
individuals may not deal in firearms without first receiving a license.
Individuals without licenses may make periodic sales of firearms from their
personal collections, although they may not engage in the regular business of
dealing firearms for profit. When a purchaser buys a firearm from a lawfully
licensed dealer, both the dealer and the buyer must record the transaction with
a Bureau of Alcohol, Tobacco, Firearms and Explosives Form 4473, a transaction
record form that dealers are required by law to keep. The form requires the
purchaser to provide certain personal information and to certify that he is the
“actual buyer” of the firearm. In other words, the purchaser must certify that
he is buying the firearm for himself, not for an unnamed person. Federal law
also requires licensed dealers to maintain “Acquisition and Disposition” (“A&D”)
record books, which are also used to record information about transactions.
The evidence presented at trial showed that Shipley was a Federal Bureau
of Investigations agent who collected firearms as a hobby between 1996 and
2005. In early 2005, Shipley sold a substantial portion of his collection to finance
the costs of a child adoption he and his wife were attempting. Although Shipley
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never received a license to deal in firearms, those sales, being limited sales from
his personal collection, were lawful. Shortly after that, however, Shipley, despite
not having a license, began dealing in firearms as a regular side business to
supplement his lawful income as an FBI agent.
The investigation into Shipley began as an investigation into someone else,
Luis Armando “Mando” Rodriguez, a deputy sheriff in El Paso, Texas, who was
suspected of illegally sneaking high-powered firearms into Mexico. American
federal government agents traveled to Mexico to examine weapons recently
seized by the Mexican military after a shootout that resulted in one person's
death. The agents traced one of the weapons, a Barrett .50 caliber rifle, to a
lawful firearms dealer in Missouri that had sold the firearm to Shipley. The
agents contacted Shipley to try to obtain further information about how the
firearm had eventually landed in Mexico. Shortly after the agents made contact,
Shipley ordered two new A&D books. Over the course of a few telephone
conversations between Shipley and an investigating agent, Shipley stated that
he had sold Rodriguez the rifle that was used in the shootout in Mexico as well
as two other firearms. Shipley offered his assistance in the investigation and
volunteered his records for the agent’s review. Several days later, Shipley and
the agent met in person and Shipley handed over voluntarily an A&D book with
four pages of recorded sales, including the three sales to Rodriguez that Shipley
had told the agent about. The book purported to cover the entire period from
1996 to the present. Shipley told the agent that the book reflected all sales he
had made during the relevant period.
Several months later, federal agents searched Shipley’s residence and
motor vehicles. During the search, agents uncovered a second A&D book.
Compared to the one Shipley had turned over, this one, which also purported to
cover the same period from 1996 to the present, was pages longer and listed a
number of additional sales, including the sale of armor-piercing and incendiary
ammunition. The government analyzed this newly discovered book and the one
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previously handed over. According to the government’s expert, the shorter book
was written in a single sitting and with the same pen, and the longer book was
written over numerous sittings and with different pens. The search also
uncovered on Shipley’s home computer additional records covering
approximately twenty-two firearms sales as well as photographic images and
email correspondence relating to firearms transactions. The agents found a
number of firearms, several of which were not mentioned in either of the A&D
books and many of which were mass-produced firearms of similar make and
model that, according to testimony at trial, were not likely to be part of a
personal collection. Also uncovered were hundreds of bullets, thousands of
dollars in cash, and a number of postal-service records and other items tending
to indicate that Shipley had been sending firearms through the mail.
Following an eight-day trial, Shipley was convicted on all six counts of the
indictment. The district court sentenced him to two years’ imprisonment and
three years’ supervised release.
II.
Shipley contends that he should be granted a new trial because the
transcript of proceedings in the district court is missing the testimony from a full
day of trial, thus frustrating adequate appellate review. In this circuit, if “a
criminal defendant is represented on appeal by counsel other than the attorney
at trial, the absence of a substantial and significant portion of the record, even
absent any showing of specific prejudice or error, is sufficient to mandate
reversal,” United States v. Selva, 559 F.2d 1303, 1306 (5th Cir. 1977) (Selva II)
(footnote omitted), unless the district court can reconstruct “a ‘substantially
verbatim account of the proceedings,’” United States v. Pace, 10 F.3d 1106, 1123
(5th Cir. 1993) (quoting United States v. Selva, 546 F.2d 1173, 1174 (5th Cir.
1977) (Selva I)). Here, following a limited remand to the district court to
attempt to reconstruct the record, the district court considered evidence and
other party submissions during two days of hearings. Those hearings resulted
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in a reconstructed record that the district court found constituted a substantially
verbatim account of the proceedings. “[A]bsent a showing of intentional
falsification or plain unreasonableness,” the district court’s finding as to the
accuracy of the reconstructed record “is conclusive.” United States v. Margetis,
975 F.2d 1175, 1177 (5th Cir. 1992); see also United States v. Mori, 444 F.2d 240,
246 (5th Cir. 1971). Because there has not been a showing of intentional
falsification or plain unreasonableness, we accept the district court’s findings
and we further conclude that the record is sufficient for appellate review.
III.
Shipley contends that insufficient evidence was presented at trial to
support his convictions, which is an issue we review de novo. See United States
v. Ragsdale, 426 F.3d 765, 770 (5th Cir. 2005). We “will affirm the jury’s verdict
if a reasonable trier of fact could conclude from the evidence that the elements
of the offense were established beyond a reasonable doubt, viewing the evidence
in the light most favorable to the verdict and drawing all reasonable inferences
from the evidence to support the verdict.” Id. at 770-71.
A.
The first count of conviction, count one, was for unlicensed firearm
trafficking in violation of 18 U.S.C. § 922(a)(1)(A), under which it is “unlawful
. . . for any person . . . except a licensed importer, licensed manufacturer, or
licensed dealer, to engage in the business of importing, manufacturing, or
dealing in firearms, or in the course of such business to ship, transport, or
receive any firearm in interstate or foreign commerce.” To be “engaged in the
business” of “dealing in firearms” means, “a person who devotes time, attention,
and labor to dealing in firearms as a regular course of trade or business with the
principal objective of livelihood and profit through the repetitive purchase and
resale of firearms, but such term shall not include a person who makes
occasional sales, exchanges, or purchases of firearms for the enhancement of a
personal collection or for a hobby, or who sells all or part of his personal
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collection of firearms.” Id. § 921(a)(21)(C). The statute further defines the term
“with the principal objective of livelihood and profit” to mean “that the intent
underlying the sale or disposition of firearms is predominantly one of obtaining
livelihood and pecuniary gain, as opposed to other intents, such as improving or
liquidating a personal firearms collection.” Id. § 921(a)(22). To determine
whether the defendant unlawfully engaged in the business of firearms dealing,
as so defined, the jury “must examine the intent of the actor and all
circumstances surrounding the acts alleged to constitute engaging in business.”
United States v. Tyson, 653 F.3d 192, 201 (3d Cir. 2011) (citation omitted). The
evidence at trial showed that Shipley did not have a license and that he
nevertheless engaged in a regular course of dealing firearms for profit for a
number of years, and that evidence was sufficient to support the jury’s verdict.
Shipley’s primary argument for why this result should not follow is that he
presented evidence at trial showing that, contrary to the government’s
contentions and evidence, his firearms transactions actually caused him to suffer
a net loss. The jury, however, was entitled to disbelieve that evidence.
Furthermore, a conviction requires that the defendant had the “principal
objective” of making a profit, but it does not require that he succeeded in that
endeavor. Accordingly, the jury’s verdict was rational and we will not set it
aside.
B.
Counts two through five charged Shipley with causing a firearms dealer
to maintain false records in violation of 18 U.S.C. § 924(a)(1)(A), under which it
is unlawful to “knowingly make[] any false statement or representation with
respect to the information required by this chapter to be kept in the records of
a person licensed under this chapter,” which includes the Form 4473s that
dealers must use to record customers’ purchases. The counts against Shipley
involve four separate instances in which he purchased a firearm, certified on the
Form 4473 that he was the “actual buyer” of the firearm, and then turned
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around almost immediately and sold the firearm to a third party. During the
time relevant to this case, Form 4473 asked in question 11.a.:
Are you the actual buyer of the firearm(s) listed on this form?
Warning: You are not the actual buyer if you are acquiring the
firearm(s) on behalf of another person. If you are not the actual
buyer, the dealer cannot transfer the firearm(s) to you.
The form further explained:
Actual Buyer: For purposes of this form, you are the actual buyer if
you are purchasing the firearm for yourself or otherwise acquiring
the firearm for yourself (for example, redeeming it from
pawn/retrieving it from consignment, firearm raffle winner). You
are also the actual buyer if you are legitimately acquiring the
firearm as a gift for a third party.
ACTUAL BUYER EXAMPLES: Mr. Smith asks Mr. Jones to
purchase a firearm for Mr. Smith. Mr. Smith gives Mr. Jones the
money for the firearm. Mr. Jones is NOT the actual buyer of the
firearm and must answer ‘no’ to question 11.a. The licensee may not
transfer the firearm to Mr. Jones.
And, directly above the signature line that Shipley signed, the form contained
the following certification and warning:
I certify that the answers to Section A are true and correct. . . . I
understand that answering ‘yes’ to question 11.a if I am not the
actual buyer of the firearm is a crime punishable as a felony.
The evidence at trial was sufficient to support the jury’s finding that
Shipley was not in fact the “actual buyer” of the firearms but was rather buying
them for the purpose of transferring to the true purchaser that had already been
lined up or would soon be lined up, and thus, his statements on the forms were
knowingly false and were illegally made. See United States v. Johnson, 680 F.3d
1140 (9th Cir. 2012) (affirming convictions under § 924(a)(1)(A) for falsely
certifying on Form 4473s that the defendant was the “actual buyer” and then
turning around and reselling the firearms). We decline to set aside these
convictions.
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C.
Lastly, count six charged Shipley with making a false statement in a
matter within the jurisdiction of the federal government in violation of 18 U.S.C.
§ 1001(a)(3), under which it is unlawful for a person to, “in any matter within the
jurisdiction of the executive, legislative, or judicial branch of the Government of
the United States, knowingly and willfully . . . make[] or use[] any false writing
or document knowing the same to contain any materially false, fictitious, or
fraudulent statement or entry.” The material falsity may be a willful omission
of information. United States v. Wright, 211 F.3d 233, 238 (5th Cir. 2000); see
also United States v. Mattox, 689 F.2d 531, 533 (5th Cir. 1982) (“Silence may be
falsity when it misleads.”). Here, the evidence at trial showed that Shipley
provided to federal agents an A&D book purporting to represent his only
firearms transaction records while he actually maintained a second A&D book
showing far more transactions, thus masking the true extent of his dealing, and
such evidence was sufficient to support the jury’s verdict.
IV.
Next, Shipley contends that, even if there is sufficient evidence to support
the conviction under count one, for unlicensed firearm trafficking, the conviction
should be vacated because the statutes defining the offense and certain relevant
terms, 18 U.S.C. §§ 921(a)(21)(C), (a)(22), and 924(a)(1)(A), are
unconstitutionally vague. “We review whether a statute is void for vagueness
de novo.” United States v. Monroe, 178 F.3d 304, 308 (5th Cir. 1999).
“[T]he void-for-vagueness doctrine requires that a penal statute define the
criminal offense with sufficient definiteness that ordinary people can understand
what conduct is prohibited and in a manner that does not encourage arbitrary
and discriminatory enforcement.” Kolender v. Lawson, 461 U.S. 352, 357 (1983).
A statute is not unconstitutionally vague when it is “set out in terms that the
ordinary person exercising ordinary common sense can sufficiently understand
and comply with, without sacrifice to the public interest.” Broadrick v.
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Oklahoma, 413 U.S. 601, 608 (1973). However, “one who has received fair
warning of the criminality of his own conduct from the statute in question is
[not] entitled to attack it because the language would not give similar fair
warning with respect to other conduct which might be within its broad and
literal ambit. One to whose conduct a statute clearly applies may not
successfully challenge it for vagueness.” Parker v. Levy, 417 U.S. 733, 756
(1974). “[E]ven if the outermost boundaries of [the statute] may be imprecise,
any such uncertainty has little relevance . . . where [the defendant’s] conduct
falls squarely within the ‘hard core’ of the statute’s proscriptions.” Broadrick,
413 U.S. at 608.
Although it may be true that there is a degree of ambiguity in locating
precisely the border between, on the one hand, an unlicensed dealer that
unlawfully engages in the regular business of dealing firearms and, on the other
hand, an unlicensed hobbyist that lawfully engages in periodic sales, the jury
here found Shipley guilty of making, over a number of years, numerous
repetitive sales in quick succession, sometimes to repeat customers, and such
conduct is unquestionably prohibited by the statutes’ text. Shipley’s void-for-
vagueness claim is therefore without merit.
V.
Shipley argues that the district court erred in excluding from evidence the
testimony of Enrique Moreno, one of Shipley’s witnesses, relating to Shipley’s
good character. “[W]e review the district court’s ruling regarding the exclusion
of character evidence against an abuse of discretion standard.” United States v.
Marrero, 904 F.2d 251, 260 (5th Cir. 1990). “Rarely and only upon a clear
showing of prejudicial abuse of discretion will appellate courts disturb the
rulings of trial courts in the admissibility of character evidence.” United States
v. Davis, 546 F.2d 583, 592 (5th Cir. 1977).
“A defendant may introduce character testimony to show that the general
estimation of his character is so favorable that the jury may infer that he would
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not be likely to commit the offense charged.” United States v. John, 309 F.3d
298, 303 (5th Cir. 2002) (internal quotation marks omitted); see also Fed. R.
Evid. 404(a)(2)(A) (allowing criminal defendants to “offer evidence of the
defendant’s pertinent trait”). “[E]vidence of a person’s character . . . may be
proved by testimony about the person’s reputation or by testimony in the form
of an opinion.” Fed. R. Evid. 405.
Here, the district court found that Moreno did not have sufficient
familiarity with Shipley to offer an opinion about his character, as the two had
limited interaction for only a brief period, nor did Moreno have sufficient
knowledge of Shipley’s reputation in the community to testify on that matter
either. The district court also found that the limited probative value of the
character evidence was sufficiently outweighed by danger of confusing the issues
and wasting time, see Fed. R. Evid. 403, because allowing Moreno’s testimony
would have opened the door to further examination regarding the relations
between him and Shipley, a matter divorced from the central issues at trial. We
do not believe that the district court abused its discretion.
Because the district court did not abuse its discretion in excluding the
character evidence, it also did not err in declining to give the jury an instruction
regarding the jury’s consideration of character evidence. See John, 309 F.3d at
303 (“A character instruction is warranted only if the defendant first introduces
admissible character evidence.”).1
VI.
Shipley’s final argument regarding the validity of his conviction is that
certain comments made by the prosecutor during trial were improper and
warrant a new trial. Because Shipley did not object to the comments at trial, we
review for plain error. United States v. Gracia, 522 F.3d 597, 599-600 (5th Cir.
2008).
1
We do not construe Shipley’s testimony at trial to have been character evidence since
it neither discussed his reputation in the community nor purported to be an opinion of his own
character.
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“This court’s review of an assertion of prosecutorial misconduct takes place
in two steps. First, we must initially decide whether or not the prosecutor made
an improper remark. If an improper remark was made, we must then evaluate
whether the remark affected the substantial rights of the defendant.” United
States v. Gallardo-Trapero, 185 F.3d 307, 319 (5th Cir. 1999) (citations omitted).
Overturning a jury verdict for prosecutorial misconduct is appropriate only
when, “taken as a whole in the context of the entire case,” the prosecutor’s
comments “prejudicially affect[ed] [the] substantial rights of the defendant.”
United States v. Risi, 603 F.2d 1193, 1196 (5th Cir. 1979). We consider “the
magnitude of the prejudicial effect of the statement, the efficacy of any
cautionary instruction, and the strength of the prosecution’s evidence.” United
States v. Crooks, 83 F.3d 103, 107 (5th Cir. 1996).
First among the numerous statements Shipley complains of are several
references to one of the firearms Shipley sold having been found in Mexico, at
the scene of a shootout. Those statements related to evidence that was
presented at trial, and the evidence was relevant. We do not find plain error
warranting reversal here. Second, Shipley complains that certain statements
made during the prosecutor’s closing statements were improper appeals to
passion or prejudice that were calculated to inflame the jury. We disagree and
find no plain error. Third, Shipley contends that the prosecutor improperly
vouched for the credibility of the government’s witnesses. We read the trial
transcript differently and find no statements plainly vouching for any witness’s
credibility. In sum, we do not believe that any of the challenged statements were
improper ones sufficient to warrant reversal under plain error review.
VII.
Shipley contends that the forfeiture order contained in the district court’s
written judgment should be reversed for three separate reasons. The first is that
the district court did not give an oral forfeiture order at sentencing. The Federal
Rules of Criminal Procedure provide that, “in advance of sentencing,” “[i]f the
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court finds that property is subject to forfeiture, it must promptly enter a
preliminary order of forfeiture,” and then, “[a]t sentencing,” “the preliminary
forfeiture order becomes final as to the defendant.” Fed. R. Crim. P.
32.2(b)(2)(A), (b)(2)(B), and (b)(4)(A). The rules further provide that the district
court must “include the forfeiture when orally announcing the sentence or must
otherwise ensure that the defendant knows of the forfeiture at sentencing.” Fed.
R. Crim. P. 32.2(b)(4)(B). We, however, will reverse a court for failing to include
the forfeiture when orally announcing the sentence only if the defendant shows
“a reasonable probability that, but for the error claimed, the result of the
proceeding would have been different.” United States v. Dominguez Benitez, 542
U.S. 74, 76 (2004) (alteration and citation omitted). Here, Shipley has shown no
such reasonable probability.
Second, Shipley contends that the criminal forfeiture commenced outside
the legal time limitations. Under 18 U.S.C. § 924(d)(1), “[a]ny action or
proceeding for the forfeiture of firearms or ammunition shall be commenced
within [120] days of [the] seizure.” Shipley, however, did not raise this
argument in the district court. See United States v. Arky, 938 F.2d 579, 582 (5th
Cir. 1991) (“[T]he defendant must affirmatively assert a limitations defense at
trial to preserve it for appeal.”). If there was error, it was not plain.
Lastly, Shipley contends that there was not a nexus between his forfeited
firearms and ammunition and the counts of conviction. Under the Federal Rules
of Criminal Procedure, “the court must determine whether the government has
established the requisite nexus between the property and the offense.” Fed. R.
Crim. P. 32.2(b)(1)(A). Here, the government sought and obtained a court order
finding such a nexus, and Shipley did not object. Because there was sufficient
evidence in the record for the district court to so find, we do not believe there
was any error, let alone plain error.
***
We AFFIRM.
12
|
152 A.2d 191 (1959)
Charles Edward WASHINGTON, Appellant,
v.
GOVERNMENT OF DISTRICT OF COLUMBIA (a Municipal Corporation), Appellee.
No. 2328.
Municipal Court of Appeals for the District of Columbia.
Argued February 9, 1959.
Decided June 23, 1959.
Dovey J. Roundtree, Washington, D. C., with whom Julius W. Robertson, Washington, D. C., was on the brief, for appellant.
Richard W. Barton, Asst. Corp. Counsel, Washington, D. C., with whom Chester H. Gray, Corp. Counsel, Milton D. Korman, Principal Asst. Corp. Counsel, and Hubert B. Pair, Asst. Corp. Counsel, Washington, D. C., were on the brief, for appellee.
Before ROVER, Chief Judge, and HOOD and QUINN, Associate Judges.
ROVER, Chief Judge.
This is an appeal from the granting of a summary judgment in favor of the District of Columbia.
In his amended complaint appellant alleges that on November 13, 1956, he was removed from his position as a heavy truck driver in the District government "without proper notice * * * and in violation of rules and regulations governing the employment of District of Columbia employees"; that he was placed in a non-pay status from the date of removal through March 23, 1957, *192 when he was restored to pay status by the Commissioners of the District; that he was entitled to his wages from November 14, 1956, to March 23, 1957, which amount he fixed at $2,000 and for which he asked judgment.
The District first filed a motion to dismiss the complaint on the ground that it failed to state a claim upon which relief could be granted; this motion was denied by Judge Kronheim, whereupon the District filed a motion for summary judgment supported by certified copies of two orders of the Commissioners and affidavits of William A. Xanten, Superintendent, Division of Sanitation (the unit in which appellant was employed) and of Samuel C. Seiler, Personnel Officer of the Department of Sanitary Engineering (the custodian of the personnel file of appellant), the Sanitation Division being a part of the Sanitary Engineering Department. This appeal is prosecuted from an order by Judge Beard granting summary judgment.
Counsel for appellant raises two contentions: (1) that the decision of Judge Kronheim denying the District's motion to dismiss established as the law of the case that there existed a genuine issue of material fact and that accordingly it was error for Judge Beard to entertain and grant the motion for summary judgment; and (2) that Judge Beard erred in finding that there was no genuine issue of material fact and that the District was entitled to judgment as a matter of law.
As we understand the contention of counsel for appellant in reference to the first point, it is that while the District's motion was entitled a motion to dismiss, in view of the fact that Judge Kronheim before ruling considered documents outside the complaint, under the provisions of Rule 12(b)[1] of the trial court he was required to and did treat it as a motion for summary judgment and dispose of it in accordance with the provisions of Rule 56(c).[2]
We have held that an order denying a motion to dismiss or for summary judgment is an interlocutory and not a final order and that a final judgment is required to sustain the application of the law of the case rule.[3]
We do not understand that counsel for appellant contends that if the District's first motion is to be regarded simply as a motion to dismiss Judge Kronheim's order denying it established the law of the case, but rather that in view of the matters outside the complaint allegedly considered at the hearing on that motion it was treated as one for summary judgment, and for that reason Judge Beard could not as a matter of law consider and grant the motion for summary judgment subsequently filed by the District because Judge Kronheim's decision constituted the law of the case.
In view of our determination, for the reasons hereafter discussed, that the first motion was treated merely as one to dismiss and not for summary judgment and that accordingly under settled law the decision denying it did not constitute the law of the case we are not required to decide whether our ruling would be different if we were confronted with an order denying a summary judgment.
*193 Rules 12(b) and 56(c) of the trial court are counterparts of the same rules of the Federal Rules of Civil Procedure, 28 U.S. C.A. Our United States Court of Appeals in Sardo v. McGrath, 90 U.S.App.D.C. 195, 196 F.2d 20, 22 in discussing the interrelationship of the same two rules said that whether documents "* * * can qualify as `matters presented' within 12(b) depends, in our view, upon whether it is the sort of material contemplated by Rule 56. The latter is the definitive rule concerning summary judgment; Rule 12(b) merely provides one means of arriving at that end. It does not enlarge the record on which a summary judgment may be granted under Rule 56. Rule 56(c) says that summary judgment shall be granted `if the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that, * * * there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.' Thus, the extra-pleading matters presented must be either `depositions,' `admissions' or `affidavits.' All three possess certain characteristics which make them fitting instruments for cutting through a possible maze of false, illusory or collateral issues raised by loosely-drawn pleadings. * * *"
Counsel for appellant attempt to bring their case within the purview of Rules 12(b) and 56(c) when they state on page 4 of their brief: "Virtually the same matter the same cases and authorities and affidavits containing the precise averments were presented to the Court by pleadings and in arguments at the hearing upon which both the motion to dismiss and the motion for summary judgment were based. It follows therefore, that the question relative to issues of fact and a claim for adjudication had been fully established by the Court's ruling of August 29, 1958, when appellee's motion to dismiss was denied."
While it is true that the record could be more precise, we find in it no evidence that Judge Kronheim had before him any of the type of "extra-pleading matters" discussed in Sardo. It is true that some discussion was had concerning a document called "District Personnel Manual, Transmittal Sheet No. 5" and it probably received consideration; just what the contents of this document are we do not know as it was not made a part of the record. Reference was also made at the hearing to certain rules and regulations, allegedly promulgated by the Sanitation Department, setting forth the procedures to be followed in discharging employees and which procedures allegedly were not followed when appellant was discharged. This document was made a part of the record by the Corporation Counsel when he attached it as an exhibit to his motion for summary judgment. Even if it had been actually promulgated it is dated March 1, 1957, and accordingly was not in existence on November 14, 1956, the date of appellant's removal. The affidavits appellant's counsel contend were before Judge Kronheim obviously are those of Xanten and Seiler heretofore referred to; these documents were attached as exhibits to the motion for summary judgment and were dated September 8, 1958; the hearing on the motion to dismiss was concluded on August 29, 1958. The only other document we find in the record is one in the form of an affidavit signed by appellant; it is dated the _____ day of August 1958 and is not sworn to. Again, we find in the record a suggestion by the Corporation Counsel during the argument on the motion to dismiss that certain documents be added to the record so that the matter could be settled on the basis of a summary judgment. The discussion ended with this colloquy:
"Mr. Hofflund: Well, are you willing to proceed right here and now with the hearing on a motion for summary judgment?
"Mrs. Roundtree: I am not ready to proceed."
The court thereupon made the following entry:
"Defendant's Motion to dismiss overruled. Defendant granted 10 days within which to file an Answer."
*194 It is clear that Judge Kronheim treated the motion as one to dismiss the complaint; his denial of it was not a final order and his decision did not prevent Judge Beard from independently ruling on the merits of the questions raised by the motion for summary judgment.
Coming to the merits of the summary judgment motion, as stated earlier in this opinion, appellant's case was based on the proposition that he was removed "without proper notice * * * and in violation of the rules and regulations governing" District employees and that accordingly he was entitled to wages for the period he was in a non-pay status. We are not referred to the "rules and regulations" the District is charged with having violated. Presumably the reference is to the "Stated Practice on Non-Vets" made a part of the record by the District as an exhibit to the motion for summary judgment, but this document is dated approximately four months after appellant's removal and, according to the Xanten affidavit that is uncontradicted, this document "was prepared by personnel of the Division of Sanitation for my consideration, * * *. This office memorandum has never been officially promulgated. It was and is without force or effect in the Division of which I am Superintendent."
On the other hand, from the Seiler affidavit and the certified copies of the Commissioners' orders we find that appellant's case was handled as follows:
On November 14, 1956, the Superintendent, Mobile and Plant Equipment, Division of Sanitation (appellant's superior) recommended to Xanten, Superintendent of the Division, that appellant be discharged "for leaving a District truck unattended, with key in ignition and motor running, on Tuesday, November 13, 1956 at First and Eye Streets, S. E. * * * and for past record of warnings & suspensions."[4]
On November 15, 1956, the Commissioners were advised that appellant desired to appeal his discharge and had retained counsel to represent him.
On November 16, 1956, Xanten, with the approval of the Director of Sanitary Engineering, recommended to the Commissioners that appellant be removed from his position as a heavy truck driver for cause, effective December 8, 1956. Notice of this proposed action was sent to appellant by registered mail on November 19, 1956.
On November 29, 1956, the Commissioners approved the recommendation for removal; notice of the final removal action as approved by the Commissioners was sent to appellant by registered mail on December 4, 1956.
On December 4, 1956, the Commissioners were advised by counsel for appellant that he desired to appeal from their order and that a hearing was requested "in accordance with the usual procedures concerning employee grievances."
On December 6, 1956, the Commissioners notified appellant by registered mail that the effective date of his removal would be deferred pending action on his appeal to the District of Columbia Central Grievance Committee and that he would remain in a non-pay status pending final decision on his appeal.
*195 On February 7 and 11, 1957, the Grievance Committee held oral hearings on the appeal; at these hearings appellant was represented by counsel of his own choice and was given an opportunity to call and examine witnesses under oath, and to introduce evidence.
On March 22, 1957, the Commissioners notified appellant by registered mail that the Grievance Committee had recommended that the period during which he had been in a non-pay status constituted ample disciplinary action and that he should be restored to active duty status. Appellant was directed to report for work on March 25, 1957; he so reported and resumed his employment.
On April 2, 1957, Mr. Xanten recommended to the Commissioners that the removal action be cancelled and that appellant be restored to duty from a non-pay status effective March 25, 1957, but that he be carried in a non-pay status from November 14, 1956, through March 23, 1957. This recommendation was approved by the Commissioners on April 16, 1957, and a formal order to that effect was passed so that appellant has been continuously employed in his original position in a pay status since March 25, 1957.
The trial judge then, in considering the District's motion for summary judgment, had before him all of the facts outlined above. It is fair to say that these facts were uncontradicted; the only possible sources of contradiction were the general allegations in the complaint (for the most part merely conclusions) and the unsworn statements of appellant in the undated document hereto-fore referred to. We think on the whole record the trial judge was quite justified in finding that there was no genuine issue as to any material fact. Nor do we find anything in the record to support the allegations of the complaint that appellant was removed from his position "in violation of rules and regulations governing the employment of District of Columbia employees." So far as the record shows there were no such rules and regulations in effect at the time of his removal. It is clear that the "rules" and "regulations" relied on by appellant were never adopted nor promulgated as is demonstrated by Xanten's affidavit; even if there were a question concerning their adoption they postdate the removal by approximately four months.
Viewing the actions of the responsible District officials, it seems obvious that appellant was dealt with very fairly. He was notified of his discharge and the reasons therefor (and they were not inconsequential), he was allowed to appeal, a hearing was accorded him, he was represented by counsel of his own choice, they were permitted to call and examine witnesses under oath and to introduce testimony. Every step taken in the removal of appellant, his being placed in a non-pay status for the period in question and his restoration to duty were adopted and approved by the executive heads of the District government.[5] We rule that his removal was accomplished lawfully and that accordingly he is not entitled to recover wages for the time he was in non-pay status.
The Corporation Counsel also contends that as appellant rendered no services while in non-pay status the District is prohibited from compensating him for that period because of the provisions of Code 1951, § 1310.[6] He also refers us to Meredith v. The *196 District of Columbia, 10 D.C. 52, 3 Mac-Arthur 52 and District of Columbia v. Selden, 63 App.D.C. 40, 68 F.2d 988. We are not prepared to say that this last point is not well taken but in the light of the views expressed by us in this opinion we are not required to pass on this particular contention.
Affirmed.
NOTES
[1] "* * * If, on a motion asserting the defense numbered (5) to dismiss for failure of the pleading to state a claim upon which relief can be granted, matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56 * * *."
[2] "* * * The judgment sought shall be rendered forthwith if the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law * * *." (Emphasis supplied.)
[3] Elmira Corporation v. Bulman, D.C.Mun. App., 135 A.2d 645; McNeill v. Jamison, D.C.Mun.App., 116 A.2d 160; Davis v. Boyle Bros., D.C.Mun.App., 73 A.2d 517.
[4] A more detailed account of appellant's shortcomings is set forth in the Commissioners' order of November 16, 1956: "(1) Leaving a D. C. truck unattended, with key in the ignition and motor running, on Tuesday, November 13, 1956 at First and Eye Sts., S. E. Mr. Arney Supt. Garbage Collection noticed the truck and watched it for approximately 20 minutes. He then sent Mr. Lugenbeel to the truck, who, turned the motor off and took the key with him back to Mr. Arney's Office. Approximately 15 minutes later Charles Washington came to Mr. Arney's Office looking for the key. (2) And for past record of: (a) Failure to report for work, and to notify his superiors of the absence of safety equipment on his truck, for which he received a 2½ days suspension on July 11, 1956. (b) Failure to make satisfactory arrangements to liquidate his debts for which he was warned on July 19, 1956."
[5] Code 1951, § 1-216.
[6] "No civil officer, clerk, draftsman, copyist, messenger, assistant messenger, mechanic, watchman, laborer, or other employee shall, after June 30th 1995, be employed in any office, department, or other branch of the government of the District of Columbia or be paid from any appropriation made for contingent expenses, or for any specific or general purpose, unless such employment is authorized and payment therefor specifically provided in the law granting the appropriation or is authorized as hereinafter provided, and then only for services actually rendered in connection with and for the purposes of the appropriation from which payment is made and at the rate of compensation usual and proper for such services, and on and after July 1, 1905, all moneys accruing from lapsed salaries, or for unused appropriations for salaries, shall be covered into the treasury as are the balances of other unexpended appropriations for the support of the government of the District of Columbia." (Emphasis supplied.)
|
Dismissed w.o.j and Opinion Filed October 21, 2016
In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-16-01179-CV
IN RE LEE JEROME LEWIS, Relator
Original Proceeding from the Criminal District Court No. 6
Dallas County, Texas
Trial Court Cause No. F14-5207-X
MEMORANDUM OPINION
Before Justices Francis, Fillmore, and Stoddart
Opinion by Justice Stoddart
Before the Court is relator’s October 6, 2016 petition for writ of mandamus in which he
asks the Court to direct the district clerk to allow him to purchase the transcripts of all witness
testimony presented to the grand jury and to order the district clerk to itemize the costs of the
transcripts and either produce the transcripts to relator or swear by affidavit that no such records
are on file and why.
The Court’s power to issue a writ of mandamus is limited as set forth in section 22.221 of
the Texas Government Code. Because the Dallas County district clerk is not a judge, we may
issue a writ of mandamus to compel action by the district clerk only to the extent necessary to
enforce our jurisdiction. See TEX. GOV'T CODE ANN. § 22.221(a), (b) (West 2004) (writ power);
In re Wade, 05-15-01179-CV, 2015 WL 5783691, at *1 (Tex. App.—Dallas Oct. 5, 2015, no
pet.) (mem. op.). Relator’s prior appeal in this Court has been resolved, and the alleged failure
of the district clerk to provide relator with a copy of the grand jury transcripts does not implicate
our jurisdiction. We, therefore, lack jurisdiction over the petition for writ of mandamus.
Accordingly, we DISMISS relator’s petition for writ of mandamus for want of jurisdiction. See
TEX. R. APP. P. 52.8(a).
/Craig Stoddart/
CRAIG STODDART
JUSTICE
161179F.P05
–2–
|
577 N.E.2d 488 (1991)
217 Ill. App.3d 419
160 Ill.Dec. 358
Donna SPANN, Plaintiff-Appellant,
v.
SPRINGFIELD CLINIC, a Partnership, Defendant-Appellee.
No. 4-91-0121.
Appellate Court of Illinois, Fourth District.
August 6, 1991.
*489 R.W. Deffenbaugh, Deffenbaugh, Loewenstein, Hagan, Oehlert & Smith, P.C., Springfield, for plaintiff-appellant.
Daniel Maher, Stratton, Dobbs, Nardulli & Lestikow, Springfield, Mark E. Furlane, Alan S. King, Gardner, Carton & Douglas, Chicago, for defendant-appellee.
Justice GREEN delivered the opinion of the court:
On May 22, 1990, plaintiff Donna Spann filed a complaint in the circuit court of Sangamon County against defendant Springfield Clinic, a partnership, contending defendant improperly discharged her from her employment with defendant. She sought reinstatement and money damages. On December 6, 1990, plaintiff filed an amended three-count complaint against defendant. Count I alleged defendant had terminated plaintiff's employment without affording her grievance-procedure rights provided for in an employees' handbook. Count II alleged defendant breached a duty of good faith owed plaintiff pursuant to the employment contract between the parties. Count III contended defendant inflicted intentional emotional harm on plaintiff. On January 7, 1991, defendant filed a motion pursuant to section 2-619(a)(9) of the Code of Civil Procedure (Ill.Rev.Stat.1989, ch. 110, par. 2-619(a)(9)) maintaining a disclaimer provision in the handbook negated any right of plaintiff to a grievance procedure and that counts II and III did not set forth causes of action. On January 22, 1991, the circuit court allowed defendant's motion dismissing the cause with prejudice.
On appeal, we need not consider the propriety of the dismissal of the count alleging intentional infliction of emotional injuries, as plaintiff has cited no error in that regard. The substance of her argument on appeal is that the law should allow redress for a faithful at-will employee who, as she alleges, is discharged with no reason given and apparently because of mistake. She contends this is particularly true when the employee has also been given a handbook defining employee rights to a grievance procedure which was not followed. However, we hold that neither statutory law nor judicial precedent has extended the rights of an at-will employee as plaintiff asserts, and the employee handbook set forth by the pleadings makes clear no grievance rights were granted to plaintiff by that handbook. Accordingly, we affirm.
Plaintiff's amended complaint alleged a great deal of factual information and attached to it were various documents and affidavits. The common substance of counts I and II were allegations that (1) plaintiff was hired on July 29, 1985, and had served as a faithful employee with good evaluations until March 28, 1990, when she was called into conference with defendant's administrator and co-employee Jackie Wolf; (2) those employees were then informed of a letter by Julie Smith asserting that the confidentiality concerning her pregnancy had been violated by someone; (3) Wolf admitted she had revealed the information to plaintiff and others; (4) plaintiff had told Smith of Wolf's telling others of Smith's pregnancy and Smith had written to the administrator telling him that Wolf had told plaintiff she had obtained confidential information from clinic files concerning Smith's pregnancy; (5) a counseling memorandum had stated a determination had been made that plaintiff saw Smith getting a sonogram and began seeking to find out why from confidential information; (6) the foregoing matter in the memo was untrue; and (7) plaintiff was *490 fired and was told she was fired for teasing someone.
Both counts also stated (1) before discharge, plaintiff had no benefit of the "Formal Problem Solving Clearance Procedure" set forth in the handbook; (2) plaintiff signed an acknowledgment of receipt of the handbook but did not understand she could be fired for allegations which were untrue; and (3) defendant violated the terms of the handbook. Count II also asserted (1) defendant had a duty of using good faith in the investigation and determination of the charges against plaintiff; (2) defendant had greater power than did plaintiff and that power was unchecked; and (3) the provisions of the handbook for employee termination proceedings should be followed.
Plaintiff's theory that she had certain procedural rights arising from an employee handbook she had been given by defendant arises from the decision in Duldulao v. Saint Mary of Nazareth Hospital Center (1987), 115 Ill.2d 482, 106 Ill.Dec. 8, 505 N.E.2d 314. There the court held the general "employment-at-will rule," which allowed either party in an employment-at-will relationship to terminate the employment for any reason, was only a presumption which could be overcome by a showing that the parties intended otherwise. The supreme court concluded that traditional requirements for contract formation governed whether any employee handbook created an enforceable contract.
The Duldulao court set forth the following principles to determine whether an employee handbook creates an employment contract:
"First, the language of the policy statement must contain a promise clear enough that an employee would reasonably believe than an offer has been made. Second, the statement must be disseminated to the employee in such a manner that the employee is aware of its contents and reasonably believes it to be an offer. Third, the employee must accept the offer by commencing or continuing to work after learning of the policy statement. When these conditions are present, then the employee's continued work constitutes consideration for the promises contained in the statement, and under traditional principles a valid contract is formed." (Duldulao, 115 Ill.2d at 490, 106 Ill.Dec. at 12, 505 N.E.2d at 318.)
The court concluded that, there, all three conditions were met, and the employer was contractually obligated to provide the grievance procedure contained in its handbook before it would discharge an employee. The court noted that, there, the "handbook contain[ed] no disclaimers to negate the promises made." Duldulao, 115 Ill.2d at 491, 106 Ill.Dec. at 13, 505 N.E.2d at 319.
The Duldulao handbook provided that, after completion of a probationary period, an employee "could be terminated only with `proper notice and investigation'" and three warning notices before discharge. (Duldulao, 115 Ill.2d at 486, 106 Ill.Dec. at 10, 505 N.E.2d at 316.) The court reasoned that accordingly, the employee would likely assume that discharge would not occur without warnings unless serious misconduct was involved. The court also noted that no disclaimers were involved and the handbook expressly indicated it was "`designed to clarify [the employees'] rights and duties as employees.'" (Emphasis in original.) Duldulao, 115 Ill.2d at 491, 106 Ill.Dec. at 13, 505 N.E.2d at 319.
After Duldulao, this court decided Anders v. Mobil Chemical Co. (1990), 201 Ill.App.3d 1088, 147 Ill.Dec. 779, 559 N.E.2d 1119, and Rudd v. Danville Metal Stamping Co. (1990), 193 Ill.App.3d 1009, 140 Ill.Dec. 789, 550 N.E.2d 674. In Anders we upheld a summary judgment determining that an employee handbook did not bind an employer to following a particular procedure before discharging an otherwise at-will employee. There, unlike in Duldulao, the handbook contained various disclaimers indicating the handbook was not intended to bind the employer. (Anders, 201 Ill.App.3d at 1096, 147 Ill.Dec. at 783, 559 N.E.2d at 1123.) In Rudd we upheld the dismissal of a complaint by an employee seeking relief from a discharge relying upon a handbook. This court concluded the handbook was not stated in terms creating *491 a contract between the employer and the employee. As we will explain, we find the handbook in this case similar to that in Anders and Rudd and materially different from that in Duldulao.
The parties do not dispute that the terms of the handbook were incorporated in the pleadings before the circuit court when it ruled. In addition to general statements of the employer's desire to be a good employer and to maintain good employee relations, the portion of the handbook upon which plaintiff relies states:
"Problems, Complaints, and Grievances
Any employee who has a problem, complaint, or grievance should discuss it first with the department supervisor. If satisfaction is not obtained at that level the Personnel Director should be consulted.
Any employee may see either the Personnel Director or the Administrator at any time to discuss a problem.
There is also a formal Problem Clearance Procedure which provides a method for hearing employee concerns and resolving them. The Personnel Director will explain this procedure and assist the employee should it become necessary." The handbook also states:
"Employees who are hired on this basis receive the full program of benefits offered by the Clinic upon the successful completion of the 90 day probationary period."
And, finally, the handbook provides: "Successful completion of the probationary period will give rise to eligibility for participation in certain Clinic benefits." (Emphasis added.) Among the benefits listed are the terms "problems," "complaints," and "grievances."
The foregoing provisions are substantially different than those in Duldulaowhich permitted termination only after "notice," "warning," and "investigation" and spoke of employees' "rights" rather than "benefits." (Duldulao, 115 Ill.2d at 490-91, 106 Ill.Dec. at 12-13, 505 N.E.2d at 318-19.) More importantly, the handbook in Duldulao had no disclaimers. Here, the handbook stated:
"This handbook is intended to be your guide to the operations of Springfield Clinic. However, you should not consider it or any other personnel documents which may be posted or distributed from time to time as a contract of employment.
* * * * * *
We adhere to the principles of individual achievement, effort and freedom of choice. Therefore, neither you nor Springfield Clinic is bound by a contract of employment for a definite period and the rights of either party to terminate the employment relationship are not limited by a contractual commitment."
In addition, the record before the trial court showed a signed receipt by plaintiff of her copy of the handbook, which stated:
"I hereby acknowledge receipt of a copy of the Springfield Clinic Employee Handbook. I understand that this handbook does not constitute a contract of employment, that neither I nor Springfield Clinic is bound to an employment contract or a commitment to employment for a definite period of time, and that the rights of either party to terminate the employment relationship are not limited."
The trial court ruled that plaintiff failed to establish the first principle required by Duldulao in order for the handbook to become a contract. We agree. The "policy statement" of the handbook does not contain "a promise clear enough that an employee would reasonably believe that an offer has been made." (Duldulao, 115 Ill.2d at 490, 106 Ill.Dec. at 12, 505 N.E.2d at 318.) Rather, as in Anders, the handbook contains a clear statement that the rights of neither the employer nor the employee to terminate the employment relationship are limited by contract. Also, as we have indicated, even absent any disclaimer, the "benefits" in regard to grievances granted to employees by the handbook are not definite or stated to be rights. Moreover, here, plaintiff has signed an acknowledgement of the existence of defendant's *492 disclaimer of intent to create a contract.
Plaintiff strongly urges us to adopt a rule of public policy which would prohibit an employer from discharging a faithful at-will employee without giving a reason and through mistake, as she maintains she has alleged here. Plaintiff asserts that even if the handbook was insufficient to create a binding contract, it creates an atmosphere in which the employee places a trust in the employer, and which she contends was violated here. She relies on language in Duldulao and cases cited therein which state that the status of at-will employment is not immune from restriction. As did the Duldulao opinion, she relies in particular on Pine River State Bank v. Mettille (Minn. 1983), 333 N.W.2d 622. However, the restriction upon the at-will status to which those opinions refer is the restriction placed upon the at-will status by a clearly defined contract contained in an employee handbook.
Plaintiff also cites Cleary v. American Airlines, Inc. (1980), 111 Cal.App.3d 443, 168 Cal.Rptr. 722, and Coats v. General Motors Corp. (1934), 3 Cal.App.2d 340, 39 P.2d 838, which set forth a rule requiring an employer to act in good faith in discharging an at-will employee. However, as late as 1985 in ruling upon the grounds for a recovery for retaliatory discharge, the supreme court stated, "The common law doctrine that an employer may discharge an employee-at-will for any reason or for no reason is still the law in Illinois, except for when the discharge violates a clearly mandated public policy." (Barr v. Kelso-Burnett Co. (1985), 106 Ill.2d 520, 525, 88 Ill.Dec. 628, 630, 478 N.E.2d 1354, 1356.) Unquestionably, the conduct with which defendant is charged here does not come within the public policy exception described in Barr and originally in Kelsay v. Motorola, Inc. (1978), 74 Ill.2d 172, 23 Ill.Dec. 559, 384 N.E.2d 353. The violations of public policy described in those cases arose from discharges for exercise of such rights as to file workers' compensation claims (Kelsay, 74 Ill.2d 172, 23 Ill.Dec. 559, 384 N.E.2d 353) or to report freely violations of law. (Palmateer v. International Harvester Co. (1981), 85 Ill.2d 124, 52 Ill.Dec. 13, 421 N.E.2d 876.) In Harrison v. Sears, Roebuck & Co. (1989), 189 Ill.App.3d 980, 137 Ill.Dec. 494, 546 N.E.2d 248, this court held that an employer owed no duty of good faith in discharging an at-will employee.
Plaintiff relies upon Duldulao as setting the stage for acceptance of a rule requiring good faith in the discharge of an at-will employee. We see no intent in Duldulao to modify the clear strong language of Barr which we have quoted. Accordingly, we conclude that even if we favored creation of such a good-faith rule, we should await the recognition of such a rule by the Illinois Supreme Court or the General Assembly.
We affirm for the reasons stated.
Affirmed.
LUND, P.J., and STEIGMANN, J., concur.
|
984 A.2d 244 (2009)
411 Md. 600
JOSEPH E. DORSEY
v.
STATE.
Pet. Docket No. 342.
Court of Appeals of Maryland.
Denied December 11, 2009.
Petition for Writ of Certiorari denied.
|
Unable to extract the content from this file. Please try reading the original. |
195 F.3d 346 (8th Cir. 1999)
Marlon Simmons, Appellant,v.Lynda Taylor; Jeremiah (Jay) Nixon, Attorney General of the State of Missouri, Appellees.
No. 98-3082
United States Court of Appeals FOR THE EIGHTH CIRCUIT
Submitted: September 16, 1999Filed: October 21, 1999
Appeal from the United States District Court for the Western District of Missouri.
Before BOWMAN, LAY, and MORRIS SHEPPARD ARNOLD, Circuit Judges.
BOWMAN, Circuit Judge.
1
Marlon Simmons appeals from the order of the District Court1 denying his habeas corpus petition. This Court granted a certificate of appealability on two issues: "(1) whether the use of a police photo and admission of testimony that the detective obtained the photo from the police records unit was a denial of due process, and (2 whether appellant was denied due process and effective assistance of counsel when he was tried in jail clothing." We affirm.
I.
2
In February 1994, Investigator Lee Richards, an undercover officer with the Kansas City Police Department, made three purchases of cocaine. On each occasion, the purchase occurred in Investigator Richards's car, allowing him an unobstructed view of the dealer. On the day of the second purchase, Officer Bradley Thomas conducted a pedestrian check of an individual matching the general description of the dealer in order to ascertain his identity. The individual claimed to be Marlon Simmons. After the final sale, Detective Ginger Locke obtained a photograph of Simmons from the police records unit and placed it in a photo lineup. Investigator Richards identified Simmons as the dealer.
3
Simmons was charged with three counts of the sale of a controlled substance in circuit court in Jackson County, Missouri. Although Simmons appeared at trial in "obvious jail garb," counsel made no objection on the record.2 Counsel also made no objection when Detective Locke testified that she obtained the photograph of Simmons from the police records unit. The jury found Simmons guilty on all three counts.
4
Simmons filed a notice of appeal and a Missouri Rule of Criminal Procedure 29.15 motion for postconviction relief. The Missouri Court of Appeals suspended the direct appeal pending the outcome of the 29.15 motion. Among other things, Simmons alleged in his 29.15 motion that his trial counsel was ineffective for failing to object to his being tried in jail clothing. Finding that Simmons "failed to allege facts which, if true, would warrant relief or are allegations which are refuted by the record," the motion court denied the 29.15 motion without an evidentiary hearing.3 Simmons then appealed the denial of his 29.15 motion, and the state court of appeals consolidated his 29.15 appeal with his direct appeal.
5
At the state court of appeals, Simmons argued 1) that the trial court erred in allowing a detective to testify that she obtained the photograph of Simmons used in the photo lineup from police records and 2) that the motion court erred in denying the 29.15 motion without an evidentiary hearing. Although Simmons failed to preserve the error for appeal, the state court of appeals conducted plain error review on the evidentiary issue. Finding no plain error on the first ground and no merit to Simmons's second argument, the state court of appeals affirmed.
6
Simmons raised both issues again in his pro se habeas corpus petition in the District Court. The District Court reached the merits of both issues but found neither sufficient for relief under the standard of 28 U.S.C. 2254(d). This Court then granted a certificate of appealability on both issues.
II.
7
Simmons first argues that Detective Locke's testimony that she obtained the photograph of Simmons from police records violated Simmons's due process rights. Simmons first raised this argument on direct appeal before the Missouri Court of Appeals. When a state appellate court conducts plain error review on an issue that was not preserved for appeal, there is some question within this Circuit whether the issue has been procedurally defaulted. See Sweet v. Delo, 125 F.3d 1144, 1152 (8th Cir. 1997), cert. denied, 118 S. Ct. 1197 (1998). We need not belabor this question, however, because we find that the state court's decision was not "contrary to . . . clearly established Federal law." 28 U.S.C. 2254(d)(1); see Harris v. Wyrick, 634 F.2d 1152, 1153 (8th Cir. 1980) (per curiam) (holding that "limited references in the record to police photographs and mugshots, unaccompanied by anything suggesting previous criminal activities, do not appear sufficiently prejudicial so as to be considered fundamentally unfair"), cert. denied, 451 U.S. 916 (1981).
III.
8
Simmons next argues that his trial counsel was ineffective for failing to object when he was tried in jail clothing.4 The facts relevant to this claim have not been fully developed because the state court denied Simmons's motion for postconviction relief without an evidentiary hearing. See Smith v. United States, 182 F.3d 1023, 1026 (8th Cir. 1999) (remanding federal habeas case for evidentiary hearing on whether trial counsel was ineffective for failing to object when appellant was tried in jail clothing).
9
In this case, Simmons was found by the state courts to have procedurally defaulted his opportunity for an evidentiary hearing in the state postconviction proceeding by failing to allege facts sufficient to support his claim. Simmons does not challenge the adequacy or the independence of this state procedural ground for the denial of an evidentiary hearing. We must determine, however, whether Simmons is entitled to a federal evidentiary hearing despite this procedural default.
10
Simmons does not contend that there was cause and prejudice to excuse the procedural default. With the exception of an unsupported claim that he is actually innocent, Simmons does not claim that a fundamental miscarriage of justice would result from failure to hold an evidentiary hearing. See Schlup v. Delo, 513 U.S. 298, 324 (1995) (requiring "new reliable evidence" of actual innocence to meet fundamental miscarriage of justice exception). Moreover, even if an evidentiary hearing were held and Simmons were able to show that his trial counsel's failure to object to Simmons's appearing in jail clothing fell below the constitutional standard that the Sixth Amendment requires, the overwhelming weight of the state's evidence of Simmons's guilt would make it impossible for him to demonstrate prejudice under Strickland v. Washington, 466 U.S. 668 (1984). Accordingly, Simmons is not entitled to an evidentiary hearing, and his ineffective assistance claim therefore must fail.
11
AFFIRMED.
Notes:
1
The Honorable ORTRIE D. SMITH, United States District Judge for the Western District of Missouri.
2
Simmons appeared in jail clothing at a pretrial hearing on April 10, 1995. The trial court apparently delayed the beginning of the voir dire in order to give Simmons the opportunity to have someone bring him civilian clothes. See Tr. at 2-3. But the next day Simmons again appeared in jail clothing:
THE COURT: Mr. Simmons, yesterday afternoon when we left, I told [defense counsel] to call your friends and relatives so they could deliver clothes for you and [defense counsel] tells me that you said you would call them. . . . .
DEFENDANT SIMMONS: I did call them last night. I don't know what happened. They ain't even here yet and I called them. Said they'd bring them down.
THE COURT: Go up to the Public Defenders Office and see if they've got any clothes we can borrow. He can change in here. I'll tell the panel we're going to be a little delayed. Let me know right away . . . .
[DEFENSE COUNSEL]: All right.
THE COURT: All right. Take him out in the hallway until they get his clothes down here.
Tr. at 5-6. The record does not indicate anything further at this point, but during the course of the trial, Simmons was dressed in a "dark green uniform." Tr. at 129; see also Tr. at 77, 134, 151.
3
Under Missouri law, the motion court has the authority to deny a motion for postconviction relief without an evidentiary hearing: "If the court shall determine the motion and the files and records of the case conclusively show that the movant is entitled to no relief, a hearing shall not be held." Mo. R. Crim. P. 29.15(h).
4
To the extent that our certificate of appealability granted review on the question whether the trial of Simmons in jail clothing violated his due process rights, we conclude that Simmons was not compelled to stand trial in jail clothing. See Smith v. United States, 182 F.3d 1023, 1025 (8th Cir. 1999) ("For this Court to find the compulsion necessary to establish a constitutional violation, an objection must have been made on the record.")
|
THIRD DIVISION
JANUARY 31, 2007
No. 1-06-0170
In re M.T., Alleged to be a Person ) Appeal from the
Subject to Involuntary Treatment With ) Circuit Court of
Psychotropic Medication ) Cook County.
)
(The People of the State of Illinois, )
)
Petitioner-Appellee, ) No. 06 COMH 130
)
v. )
)
Maria T., ) Honorable
) Nathaniel R. Howse,
Respondent-Appellant). ) Judge Presiding.
JUSTICE GREIMAN delivered the opinion of the court:
Respondent, Maria T., appeals from an order of the circuit
court of Cook County authorizing her involuntary treatment with
psychotropic medication. She contends that the order should be
reversed because the State failed to prove by clear and
convincing evidence that the benefits of the medication
outweighed the harm.
The State, through Dr. Joanna Poniaquwicz of Lutheran
General Hospital, petitioned the court on January 11, 2006, to
begin the involuntary treatment of respondent with psychotropic
medications pursuant to section 2-107.1 of the Mental Health and
Developmental Disabilities Code (Code) (405 ILCS 5/2-107.1 (West
2004)). In the petition, Dr. Poniaquwicz stated that respondent
suffered from paranoid schizophrenia, that she was currently
psychotic and unable to function, and sought to medicate her with
1-06-0170
Proloxin Decanoate (12.5- to 25-milligram injection every two
weeks), and alternatively with Risperidone1 Consta (25- to
50-milligram injection every two weeks), oral Proloxin tablets
(up to 40 milligrams per day), and oral risperidone tablets (up
to 8 milligrams per day).
On January 13, 2006, Dr. Poniaquwicz responded to a routine
bill of particulars, stating that respondent had been
involuntarily admitted to Chicago Read Hospital in December 2004,
received Proloxin Decanoate, and responded "well," as she was
able to care for herself and be discharged from the hospital in
March 2005. However, because respondent became noncompliant with
her medication, she was readmitted to Swedish Covenant Hospital
in November 2005.
On January 20, 2006, a hearing was held on the State's
petition. Nancy S., respondent's daughter, testified regarding
the series of events leading to respondent's present
hospitalization. During the first two weeks of November 2005,
respondent told her that she owned at least one other home, which
she did not, and that when she went there to bathe herself, the
police came and took her to Swedish Covenant Hospital. She also
told her that she was the Virgin Mary, that she was rich, and
that banks owed her money. On December 22, 2005, when Nancy took
1
"Risperidone" and "Risperdal" are used interchangeably
throughout the record.
- 2 -
1-06-0170
respondent to a grocery store, respondent was reluctant to
purchase fruits, vegetables, and milk for fear of contamination.
On January 5, 2006, respondent told Nancy that she had not been
eating because her food was being poisoned, which statement
respondent had made to her at least six times during December
2005. Nancy had also noticed that respondent had lost about 15
pounds from October 2005 to the time of the hearing.
On January 6, 2006, respondent was admitted to Lutheran
General Hospital and continued to express that her food was being
poisoned. She also told Nancy to cover herself to prevent
people from inserting objects into her orifices and that she had
inserted tampons "in her behind." In addition, respondent told
Nancy that her home was "fine" and that she had been using the
heat; however, when Nancy visited there five days later, she had
to crawl through a broken window to enter the house because the
entrance was barricaded, the refrigerator was unplugged and in
the living room with a chain around it, the furnace was turned
off, the oven was turned on and opened, and a waffle iron was
turned on to heat the basement. Respondent subsequently told
Nancy, on January 8, 2006, that she could not eat the hospital
food because it smelled "funny" and because voices had told her
not to do so.
Nancy further testified that respondent had been on long-
term psychotropic medications in the past, most recently from
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1-06-0170
October 2004 through February 2005, when she was involuntarily
admitted to Read Hospital. At that time, respondent was
prescribed Risperdal, among other things, and after receiving
this medication, respondent was more rational, did not
hallucinate as often, and talked more about everyday life.
Although she experienced some side effects from the medication,
they were able to be controlled. When respondent was discharged,
she was still "a little paranoid," but she was better able to
care for herself and her home, i.e., she bought a wider variety
of foods, gained weight, cleaned her house, and used space
heaters. Nancy acknowledged that she "probably" told Dr.
Poniaquwicz that Risperdal had not done respondent "a lot of
good" in the past.
Dr. Poniaquwicz, an expert in the field of psychiatry and
respondent's attending physician, testified that respondent was
admitted to Lutheran General Hospital on January 6, 2006. Dr.
Poniaquwicz first examined respondent on January 7, 2006, and
about six days a week thereafter. Based on her inquiry into
respondent's social history, including talking to Nancy,
reviewing respondent's medical records, and discussing the case
with her peers, she opined that respondent suffered from paranoid
schizophrenia and had done so for 26 years. Respondent was
currently symptomatic and experiencing paranoid delusions, i.e.,
her food was being poisoned and voices were telling her not to
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1-06-0170
eat. She was also displaying disorganized behaviors, i.e., she
attempted to tie a stocking around her neck and knelt on her bed
with the covers over her head. In addition, respondent was
displaying isolating behaviors and talking to herself. Based on
respondent's condition, i.e., her inability to keep her house
safe or eat properly, Dr. Poniaquwicz believed that respondent's
ability to function had deteriorated.
On January 9, 2006, Dr. Poniaquwicz observed respondent
attempting to tie a stocking around her neck and concluded that
respondent presented a threat to herself and that she lacked the
capacity to make decisions regarding her treatment. She
therefore administered two separate, 10-milligram emergency doses
of Proloxin to respondent. Although respondent became calmer
after receiving the medication, she complained that she was tired
and that her tongue felt large after the second dose was
administered on January 13, 2006. Dr. Poniaquwicz explained that
respondent had experienced a dystonic reaction to the medication,
a side effect which caused her tongue muscle to tense up, so Dr.
Poniaquwicz issued a "stat" order for Cogentin to relieve the
side effect. Because the Cogentin did not completely resolve the
issue, Dr. Poniaquwicz subsequently ordered Benadryl, which
completely resolved the problem. Dr. Poniaquwicz then
discontinued the administration of Proloxin for two reasons: the
- 5 -
1-06-0170
side effects and her uncertainty regarding the amount of time she
could administer the medication under the circumstances.
Despite respondent's reaction, Dr. Poniaquwicz still sought
permission to treat respondent with Proloxin Decanoate and,
alternatively, with Risperdal Consta, oral tablets of Proloxin,
and oral tablets of Risperdal, in the dosages indicated in the
petition, for 90 days. Dr. Poniaquwicz based her request on the
fact that respondent had historically responded best to Proloxin,
as she had taken it during her last inpatient hospitalization and
in the 1990s during a hospitalization in Montana. Moreover,
Nancy had told her that when respondent had previously taken
Proloxin for an extended period of time, her symptoms markedly
diminished and that she was able to function independently and be
discharged from the hospital. With regard to the risperidone,
Dr. Poniaquwicz testified that Nancy had informed her that
respondent had responded well to the medication in the past and
that she would have to further explore Nancy's statement that it
had not done respondent "much good."
Dr. Poniaquwicz acknowledged that the possible side effects
of Proloxin, as well as the alternative medications listed in the
petition, included tardive dyskinesia, extrapyramidal symptoms,
dystonia, tremor, akinesia, neuroleptic malignant syndrome (NMS),
and diabetes. She further acknowledged that respondent's age and
gender put her at an increased risk of developing tardive
- 6 -
1-06-0170
dyskinesia, i.e., abnormal movements, and NMS, which was
potentially, but rarely, fatal. Nevertheless, Dr. Poniaquwicz
opined that the anticipated benefits of administering the
proposed psychotropic medications outweighed the possible harm
because the side effects could be "remedied with appropriate
medications," and she "hoped" and "believed" that the requested
medications would enable respondent to function independently,
eat regularly, and be discharged from the hospital. She
conversely believed that, if left untreated, respondent's
symptoms would worsen, her condition would further deteriorate,
and she would be unable to live independently. Dr. Poniaquwicz
further opined that a less restrictive treatment was
inappropriate for respondent's condition.
Dr. Poniaquwicz finally testified that due to respondent's
most recent reaction to Proloxin, she would start her on a low
dose, closely monitor whether she experienced any side effects,
and if so, administer the "appropriate medications" to counter
them. She also stated that she would be available daily to
monitor respondent's response to the medications, would ensure
that the medications were safely and effectively administered
though various tests requested in the petition, e.g.,
electrocardiograms, metabolic profiles, and vital signs, and that
a psychiatrist would be available to intervene on an emergency
basis if respondent experienced adverse side effects. At the
- 7 -
1-06-0170
conclusion of the hearing, the circuit court found that the State
had proved the factors necessary to grant the petition by clear
and convincing evidence. The court specifically found:
"[A]lthough there were some side
effects, they were completely abated by the
administration of counteracting drugs. The
alternative for this individual is her not
[being] able to live a normal life in her
home the way she wants to live it. With the
medication she can go back to living her
life. The physical harm can be abated by the
counteracting drugs, and, therefore, the
petition is granted."
The court then entered an order allowing Dr. Poniaquwicz to
administer Proloxin Decanoate (12.5- to 50-milligram injections
every two weeks) to respondent for 90 days. The order
alternatively granted Dr. Poniaquwicz the authority to administer
Risperidone Consta (25- to 50-milligram injections every two
weeks), Proloxin tablets (up to 40 milligrams per day), and
risperidone tablets (up to 8 milligrams per day).
In this appeal from that order, respondent asserts that the
State failed to prove by clear and convincing evidence that the
benefits of the medication outweighed the harm. She thus
requests that the order of the circuit court be reversed.
- 8 -
1-06-0170
Initially, we observe that this case is moot. The order
authorizing the administration of respondent's involuntary
treatment was effective for no more than 90 days, and thus
expired on April 20, 2006. 405 ILCS 5/2-107.1(a-5)(5) (West
2004). Nevertheless, review of this appeal is appropriate under
the "public interest exception" to the mootness doctrine. In re
Mary Ann P., 202 Ill. 2d 393, 401-02 (2002).
Authorized involuntary treatment, i.e., the forced
administration of psychotropic medication, shall not be
administered to an adult recipient unless the State proves seven
specific factors, including that the benefits of the treatment
outweigh the harm, by clear and convincing evidence. 405 ILCS
5/2-107.1(a-5)(4) (West 2004); In re C.E., 161 Ill. 2d 200, 208,
221 (1994). Clear and convincing evidence is deemed to be more
than a preponderance, but does not reach the degree of proof
necessary to convict a person of a criminal offense. In re John
R., 339 Ill. App. 3d 778, 781 (2003). On review, we give great
deference to the circuit court's factual findings and will not
reverse its decision merely because we may have reached a
different conclusion; instead, reversal is warranted only if the
circuit court's decision is manifestly erroneous, i.e., the error
is clearly evident, plain, and undisputable. In re Jeffers, 239
Ill. App. 3d 29, 35 (1992). For the reasons that follow, we do
not find this to be such a case.
- 9 -
1-06-0170
The record before us discloses respondent's history and
deteriorating condition, i.e., her 26-year diagnosis of paranoid
schizophrenia, and her recent behaviors and delusions which
prohibited her from safely and properly caring for herself.
Based on these behaviors and respondent's inability to conduct a
reasonably safe existence, Dr. Poniaquwicz determined that the
benefits of administering psychotropic medications, primarily
Proloxin, outweighed the harm of the side effects. She
anticipated that if treated with the proposed psychotropic
medications, respondent would be able to function independently,
eat regularly, and be discharged from the hospital. She
conversely believed that, if left untreated, respondent's
symptoms would worsen, her condition would further deteriorate,
and she would be unable to live independently.
Dr. Poniaquwicz based her opinion, in part, on Nancy's
report of respondent's positive response to Proloxin in the past.
When respondent had previously taken this medication for an
extended period of time, her symptoms markedly diminished, and
she was able to function independently and be discharged from the
hospital. Nancy specifically told her that when respondent was
treated at Read Hospital with Proloxin (and Risperdal) from
October 2004 through February 2005, she was more rational, did
not hallucinate as often, talked more about everyday life, and
better cared for herself and her home upon discharge from the
- 10 -
1-06-0170
hospital. Nancy also reported that although respondent had
experienced side effects from the medications, they were able to
be controlled.
The evidence further showed that despite respondent's
dystonic reaction to the second 10-milligram dose of Proloxin on
January 13, 2006, Dr. Poniaquwicz was able to relieve the side
effects with Cogentin and Benadryl, and would be available daily
to monitor respondent's response to the medications and to
administer "appropriate medications" to counteract any side
effects. In addition, the circuit court approved Dr.
Poniaquwicz's request for laboratory tests to ensure that the
psychotropic medications were administered safely and
effectively. We thus conclude that the State provided clear and
convincing evidence that the benefits of administering
psychotropic medications to respondent outweighed the harm (405
ILCS 5/2-107.1(a-5)(4)(D) (West 2004)), and that the court's
order to that effect was not manifestly erroneous.
In so finding, we reject respondent's arguments that the
circuit court's order should be reversed because the "side-
effect-relieving" medications were not requested in the petition
or authorized by the court, and because such medications posed
the risk of side effects. A petitioner is not required to set
forth the specific medications she seeks to administer. In re
Miller, 301 Ill. App. 3d 1060, 1071 (1998). Moreover, while an
- 11 -
1-06-0170
order "shall *** specify the medications and the anticipated
range of dosages that have been authorized and may include a list
of any alternative medications and range of dosages" (405 ILCS
5/2-107.1(a-5)(6) (West 2004)), we have not found, and respondent
has not provided, any case law where an order entered under
section 2-107.1 was reversed because a medication used to quell
the side effects of a psychotropic medication was not listed in
the court's order.
Rather, reviewing courts have reversed circuit court orders
where the order, and the court's oral ruling, failed to specify
the psychotropic medications and the range of dosages requested
in the petition. See, e.g., In re Gwendolyn N., 326 Ill. App. 3d
427, 430-31 (2001); In re Williams, 305 Ill. App. 3d 506, 511-512
(1999); In re Len P., 302 Ill. App. 3d 281, 285 (1999). Here,
the circuit court heard the harm and benefits associated with all
of the medications listed in the petition, and its order properly
enumerated each of those medications and ranges of dosages. In
re Mary Ann P., 202 Ill. 2d at 405. In addition, the circuit
court's ruling made it clear that the side effects of the
psychotropic medications were to be relieved with "counteracting
drugs." Thus, we find no cause for reversal based on
respondent's argument with regard to the auxiliary medications.
We further find that reversal is not warranted where
respondent failed to object to the omission of the counteracting
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drugs when the court entered its order, and where the record
shows that Dr. Poniaquwicz was intimately familiar with
respondent's treating protocol. Dr. Poniaquwicz treated
respondent when she experienced side effects from Proloxin, acted
as respondent's attending physician for weeks before the hearing,
and intended to continue in that role when the requested
medications were administered.
Moreover, respondent has failed to argue or demonstrate that
she was prejudiced by the omission of the counteracting
medications from the order. In re Miller, 301 Ill. App. 3d at
1072. Instead, she merely asserts that Dr. Poniaquwicz lacked
the authorization to administer counteracting medications to her
in the event that she experienced side effects from the
psychotropic medications. This argument is clearly refuted by
the record.
Finally, we refuse to consider respondent's argument, raised
for the first time on appeal, that Cogentin and Benadryl may
cause side effects. In re Jeffers, 239 Ill. App. 3d at 37.
Accordingly, we affirm the order of the circuit court of
Cook County.
Affirmed.
THEIS, P.J., and KARNEZIS, J., concur.
- 13 -
|
651 S.E.2d 801 (2007)
THOMAS
v.
The STATE.
No. A07A1077.
Court of Appeals of Georgia.
September 11, 2007.
*802 William B. Hollingsworth, Gainesville, for appellant.
Lee Darragh, District Attorney, Elizabeth D. Simmons, Assistant District Attorney, for appellee.
ADAMS, Judge.
Jerry Thomas appeals from the denial of his motions to vacate his sentence and to withdraw his guilty plea to a charge of possession of methamphetamine. We affirm.
Thomas initially entered a plea of not guilty to the possession charge, and ten days prior to the scheduled trial, the State filed notice of intent to seek recidivist sentencing under OCGA § 17-10-7. On the day of trial, however, Thomas entered a nonnegotiated guilty plea and was sentenced to 30 years, 12 years to serve. His sentence was without parole under OCGA § 17-10-7(c) due to his prior felony convictions.
1. Thomas contends that the trial court should have granted his motion to withdraw his guilty plea because it was error for the court to accept his plea without, as required by Uniform Superior Court Rule 33.8(C)(3), first informing him, and ensuring that he understood, that his sentence was without parole.
This Court will not disturb a trial court's ruling on a motion to withdraw a guilty plea absent a manifest abuse of discretion. Schlau v. State, 261 Ga.App. 303, 304(1), 582 S.E.2d 243 (2003). And after sentence has been pronounced, a guilty plea may be withdrawn only to correct a manifest injustice. Maddox v. State, 278 Ga. 823, 826(4), 607 S.E.2d 587 (2005). "The test for manifest injustice will by necessity vary from case to case, but it has been said that withdrawal is necessary to correct a manifest injustice if, for instance, a defendant is denied effective assistance of counsel, or the guilty plea was entered involuntarily or without an understanding of the nature of the charges." (Citation and punctuation omitted.) Id. Moreover, the State bears the burden of establishing that the plea was entered voluntarily, intelligently and knowingly. Muckle v. State, 283 Ga.App. 395, 397, 641 S.E.2d 603 (2007).
At the plea hearing, the trial judge questioned Thomas to determine whether the plea he entered was knowing and voluntary, and Thomas signed a plea form delineating the legal rights waived by the entry of his guilty plea. The trial court confirmed that Thomas had read the form and understood those rights. The trial court also delineated the rights Thomas was giving up by entering his plea and asked whether he had been coerced into entering into the plea or offered something in return for it. Further, the plea form specifically noted that the trial judge could sentence Thomas to a maximum of 30 years. And the trial judge told Thomas that by entering a nonnegotiated plea, the length of his sentence was entirely up to the court and the judge noted that he could receive up to 30 years in prison.
Although the trial judge did not specifically address the issue of parole or recidivist punishment prior to entry of the plea, Thomas's trial counsel discussed the matter with him. The attorney testified at the hearing on the motion to withdraw that despite his recommendation that Thomas should go to trial because he would get "walloped" if he entered a plea, Thomas chose to enter an open-ended plea because he did not want to go to trial. The attorney said he specifically told Thomas before the plea that he would not be eligible for parole if the trial court rejected the attorney's argument that the recidivist statute did not apply. Thomas's trial attorney argued both before and after the entry of the plea that he should not be subject to recidivist sentencing under OCGA § 17-10-7(c) because OCGA § 16-13-30(c), which sets out a specific sentencing scheme for multiple drug possession convictions, controlled his sentencing.
When the trial court rejected this argument, Thomas's attorney noted "for the record" that Thomas would be ineligible for parole under OCGA § 17-10-7(c), but told *803 the court that it retained the discretion to probate any portion of the sentence. The trial judge also stated during the sentencing phase that he was sentencing Thomas under OCGA § 17-10-7(c) which made him ineligible for parole.
Thus, the record indicates that before entering his plea Thomas had discussed the recidivism issue with his attorney and knew that the possibility existed that he could be sentenced to 30 years without parole. And after the trial court decided the recidivism issue but before sentence was pronounced, his attorney clarified that his sentence would be without parole.[1] While the better practice would have been for the trial court to have resolved the issue of recidivist sentencing and to have informed Thomas of the court's decision before accepting his guilty plea, we cannot say that the trial court abused its discretion in denying the motion to withdraw given the record before us. See Thompson v. State, 263 Ga.App. 54, 55, 587 S.E.2d 208 (2003).
2. Thomas next contends that the trial court erred in sentencing him under the general recidivist provisions of OCGA § 17-10-7(a) and (c) in light of the specific sentencing scheme set out in OCGA § 16-13-30(c) for multiple possession convictions. He relies upon the longstanding principle of statutory construction that "a specific statute will prevail over a general statute, absent any indication of a contrary legislative intent." (Punctuation and footnote omitted.) Mann v. State, 273 Ga. 366, 368(1), 541 S.E.2d 645 (2001). We find no merit to this argument.
Initially we note that OCGA § 16-13-30(c) has no application to Thomas's conviction for possession of methamphetamine. That subsection by its terms applies to "a controlled substance in Schedule I or a narcotic drug in Schedule II." (Emphasis supplied.) Methamphetamine does not fall under either category. Rather, it is a Schedule II nonnarcotic drug,[2] and as such it falls under OCGA § 16-13-30(e), which applies to controlled substances under Schedule II "other than a narcotic drug."
And although subsection (e) sets forth its own specific sentencing scheme for multiple convictions, the trial court did not err in applying the more general provisions of OCGA § 17-10-7 in sentencing Thomas. The Supreme Court of Georgia has expressly rejected Thomas's statutory construction argument in connection with multiple possession convictions under OCGA § 16-13-30. In Butler v. State, 281 Ga. 310, 311, 637 S.E.2d 688 (2006), the Court noted that subsection (e) of OCGA § 17-10-7, as revised and adopted in 1994, expressly states that it is intended to be "supplemental to other provisions relating to recidivous offenders." The court concluded that this language was intended to make the general recidivist provisions of OCGA § 17-10-7 applicable to cases otherwise falling under specific recidivist provisions, such as those found in OCGA § 16-13-30. Butler v. State, 281 Ga. at 312, 637 S.E.2d 688.
In support of this conclusion, the court noted that after adopting the 1994 revisions to OCGA § 17-10-7, the legislature amended subsection (d) of OCGA § 16-13-30, which addresses drug violations committed with the intent to distribute under OCGA § 16-13-30(b), specifically to provide that OCGA § 17-10-7(a) does not apply to a second or subsequent conviction under subsection (b). Butler v. State, 281 Ga. at 312, n. 3, 637 S.E.2d 688. The Supreme Court explained that "[t]here would be no need for the language in OCGA § 16-13-30(d) blocking the application of subsection (a) of OCGA § 17-10-7 if [OCGA § 17-10-7](e) did not otherwise require the general recidivist statute to prevail over the specific recidivist statute." Id. at 312, 637 S.E.2d 688.
*804 Accordingly, we find that because nothing in the language of OCGA § 16-13-30(e) blocks the application of any provision of OCGA § 17-10-7 to a conviction for simple possession of methamphetamine under OCGA § 16-13-30(a), the trial court did not err in applying that statute in sentencing Thomas.[3] See Patrick v. State, 284 Ga.App. 472, 474, 644 S.E.2d 309 (2007) (application of OCGA § 17-10-7 proper where no prohibition under specific recidivist provisions of shoplifting statute); Gray v. State, 254 Ga. App. 487, 489(2), 562 S.E.2d 712 (2002) (applying both OCGA §§ 16-13-30(c) and 17-10-7(a) to conviction for possession of cocaine, where it was fourth felony conviction).
Judgment affirmed.
ANDREWS, P.J., and ELLINGTON, J., concur.
NOTES
[1] We note that the notifications required under USCR 33.8(C)(4) "may be developed by questions from the judge, the district attorney or the defense attorney[,] or a combination of any of these."
[2] See OCGA § 16-13-21(17) (defining "narcotic drug" to include, inter alia, opium, coca leaves and any compound or derivatives thereof, but not methamphetamine); OCGA § 16-13-26(3)(B) (listing methamphetamine under Schedule II). See also Hailey v. State, 263 Ga. 210, 429 S.E.2d 917 (1993) (recognizing methamphetamine as a Schedule II nonnarcotic drug).
[3] In any event, we find no evidence that the trial court applied subsection (a) of the recidivist statute in this case. In his pronouncement of sentence, the trial court made no reference to OCGA § 17-10-7(a), although the court repeatedly announced that it was sentencing Thomas under OCGA § 17-10-7(c). Instead, the judge stated that he was setting the length of Thomas's sentence at 30 years, 12 to serve "simply because of [his] history."
|
747 F.2d 1024
R.S. MARTIN, Jr., Plaintiff-Appellant,v.KILGORE FIRST BANCORP, INC. and Kilgore First National Bank,Defendants-Appellees.
Nos. 83-2662, 84-2199.
United States Court of Appeals,Fifth Circuit.
Dec. 7, 1984.
Charles H. Clark, Tyler, Tex., Joan Sprague, Dallas, Tex., for plaintiff-appellant.
Beth Fielding Siever, Austin, Tex., Richard Grainger, Tyler, Tex., for defendants-appellees.
Ronald R. Glancz, Eugene M. Katz, Washington, D.C., for amicus curiae--C.T. Conover, Comptroller.
Appeals from the United States District Court for the Eastern District of Texas.
Before CLARK, Chief Judge, JOHNSON, and WILLIAMS, Circuit Judges.
CLARK, Chief Judge:
1
Plaintiffs seek review of rulings of the district court (i) refusing to enjoin the sale of bank holding company stock to satisfy the requirements of 12 U.S.C. Sec. 215(d), and (ii) denying a motion for summary judgment on their claim that the same section requires the auction of stock in a national banking association, rather than stock in a bank holding company chartered under state law. The district court certified the second question for interlocutory appeal as a controlling question of law pursuant to 28 U.S.C. Sec. 1292(b).
2
We find that in the type of transaction at issue here the demands of section 215(d) are satisfied by the auction of stock in the bank holding company and affirm the district court.
3
* Plaintiffs were minority shareholders in Kilgore First National Bank (First National I). Sometime in 1980 or 1981 a majority of the board of directors of First National I decided to convert the bank's ownership from individual shareholders to a bank holding company. A reverse triangular merger was chosen to achieve the conversion. This type of merger has three phases: (1) the principals of an existing bank establish a bank holding company; (2) these same principals then apply to the appropriate authorities to charter an interim bank which is owned wholly by the holding company; and (3) the directors of both the original bank and the interim bank agree to merge or consolidate the two banks, subject to the approval of the Comptroller of the Currency (Comptroller), thereby forming the surviving bank. In this type of merger or consolidation agreement, shareholders of the existing bank exchange their shares for shares in the holding company.
4
Dissenting shareholders of the existing bank are entitled to the protections afforded by 12 U.S.C. Sec. 215(d); they must be paid the appraised value of the shares they formerly owned and receive any excess over that value generated by an auction of the shares of the consolidated banking association which they would have received but for their dissent. The nondissenting shareholders of the original bank become the owners of all stock in the holding company, which in turn owns all of the stock of the surviving bank.
5
The board of First National I chose the reverse triangular merger method of changing ownership because of the tax advantages it offered. If the holding company acquired at least 80% of the stock in the surviving bank, the exchange would be tax free. Because 25% of the shareholders in First National I indicated they would dissent from the consolidation plan, the exchange would have been fully taxable if a traditional tender offer had been used. The reverse triangular merger enabled the board to eliminate the dissenters so that the bank holding company would be able to acquire all the stock in the surviving bank, and avoid any tax liability on the exchange for the shareholders.
6
To implement the reverse triangular merger, a majority of the directors applied to the Federal Reserve Board for prior approval of the formation of a bank holding company. On July 20, 1981 these same directors formed a Texas corporation, Kilgore First Bancorp, Inc. (Bancorp) for the express purpose of acquiring and holding all the outstanding stock of the surviving bank. The directors then secured a charter for an interim or "phantom" bank, New Kilgore First State Bank (First State), from the Commissioner of the Texas Banking Department on May 18, 1982. First State was formed only to serve the interim function of a controlled subsidiary needed to execute the reverse triangular merger. The Federal Reserve Bank of Dallas approved Bancorp's application to become a bank holding company on January 19, 1982.
7
The directors presented their plan of consolidation to the shareholders of First National I in a proxy statement that was accompanied by a prospectus of Bancorp on September 30, 1982. The Federal Deposit Insurance Corporation and the Comptroller approved the consolidation five days later.
8
Plaintiffs voted against the consolidation at the October 22 meeting, thereby becoming dissenting shareholders within the provisions of 12 U.S.C. Sec. 215(b)-(d), which governs the consolidation of national or state banks with national banks. On March 16, 1983 the Comptroller, pursuant to section 215(d), gave notice of his intent to cause an appraisal of the shares of First National I held by the dissenters. These individuals were later paid the appraised value of their First National I stock which was $279.69 per share. Bancorp subsequently scheduled a public auction of its stock to comply with the second potential payment requirement of section 215(d).
9
Prior to the auction date plaintiffs filed suit against Bancorp and the surviving bank, Kilgore First National Bank (First National II), challenging the results of the Comptroller's appraisal, as well as the propriety of his action in making the appraisal at all. They also sought a temporary restraining order and a preliminary injunction to stop the scheduled auction of Bancorp stock, contending that section 215(d) required the auction of First National II stock.
10
The district court granted the temporary restraining order against the auction on July 26, 1983, but on November 22, 1983, the court denied the requested preliminary injunction and dissolved the temporary restraining order. Plaintiffs appealed that order to this court.
11
Bancorp chose not to proceed with the sale. Plaintiffs later moved for partial summary judgment on their claim that section 215(d) required the auction of First National II stock instead of Bancorp shares. The district court certified to this court its denial of the motion. Plaintiffs filed this appeal based on that certification which we have accepted. 28 U.S.C. Sec. 1292(b).
II
12
The only issue before us is the application of the following portion of 12 U.S.C. Sec. 215(d) to the consolidation described in Part I of this opinion.
13
Within thirty days after payment has been made to all dissenting shareholders as provided for in this section the shares of stock of the consolidated banking association which would have been delivered to such dissenting shareholders had they not requested payment shall be sold by the consolidated banking association at an advertised public auction .... If the shares are sold at public auction at a price greater than the amount paid to the dissenting shareholders the excess in such sale price shall be paid to such shareholders.
14
Our resolution of this question necessarily will dispose of plaintiffs' appeal from the denial of their request for a preliminary injunction against the sale of Bancorp stock.
15
* Plaintiffs maintain that the reorganization should be viewed as involving two steps: (1) the consolidation of First National I and First State into First National II and (2) the exchange of First National II shares for Bancorp shares. They insist that they dissented to the first step, the consolidation. Bancorp was not involved in this part of the transaction. According to their argument, if the plaintiffs had not dissented at this point, they would have received shares in the surviving bank, First National II, not Bancorp. Therefore, section 215(d) requires the auction of First National II shares, not stock in Bancorp. Moreover, they contend, the statute requires auction of the shares of a national "consolidated banking association." Bancorp, they point out, is a Texas corporation, not a national banking association.
16
Defendants reply that the reorganization, as set forth in the Agreement and Plan of Consolidation approved by the majority of shareholders in First National I and by the Comptroller, was a one-step transaction: shareholders of First National I tendered their stock in exchange for Bancorp shares. They admit that Bancorp is not a national banking association as described in the statute, but urge us to focus instead on the later phrase "[shares] which would have been delivered to such dissenting shareholders had they not requested payment ...." Those shareholders who did not dissent to this transaction received Bancorp shares.
17
There is no basis in fact for plaintiffs' claim that they would have received First National II stock but for their dissent. No shares in First National II were ever issued. Ordering the issuance and auction of First National II stock would not only ignore the realities of the transaction legally chosen by the majority stockholders, but would also defeat section 215's purpose. That purpose is to ensure that dissenters realize the same economic benefits as nondissenters. Restructuring the real transaction could give dissenters a windfall since stock in the surviving bank may often be more valuable than holding company stock. Defendants claim it is here.
18
The Comptroller, who appeared amicus curiae during the district court proceedings and on appeal, urges the adoption of the construction advanced by defendants.
B
19
We reject plaintiffs' request to characterize the reorganization as a two-step transaction. The Agreement and Plan of Consolidation clearly provides one step: the exchange of First National I stock for Bancorp shares. Plaintiffs' argument would be feasible only if the agreement had provided for the exchange of First National I shares for those of First National II and then a separate exchange of the First National II shares for Bancorp stock.
20
Undeniably, the plain language of section 215(d) is ambiguous, if not internally contradictory, when applied to a reverse triangular merger. As plaintiffs point out, the statute requires auction of the stock of a consolidated national banking association and Bancorp is not such an organization. Defendants, however, are equally correct in their assertion that the statute requires auction of the shares the dissenters would have received if they had not dissented. In this case plaintiffs would have received Bancorp stock as did the shareholders who did not dissent. Their claim that they would have received shares in First National II but for their dissent is without merit because no such shares were ever issued.
21
The ambiguity in the statute is the result of changes in the forms of entities now used to conduct banking business. Reverse triangular mergers, using an interim or "phantom" bank to transfer ownership of a national bank to a one-bank holding company, were not devised until the mid-1960's. Section 215(d) was enacted in 1918 and last amended in 1959. Congress has not further modified the statute to accommodate newly developed merger mechanisms such as that presented here despite the fact that the Comptroller and the Federal Reserve System have consistently recognized the use of these new business forms and merger procedures.
C
22
Regardless of the age of the ambiguity, our duty is to interpret the words of the statute to further the purpose Congress sought to accomplish by its enactment. Dickerson v. New Banner Institute, Inc., 460 U.S. 103, 103 S.Ct. 986, 994, 74 L.Ed.2d 845 (1983); WTWV, Inc. v. National Football League, 678 F.2d 142, 143 (11th Cir.1982). Because the Comptroller has the primary responsibility for regulating consolidations involving national banks, we will accord substantial deference to his interpretation of section 215(d) where it represents a reasonable construction of the language and is consistent with the legislative intent. See Securities Industry Association v. Board of Governors, --- U.S. ----, 104 S.Ct. 2979, 2983, 82 L.Ed.2d 107 (1984).
23
Section 215(d) was enacted to protect the dissenting stockholders in a consolidation involving a national bank by providing a means whereby the dissenters would receive full value for their stock. Central-Penn National Bank v. Portner, 201 F.2d 607, 609 (3d Cir.1953) (citing H.R.Rep. No. 408, 65th Cong., 2d Sess. (1918); S.Rep. No. 406, 65th Cong., 2d Sess. (1918)). Congress intended to ensure that the dissenters would receive the same economic benefits as nondissenting shareholders.
24
The auction of Bancorp shares will place these plaintiffs in a position as nearly equal to that of the nondissenting shareholders as their dissent will permit. The nondissenters holding stock in First National I were never given the option of receiving First National II stock instead of Bancorp shares. If the dissenters are permitted to force the auction of First National II shares they could receive an economic return different from that realized by the nondissenters who could only own stock in a different concern. As the Comptroller notes, shares of First National II could be more valuable than Bancorp shares because individual ownership of some shares of First National II would give the owners disproportionate leverage in management. Such stock might also have a premium value because of its attractiveness to a multibank holding company seeking to take over First National II.
25
At oral argument plaintiffs contended that even if the First National II shares are more valuable than the Bancorp shares received by the nondissenters, this does not represent a windfall to the dissenters. It only ensures they receive the full value of their First National I shares as intended by section 215(d). However, that is not the purpose of the auction provision. The appraisal process established in section 215(d) protects plaintiffs' right to receive the full value of their First National I shares. The adequacy of their compensation for those shares is a function of the appraisal process. That process should not be confused with the separate statutory requirement to auction the stock of Bancorp which was received by the nondissenters.
26
The auction step is designed to secure to the dissenters the same economic benefits as the nondissenters realize from the consolidation transaction. To allow plaintiffs to force the issuance and auction of stock to which the nondissenters did not have access could allow plaintiffs to realize a greater profit from the transaction than the nondissenters. This could destroy the parity intended by the statute.
27
Accepting plaintiffs' contention that the auction of First National II shares was required because Bancorp is not a consolidated national banking association would not advance the purposes of the statute. Such a construction would produce an unreasonable result which is "plainly at variance with the policy of the legislation as a whole ...." United States v. Mendoza, 565 F.2d 1285, 1288-89, modified on other grounds, 581 F.2d 89 (5th Cir.1978) (en banc) (quoting Perry v. Commerce Loan Co., 383 U.S. 392, 86 S.Ct. 852, 857, 15 L.Ed.2d 827 (1966)). The court would be required to order the issuance of First National II stock for the auction, despite the fact that the agreement did not provide for the issuance of such stock. The reverse triangular merger plan adopted by the majority of the shareholders in First National I to convert the bank to holding company ownership while avoiding tax liabilities was a legitimate transaction. Ignoring it could give plaintiffs a windfall. We refuse to follow this course.
III
28
The legislative intent which produced section 215(d) is best served by construing its terms to require the auction of stock in the bank holding company and not of the surviving bank in a reverse triangular merger. The orders of the district court are
29
AFFIRMED.
|
171 U.S. 277 (1898)
CAMOU
v.
UNITED STATES.
No. 28.
Supreme Court of United States.
Argued March 16, 1898.
Decided May 31, 1898.
APPEAL FROM THE COURT OF PRIVATE LAND CLAIMS.
*279 Mr. Rochester Ford for appellant.
Mr. Special Attorney Reynolds for appellees. Mr. Solicitor General was on his brief.
MR. JUSTICE BREWER, after stating the case, delivered the opinion of the court.
This grant was made in the name of the state of Sonora and by the proper officer of that state, if it had power to make the grant. The first question, therefore, is as to the power of the state. We held in United States v. Coe, 170 U.S. 681, just decided, that from and after the adoption of the constitution of 1836 no such power was vested in the separate states. But that case called for no determination of the authority those states possessed prior thereto, and in respect to that matter no opinion was expressed. We have in this case, and that immediately following, Perrin v. United States, post, 292, elaborate discussions by counsel as to the title to the public lands within the limits of Mexico and the respective rights thereto of the general government and the separate states. On the one hand it is insisted that, as in the case of the thirteen colonies that formed the United States of America, the vacant lands were the property of the states; that as no express cession was made by any Mexican states to the general government the title to those lands remained in the states until at least the formation of the constitution of 1836, and that each state had therefore the absolute right to dispose of all within its own limits. On the other hand, it is said that, prior to the separation of Mexico from Spain, the lands were the property of the king of Spain, that the separation created a new national government which succeeded to all the rights of the prior sovereign, including therein the ownership of all vacant lands. We *280 deem it unnecessary to review this discussion or attempt to settle the disputed question as to the location of the title. In this expediente the treasurer general refers to "Article XI of the sovereign decree number 70 of the general congress of the union," as conceding to the states the revenues derived from the sale of lands within their respective limits, and upon that and law number 30 of the congress of the state relies as the sources of his power to make the conveyance. The state having undoubtedly vested its authority in the treasurer general, the inquiry comes back to the effect of said Article XI.
Preliminary thereto we must notice these matters:
The constitutive act of the Mexican federation, adopted January 31, 1824, in Articles 5 and 6, declares:
"ART. 5. The nation adopts for the form of its government a popular representative and federal republic.
"ART. 6. Its integral parts are free, sovereign and independent states, in as far as regards exclusively its internal administration, according to the rules laid down in this act, and in the general constitution." 1 White's New Recopilacion, p. 375.
On October 4, 1824, a constitution was established. In it Article 49 reads:
"The laws or decrees, which emanate from the general congress, shall have for their object:
"1. To sustain the national independence, and to provide for the preservation and security of the nation in its exterior relations.
"2. To preserve the federal union of the states, and peace and public order in the interior of the confederation.
"3. To maintain the independence of the states among themselves, so far as respects their government according to the constitutive act and this constitution.
"4. To sustain the proportional equality of obligations and rights which the states possess in point of law." 1 White, p. 393.
And enumerating in Article 50 the powers possessed by the general congress, subdivision 31 reads:
"To dictate all laws and decrees, which may conduce to *281 accomplish the objects spoken of in the forty-ninth article, without intermeddling with the interior administration of the states." 1 White, p. 395.
Article 137, defining the attributes of the supreme court, names among others:
"1. To take cognizance of disputes, which may arise between the different states of the union, whenever there arises litigation in relation to the same, requiring a formal decree, and that arising between a state and one or more of its inhabitants, or between individuals in relation to lands under concessions from different states, without prejudice to the right of the parties to claim the concession from the party which granted it." 1 White, 405.
It cannot of course be pretended that these provisions either operated to transfer the title to vacant public lands from the nation to the respective states or amount to a declaration that the title to such lands is vested in the states. All that can fairly be inferred from them is that the supremacy of the several states in matters of local interest was recognized, and further, that conflicting cessions of lands from different states might be expected and that the settlement of disputes respecting them should be by the supreme court of the nation. These inferences are by no means determinative of the question here presented, and yet it must be conceded that they at least point to some control by the states over vacant lands within their limits, and suggest the exercise by those states of the right to make concessions of those lands.
Two prominent laws of the Mexican nation are the colonization law of August 18, 1824, 1 White, 601; Reynolds, p. 121, and the law in respect to general and special revenues of August 4, 1824. Reynolds, p. 118. White's translation of Articles 1, 2, 3, 10, 11 and 16 of the colonization law, differing slightly from that given by Reynolds, is as follows:
"ART. 1. The Mexican nation offers to foreigners, who come to establish themselves within its territory, security for their persons and property; provided they subject themselves to the laws of the country.
"ART. 2. This law comprehends those lands of the nation, *282 not the property of individuals, corporations or towns, which can be colonized.
"ART. 3. For this purpose the legislatures of all the states will, as soon as possible, form colonization laws or regulations for their respective states, conforming themselves in all things to the constitutional act, general constitution and the regulations established in this law."
"ART. 10. The military who, in virtue of the offer made on the 27th of March, 1821, have a right to lands, shall be attended to by the states, in conformity with the diplomas which are issued to that effect by the supreme executive power.
"ART. 11. If, in virtue of the decree alluded to in the last article, and taking into view the probabilities of life, the supreme executive power should deem it expedient to alienate any portion of land in favor of any officer, whether civil or military of the federation, it can do so from the vacant lands of the territories."
"ART. 16. The government in conformity with the provisions established in this law will proceed to colonize the territories of the republic."
It is not pretended that the grant in question was made under this colonization law, and we only refer to it as showing a recognition by the general government of some authority on the part of the states in reference to the vacant lands. It will be seen that while Article 2 speaks of "the lands of the nation," Article 3 directs the states to enact colonization laws in conformity to the general provisions of the constitution. So that the actual management of colonization affairs was put within the control of the states, subject, of course, to the superior dominion of the general government. Article 10 provides that military rights to lands, though created by the nation shall be attended to by the states, thus implying at least that, for convenience, administration of the vacant lands was entrusted to the states. Obviously the thought here was that there should not be two places in which the administration of the public lands should be carried on, and so in Article 11 it was provided that if in the judgment of the nation it was expedient *283 to grant to a military or civil officer any public lands, it was to be made from vacant lands in the territories. And, finally, in Article 16, as though to separate the administration of the public lands in the states from those in the territories, it is distinctly declared that the national government will colonize the territories of the public. As heretofore said, all this, of course, amounts only to assigning to the states the administration of the vacant lands for purposes of colonization.
The other act to which we have referred, the one which is relied upon by the treasurer general as giving authority for this expediente, is that in reference to general and special revenues. It commences with the declaration that the following belong to the general revenues of the federation, and then in ten articles are named revenues derived from different sources, such as import and export duties, tobacco and powder, etc. The eighth, ninth, tenth and eleventh articles are as follows, Reynolds, p. 118:
"8. That from the territories of the federation.
"9. National property, in which is included that of the inquisition and temporal property of the clergy, or any other rural or urban property that belongs, or shall hereafter belong, to the public exchequer.
"10. The buildings, offices, and the lands attached thereto, which belong, or have belonged, to the general revenues and those that have been maintained by two or more of what were formerly provinces, are at the disposal of the government of the federation.
"11. The revenues not included in the foregoing articles belong to the states."
The eighth article gives to the national government all the revenues derived from the territories. Obviously the entire management of the affairs of the territories was reserved to the general government, and any revenue derived therefrom passed into the general treasury.
The ninth article is indefinite in that it fails to define what is national property. It assumes that certain things pass within the description of national property, and affirmatively includes within that description the property taken *284 from the clergy. The language used is broad enough to include all public lands within the limits of the nation, and yet if it was intended to include such lands it would seem scarcely necessary to add the clause including those taken from the clergy. Certain is it that according to our methods of legislation, and our use of language, this article would not be considered as defining the property the revenues from which it assigns to the national government. The tenth article seems to have little significance in this connection, and refers obviously to public buildings and the grounds attached, and not to vacant public lands. While the eleventh article concedes to the states the revenues not included in the foregoing articles, it does not define those revenues, and depends for its scope upon the significance and force of the prior articles. If these articles were all that called for consideration it would be difficult to infer from them that the vacant public lands were given to the states for purposes of sale or for appropriation of the proceeds of such sales. But in the same statute is a provision that "the sum of $3,136,875, estimated as the deficit in the general expenses, shall be apportioned among the states of the federation," and following that is the apportionment. Other sections required delivery by the states every month of their part of the above apportionment and the final adjustment of the amount thereof between the government and the states. Of course this implies that within the limits of the state there were certain matters of revenue reserved, out of which the states were to collect the sums apportioned to them, and to return the same to the general treasury. Subsequent legislation throws light upon the meaning of this revenue law. Thus, on April 6, 1830, a decree was passed, the third article of which is as follows:
"The government shall have power to appoint one or more commissioners to visit the colonies of the frontier states, to contract with their legislatures for the purchase, in the name of the federation, of the lands they may consider suitable and sufficient for the establishment of colonies of Mexican and of other nations, to enter into such arrangements with *285 the colonies already established as they may deem proper for the security of the republic, to see to the exact compliance with the contracts upon the entry of new colonists, and to examine as to how far those already entered into have been complied with.
"4. The executive shall have the power to take the lands he may consider suitable for fortifications and arsenals, and for new colonies, and shall give the states credit for their value on the accounts they owe the federation." Reynolds, p. 148.
The language of this decree is very significant, and clearly recognizes some title in the states, for why should commissioners be authorized to contract with the legislatures of the states for the purchase of lands which belonged to the nation? It also clearly recognizes the right of the states to sell these vacant lands and apply the proceeds in settlement of the demands made against them by the general apportionment of the revenue law of 1824. It declares that the executive may take the lands he considers suitable for fortifications, arsenals and for new colonies, and at the same time provides that he shall give the states credit on the amount they owe the confederation. But why should any credit be given if these lands so taken by the executive were the property of the nation and the states without authority to sell them or receive the proceeds of sales? If during all these years the lands were the property of the nation, were to be held and sold only by the nation, and the proceeds thereof to be accounted for directly to the nation, why should it be decreed that if the nation takes any part of them for arsenals and other public purposes, credit for the value thereof is to be entered upon the amounts due by the states to the nation? We find it difficult to escape the force of this decree of 1830. It indicates that although the language of the revenue decree of 1824 is indefinite, and does not in terms name vacant public lands, yet both the nation and the states understood that its effect was to grant authority to the states to sell such lands and appropriate the proceeds in settlement of the amounts charged against them by the nation. We see no *286 other way in which to give reasonable force to the language of this decree of 1830, and it must be held to be a national interpretation of the revenue decree of 1824.
But we are not limited to this authoritative national exposition of the meaning of the revenue law of 1824. The testimony in the several cases of a similar nature now before us, including therein the reports of the officers of this government sent to examine the archives of Mexico, discloses that the state of Sonora, at least, assumed that the revenue act of 1824 authorized its disposal of the vacant public lands, and acting on that assumption did in a multitude of cases make sales thereof. In this connection it may be observed that the constitution of the state of Sonora, or State of the West, declares, article 47, that the right of selling lands belongs to the state. This constitution bears date May 11, 1825. Law No. 30 of that state, of May 20, 1825, the law referred to by the treasurer general in the expediente, recites that "the congress has seen fit to decree the following provisional law for the purchase of the lands of the state." Subsequent legislation of the state is in the same line.
Further, sections 8 and 9 of article 161 of the national constitution of 1824 made it the duty of each Mexican state
"To present annually to each one of the houses of the general congress a minute and comprehensive report of the amounts that are received and paid out at the treasuries within their limits, together with a statement of the origin of the one and the other, and touching the different branches of agriculture, commercial and manufacturing industries," etc.
And also
"To forward to the two chambers (of the federal government) and when they are in recess, to the council of the government, a certified copy of their constitutions, laws and decrees."
It may be assumed that these requirements of the national constitution were complied with, and that the constitutions, laws and decrees of the state and the proceedings had in reference to these several sales of land were reported to the congress of the nation. We find no act of that congress setting *287 aside such legislation or sales. This is significant, and it is not inappropriate to refer to Clinton v. Englebrecht, 13 Wall. 434, 446, in which it was said:
"In the first place, we observe that the law has received the implied sanction of congress. It was adopted in 1859. It has been upon the statute book for more than twelve years. It must have been transmitted to congress soon after it was enacted, for it was the duty of the secretary of the territory to transmit to that body copies of all laws, on or before the first of the next December in each year. The simple disapproval by congress at any time would have annulled it. It is no unreasonable inference, therefore, that it was approved by that body."
We are not insensible of the fact that the provisions of the act of September 21, 1824, creating the office of commissary general, an act which we had occasion to consider in Ely's Administrator v. United States, ante, 220, seem to make against the idea of the administration of vacant lands by the states, and it is difficult to work out from all the statutes a consistent, continuous and harmonious rule. We must in each case endeavor to ascertain what the Mexican government recognized as valid, and when that is done the duty of respecting and enforcing the grant arises. Other matters are referred to by counsel in their briefs, but it would needlessly prolong this opinion to refer to them. Our conclusion is that at the time of these transactions the several states had authority to make sales of vacant public lands within their limits, and that such sales, unless annulled by the national government, must be considered as grants to be recognized by this Government under the terms of the treaty of 1853.
We pass, therefore, to a consideration of the effect of the decrees of Santa Anna. The lands in controversy were obtained from Mexico under what is known as the Gadsden treaty of 1853. This treaty was concluded on December 30, 1853, and ratified June 30, 1854. At the time of the treaty Santa Anna was supreme executive and virtually dictator in Mexico, and the treaty was negotiated with him. On November 25, 1853, only about a month before the signing of the Gadsden treaty, he published this decree:
*288 "ART. 1. It is declared that the public lands, as the exclusive property of the nation, never could have been alienated under any title by virtue of decrees, orders and enactments of the legislatures, governments or local authorities of the states and territories of the republic.
"2. Consequently, it is also declared that the sales, cessions or any other class of alienations of said public lands that have been made without the express order and approval of the general powers, in the manner prescribed by the laws, are null and of no value or effect.
"3. The officials, authorities and employés upon whom devolve the execution of this decree, shall proceed as soon as they receive it to recover and take possession in the name of the nation, of the lands comprehended in the provisions of article 1, and that may be in the possession of corporations or private individuals, whatever may be their prerogatives or position.
"4. The judicial, civil or administrative authorities shall admit no claims of any kind nor petitions whose purpose is to obtain indemnification from the public treasury for the damages the unlawful holders or owners may allege under the provisions of the preceding article; and they shall preserve their right only against the persons from whom they have the lands they are now compelled to return." Reynolds, p. 324.
On July 5, 1854, he published another decree, which was even more specific, containing these provisions:
"ART. 1. The titles of all the alienations of public lands made in the territory of the republic from September, 1821, till date, whether by the general authorities or by those of the extinguished states and departments, shall be submitted to the revision of the supreme government, without which they shall have no value and shall constitute no right of property.
* * * * *
"5. The alienations of public lands, of whatever nature they be, that have been made by the authorities and officials of the departments without the knowledge and approval of the general government, during the epoch when the central system was in force in the republic, are void.
*289 "6. Those made by said authorities in the epoch of the extinguished federation are likewise void; provided they were not made for the purpose of extending and promoting colonization, which was the purpose proposed by the law of August 18, 1824.
"7. Grants or sales of lands made to private individuals, companies, or corporations under the express condition of colonizing them, and the holders of which have not complied therewith in the terms stipulated, are declared to be of no value." Reynolds, p. 326.
Subsequently, on December 3, 1855, and after Santa Anna had been deposed and while Juan Alvarez was president ad interim, a decree containing the following provisions was entered:
"ART. 1. The decrees of November 25, 1853, and July 7, 1854, which submitted to the revision and approval of the supreme government the grants or alienations of public lands made by the local governments of the states or departments and territories of the republic from September, 1821, to that date, are repealed in all their parts.
"ART. 2. Consequently, all the titles issued during that period by the superior authorities of the states or territories under the federal system, by virtue of their lawful faculties, or by those of the departments or territories, under the central system, with express authorization or consent of the supreme government for the acquisition of said lands, all in conformity with the existing laws for the grant or alienation respectively, shall for all time be good and valid, as well as those of any other property lawfully acquired, and in no case can they be subjected to new revision or ratification on the part of the government." Reynolds, p. 329.
And again, on October 16, 1856, a decree was passed while Ignacio Comonfort was president, the first article of which is as follows:
"ART. 1. The decrees of November 25, 1853, and July 7, 1854, are void." Reynolds, p. 331.
The Court of Private Land Claims was divided. Three of the justices were of opinion that as this Government recognized *290 Santa Anna in negotiating with and purchasing from him the territory within the Gadsden purchase, the courts must also recognize his declarations in respect to titles as authoritative, citing in support of these general propositions Wheaton's International Law, secs. 31 and 32, and Halleck's International Law, pages 47 and 62. Without questioning the general propositions laid down in these authorities, we are of opinion that too much weight was given to the decree of Santa Anna of November 25, 1853, the only one announced before the cession, and that that decree should not be considered as absolutely determinative of individual rights and titles.
While it is true that practically Santa Anna occupied for the time being the position of dictator, it must not be forgotten that Mexico, after its separation from Spain in 1821, was assuming to act as a republic subject to express constitutional limitations. While temporary departures are disclosed in her history, the dominant and continuous thought was of a popular government under a constitution which defined rights, duties and powers. In that aspect the spasmodic decrees made by dictators in the occasional interruptions of constitutional government should not be given conclusive weight in the determination of rights created during peaceful and regular eras. The divestiture of titles once legally vested is a judicial act. In governments subject to ordinary constitutional limitations a mere executive declaration disturbs no rights that have been vested, and simply presents in any given case to the judicial department the inquiry whether the rights claimed to have been vested were legally so vested. Undoubtedly this Government dealing with Mexico, and finding Santa Anna in control, rightfully dealt with him in a political way in the negotiation of a treaty and the purchase of territory, and the judicial department of this Government must recognize the action of its executive and political department as controlling. But when the courts are called upon to inquire as to personal rights existing in the ceded territory, a mere declaration by the temporary executive cannot be deemed absolutely and finally controlling. It is unnecessary *291 to rest this case upon the fact disclosed that these decrees of Santa Anna were immediately thereafter revoked. It is not significant that the substance of them was thereafter reëstablished. We are compelled to inquire whether prior to such decree there were rights vested, rights which the Mexican government recognized, and then determine whether those rights were by such decree absolutely destroyed.
Turning to the decree of November 25, 1853, the first and second articles are mere declarations of law. The third article directs the officials to proceed to the execution of the decree and to recover and take possession of the lands coming within the scope of the prior articles. It does not appear that any steps were taken by any officials to carry into execution this decree. Whether this particular grant came within the scope of the two declarations of law was a question to be considered and determined. On that question the grantee never was heard. There never was a judicial adjudication that his grant came within the scope of the first two articles. He was never dispossessed. His property was never taken possession of. It is going too far to hold that the mere declaration of a rule of law made by a temporary dictator, never enforced as against an individual grantee in possession of lands, is to be regarded as operative and determinative of the latter's rights.
As for the reasons heretofore mentioned, we are of opinion that a valid grant was made in this case, we think this arbitrary declaration by a temporary dictator was not potent to destroy the title. The decree of the Court of Private Land Claims must therefore be reversed. As shown by the statement of facts the survey of the land claimed in the petition is in excess of the four sitios granted and paid for. While the excess is not so great as in many cases, yet we think the rule laid down in Ely's Administrator v. United States, ante, 220, should control, and that this Government discharges its full duty under the treaty when it recognizes a grant as valid to the amount of land paid for.
The decree of the Court of Private Land Claims will be reversed, and the case remanded for further proceedings.
|
617 F.Supp. 156 (1985)
Robert J. CRANE, Plaintiff,
v.
Elizabeth DOLE, et al., Defendants.
Civ. A. No. 81-1081.
United States District Court, District of Columbia.
February 26, 1985.
Marc P. Charmatz, Washington, D.C., for plaintiff.
Charles F. Flynn, Asst. U.S. Atty., Washington, D.C., James W. Whitlow, Off. Chief Counsel, F.A.A., Washington, D.C., for defendants.
MEMORANDUM OPINION
JOHN GARRETT PENN, District Judge.
The plaintiff filed this action pursuant to the Rehabilitation Act of 1973 (Act), 29 U.S.C. §§ 791 and 794a and the Administrative Procedure Act (APA), 5 U.S.C. § 501 et seq. He alleges that the defendants violated the Act by discriminating against him based solely on his physical handicap, a hearing loss, and that they violated the APA by treating him in a wholly arbitrary and capricious manner. He contends that he is entitled to placement in a position as an Aeronautical Information Specialist (AIS) in the National Flight Data Center of the Federal Aviation Administration (FAA) with back pay, "including appropriate account taken for step and grade promotions, and attorneys' fees and costs incurred in this action". The case came before the Court for a trial de novo. This memorandum opinion constitutes the Court's findings of fact and conclusions of law. See Fed.R.Civ.P. 52.
I
1. Plaintiff Robert Crane is a hearing-impaired individual. He uses a hearing aid, and at times, hearing aids.
2. From 1966 to 1976, plaintiff was an employee of the FAA. For eight of those ten years he worked as an air traffic control specialist (station), GS-2152, a position in which he provided advice and guidance to general aviation pilots and which required, on certain occasions, in-flight communications with pilots and handling of airborne emergencies. During one two-year period, plaintiff held the position of evaluations, proficiency and development specialist, where his principal task was training others.
3. The medical requirements for the position of air traffic control specialist include the requirement that the incumbent or applicant have no hearing loss of more than 25 decibels in the 500, 1000 or 2000 HZ ranges and must demonstrate no hearing loss in these ranges of more than 20 decibels *157 in the better ear, using ISO (1964) or ANSI (1969) standards.
4. In 1975, a hearing examination routinely conducted by the FAA revealed that plaintiff suffered from a hearing loss which ultimately resulted, in 1976, in a disability retirement from the FAA because he could no longer meet the stringent hearing requirements for the position of air traffic control specialist.
5. Later in 1976, plaintiff applied for another FAA position, as an Aeronautical Information Specialist, GS-1361-12 in the National Flight Data Center in Washington, D.C., FAA headquarters, which is responsible for the collection, verification and distribution of aeronautical data concerning the nation's airports, navigation system, air space and related subjects. The AIS position involves no in-flight communications with pilots or any other flight-control function.
6. The National Flight Data Center is divided into six separate functional areas, some of which are sections and some of which are combined into one section. All are staffed by Specialists in the GS-1361 series. The job descriptions of all sections other than the Notice to Airmen section are identical.
7. One section, the Flight Data Services Section, is responsible exclusively for publishing seven different compilations of data which appear at designated intervals of time and which are designed to keep the aviation community up to date on the status of flight paths, airports, air space, terminology and other relevant flight information. The seven publications are published on a specific schedule, most every 112 days. The shortest publication interval is 28 days, while the longest is quarterly. Specialists in the Flight Data Services Section prepare these publications.
8. Two other functional areas, Navigations Aids and Communications and Airports, are combined in one section and have similar functions. The navigation and communication specialists maintain information on the status of navigational aids and communications mechanisms used in the nation's air traffic control system. They do this by receiving information on changes in the system, by verifying those changes, obtaining a written record and entering the changes into the data base used by the FAA for such information. Ninety-nine percent of the time this information is received in writing the ordinary course of business; emergency changes would be entered through a different mechanism, through the Notice of Airmen Section described below.
9. The Airports specialists maintain records on all public use of privately owned airports, including such matters as changes in operating hours of runways, services and other aspects of airport operation. They use the same methods to obtain, verify and transfer the information received as the navigations/communications specialists. It takes 15 days to get information from receipt to the data base. As with respect to the navigations and communications specialists, emergencies are handled through the Notice of Airmen Section.
10. Two of the sections, Air Space and Flight Procedures, are responsible for updating information on the routes on which and the procedures by which planes fly. The information for these sections almost always becomes a rulemaking component of the FAA inasmuch as the information received concerning these matters consists of rules or regulations of the agency. These sections receive the rules or regulations in writing and transmit that information in various ways on a specific cycle, such as 56 days for the Airspace Section.
11. The Notice to Airmen Section (NOTAM) differs from the other sections of the National Flight Data Center, despite the fact that the AIS are in the same job category and Civil Service designation, GS-1361. This section, as the job description states, is responsible for "ensur[ing] expeditious receipt, effective processing and dissemination of time-critical" information concerning changes in any aspect of the nation's flight data. The NOTAM section is divided into two parts, the domestic and international. The domestic section receives *158 information from 371 flight service stations by teletypes in the National Flight Data Center; the international section receives information worldwide. The specialists who work in the NOTAM section receive teletyped pieces of information (NOTAMs) and, when necessary, verify it by contacting its sources. While, at present, specialists in the domestic part of the NOTAM section use the telephone to perform this task, this is not the only way in which verification can take place. For example, the international component verifies information by teletype; telephone verification is not used at all in the international section. Other means of verification are possible.
12. At the time plaintiff applied for the position of AIS in the National Flight Data Center, there existed no hearing requirements for the AIS job similar to those which existed for the position of air traffic control specialist. At the time he applied in 1976, the requirement for hearing was that imposed generally on federal employees, that is, the "ability to hear the conversational voice, with or without a hearing aid." The FAA does not test or otherwise make any effort to ascertain the hearing levels of its AIS in any section.
13. In 1978, Congress amended the Act, 29 U.S.C. § 794a. As a result of that legislation, the Office of Personnel Management revised the hearing requirements for AIS positions so as to provide, as of September 24, 1979, that "in most cases, a specific physical condition or impairment will not automatically disqualify an applicant for appointment." Rather, the new rule provides that the "loss or impairment of a specific function may be compensated for by the satisfactory use of a prosthesis or mechanical aid. Reasonable accommodation may also be considered in determining an applicant's ability to perform the duties of a position. Reasonable accommodation may include but is not limited to: the use of assistive devices, job modification or restructuring, provisions of readers and interpreters, or adjusted work schedules."
14. When plaintiff applied for the position of AIS, GS-13611-112, in 1976, he was found among the "best qualified" by personnel rules, but his name was inadvertently left off the list of best qualified applicants," the list of names from which a selecting official must make his selection. Thereafter, the agency reconsidered plaintiff for the position. The first time, the agency acknowledged erroneous procedures were used, and agreed to consider plaintiff again. The second time, the Court found the decision to be unlawful and remanded. The third consideration is at issue here.
15. After administrative appeal, the FAA agreed, on August 5, 1977, to give Mr. Crane "priority consideration" for the next AIS position at the National Flight Data Center.
16. Under FAA personnel rules, an applicant granted "priority consideration" must be considered for the next "appropriate" vacancy before other candidates are considered for the position. An "appropriate" vacancy is one which (a) would normally be filled competitively; (b) is at the same grade level as originally applied for; and (c) would be acceptable to the employee.
17. On February 13, 1978, Beauford Bancroft, director of the National Flight Data Center, considered plaintiff solely for a position in the NOTAM section and declined to select plaintiff.
18. The basis for Bancroft's decision was that plaintiff had been medically retired as a result of his hearing loss from his position as air traffic control specialist.
19. At the time of his decision, Bancroft had no authority to impose medical requirements on the position of AIS, had no knowledge of the extent of plaintiff's hearing loss and made no inquiries to determine what the extent of plaintiff's hearing loss was. Nor did Bancroft have any knowledge whether plaintiff had any difficulty using the telephone. He was unaware of any duty toward plaintiff with respect to his hearing impairment. Finally, at the time of the decision in 1978, Bancroft had *159 no knowledge whether plaintiff's hearing loss would affect his ability to perform the essential function of the job of AIS in the NOTAM section of any other National Flight Data Center section. The actions of Bancroft or the agency did not amount to an "intentional" discrimination against the plaintiff. In other words, the action of the agency was not done with bad faith or with the design to discriminate against plaintiff personally, or as the result of his handicap.
20. Plaintiff sought to challenge Bancroft's decision in ongoing litigation between the plaintiff and the Federal Aviation Administration, but at the suggestion of the Court, see Civil Action No. 77-0895, it was agreed to handle the matter through an administrative grievance. Plaintiff filed a grievance at the FAA. On October 17, 1979, the FAA decided the grievance. It found that Bancroft's decision "was not completely documented." The agency decided that it would "re-run" the priority consideration after a determination of applicable medical standards.
21. Pursuant to this decision, plaintiff reapplied and on November 7, 1980, was again turned down by John R. Ryan, the acting chief of the Operations Division, the official who was Bancroft's direct superior. In his decision, Ryan stated that plaintiff was not medically qualified for employment as an AIS. While the decision made reference to the position of AIS without regard to section, Ryan only considered plaintiff for a position in the domestic portion of the Notice to Airmen Section. He did not consider any other sections.
22. Ryan made no attempt to determine whether plaintiff could actually perform the job as an AIS. Nor did he consider whether reasonable accommodation of plaintiff's handicap would permit him to be hired as an AIS in the National Flight Data Center.
23. Plaintiff sought reconsideration of Ryan's decision. He submitted medical evidence, including the results of an examination by R. Emil Hecht, M.D., a board-certified otolaryngologist, a graduate with wings from the Aerospace Medical Institute Flight Surgery Training Program and a former aviation medical examiner.
24. On reconsideration, the agency reaffirmed its original decision. Its chief of the Labor Relations and Career Development Branch, Lionel R. Driscoll, stated, inter alia, that material provided by plaintiff was not relevant and affirmed the original decision.
25. Plaintiff then filed this lawsuit, alleging violations of the Act and the APA. On June 29, 1982, on cross-motions for summary judgment, the Court found that the decisions by Ryan and Driscoll violated the Act because they failed to determine whether plaintiff could perform the job and failed to consider any reasonable accommodations. Crane v. Lewis, 551 F.Supp. 27 (D.D.C.1982). The court also found that the decision of the agency was arbitrary and capricious under the APA in considering medical evidence plaintiff submitted irrelevant and drawing conclusions about plaintiff's ability to do the job without ascertaining relevant facts.
26. The Court remanded the case to the agency for further administrative consideration, particularly with respect to plaintiff's ability to perform the essentials of the job of AIS with a hearing aid and with respect to any other accommodations the agency might consider.
27. On remand, Mr. Ryan and the agency's attorney developed a "test" which purported to ascertain whether Mr. Crane could perform the job of an AIS in the NOTAM Section. In developing the test, however, FAA officials considered only plaintiff's ability to perform in the domestic side of the Notice to Airmen section.
28. Neither of the individuals who participated in the development of the test had any experience in the development of tests. They had no knowledge of how one develops a valid job-related test. They did not secure available professional advice on how to develop a test from within the agency or from the Office of Personnel Management.
29. The test consisted of reading plaintiff a list of individual pieces of information *160 which come in by teletype to the NOTAM section, called notice to airmen or "NOTAMs". Each consisted of a sentence describing a particular aeronautical condition at a particular place and time, e.g., operating hours of the Fort Riley, Kansas tower. Curtis Alms read a series of 15 of these notices to plaintiff without interruption and at a speed of approximately 100 words per minute. Plaintiff was expected to copy the notices to airmen sequentially without error in transcription. Prior to the test, no attempt was made to verify or test it through the use of a control individual or group.
30. The test had a number of very serious deficiencies, including the following: (a) It tested in addition to hearing, the skill of shorthand. Unless one knew some form of shorthand, it was difficult to copy language read at 100 words per minute, the speed at which Mr. Alms read the notices to plaintiff. The federal government requires entry-level stenographers to take shorthand at only 80 words per minute, the same speed as the leading secretarial school in Washington (100 words per minute is considered for an advanced course at that school). Plaintiff noted in his notes his inability to write the NOTAMs down as quickly as they were read. He also objected to the test.
(b) The test was not job-related. The NOTAMs were read sequentially and without interruption, in a form completely unlike the circumstances under which the job would actually be performed. On the job, if an AIS had a question about a NOTAM which arrived by teletype, he would call the originating flight service section on the phone and discuss any clarification he felt was needed. This would be a normal back-and-forth conversation in which any problems could be discussed, cleared up and lems could be discussed, cleared up and verified. No such conversations about a particular notice or series of notices was used in the test given to plaintiff; rather, a list was read to be transcribed. Moreover, whereas in an entire eight-hour shift, a specialist will have received 15 NOTAMs which require clarification, here 15 NOTAMs were read without interruption in a matter of minutes.
(c) The conditions of the test were uncontrolled, without an attempt to ascertain whether the telephone was operating properly.
(d) The text was not validated to determine whether an AIS who was not hearing-impaired could pass.
31. On remand, the agency was also required by the Court to give consideration to reasonable accommodation, but none of the officials involved in the decision was even aware that reasonable accommodation was necessary to plaintiff and apparently all were unsure what it meant. The deciding official, again Mr. Ryan, was unaware that he had to consider reasonable accommodation for plaintiff and did not know how he would go about considering such reasonable accommodations.
32. Neither Mr. Ryan nor Mr. Bancroft were able to say whether any accommodations to plaintiff's handicap were possible in the National Flight Data Center.
33. The Director of Personnel for the Washington headquarters of the FAA, Mr. Driscoll, similarly never considered whether reasonable accommodations were possible for plaintiff, notwithstanding the requirements of the Court's order.
34. Numerous publications of the Office of Personnel Management provide guidance to federal management officials responsible for complying with the duty of reasonable accommodation. These include a Handbook of Reasonable Accommodation, a Handbook of Job Analysis for a Reasonable Accommodation and specific publication concerning Reasonable Accommodation for Deaf Employees in White-Collar Jobs. These publications were not consulted by any FAA officials responsible for the decision not to hire the plaintiff.
35. The evidence demonstrates that, even without any accommodation by the agency, but with the use of a hearing aid which plaintiff has obtained and is willing to use, he may be able to perform the essential functions of the AIS job in the *161 domestic Notice to Airmen section. Since the other jobs require less use of the telephone, he would be able to do those jobs. The tests performed by the audiologist at the Gallaudet College demonstrate that, in a variety of circumstances, including the introduction of significant background noises, plaintiff can hear and receive messages over the telephone.
36. Alternatively, plaintiff can perform the job of an AIS with reasonable accommodation.
37. It may be that accommodations are possible which would enable plaintiff to perform the job of an AIS in the domestic NOTAM section competently and efficiently, without hazard to anyone.
38. Unfortunately, the "test" conducted by the agency did not have adequate controls. First, as noted, see Finding No. 30, the test was given in such a way, that it not only tested hearing, but the skill of the plaintiff in recording the information read over the telephone as well. Nothing in the record indicates that speed writing or shorthand are requirements of the job. Second, the agency did not conduct a controlled test, that is, the agency did not give the test to one or more other persons so as to have the results of those tests as a gauge for the performance of the plaintiff. Third, the agency did not take action to preserve the test, for example, the agency could have recorded the test so that the actual statements of the reader could be played back at a later date. The agency should have recorded the message received over the telephone so that it would have been clear to the finder of fact what the plaintiff should have heard. Such action would also have conclusively established the speed at which the test was given, any problem in the method the NOTAMs were read, any problems with the telephone, and any comments made by the reader and the plaintiff. Such action also may have assisted the agency to determine whether a reasonable accommodation could be made if the plaintiff is assigned to work in the domestic NOTAM section.
39. In the event the plaintiff is unable to "pass" the test, the agency could have considered the accommodation which would be to assign the plaintiff to the international NOTAM section, where little telephone communication is used.
II
1. At all times relevant to this action, that is, from 1978 to the present, plaintiff has been a qualified handicapped individual within the meaning of Act, 29 U.S.C. § 791, and 29 C.F.R. 1613.702(f).
2. Under FAA regulations, plaintiff's entitlement to "priority consideration" pursuant to the 1977 decision of the agency, entitled him to be considered for the "next appropriate vacancy" defined by regulation as one which (a) would normally be filled by competitive promotion procedures, or by other placement action, including outside recruitment; (b) which is the same grade or level as that to which the employee was not promoted or given proper consideration because of the violation; and (c) which would be acceptable to the employee if selected.
3. To the extent that the FAA, throughout the proceedings in this case, considered plaintiff only for a position in the domestic Notice to Airmen section when it believed plaintiff was not medically qualified for employment in that section as a result of his hearing loss, the agency has never considered plaintiff for the next "appropriate" vacancy, in violation of the FAA's own regulations, when construed in conjunction with the requirements of the Act.
4. The decision in 1978 not to hire plaintiff violated the Act by discriminating against plaintiff solely on the basis of his hearing loss and his disability retirement, where the selecting official made no attempt to find out the extent of plaintiff's hearing loss or whether that hearing loss interfered with his ability to perform the job.
5. The decision of Bancroft in 1978 not to hire plaintiff was arbitrary and capricious in violation of the APA, because the selecting official made no attempt to find out the extent of plaintiff's hearing loss or *162 whether that hearing loss interfered with his ability to perform the job.
6. The decision of the FAA in 1980, reaffirmed on reconsideration in 1981, not to hire plaintiff for a position as an AIS violated the Act insofar as it did not consider plaintiff's ability to perform the job with or without reasonable accommodation. This conclusion is the law of the case pursuant to the Court's order of June 29, 1982. See Crane v. Lewis, supra.
7. The decision of the FAA in 1980, reaffirmed on consideration in 1981, not to hire plaintiff for a position as an AIS was arbitrary and capricious in violation of the APA insofar as it did not consider plaintiff's ability to perform the essential functions of the job with or without reasonable accommodation, rendered medical conclusions without medical knowledge and deemed plaintiff's evidence irrelevant. This conclusion is the law of the case pursuant to the Court's order of June 29, 1982.
8. The agency's decision on remand from this Court violated the Act in using a test for job performance which was not valid, which was not administered fairly or under controlled conditions and which was not job-related. 29 C.F.R. 1613.705(a).
9. The agency's decision on remand from this Court was arbitrary and capricious under the APA in using a test for job performance which was not valid, which was not administered fairly or under controlled conditions and which was not job-related.
10. The agency's decision on remand from this Court violated the Act by failing to consider reasonable accommodations to plaintiff which would enable him to perform the essential functions of the job of AIS in the domestic NOTAM section, despite a specific order from this Court to consider such accommodations.
11. The agency's decision on remand from this Court was arbitrary and capricious in violation of the APA by failing to consider reasonable accommodations to plaintiff which would enable him to perform the essential functions of a job of AIS in the domestic NOTAM section.
12. Reasonable accommodations the agency could have considered, and which it is required to consider as a matter of law, include making facilities usable by handicapped persons, 29 C.F.R. 1613.704(b)(1); and modification of equipment or devices, 29 C.F.R. 1613.704(b)(2). The agency never considered any of these possible accommodations.
13. Some of the accommodations proposed by plaintiff could be accomplished without undue hardship on the operation of the agency, considering the size of the National Flight Data Center, the number of employees, the resources of the FAA; the nature of the agency's operation, including the composition and structure of the work force and the nature and cost of the accommodations suggested.
14. As a result of the violation of law described, plaintiff is entitled to back pay to February 1978 at the level of GS-12, with all statutory pay increases, grade increases and promotions.
15. Insofar as plaintiff's hearing loss complaint is concerned, and as a result of the violations of law described, plaintiff is entitled to placement in the position of AIS in the National Flight Data Center, GS-1361-13 in the next vacancy which arises in the Center. Until such vacancy occurs, plaintiff is entitled to "front pay" from the date of the Court's decision to the date of placement in a position.
16. Plaintiff is entitled to reasonable attorney's fees and costs. 29 U.S.C. § 794a(a).
III
In this part, the Court briefly amplifies what it has stated in Parts I and II. It is clear that the defendants have not complied with the direction given by this Court in Crane v. Lewis, supra. The Court noted the difficulty it had in deciding this case on the cross-motions because the agency's decision to reject the plaintiff lacked an evidentiary basis. 551 F.Supp. at 32. It was *163 for this reason that the case was remanded to the agency with direction that the hearing capability of the plaintiff be tested. In Findings Numbered 30 and 38, Part I, supra, the Court has noted the deficiencies apparent in the test given the plaintiff. The Court now concludes that the defendants could have reached a reasonable accommodation by placing the plaintiff in the next appropriate vacancy in the International NOTAM Section. See Southeastern Community College v. Davis, 442 U.S. 397, 99 S.Ct. 2361, 60 L.Ed.2d 980 (1979); Treadwell v. Alexander, 707 F.2d 473 (11th Cir.1983). For this reason, the Court's decision is a final one and a final order has been entered. Notwithstanding this fact, the defendants may give further consideration to placing the plaintiff in the domestic NOTAM section either with or without making an accommodation. In short, the agency may retest the plaintiff one more time having in mind the defects found in the earlier test. If such a test is given, the agency shall "preserve" the test as suggested by the Court. If the plaintiff passes the test, then the agency shall take action to place the plaintiff in the next appropriate vacancy in the domestic NOTAM section. If the plaintiff fails the test, the agency may consider whether there are reasonable accommodations which can be made to permit the plaintiff to work in the domestic NOTAM section. Such accommodations may include, but are not limited to, a phone designed to amplify voices, however, the agency is not required to hire additional personnel or to make scheduling changes which would decrease, in any way, the operations of the important services the agency renders.
The plaintiff brought this action pursuant to the Rehabilitation Act of 1973 and the Administrative Procedures Act. While the Court finds that the agency has acted arbitrarily and capriciously in considering plaintiff's application for employment, the relief it grants is solely based upon that afforded under the Rehabilitation Act of 1973.
An appropriate order has been issued.
|
515 F.2d 892
75-2 USTC P 9656
UNITED STATES of America, Plaintiff-Appellee,v.Joe Raymond DIEZ and Peter A. Palori, Defendants-Appellants.
No. 74-2641.
United States Court of Appeals,Fifth Circuit.
July 14, 1975.
Raymond E. LaPorte, Tampa, Fla., for Diez.
E. David Rosen, Miami, Fla., for Palori.
John L. Briggs, U. S. Atty., Bernard Dempsey, Asst. U. S. Atty., Jacksonville, Fla., Claude Tison, Jr., Asst. U. S. Atty., Tampa, Fla., for plaintiff-appellee.
Appeals from the United States District Court for the Middle District of Florida.
Before GIBSON,* THORNBERRY and AINSWORTH, Circuit Judges.
AINSWORTH, Circuit Judge:
1
Peter A. Palori and Joe Raymond Diez appeal from convictions of conspiring to defraud the United States by impeding the Internal Revenue Service in the collection of income tax in violation of 18 U.S.C. § 371. Palori also appeals from his conviction on four counts of income tax evasion. 26 U.S.C. § 7201. Both defendants assign numerous errors in the trial court's rulings concerning the admissibility and weight of hearsay evidence, the propriety of a joint trial of the defendants, and the possibility of prejudice from the Government's use of illustrative charts.
I. Factual Background
2
The Government's case against Palori and Diez involved a series of real estate transactions in Tampa, Florida, between 1965 and 1968. The Government's theory was that Palori was the real owner of shares of the various parcels sold in these transactions, but that he had arranged for several of his relatives to act as nominal owners or brokers in the transactions and to report part of the profits from the sales on their own tax returns. Palori's mother, Minnie Lopez, reported profits from a number of the transactions on her returns and was indicted as a member of the conspiracy but acquitted. Diez, who is Palori's uncle, reported part of the profit from one of the transactions, as well as two brokerage commissions allegedly received in connection with other transactions, and interest on a loan he allegedly made to Palori. B. J. DeGuzman, Palori's accountant during the tax years in question, reported part of the profit from one of the real estate transactions, and was indicted and convicted both for his role in the conspiracy and for preparing false returns specifically those of Palori and his relatives.1 The Government contended that all of this income was properly attributable to Palori. James Garrett and Clarence Prevatt, two unindicted coconspirators, also participated in some of the transactions.
3
II. Evidence Allegedly Admitted in Violation of the Hearsay Rule
A. Statements of Coconspirators
4
Palori and Diez contend that it was error to permit the introduction of several statements by Garrett and DeGuzman, two of their coconspirators, which, they argue, were inadmissible under the hearsay rule. The general principles governing the introduction of out-of-court declarations by one conspirator against another, for the truth of the matter stated, are clear:
5
It is established law, at least since Krulewitch v. United States, 1949, 336 U.S. 440, 69 S.Ct. 716, 93 L.Ed. 790, and under so many cases prior to and following Krulewitch that it would be an affectation to cite them, that acts and declarations of co-conspirators are binding upon each member of the conspiracy, if made during the life of the conspiracy and in furtherance of any of its objects.
6
United States v. Harrell, 5 Cir., 1970, 436 F.2d 606, 613. See United States v. Register, 5 Cir., 1974, 496 F.2d 1072, 1078.
7
The statements complained of were part of the testimony of Agents Brock and Hill of the Internal Revenue Service. Brock testified that DeGuzman told him, in an interview in November 1970, that during a prior audit another agent, named Hunting, had proposed to classify Palori as a dealer in real estate,2and thus as ineligible for the special tax treatment usually given long-term capital gains.3 DeGuzman also stated in interviews during July 1969 and July 1970, according to the testimony of Agents Brock and Hill, that he and Minnie Lopez had paid fees and brokerage commissions to Diez in connection with several of the real estate transactions in the case.4
8
According to Agent Brock's testimony, in an interview during January 1972 Garrett stated that Diez "didn't participate as a partner in any of Mr. Palori's real estate transactions, nor did he perform any services which would entitle him to a commission." This statement, in contrast to that of DeGuzman concerning payment of fees and commissions, supported the Government's contention that income properly belonging to Palori was being attributed to Diez as part of the conspiracy. Agent Brock, testifying as an expert witness, also stated that in computing Palori's income for 1965 he disregarded a check from Palori to Garrett, allegedly for the latter's interest in a parcel sold in one of the transactions, because Garrett had told him (in the January 1972 interview) that he did not own an interest in the parcel in question.5
9
Palori and Diez contend that these hearsay statements were, at most, attempts to conceal the completed crime, and thus could not be introduced under the coconspirator exception to the hearsay rule. A review of the prior Supreme Court cases convinces us that this argument must fail.
10
In Krulewitch v. United States, 336 U.S. 440, 69 S.Ct. 716, 93 L.Ed. 790 (1949), the Supreme Court held inadmissible the hearsay statement of a coconspirator made after she had been apprehended. The Government argued that there was an implicit conspiracy to conceal the crime. The Court noted, however, that no such conspiracy to conceal had been charged in the indictment, and stated:
11
It is beyond doubt that the central aim of the alleged conspiracy transportation of the complaining witness to Florida for prostitution had either never existed or had long since ended in success or failure when and if the alleged co-conspirator made the statement attributed to her.
12
336 U.S. at 442, 69 S.Ct. at 718.
13
In Lutwak v. United States, 344 U.S. 604, 73 S.Ct. 481, 97 L.Ed. 593 (1953), a conspiracy to conceal the crime was charged in the indictment, but the Court interpreted Krulewitch to require more than an unsubstantiated allegation:
14
This Court in (Krulewitch) rejected the Government's contention that in every conspiracy there is implicit an agreement as a part thereof for the conspirators to collaborate to conceal the conspiracy.
15
344 U.S. at 616, 73 S.Ct. at 489. The Court held in Lutwak that the Government had failed to prove a conspiracy to conceal the crime, and went on to discuss what kind of proof would be sufficient. See Grunewald v. United States, 353 U.S. 391, 403-405, 77 S.Ct. 963, 973-974, 1 L.Ed.2d 931 (1957).
16
It is unnecessary to apply the reasoning developed in these prior cases concerning proof of a conspiracy to conceal a completed crime, because the statements in question here were part of the central conspiracy itself, which had not terminated when those statements were made. In this case the Government charged a conspiracy to defraud the United States by impeding the Internal Revenue Service in the collection of income tax. This conspiracy is different from the conspiracies discussed in the cases relied on by defendants.
17
In Krulewitch the conspiracy was to transport a woman across state lines for prostitution in violation of 18 U.S.C. § 2421. That conspiracy clearly had ended when the arrested coconspirator made her statement. In Lutwak, supra, the conspiracy was
18
" 'to defraud the United States of and concerning its governmental function and right of administering' the immigration laws and the Immigration and Naturalization Service, by obtaining the illegal entry into this country of three aliens as spouses of honorably discharged veterans."
19
344 U.S. at 605, 73 S.Ct. at 483 (emphasis added). The conspiracy to defraud was complete when the conspirators deceived the immigration officials into permitting them to enter the country.6 The Court held that coconspirators' statements made later would not be admissible under the coconspirator exception to the hearsay rule. In Grunewald, supra, the conspiracy was to defraud the United States by preventing criminal tax prosecutions. The prosecutions were prevented through the procurement, by bribery, of "no prosecution" rulings from the Internal Revenue Service, and ended when the rulings were issued.
20
On the other hand, in the present case the central aim of the conspiracy was to deceive officials of the Internal Revenue Service, thereby inducing them to accept fraudulent tax returns as truthful and accurate. In light of the substantial possibility that the returns would be audited and investigated, the filing of the returns did not fully accomplish the purpose of the main conspiracy, which, by its very nature, called for concealment.7
21
The Supreme Court described a very similar conspiracy in Forman v. United States, 361 U.S. 416, 423-424, 80 S.Ct. 481, 486, 4 L.Ed.2d 412 (1960):
22
(T)he conspiracy was a continuing one extending from 1942 to 1953 and its principal object was to evade (taxes) for 1942-1945, inclusive, by concealing (the conspirators') "holdout" income. This object was not attained when the tax returns for 1945 concealing the "holdout" income were filed. As was said in Grunewald, this was but the first step in the process of evasion. The concealment of the "holdout" income must continue if the evasion is to succeed.
23
In some circumstances it may be difficult to determine precisely when the deception has been accomplished in a conspiracy like this one.8 A lapse of several years between the filing of the last fraudulent return and the initiation of investigative efforts by the Government might suggest that the conspiracy had succeeded in its purpose. Statements made during the course of such an investigation might be considered outside the scope of the coconspirator exception. That difficult determination is unnecessary in the present case, however, because an IRS audit of Palori's returns for 1965 and 1966 was undertaken in April 1968 even before the last fraudulent return involved here was filed. Thus the conspirators were clearly on notice that their activities had aroused suspicion and that further deception might be necessary to fulfill their purpose. At the time of the statements by DeGuzman and Garrett, it could not be said that the conspiracy "had long since ended in success or failure," as was true in Krulewitch. No charges had been brought, so the conspiracy could not be considered a failure, and the investigation had not been abandoned, so the conspiracy could not be considered a success.
24
"(T)he termination of a conspiracy generally is an issue to be determined on the facts of the individual case . . . ." United States v. Sarno, 1 Cir., 1972, 456 F.2d 875, 878. We find no reversible error in the District Court's conclusion that, for purposes of admissibility, there was sufficient evidence that the statements in question were made during the course of the conspiracy. See United States v. Nowak, 7 Cir., 1971, 448 F.2d 134, 139; Nassif v. United States, 8 Cir., 1966, 370 F.2d 147, 151-152; United States v. Hickey, 7 Cir., 1966, 360 F.2d 127, 140-141; United States v. Klein, 2 Cir., 1957, 247 F.2d 908.
25
Defendants contend that, even if made during the conspiracy, several of the statements made by DeGuzman and Garrett to the IRS agents cannot be considered in furtherance of the conspiracy.9 Defendants argue that since the statements were consistent with the Government's position at trial, they must be considered as true; and true statements do not further a conspiracy to deceive. A statement need not be false in every detail, however, in order to have been made in furtherance of a conspiracy to conceal and defraud. Deception rarely takes the form of an uninterrupted series of lies. A fair reading of the agents' interviews with DeGuzman and Garrett convinces us that, taken as a whole, the coconspirators' statements were deceptive in design, especially when considered in conjunction with the versions of the facts related to the agents by Palori, Diez and the others during the investigation. The truthfulness of isolated parts of the statements does not affect this conclusion. Cf. Bruton v. United States, 391 U.S. 123, 126, 88 S.Ct. 1620, 1622, 20 L.Ed.2d 476 (1968); United States v. Maddox, 5 Cir., 1974, 492 F.2d 104, 107.
26
B. Evidence Admitted Under the Business Records Act
27
The trial court received into evidence, over defendants' objections, several documents which the Government contended were admissible under the Business Records Act. 28 U.S.C. § 1732(a).10 Defendants particularly objected to the introduction of work papers, given to the IRS agents by DeGuzman, showing that Palori had a one-third interest in a parcel of land sold in one of the transactions in the case, although Diez reported half of the gain attributable to that one-third share on his own tax return for 1965. Defendants contend that proper foundation for introducing the papers as business records was lacking. We need not resolve that question, however, because DeGuzman's work papers, like his statements discussed earlier, were admissible under the coconspirator exception to the hearsay rule. The work papers were prepared shortly after the sale of the parcel in 1965, and thus were statements made during the course of the conspiracy. They also were in furtherance of the purpose of the conspiracy: the filing of false income tax returns.11
28
The remainder of the documents in question, objected to by Palori, are writings "made in (the) regular course of any business," 28 U.S.C. § 1732, and were otherwise qualified to be introduced under the Act. Palori does not dispute this, but raises other objections to the admission of these documents, which we deal with separately.
29
The Government offered in evidence the work papers of Clarence Prevatt's accountant, showing a profit of $24,612.91 on the sale of a parcel of real estate in 1968 and allocating $9,000 of that profit as Palori's share $9,000 that Palori did not report on his 1968 return. The accountant testified that he prepared the work paper in the regular course of business, specifically in the course of preparing Prevatt's 1968 tax return. He also testified that Prevatt, an unindicted coconspirator in the case, had provided the information he used in his computations.
30
Apparently Palori's only objection to the introduction of this document is that, since the accountant could not testify to what Prevatt had told him concerning the ownership of the land, the same information could not come in by virtue of being preserved in a business record. We believe, however, that the accountant could have so testified, because Prevatt's statements to him were those of a coconspirator during the course and in furtherance of the conspiracy. The purpose of the conspiracy was to enable Palori to receive income from the various real estate transactions without revealing his participation in them as an owner and thus exposing himself to tax liability. The statements of the conspirators that were intended to facilitate the flow of funds to Palori were as much in furtherance of the conspiracy as were the statements designed to conceal the disposition of the proceeds of the transactions. Without Prevatt's directions to his accountant, which indisputably were given before the conspiracy ended, Palori would not have received his share of the proceeds from the sale, and a major purpose of the conspiracy would have been frustrated.
31
To establish Palori's intention to conceal his participation in one of the transactions in 1967, the prosecution offered a letter from an official of the title company that closed the sale, stating that Palori "did not want his name to appear because he did not think it was politically expedient that it do so." The title company official testified that he wrote the letter in the regular course of business and that Palori himself was the source of his statement concerning the omission of Palori's name from the transaction.12
32
Palori contends that the title company officer's letter should not have been admitted because he was available to provide his own testimonial recollection of the facts in the letter. Availability of the declarant, however, does not bar introduction of a document under the Act. McCormick on Evidence § 311 at 728-729 (1972); Fed.R.Evid. Rule 803(6).
33
As further evidence of Palori's concealment of his participation in the transactions, the prosecution introduced a letter from an attorney for the seller of a parcel purchased and later resold by Palori. It stated that Palori was the actual mortgagor of the property, even though the parcel was held in the name of Minnie Lopez, Palori's mother. The attorney testified that he prepared the letter in the regular course of his business. He stated that he had written Mrs. Lopez to tell her where to send the mortgage payments, but she had failed to make the first payment. Garrett intervened, informing the attorney that Palori was the actual mortgagor of the property and would be making the payments.
34
Palori maintains that the attorney was uncertain of the source of his information, but a review of the attorney's testimony reveals this contention to be without merit. Furthermore, the fact that the attorney relied on Garrett's statement does not render admission of the letter violative of the hearsay rule. The statement was made in 1967, long before the conspiracy ended. It was in furtherance of the conspiracy because the attorney had already brought foreclosure proceedings against Minnie Lopez. If Garrett had not intervened the conspirators could not have resold the property.
III. Sufficiency of the Evidence as to Diez
35
Diez contends that the trial court erred in denying his motion for acquittal under Rule 29 of the Federal Rules of Criminal Procedure, because the evidence was insufficient for submission of the case to the jury. His argument is based chiefly on the paucity of references to his role in the conspiracy by the numerous witnesses at trial. Under the Government's theory of the case, however, Diez's role was amply established by the evidence.
36
The Government sought to prove that Diez had reported income that was not properly attributable to him. That the income was reported by Diez was established by introducing his tax returns for 1965, 1966, 1967 and 1968. The other half of the Government's case against Diez was more difficult, because it required proof that Diez had not earned the income in question and had not owned a share of the property that was the source of the sales proceeds listed on his return.
37
The prosecutor asked a number of witnesses whether they knew Diez, and many of them answered affirmatively. Diez argues that, because the prosecutor did not pursue the relevance of these witnesses' familiarity with Diez, his conviction was the product of guilt by association. It is true that mere association with members of a conspiracy is insufficient to establish a person's participation in the conspiracy,13 but in this case it was the defendant's nonassociation that proved his guilt. Despite his acquaintance with a number of the witnesses at trial, Diez was not mentioned as a participant in the real estate transactions by anyone but Palori and, in one statement, DeGuzman.
38
Simon Wooten, an associate of Palori who owned a one-third share of one of the parcels sold, indicated no knowledge of any participation in the transaction by Diez, who nevertheless reported the profit from a one-sixth interest in the property on his return. Gaston Fernandez, the real estate broker who handled the transaction, identified only Palori, Garrett, and Simon Wooten as owners of the land. Diez's name did not appear on any documents connected with the sale, and there was no record of any payment of sale expenses by him. Although the other owners received payments from Palori by check for their interests in the property, there was no record of any such check from Palori to Diez. DeGuzman's worksheet compiled during the preparation of Palori's 1965 tax return, lists one-third interests held by Palori, Garrett, and Simon Wooten.
39
Diez reported a $5,000 brokerage commission, allegedly paid by Minnie Lopez, from another real estate sale involved in the case. The broker who procured the purchase option by which the owners (Palori and others) acquired this land, however, knew of nothing Diez had done in connection with the property which would warrant receipt of a commission. The closing statements for this transaction show payment of commissions to several real estate brokers, but Diez is not among them. Although in all the other transactions Minnie Lopez paid sale expenses by purchasing cashier's checks with cash withdrawals from her savings account, there was no such check payable to Diez.14
40
Diez also reported a $6,000 commission, allegedly paid to him in cash by DeGuzman, in connection with another real estate transaction involved in the case. Like Minnie Lopez, DeGuzman consistently made payments by check in the other transactions. The real estate broker who helped Palori and Garrett obtain an option to purchase on the property, which was later sold, testified that he knew of no efforts by Diez in connection with the property which would warrant receipt of a commission.
41
Finally, Diez reported as his income $3,200 allegedly paid to him by Palori as interest on a loan. Palori's records contain no indication, however, of such payments. Nor is there any evidence that any such loan was made to Palori by Diez.
42
The pattern of Diez's reporting of income also reinforced the Government's case. For three of the four years in question (1965-1968), Diez reported substantial losses consistently in excess of his gains from the real estate transactions. In 1966, the only year in which Diez reported no losses, no gains from commissions or the sale of real estate were reported on his return.
43
Against all this evidence there was only the out-of-court statement of DeGuzman (to which Agent Brock testified) concerning his payment of a commission to Diez, for which he furnished an alleged receipt, and the testimony of Palori, who stated that Diez participated in all of the transactions from which he reported income, but had been paid in cash each time and had participated without the knowledge of anyone but himself, DeGuzman, and Minnie Lopez.
44
The standard we must apply in reviewing a denial of a motion for acquittal is clear. "The verdict of a jury must be sustained if there is substantial evidence, taking the view most favorable to the Government, to support it." Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 469, 86 L.Ed. 680 (1942). That the Government's case rested in substantial part on circumstantial evidence does not change that standard. Id.; United States v. Prince, 5 Cir., 1974, 496 F.2d 1289, 1293; McFarland v. United States, 5 Cir., 1960, 273 F.2d 417, 419. "Circumstantial evidence in this respect is intrinsically no different from testimonial evidence." Holland v. United States, 348 U.S. 121, 140, 75 S.Ct. 127, 137, 99 L.Ed. 150 (1954). See United States v. Miller, 5 Cir., 1974, 500 F.2d 751, 763. Our examination of the evidence and application of the appropriate standard of review compels the conclusion that the trial court did not err in denying Diez's motion for acquittal.
IV. Defendants' Motions for Severance
45
Palori contends that the trial court erred in refusing to grant him a trial separate from DeGuzman's. Diez contends that the trial court erred in refusing to grant him a trial separate from Palori's. Both of these assignments of error are without merit.
A. Palori's Motion
46
After the Government and the other defendants had rested and he had presented his evidence, Palori moved for a severance, alleging that DeGuzman would testify in his behalf if a separate trial was granted. Palori's proffer in support of his motion was, in its entirety, as follows:He (DeGuzman) would be prepared to testify for and on behalf of Mr. Palori as to the manner and means by which he computed the taxes and his error or omission on the 1967 tax return. His advice from time to time on tax matters.
47
In Byrd v. Wainwright, 5 Cir., 1970, 428 F.2d 1017, we discussed the factors a trial court should consider in ruling on a motion for severance based on the unavailability of a codefendant whose testimony is allegedly needed. First, the movant must show a bona fide desire to use the codefendant's testimony. In Byrd the movant's assertions concerning the importance of the codefendant's testimony were made "with full exploration of reasons." 428 F.2d at 1020. Here, in contrast, the defendant offered an unelaborated conclusory statement.
48
Second, the codefendant's testimony must be specifically shown to be exculpatory. United States v. Wilson, 5 Cir., 1974, 500 F.2d 715, 721. In this case the defendant's proffer not only lacked sufficient detail but also was bereft of exculpatory content. Palori had based prior motions for severance on the allegedly prejudicial effect of admissions made by DeGuzman during the investigation. His proffer contained nothing to erase this suggestion that DeGuzman would be a damaging, rather than exculpating, witness. The testimony briefly described in the proffer was irrelevant. Palori's defense was not that he relied in good faith on advice that proved to be incorrect. He contended that the transactions were exactly as represented on the various tax returns. As to the omission on Palori's 1967 tax return, Palori had already stated that the proceeds from one of the sales was left out of the return inadvertently. See United States v. Burke, 5 Cir., 1974, 495 F.2d 1226, 1234. Cf. United States v. Shuford, 4 Cir., 1971, 454 F.2d 772, 778.
49
Third, the movant must show a substantial likelihood that the codefendant will testify if the severance is granted. In Byrd the prosecutor and other defense counsel advised the judge, before he ruled on the severance motion, that the codefendant would testify if a separate trial was granted. Here there is nothing to show why DeGuzman would be any more willing to testify in a separate trial than in a joint trial. See United States v. Cochran, 5 Cir., 1974, 499 F.2d 380, 391-392; United States v. Burke, supra, 495 F.2d 1226, 1234.
50
Finally, the trial judge should consider the timeliness of the motion and the effect of a severance on economy of judicial resources. Byrd v. Wainwright, supra, 428 F.2d at 1020; United States v. Burke, supra, 495 F.2d at 1234; United States v. Johnson, 5 Cir., 1973, 478 F.2d 1129, 1134. In the present case, Palori has offered no explanation for making his motion very late in the trial.15 Having spent three weeks of trial time hearing the testimony of over sixty witnesses and considering over three hundred documents, the trial judge was not obliged to treat Palori's motion as he would an ordinary severance request made at the outset of a trial.
51
The granting of a motion for severance under Rule 14 of the Federal Rules of Criminal Procedure is within the trial court's discretion. E. g., Opper v. United States, 348 U.S. 84, 95, 75 S.Ct. 158, 165, 99 L.Ed. 101 (1954); United States v. Burke, supra, 495 F.2d at 1233-1234; Byrd v. Wainwright, supra, 428 F.2d at 1018; Smith v. United States, 5 Cir., 1967, 385 F.2d 34, 38. We find nothing to indicate an abuse of discretion on the part of the trial court in denying Palori's motion.16B. Diez's Motion
52
Diez contends that trying him with Palori was inherently unfair, because of the sheer complexity of the case and the impossibility of expecting the jury to restrict their consideration of evidence admitted against less than all the defendants. Closely related to this contention is Diez's assertion that the trial court's general instructions to the jury concerning the admissibility of evidence in a conspiracy trial were inadequate.
53
The complexity of a trial, by itself, is insufficient grounds for overturning a trial court's denial of a severance motion. In complex trials the pressures against severance are especially great, because of the drain on judicial resources that would be created by separate trials. See Byrd v. Wainwright, supra ; United States v. Martinez, supra, 486 F.2d at 23.
54
The only specific evidence cited by Diez as prejudicing him in the joint trial was a record of zoning proceedings held by the Hillsborough County Commission in late 1966 and early 1967, and a financial statement given by Palori to his bank in September 1964. The minutes of the Commission proceedings were introduced to refute Palori's contention that he recommended to Minnie Lopez that she pay Diez a $5,000 commission for arranging sewer hook-ups to a parcel of property sold in her name in 1967. This evidence showed that Palori had been aware of the sewerage problem months before he allegedly commissioned Diez to look into the matter, and had hired an engineer to develop plans for sewerage connections. The minutes supported the Government's contention that Diez had not earned the $5,000 he reported on his 1967 tax return. They were admissible against both Palori and Diez as proof of the existence of a conspiracy to conceal Palori's income.17
55
Diez's objection to the admission of Palori's financial statement is also without merit. Palori furnished the statement to his bank in connection with an application for a loan several months before, under the Government's theory, the conspiracy began. The statement purported to list Palori's outstanding obligations, yet made no mention of a loan from Diez. By casting doubt on whether Palori had made a $3,200 payment of interest to Diez, the evidence supported the Government's charge of a conspiracy to conceal Palori's income. Although the court did not give an instruction to the jury cautioning that Palori's admission was not binding on Diez, or the other alleged coconspirators, such an instruction was given in connection with the introduction of a similar financial statement by Palori later in the trial. More importantly, the jury was repeatedly instructed throughout the trial that "(s)tatements of any conspirator which are not in furtherance of the conspiracy or made before its existence or after its termination may be considered as evidence only against the person making it." In light of these instructions we fail to see how Diez was prejudiced by the introduction of Palori's pre-conspiracy financial statement.To say that the jury might have been confused amounts to nothing more than an unfounded speculation that the jurors disregarded clear instructions of the court in arriving at their verdict.
56
Opper v. United States, supra, 348 U.S. at 95, 75 S.Ct. at 165.18
V. The Government's Use of Charts
57
Palori and Diez claim prejudice by the Government's use of illustrative charts and summaries in connection with the testimony of its summary witness, Agent Brock. Their argument is that the captions on the charts and the headings on various columns of figures misled the jury by assuming the central fact to be proved at trial to whom various items of income were properly attributable.19 The caption on one chart, for example, reads "Schedule of Sales, Net Taxable Gains to Peter A. Palori And Amounts Not Reported Or Taxable Gain Reported By Others."
58
The charts undeniably make assumptions concerning the proper attribution of the income from the transactions in this case, and the propriety of Palori and Diez's attributions of this income was the crucial issue at trial. Any such chart of computations, however, must rest on certain assumptions. Contrary to defendants' argument, the essential requirement is not that the charts be free from reliance on any assumptions, but rather that these assumptions be supported by evidence in the record. United States v. Lawhon, 5 Cir., 1974, 499 F.2d 352, 357; Gordon v. United States, 5 Cir., 1971, 438 F.2d 858, 876; Myers v. United States, 5 Cir., 1966, 356 F.2d 469, 470; Azcona v. United States, 5 Cir., 1958, 257 F.2d 462, 466; Barsky v. United States, 9 Cir., 1964, 339 F.2d 180, 181-182. See Watkins v. United States, 1 Cir., 1961, 287 F.2d 932, 934.20 In this case it is indisputable that the assumptions on which the Government based its charts that is, its version of the facts were amply supported by evidence already presented to the jury.
59
The court should instruct the jury that "summaries do not, of themselves, constitute evidence in the case but only purport to summarize the documented and detailed evidence already submitted."21 Gordon v. United States, supra, 438 F.2d at 877. See Myers v. United States,supra, 356 F.2d at 470. In this case such instructions were given both when the Government's summary witness testified and again at the close of the case.22 We believe the court's instructions eliminated any possibility of the charts confusing the jury.
60
It is within the trial court's discretion to decide whether the Government may use illustrative charts. United States v. Lawhon, supra, 499 F.2d at 357; Gordon v. United States, supra, 438 F.2d at 877; Bobsee Corporation v. United States, 5 Cir., 1969, 411 F.2d 231, 241; Lloyd v. United States, 5 Cir., 1955, 226 F.2d 9, 16; United States v. Dana, 7 Cir., 1972, 457 F.2d 205, 207-208. We perceive no abuse of discretion here.
61
Having reviewed all of defendants' assignments of error carefully, we find no reversible error.
62
Affirmed.
*
Of the Eighth Circuit, sitting by designation
1
DeGuzman did not appeal his conviction
2
The fact that DeGuzman's statement, like numerous others introduced at trial, relied on a statement by another person does not render the testimony inadmissible. Agent Hunting's statement, reported to Agent Brock by DeGuzman, was a statement of his intention to classify Palori as a dealer in real estate. The statement was received not to prove that Palori was or had been classified as a dealer, but rather to prove that Agent Hunting intended to regard him as one. The statement was thus a "statement of the declarant's then existing state of mind, emotion, sensation, or physical condition (such as intent, plan, motive, design, mental feeling, pain and bodily health)" and falls under the well-established exception to the hearsay rule for such statements. Fed.R.Evid. Rule 803(3). DeGuzman was therefore a competent witness to Hunting's statement, just as Agent Brock was a competent witness to DeGuzman's statement under the coconspirator rule. "Hearsay included within hearsay is not excluded under the hearsay rule if each part of the combined statements conforms with an exception to the hearsay rule provided in these rules." Fed.R.Evid. Rule 805
The Federal Rules of Evidence were approved by Congress on January 2, 1975, and take effect on the one hundred and eightieth day thereafter. The Rules are to be applied even in advance of their effective date "except to the extent that application of the rules would not be feasible, or would work (an) injustice." United States v. Rivera, 2 Cir., 1975, 513 F.2d 519. See United States v. Arias-Diaz, 5 Cir., 1974, 497 F.2d 165, 170.
3
Palori made no objection to the introduction of this statement, either on the basis of the hearsay rule or on the basis of irrelevance, and admission of the testimony was not plain error. Wright, Federal Practice and Procedure: Criminal § 856 (1969). Therefore, it seems doubtful that we can consider this assignment of error as to Palori. Moreover, Agent Hunting was available and testified at trial. Neither Palori nor Diez has explained why they did not attempt to cross-examine him or call him as a witness on this issue
4
Because DeGuzman's statement is consistent with Palori and Diez's version of the facts, it is unclear how admission of this testimony prejudiced defendants. Moreover, when Agent Brock first interviewed Diez he specifically referred the agent to DeGuzman for answers to any questions concerning his taxes. DeGuzman's statement, therefore, would appear to be an "admission by an authorized agent," Hayes v. United States, 5 Cir., 1969, 407 F.2d 189, 192, and therefore would be admissible irrespective of whether the coconspirator exception applies. In Hayes the accountant acted pursuant to a written power of attorney, but we know of no precedent requiring authorization by a written instrument
5
This testimony is largely repetitive of earlier testimony by Agent Brock. On cross-examination his testimony strongly suggested that Garrett had told him he held no interest in the property in question. No objection was made by defendants. His testimony on redirect examination, to which Palori objected, was largely repetitive of his answers on cross-examination
Garrett's statement to the agents disavowing any ownership of a share in one of the parcels sold in 1965 was also introduced in the form of his tax return for that year, which contained no reference to gain from that sale. Palori contends that the tax return was inadmissible, relying on Greenbaum v. United States, 9 Cir., 1935, 80 F.2d 113, 125, which we cited approvingly in dicta in United States v. Ragano, 5 Cir., 1973, 476 F.2d 410, 417-418. Like the testimony on redirect concerning Garrett's oral statement to the agents, however, the information supplied by the tax return was merely repetitive of what Agent Brock had stated on cross-examination without objection. Under these circumstances, the admission of the tax return and Agent's Brock's statements on redirect examination was not erroneous or prejudicial.
6
The dissolution of the fraudulent marital relations, after the aliens had entered the United States but long before the indictments were handed down, left little doubt that the conspiracy to defraud the Government had ended
7
The conspiracy alleged in this case is similar to the Supreme Court's examples, in Grunewald, supra, of crimes that inherently involve concealment
Kidnapers in hiding, waiting for ransom, commit acts of concealment in furtherance of the conspiracy itself, just as repainting a stolen car would be in furtherance of a conspiracy to steal; in both cases the successful accomplishment of the crime necessitates concealment.
353 U.S. at 405, 77 S.Ct. at 974 (emphasis added).
8
In Forman the Supreme Court suggested that so long as acts of concealment continue beyond the filing of the returns, such conspiracies cannot be said to have "ended in success or failure" until either the conspirators are caught or the statute of limitations has run on any action to recover the evaded taxes. 361 U.S. at 424, 80 S.Ct. at 486
9
The fact that Garrett and Prevatt were not made defendants in the case does not render the coconspirator exception inapplicable to them. United States v. Nixon, 418 U.S. 683, 700-701, 94 S.Ct. 3090, 3104, 41 L.Ed.2d 1039 (1974)
10
Section 1732(a) provides:
In any court of the United States and in any court established by Act of Congress, any writing or record, whether in the form of an entry in a book or otherwise, made as a memorandum or record of any act, transaction, occurrence, or event, shall be admissible as evidence of such act, transaction, occurrence, or event, if made in regular course of any business, and if it was the regular course of such business to make such memorandum or record at the time of such act, transaction, occurrence, or event or within a reasonable time thereafter.
Rule 803(6) of the Federal Rules of Evidence provides:
The following are not excluded by the hearsay rule, even though the declarant is available as a witness:
(6) Records of regularly conducted activity. A memorandum, report, record, or data compilation, in any form, of acts, events, conditions, opinions, or diagnoses, made at or near the time by, or from information transmitted by, a person with knowledge, if kept in the course of a regularly conducted business activity, and if it was the regular practice of that business activity to make the memorandum, report, record, or data compilation, all as shown by the testimony of the custodian or other qualified witness, unless the source of information or the method or circumstances of preparation indicate lack of trustworthiness. The term "business" as used in this paragraph includes business, institution, association, profession, occupation, and calling of every kind, whether or not conducted for profit.
11
As we noted earlier in connection with DeGuzman and Garrett's oral statements, the fact that DeGuzman's notations on the work papers coincided with the Government's version of the facts at trial does not mean that they were not in furtherance of the conspiracy
12
Palori contends that the title company official could not remember whether Palori specifically directed that his name be kept out of the transaction or whether he simply drew that conclusion himself. A careful reading of the testimony to which Palori refers, however, shows that the official's uncertainty concerned a different part of his letter. In any event, the clear import of the text of the letter is that Palori had requested that his name not be mentioned, and a specific present recollection of that fact on the part of the writer of the letter is unnecessary
13
United States v. Oliva, 5 Cir., 1974, 497 F.2d 130, 134; United States v. Suarez, 5 Cir., 1973, 487 F.2d 236, 239; United States v. Martinez, 5 Cir., 1973, 486 F.2d 15, 24; United States v. Jackson, 5 Cir., 1970, 426 F.2d 305, 309; Jett v. United States, 5 Cir., 1968, 393 F.2d 139, 140; Causey v. United States, 5 Cir., 1965, 352 F.2d 203, 207; Panci v. United States, 5 Cir., 1958, 256 F.2d 308, 312; United States v. Cantone, 2 Cir., 1970, 426 F.2d 902, 904. Cf. United States v. Menichino, 5 Cir., 1974, 497 F.2d 935, 942-943; United States v. Edwards, 5 Cir., 1974, 488 F.2d 1154, 1158
14
At trial Palori offered a different explanation of Diez's receipt of the $5,000. He stated that Diez had made arrangements for sewerage hook-ups for a parcel sold in Minnie Lopez's name, and he had recommended that she pay Diez $5,000 for his services. The Government introduced evidence showing that Palori was aware of the need for sewerage hook-ups long before he allegedly commissioned Diez to look into the matter and had hired an expert engineer to solve the problem. Palori maintains that the engineer was hired in connection with sewerage hook-ups for another parcel sold in the same transaction, but that was a question for the jury
15
Palori's two prior motions for severance were not based on the contention that DeGuzman would testify in his behalf, and he has not contended on appeal that the denial of these earlier motions is error
16
Palori alternatively requested that the court bifurcate the jury deliberations, so that DeGuzman's guilt or innocence could be resolved whereupon he would testify for Palori. This procedure would have been impractical and unwarranted. The jury could not have determined DeGuzman's guilt or innocence on the conspiracy count without coming to a conclusion concerning Palori's guilt or innocence on the substantive count, which would nullify the purpose of having the bifurcated deliberation in the first place
17
Diez asserts that a cautionary instruction was necessary because this evidence was offered only to impeach Palori's credibility. Although in its brief the Government does use the term "impeachment" in discussing Diez's contention, this evidence is referred to as "impeachment of Palori's testimony." The context in which the Commission records were offered leaves no doubt that they were introduced as evidence of guilt
Palori contends the minutes were introduced to inject an element of political scandal into the trial, because they suggest connivance between him and Prevatt, an unindicted coconspirator and member of the Commission, to arrange for zoning variances and changes. As we explained in our discussion of Diez's motion for severance, however, there were legitimate reasons for the introduction of the minutes. The Government is not required to forego valuable evidence merely because it may lay bare the unsavory details of a defendant's dealings.
18
Diez challenges the correctness of the court's cautionary instruction concerning the kind of evidence admissible to connect a defendant with a conspiracy. The record shows that the trial judge apparently did skip a line, inadvertently, when he first read to the jury the standard instruction on this point. No one objected. Moreover, the instruction was correctly repeated throughout the trial, thus eliminating any possibility of prejudice
19
Defendants also object to the parts of one chart listing the total sales price of the properties sold and the listing of the taxable gains, rather than the entire gains, reported by DeGuzman and Minnie Lopez on the various real estate transactions. We find no prejudice from the listing of the sales prices. Furthermore, the taxable gain to Lopez and DeGuzman was only half of the entire gain because they reported these items of income as long-term capital gains. If the entire gain had been shown, the chart would have given a misleading indication of the amount of taxable income Palori had avoided reporting
20
Baines v. United States, 5 Cir., 1970, 426 F.2d 833, relied on by defendants, is inapposite. In that case the crucial issue was whether dancing and music occurred simultaneously after 9:30 p. m. in a nightclub, for purposes of a cabaret tax on the sale of liquor. The Government relied on a chart computing the amount of taxes based on the assumption that every sale of liquor after 9:30 p. m. occurred while music and dancing were occurring simultaneously. There was no evidence to support that assumption. In this case, each representation made on the charts is supported by evidence in the record
21
Contrary to defendants' assertion, relying on Steele v. United States, 5 Cir., 1955, 222 F.2d 628, this Court has never held that the jury cannot take illustrative charts with them to the jury room. In that case we held only that the charts in question, because of their composition and layout, could not properly have been submitted to the jury, and that it was doubly prejudicial to accede to the jury's request for the charts after the deliberations began. See Flemister v. United States, 5 Cir., 1958, 260 F.2d 513, 516; United States v. Warner, 8 Cir., 1970, 428 F.2d 730, 737
22
Defendants contend that the court described these charts in its instruction to the jury as "summaries of facts." Although that phrase appears in the Government's proposed instruction, the record shows that the trial judge did not use this language
|
399 B.R. 81 (2008)
In re Martin Barry PAUL, Debtor.
Jeffrey D. Sternklar, Chapter 7 Trustee, Plaintiff,
v.
Heritage Auction Galleries, Inc., Heritage Galleries and Auctioneers, Heritage Capital Corporation, Heritage Auctions, Inc., Steven Ivy, and James Halperin, Defendants.
In re The Rarities Group, Inc., Debtor.
Jeffrey D. Sternklar, Chapter 7 Trustee, Plaintiff,
v.
Heritage Auction Galleries, Inc., Heritage Galleries and Auctioneers, Heritage Capital Corporation, Heritage Auctions, Inc., Steven Ivy, and James Halperin, Defendants.
Bankruptcy Nos. 05-22881-WCH, 03-18371-WCH. Adversary Nos. 08-1069, 08-1070.
United States Bankruptcy Court, D. Massachusetts, Eastern Division.
November 4, 2008.
*86 Jeffrey D. Sternklar, Duane Morris, LLP, Boston, MA, Ronald M. Jacobs, Conn Kavanaugh Rosenthal Peisch & Ford, Boston, MA, for Plaintiff.
Connor G. Sheehan, Deirdre B. Ruckman, William D. Dunn, Gardere Wynne Sewell LLP, Dallas, TX, for Defendants.
MEMORANDUM OF DECISION
WILLIAM C. HILLMAN, Bankruptcy Judge.
I. INTRODUCTION
The matters before the Court are the Motions to Dismiss or Stay and Compel Arbitration and Alternative Motion to Dismiss Fraud Claims Pursuant to Rule 9(b) (the "Motion to Compel") filed by Heritage Auction Galleries, Inc.,[1] Heritage Galleries and Auctioneers, Heritage Capital Corporation, Heritage Auctions, Inc. (collectively, "Heritage"), Steven Ivy ("Ivy"), and James Halperin ("Halperin") (collectively, the "Defendants") in two identical adversary proceedings brought by Jeffrey D. Sternklar, Chapter 7 trustee (the "Trustee") for the estates of Martin Barry Paul ("Paul") and the Rarities Group, Inc. ("RGI") (collectively, the "Debtors"), and Paul (collectively, the "Plaintiffs") asserting various counts arising from a prior business relationship between Paul and Heritage.[2] Through the Motion to Compel, the Defendants seek to enforce arbitration clauses contained within various documents Paul executed, both as an individual and as an officer and director of RGI, while participating in Heritage's coin auctions and stay or dismiss these adversary proceedings. In the alternative, the Defendants seek to dismiss the Plaintiffs' fraud claims under Fed.R.Civ.P. 9(b). For the reasons set forth below, I will enter an order denying the Motion to Compel.
II. BACKGROUND
From the outset, I note that the Trustee's allegations as set forth in the Complaint span thousands of individual transactions involving both Debtors over the course of many years. As such, the allegations with respect to these transactions are generalized and somewhat vague. The parties have further complicated this matter by submitting numerous documents which may or may not relate to some or all of these transactions. With this in mind, the relevant background of the dispute is as follows.
Paul is a buyer and curator of rare coins.[3] For many years, Paul operated RGI as a vehicle for buying and selling coins, as well as sports and entertainment *87 memorabilia.[4] Heritage is a collections auctioneer based in Dallas, Texas, and is purportedly the world's largest rare coin firm.[5] Upon information and belief, Ivy and Halperin are co-chairmen of Heritage.[6] Since the early 1980's, Paul, or companies in which he held an ownership interest, have conducted business with Heritage encompassing thousands of individual transactions.[7]
In the Complaint, the Trustee alleges that these transactions fall roughly into four categories: consignments, purchases of memorabilia, split coin deals, and loans.[8] In consignment transactions, Paul or RGI would consign individual coins or memorabilia to Heritage, and pursuant to consignment agreements, Heritage would, from time to time, advance funds to be applied against the sale price.[9] Commissions, interest rates, auction sale placements, and other terms would be negotiated.[10] In memorabilia purchase transactions, Paul or RGI would purchase individual memorabilia items at Heritage Auctions on credit, which Heritage would deliver.[11] Split coin deals were transactions where Heritage and Paul or RGI purchased coins together with the intention of Heritage reselling them for profit.[12] At times, Paul or RGI might curate the coins to increase their grade and value.[13] Profits from split coin deals would be split between Heritage and Paul or RGI according to agreed formulae, taking into account the funds advanced by Heritage, an implied rate of interest, expenses incurred in curating the coins, the grading, and the ultimate disposition of the coin.[14] From time to time, Heritage might also compensate Paul for curating services by an hourly rate or a commission.[15] In loan transactions, Heritage would advance money to Paul, purporting to reserve a right to offset against Paul's share of future profits.[16]
Over the course of their business relationship, the parties entered into numerous agreements to govern these transactions. The Defendants assert that its standard Terms and Conditions of Auction (the "Standard Auction Terms") are applicable to all auction participants and transactions. The Standard Auction Terms provide in relevant part:
Dispute Resolution and Arbitration Provision
45. By placing a bid or otherwise participating in the auction, Bidder accepts these Terms and Conditions of Auction, and specifically agrees to the alternative dispute resolution provided herein. Arbitration replaces the right to go to court, including the right to a jury trial.
* * *
48. Arbitration Clause: All controversies or claims under this Agreement or arising from or pertaining to: this Agreement or related documents, *88 or to the Properties consigned hereunder, or the enforcement or interpretation hereof of this or any related agreements, or damage to Properties, payment, or any other matter, or because of an alleged breach, default or misrepresentation under the provisions hereof or otherwise, that cannot be settled amicably within one (1) month from the date of notification of either party to the other of such dispute or question, which notice shall specify the details of such dispute or question, shall be settled by final and binding arbitration by one arbitrator appointed by the American Arbitration Association ("AAA"). The arbitration shall be conducted in Dallas, Dallas County, Texas in accordance with the then existing Commercial Arbitration Rules of the AAA. The arbitration shall be brought within two (2) years of the alleged breach, default or misrepresentation or the claim is waived. The prevailing party (a party that is awarded substantial and material relief on its claim or defense) may be awarded reasonable attorney's fees and costs. Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof; provided, however, that the law applicable to any controversy shall be the law of the State of Texas, regardless of its or any other jurisdiction's choice of law principles and under the provisions of the Federal Arbitration Act.
* * *
50. In consideration of their participation or application for the Auction, a person or entity (whether the successful Bidder, a Bidder, a purchaser and/or other Auction Participant or registrant) agrees that all disputes in any way relating to, arising under, connected with, or incidental to these Terms and Conditions and purchases, or default in payment thereof, shall be arbitrated pursuant to the arbitration provision. In the event that any matter including actions to compel arbitration, construe this agreement, actions in aid or arbitration or otherwise needs to be litigated, such litigation shall be exclusively in the Courts of the State of Texas, in Dallas Country, Texas, and if necessary, the corresponding appellate courts. The successful Bidder, purchaser, or Auction participant also expressly submits himself to the personal jurisdiction of the State of Texas.[17]
Paul and/or RGI purportedly agreed to the Standard Auction Terms, including the arbitration clause, by placing bids and otherwise participating in Heritage's auction and by registering online at Heritage's internet auction site.[18]
Additionally, the Defendants attached other documents with arbitration clauses to the Motion to Compel. One was a document titled "Extended Payment Terms for Dealers with Preapproved Credit" (the "Extended Payment Terms") *89 for Heritage's 2001 February Long Beach Signature Sale. Paul executed the Extended Payment Terms on February 23, 2001.[19] Paragraph 10 of the Extended Payment Terms provides:
10. All disputes in any way arising relating to, arising under, connected with, or incident to this agreement, shall be submitted to binding arbitration under the commercial rules of the American Arbitration Association (heard at Dallas, Texas) or if applicable, the Professional Numismatists Guild.[20]
The next attached document was an Auction Consignment Agreement (the "Consignment Agreement") executed by Paul on behalf of RGI on March, 19, 2002 for a Signature Sale to be held on or about April 25-27, 2002.[21] There are several notable things about the Consignment Agreement. First, a schedule of coins to be consigned is not attached to the agreement despite a reference to one in the first paragraph.[22] Second, the following notice appears before the signature block: "Important notice: Further items and conditions of this agreement appear on the reverse side."[23] The document, as submitted to the Court, does not have a reverse side. There is, however, a second page titled "General Consignment Terms and Conditions Auction Consignment Agreement" (the "Consignment Terms").[24] The Consignment Terms state as follows:
The sale will be conducted in accordance with the Terms and Conditions of Sale that are printed in the Sale catalog, a copy of which you will receive approximately two weeks before a Signature SaleTM, one week before a Bullet AuctionTM....
* * *
This Agreement is the entire agreement between you and us concerning the consignment of your Coins, and it supercedes any prior agreement or representation. This Agreement can only be changed in writing by both you and us....
* * *
Arbitration Clause: if any disputes arise regarding any matter pertaining to the sale, Consignor and Auctioneer agree that the dispute shall be submitted to binding arbitration in accordance with the rules of the Professional Numismatists Guild (PNG) or the commercial rules of the American Arbitration Association (A.A.A.). The A.A.A. arbitration shall be conducted under the provisions of the Federal Arbitration Act with locale in Dallas, Texas....[25]
The signature block of the Consignment Agreement contains three boxes. One is signed by Ivy, as a consignment assistant on behalf of Heritage.[26] The box indicating acceptance by the consignor is conspicuously blank.[27] The third box, apparently to be completed when the consignor is a corporation, is signed by Paul as President of RGI, but that box does not contain any language indicating assent to the Consignment *90 Terms.[28]
Four invoices were attached to both the Complaint and Motion to Compel with dates ranging from October 25, 2004, to May 28, 2005.[29] Each contain the following acknowledgment: "I have read and agree to the Terms and Conditions of Sale as they appear in the catalogue."[30] A document titled Terms & Conditions of Sale (the "Terms of Sale"), attached to an executed document titled "Central States Signature Sale & Internet Bullet Auction, April 25-28, 2002 (the `Bullet Auction Document')," similarly contains an arbitration clause.[31] It is unclear whether the Terms of Sale is the document referenced by the invoices and Consignment Agreement. In the Motion to Compel, the Defendants assert that the invoices reference the Standard Auction Terms. Nonetheless, it provides in part:
If any disputes arise regarding payment, authenticity, or grading or any other matter pertaining to the sale, the bidder or a participant in the Auction Sale and/or the Auctioneer agree that the dispute shall be submitted, if otherwise mutually unresolved, to binding arbitration in accordance with the rules of the Professional Numismatists Guild (PNG) or American Arbitration Association (A.A.A.). The A.A.A. arbitration shall be conducted under the provisions of the Federal Arbitration Act with locale in Dallas, Texas....[32]
The Bullet Auction Document appears to be an agreement by which Paul acknowledged that he agreed to the Terms of Sale in consideration of his participation in that particular auction.[33]
On May 1, 2003, Paul, on behalf of RGI, executed the Participation Agreement by which RGI, through Paul, would provide services to Heritage as an independent contractor.[34] Under Heritage's general direction and with funds it provided, Paul would purchase "numismatic items" and, if necessary, curate them.[35] Heritage would then resell the coins through its normal business operations.[36] As compensation, Paul would be paid an advance of $30,000 per month against his fifty percent commission from the net profits of the resales.[37] The Participation Agreement further provided:
4. Term. Provided Paul exclusively performs Participant's duties under this Agreement, the term of this Agreement shall commence from May 1 and shall continue for six (6) months, and is automatically renewed at six (6) month intervals, upon the same terms and conditions, or until sooner terminated by either the Company or the Participant upon provided written notice to the non-terminating party, which notice is deemed complete upon posting by certified mail. Termination may be by either party at any time either for or without cause. Upon termination of this Agreement, and, except as other provided in Sections 9, 11, 14, 16, and the Arbitration section of 24 of this Agreement, all rights and obligations of *91 the Company and the Participant under this Agreement shall cease.
* * *
18. Prior Agreements. The parties hereto stipulate and acknowledge that they previously entered into a series of prior agreements from time to time. Any and all prior agreements of the parties with respect to the subject matter hereof, whether oral or in writing, are superseded by the terms of this Agreement....
* * *
24. Miscellaneous ...
* * *
Arbitration. Agreement for Arbitration. Company, Participant and Paul hereby agree that any dispute arising [sic] pertaining to this Agreement or its termination, shall be resolved in Dallas, Texas, by final and binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association and AAA's National Rules for the Resolution of Employment Disputes in effect on the date the dispute arises....
* * *
This Agreement contains the entire understanding and agreement between the parties with respect to the subject matter hereof. Except as otherwise provided herein, this Agreement may not be altered, amended, or rescinded, nor may any of its provisions be waived, except by an instrument in writing signed by the parties hereto or, in the case of an asserted waiver, by the party against whom the waiver is sought to be enforced.[38]
On October 7, 2003, RGI filed a voluntary Chapter 11 petition.[39] On Schedule D-Creditors Holding Secured Claims ("Schedule D"), RGI listed Heritage as the holder of unsecured debt totaling approximately $174,000.[40] Heritage did not file a proof of claim. On February 14, 2005, I confirmed RGI's plan of reorganization.
The Trustee alleges that on or about February 7, 2005, Heritage, through Ivy and Halperin, outlined the terms of a five year employment agreement (the "Employment Agreement").[41] The material terms of the Employment Agreement included: a $55,000 monthly advance against commissions on Paul's purchases; a $200,000 annual salary based on an average of 15 hours worked weekly plus $300 per hour for any additional hours worked; an annual bonus up to $200,000; a minimum $100,000 per year early buy-out provision in the event of a termination without cause during the five year term; and a balloon payment of $500,000 at the end of the five year term.[42] There were additional terms to the Employment Agreement and subsequent negotiations among Paul, Ivy, and Halperin.[43] The Trustee alleges, however, that the parties orally agreed to the Employment Agreement no later than March 15, 2005, as evidenced by Heritage increasing Paul's monthly draw to *92 $55,000.[44]
According to the Trustee, the Employment Agreement placed a number of conditions on Paul's employment with Heritage.[45] He alleges that it required Paul to sell his Massachusetts home and establish permanent residency in Dallas, Texas, abandon all business interests, immediately settle all pending litigation, and consign personal and RGI collectible inventories to Heritage for auction.[46] At this time, Paul was involved in a "bitterly contested" divorce proceeding, several non-bankruptcy lawsuits, and a "hotly contested" confirmation hearing in RGI's bankruptcy case.[47] The Trustee alleges that in reliance on the generous terms of the Employment Agreement, Paul settled all pending litigation on otherwise disadvantageous terms.[48]
In early April, 2005, Paul allegedly expressed concern to Heritage that it had not yet memorialized the Employment Agreement to which they had agreed and under which they had been operating.[49] On April 5, 2005, Ivy responded by email, apologizing that the preparation of the written contract had not yet started, and assuring Paul that the delay was due to a need to seek the advice of a tax attorney in order to maximize Paul's cash flow under the Employment Agreement.[50] Paul allegedly reiterated his concern on subsequent occasions, only to be reassured each time by Ivy that the contract would be prepared soon.[51]
The Trustee alleges that Paul was provided with a written draft purporting to memorialize the Employment Agreement (the "Draft Agreement") on July 21, 2005.[52] Although the Complaint is unclear on this point, Heritage allegedly terminated Paul a day before providing the Draft Agreement, but subsequently "changed course," presumably, rehiring him.[53] The Trustee alleges that the Draft Agreement was materially different to the Employment Agreement to which both Heritage and Paul had agreed.[54] In contrast, the Draft Agreement allegedly introduced many new terms and terms unfavorable to Paul.[55] Ultimately, the parties never executed the Draft Agreement.
On September 30, 2005, Heritage, specifically identified as Heritage Galleries and Auctioneers, and Paul, with no mention of RGI, executed a document titled "Bill of Sale" (the "Bill of Sale").[56] The Trustee alleges that Heritage required Paul to execute the Bill of Sale as a condition of his continued employment.[57] The Bill of Sale, as submitted to the Court, is a two page document with approximately sixty pages of invoices, spreadsheets, and photocopies of coins attached.[58] The first page of the document consists of a single paragraph of recitals followed by nine numbered sentences outlining the terms of the agreement.[59]*93 The Bill of Sale recites the following:
IT IS AGRRED [sic] by and between the Parties as follows:
[Heritage]'s business is that of auctioneer and dealer in collectibles. [Paul] has consigned and tendered items to [Heritage] ("Consignments") and [Paul] has received multiple advances at various dates against those consignments. [Heritage] has a perfected security interest in the Consignments. [Paul] has participated in [Heritage]'s auctions and has acquired numerous lots from [Heritage] ("Auction Purchases"). All of the Consignments and Auction Purchases were made for the [Paul]'s personal account. [Paul] owns clear title to all Consignments and has not otherwise pledged his Auction Purchases. [Heritage] has possession of the [Paul]'s Auction Purchases and the Consignments. [Heritage] retains title to the Auction Purchases to such date of the full payment for such purchases. [Heritage] is a secured party on the Auction Purchases under the terms of its sales to which [Paul] as an auction purchaser has agreed. [Paul] has not paid for his Auction Purchases ("Debt"). The Parties desire to settle any and all issues pertaining to the Consignment, Advances and Debt.[60]
The second page of the Bill of Sale contains only two undated signature lines where Paul, in his individual capacity, and Ivy, as co-chairman of Heritage Auctions, Inc., executed the document.[61]
The Trustee maintains that the Bill of Sale as produced by Heritage and submitted to the Court is incomplete and has been manipulated.[62] Paul, for reasons explained below, does not have his own copy of the Bill of Sale. Notably, the first page of the Bill of Sale identifies "Heritage Galleries and Auctioneers" as a party to the agreement, but the signature line on page two indicates that Ivy signed on behalf "Heritage Auctions, Inc."[63] The Trustee also points out that several of the documents currently attached to the Bill of Sale have a "run date" of October 7, 2005, and therefore could not have been attached on September 30, 2005.[64] I also note that the word "advances" is capitalized in the final sentence of the above paragraph as if it were an identified term, but it is not identified in any part of the document, nor is it referenced further.[65]
The parties also disagree as to the purpose of the Bill of Sale. Heritage maintains that the Bill of Sale constituted an outright sale of coins and memorabilia that Paul had either previously purchased at Heritage's auction and not yet paid for or consigned to Heritage.[66] The Trustee alleges that the Bill of Sale was meant to be an accounting mechanism reflecting the Heritage's purchase of an interest in the scheduled items for $50,000 so that it could resell them and receive a twenty-five percent share of the profits.[67] Reiterating his allegation that the Bill of Sale is incomplete, the Trustee notes that the document in its current form does not contain any *94 terms with respect to profit sharing.[68]
Paul filed his own individual Chapter 7 case on October 14, 2005 and the Trustee was appointed Chapter 7 trustee of his estate.[69] At the time of his filing, Paul remained employed at Heritage. By November, 2005, however, Heritage terminated Paul's employment, allegedly without cause.[70] Paul did not receive the severance payment allegedly required by the Employment Agreement.[71] Moreover, Paul alleges that upon his termination, Heritage retained or sold his personal property, only some of which had been consigned.[72] Paul estimates that his inventory at Heritage was approximately $6,000,000 in coins, the profits of which he and Heritage were to share equally.[73] Additionally, Heritage allegedly retained some of Paul's personal effects, as well as files regarding his personal financial and legal affairs, including his various dealings with Heritage.[74]
Heritage filed two proofs of claim in Paul's Chapter 7 case. These claims total approximately $401,958.89.[75] As previously stated, Heritage did not file any proofs of claim in RGI's case, but Schedule D reflects that Heritage is the holder of secured claims totaling $174,771.05.[76] Additionally, RGI's Schedule FโCreditors Holding Unsecured Nonpriority Claims ("Schedule F"), reveals that Paul holds unsecured claims totaling $223,020.99.[77]
Paul subsequently obtained employment as a buyer for Rare Coin Wholesalers ("RCW").[78] The Trustee alleges that Paul's employment arrangement with RCW was "very lucrative," with potential annual income from commissions in excess of $700,000.[79] Despite his employment at RCW, Paul remained dependant on Heritage as he made over ninety percent of his coin purchases at auctions, of which Heritage was the largest.[80]
On January 31, 2006, RGI moved to convert its case to one under Chapter 7. The motion to convert stated that Paul was unable to continue RGI's business operations because, inter alia, Paul commenced full-time employment with a Dallas based company, presumably RCW, which required that he devote himself exclusively to the business of the employer and discontinue the business of buying and selling memorabilia.[81] I granted the motion to convert on February 1, 2006. The Trustee was subsequently appointed Chapter 7 trustee of RGI's estate.
On December 29, 2006, the Trustee filed motions in both RGI's and Paul's bankruptcy cases seeking to retain Scott Gray of the Dallas law firm of Gray & Gray as *95 special counsel to prosecute claims against Heritage on behalf of both Debtors' estates. While Heritage's Dallas counsel, Attorney Deirdre Ruckman of the Dallas law firm of Gardere & Wynne, had not filed a formal appearance in either case, the Trustee provided Attorney Ruckman a copy of these motions via email.[82] Shortly thereafter, on January 10, 2007, Ivy forwarded a copy of the Trustee's email to Steve Contursi ("Contursi"), the owner of RCW and Paul's employer, with the following message (the "Email"):
Please find attached a lovely missive from Martin's bankrupt estate(s) attorney. Not surprisingly, we have an entirely different view of the facts than does Martin. The reason for this email isn't to involve you in our dispute with Martin as I'm sure you have enough to deal with, but rather it is to inform you that until said dispute is resolved Martin will not be allowed to participate in any Heritage auction. Clearly our dispute isn't with you. We have a great relationship, and I see no reason why it shouldn't continue as such. Hopefully you will appreciate the reasons we are taking this action[.] Please call or write if you have any questions.[83]
Two days later, Contursi informed Paul of the Email and terminated his employment.[84] Todd Griffith, Contursi's associate, told Paul that he was dramatically less profitable to RCW as a result of being barred from Heritage's auctions and therefore, RCW could not continue to employ him.[85]
In addition to all his prior allegations, Paul believes Heritage is engaged in systemic fraudulent conduct and deceptive practices with respect its auctions. Examples of this conduct include: selling memorabilia to which it has no proof of ownership; improperly "reholdering" coins with major coin grading services; improperly using inside bidding information to provide selective parties with an unfair advantage; selling gradable coins at it auction without grades so that Heritage could purchase them cheaply and make a profit on the graded resale; and intentionally making its settlement and reporting paperwork confusing to limit the ability to reconcile transactions.[86] As a result of these deceptive practices, the Plaintiffs' allege that Paul and the Debtors' estates have been economically damaged, and that Paul has suffered mental anguish, both in amounts yet to be determined.
On March 27, 2008, the Trustee commenced the present adversary proceedings by filing a twenty-five count Complaint. In light of the procedural posture of the case, further discussion requires a brief summary of each individual count of the Complaint. In Count IโTortious Interference, Paul alleges that Ivy and Heritage willfully and intentionally interfered with Paul's employment relationship with RCW by sending the Email. In Count IIโ Promissory Estoppel, Paul and the Trustee of his estate allege that the Defendants promised to provide Paul with certain terms and conditions of employment if he moved to Texas, wound up his business, and finalized all pending litigation, intending that he rely on such representations, but failed to provide the promised terms after Paul performed his obligations. Alternatively, in Count IIIโNegligent Misrepresentation/Employment Agreement, Paul and the Trustee of his estate allege *96 that the Defendants made the above representations recklessly and without reasonable care, leading to Paul's detrimental reliance. In Count IVโDeceit/Employment Agreement, Paul and the Trustee of his estate repeat their allegations under Count I. In Count VโBreach of Contract/Employment Agreement, Paul and the Trustee of his estate allege that Heritage breached the Employment Agreement by failing to pay him all amounts due under the agreement. In Count VIโ Breach of Contract/Bill of Sale, Paul and the Trustee of his estate allege that Heritage failed to account for Paul's seventy-five percent interest in the profits on items subject to the Bill of Sale. In Count VIIโ Breach of Contract/Other, the Plaintiffs allege that Heritage breached various agreements concerning consignments, auction purchases, split coin deals, and loans with both Paul and RGI, damaging both Debtors' estates. In Count VIIIโBreach of the Implied Covenant of Good Faith and Fair Dealing, the Plaintiffs allege that Heritage breached the implied covenant of good faith and fair dealing arising under the agreements concerning their various transactions, damaging both Debtors' estates. In Count IXโBreach of Fiduciary Duty, the Plaintiffs allege that Heritage breached fiduciary duties owed to the Debtors under their various agreements, damaging both Debtors' estates. In Count XโConversion, the Plaintiffs allege that Heritage converted property of the Debtors that is property of one or both of the Debtors' estates. In Count XIโUnjust Enrichment, the Plaintiffs allege that Heritage has been unjustly enriched at the expense of the Debtor's respective estates. Through Count XIIโAccounting, the Plaintiffs seek an accounting pursuant to 11 U.S.C. ง 542(e) based on original documentation that is exclusively in Heritage's control in order to reconcile the various transactions among the parties. In Count XIIIโWrongful Termination, Paul and the Trustee of his estate allege that Heritage terminated Paul's employment in order to avoid paying him amounts owed. Through Count XIVโTurn Over Order, the Trustee, as Chapter 7 trustee of both Debtors' estates, seeks an order pursuant to 11 U.S.C. ง 542 directing Heritage to turn over property of the estate currently in its possession. In Count XVโPreference, 11 U.S.C. ง 547, the Trustee of Paul's estate alleges that Heritage is the transferee of certain transfers of interests of Paul's property, made within ninety days of the commencement of Paul's bankruptcy and while Paul was insolvent, on account of an antecedent debt which enabled Heritage to receive more than it would in a case under Chapter 7 and is thus avoidable. In Count XVIโFraudulent Transfer, 11 U.S.C. ง 548, the Trustee of both Debtors' estates asserts that property interests of one or both of the Debtors were fraudulently transferred to Heritage to the extent that the Debtors did not receive reasonably equivalent value at a time when they were insolvent due to Heritage's failure to properly credit the transfers. In Count XVIIโ Uniform Fraudulent Transfer Act, Mass. Gen. Laws Ch. 109A, ง 5(a)(2)(I) and Texas Business and Commercial Code, ง 24.005(a)(2)(A), the Trustee of both Debtors' estates asserts that Heritage failed to credit transfers of interest from one or both Debtors at a time when one or both Debtors were engaged or were about to engage in a transaction for which the remaining assets of the Debtors were unreasonably small in comparison. In Count XVIIIโUniform Fraudulent Transfer Act, Mass. Gen. Laws Ch. 109A, ง 6(a) and Texas Business and Commercial Code, ง 24.006(a), the Trustee of both Debtors' estates repeats his argument under Count XVI. In Count XIXโUnauthorized Post-Petition Transfers, 11 U.S.C. ง 549, the Trustee of both Debtors' estates alleges *97 that some transactions were made after the commencement of the Debtors' respective bankruptcy cases and were not authorized by the Court. Through Count XXโRecovery of Avoided Transfers, 11 U.S.C. ง 550, the Trustee of both Debtors' estates seeks to recover any property transferred to Heritage or its value to the extent that any transfer is avoided. In Count XXIโTrustee's Objection to Allowance of Claim, 11 U.S.C. ง 502, the Trustee of both Debtors' estates objects to the allowance of all claims asserted or held by Heritage in the Debtors' cases. Through Count XXIIโEquitable Subordination of Claims, 11 U.S.C. ง 510(c), the Trustee of both Debtors' estates seeks to subordinate the claims of Heritage on the basis of its inequitable conduct which has resulted in injury to creditors or an unfair advantage to Heritage. In Count XXIIIโTexas Business and Commercial Code, ง 17.50, the Plaintiffs assert that while the Debtors were consumers under ง 17.45 of the Texas Business and Commercial Code, the Defendants knowingly and intentionally engaged in false, misleading, or deceptive conduct upon which Paul detrimentally relied. In Count XXIVโMass. Gen. Laws Ch. 93A, ง 11, the Plaintiffs assert that each Defendant is engaged in trade or commerce and have committed unfair and deceptive acts and practices. Through Count XXVโDeclaratory Judgment, the Plaintiffs seek a declaration of the parties' rights regarding the claims asserted, particularly with respect to any property belonging to the estate of either Debtor.
On April 28, 2008, the Defendants filed the Motion to Compel and a supporting memorandum of law. After numerous continuances, the Trustee filed the Plaintiffs' Opposition to Motion to Dismiss or Stay and Compel Arbitration (the "Opposition") on August 22, 2008.[87] On August 26, 2008, the Defendants filed a Reply in Support of the Motion to Compel (the "Reply"). I conducted hearing on the Motion to Compel on August 27, 2008, at the conclusion of which, I took the matter under advisement. At the hearing, the parties declined the opportunity to further brief the issues now before the Court.
III. POSITIONS OF THE PARTIES
A. The Defendants
The Defendants move to dismiss, or alternatively stay, the present adversary proceedings and compel arbitration of the parties' dispute in Dallas, Texas, pursuant to the broad language of the various arbitration agreements between them. They argue that these various agreements cover all causes of action, whatever their nature. Specifically, the Defendants assert that the Plaintiffs' consent to the arbitration of these issues is evidenced by: 1) Paul's execution of the Participation Agreement which includes a broad arbitration clause; 2) Paul's participation in Heritage auctions under the Standard Auction Terms; 3) Paul's online registration with Heritage's internet auction site under its terms and conditions; 4) Paul's execution of the Bill of Sale which references the Standard Auction Terms; 5) the multiple invoices attached to the Complaint which state, "I have read and agree to the Terms and Conditions of Sale as they appear in the Catalogue;" 6) Paul's execution of the Consignment Agreement under the Consignment Terms; 7) Paul's execution of the Extended Payment Terms; and 8) Paul's execution of the Bullet Auction Document under the Terms of Sale. The Defendants contend that because these agreements involve *98 interstate commerce and expressly state that the Federal Arbitration Act[88] (the "FAA") applies, arbitration is mandatory under the FAA.[89]
The Defendants maintain that all claims contained within the Complaint fall within an enforceable arbitration agreement. They argue that the United States Court of Appeals for the First Circuit broadly interprets arbitration agreements which cover claims "arising from" or "relating to" an agreement to encompass both breach of contract claims and any tort or other claims related to the agreements.[90] Moreover, the Plaintiffs are equitably estopped from litigating claims otherwise arbitrable simply because Ivy and Halperin are not signatories of the agreements.[91] To the extent that the Plaintiffs assert that the Bill of Sale superceded any prior agreement, including the Participation Agreement and Standard Auction Terms, the Defendants disagree and contend that nothing in the Bill of Sale purports to amend, supercede, or supplant the terms of any other agreement. To the contrary, the Defendants argue that the Bill of Sale expressly references the Standard Auction Terms and by signing the Bill of Sale, Paul reaffirmed his consent to the mandatory arbitration provision. Further, even assuming, arguendo, that the Bill of Sale superceded the parties' prior agreements, the Defendants rely on several cases for the proposition that an arbitration clause remains effective absent a specifically manifested intent to rescind the arbitration clause itself.[92] Similarly, the Defendants assert that the Employment Agreement could not have rescinded the Participation Agreement's arbitration clause because oral modifications are ineffective under the express terms of the Participation Agreement.
Citing Shearson/Am. Express, Inc. v. McMahon,[93] the Defendants argue that to overcome the strong federal policy in favor of arbitration, the Plaintiffs must prove that there is an irreconcilable conflict between the FAA and the underlying purpose of the Bankruptcy Code.[94] Moreover, they rely on a number of cases for the proposition that a bankruptcy court has no discretion to refuse to compel arbitration of matters not involving core bankruptcy proceedings as no irreconcilable conflict arises.[95] Here, the Defendants assert that the breach of contract and related state law tort claims arising from either the auction purchase and sales transactions conducted between the parties on an independent contract basis or the alleged employment contract between Heritage and *99 Paul must be arbitrated because they are non-core claims which are not created by or rely on provisions of the Bankruptcy Code. The Defendants note that arbitration of such claims remains mandatory even when pursued by a trustee in bankruptcy.[96]
Additionally, the Defendants argue that the fraudulent transfer and recovery-related causes of action arising under the Bankruptcy Code must also arbitrated for several reasons. First, the Defendants assert that any "ancillary" causes of action that implicate the Bankruptcy Code should be considered non-core because they are merely derivative of the underlying contractual dispute and seek to vindicate the same rights. Second, even if such causes of action are core, they still must be arbitrated unless the Plaintiffs establish that arbitration "severely conflicts" with the purposes of the Bankruptcy Code.[97] In the present case, the Defendants contend that there is no conflict between arbitration and the objectives of the Bankruptcy Code as the arbitration proceeding may be promptly commenced, discovered, and concluded without unduly delaying the administration of the Debtors' estates. Moreover, the few ancillary bankruptcy claims asserted require no specialized knowledge and can be readily adjudicated based on common factual findings. To the extent that I find that any claims should resolved in the bankruptcy court, the Defendants request that I stay any proceedings with respect to those claims and compel arbitration of the remaining claims in accordance with the parties' agreements.
In addition to the numerous legal reasons for compelling arbitration, the Defendants assert that it will also be equitable as the Trustee is the only party located in Massachusetts, while all the other parties, witnesses, and evidence are already located in Dallas, Texas.
In the alternative, the Defendants argue that the Plaintiffs' fraud based claims should be dismissed under Fed.R.Civ.P. 9(b), made applicable to adversary proceedings by Fed. R. Bankr.P. 7009, because they are not plead with particularity. The Defendants argue that Fed.R.Civ.P. 9(b) requires that Plaintiffs plead specific facts to establish the "who, what, where, and when" of the alleged fraud by each defendant.[98] Specifically, the Defendants note that none of the Plaintiffs' fraud claims specify the role of each Defendant in the alleged fraudulent acts. Additionally, the Plaintiffs' allegations do not identify where and when the alleged fraudulent representations took place. Moreover, the fraudulent transfer allegations fail to identify what property is involved, or where and when it was allegedly transferred. In the event that I deny the request to dismiss, the Defendants request an additional ten days to answer the Complaint pursuant to Fed.R.Civ.P. 12(a)(4).
B. The Trustee
The Trustee disputes that any applicable arbitration agreement remains in effect. First, the Trustee argues that the Participation Agreement was superceded by the Employment Agreement, which had no arbitration clause. Moreover, any amounts that were left outstanding under the Participation *100 Agreement were "rolled into" the Employment Agreement. Second, the Trustee similarly asserts that the Standard Auction Terms was superceded by the Bill of Sale. To the extent that the Defendants rely on other documents, such as the Consignment Agreement, the Bullet Auction Agreement, and the Extended Payment Terms, the Trustee asserts that the Defendants have failed to indicate what items these documents relate to and whether the transactions remain outstanding. To the extent that they relate to any unpaid auction purchases, the Trustee argues that they were closed out by the Bill of Sale, which he notes does not contain an arbitration clause. Even assuming, arguendo, that these arbitration clauses remain in effect, the Trustee argues that the Defendants have failed to demonstrate what specific transactions, if any, they encompass. Additionally, the Trustee notes that many of the Plaintiffs' claims were brought in the name of the Trustee, or against Ivy and Halperin, none of whom are parties to any arbitration agreement.
The Trustee relies on In re Winimo Realty Corp.[99] for the proposition that where a Defendant files a proof of claim and thus seeks the benefit of the bankruptcy court's jurisdiction, the entire matter, even if based on a pre-petition contract claim, is deemed core. This is because the adversary proceeding would affect the allowance or disallowance of the creditor's claim. As such, the Trustee asserts that all the Plaintiffs' breach of contract claims are core proceedings. In contrast to the Defendants, the Trustee asserts that bankruptcy courts retain discretion to decide whether to compel arbitration of core matters.[100] The Trustee contends that compelling arbitration here would not serve the goal of centralized resolution of purely bankruptcy issues, the need to protect creditors and reorganizing debtors from piecemeal litigation, or the undisputed power of the bankruptcy court to enforce its own orders.[101] The Trustee also argues that the need for Court supervision of the discovery process militates against compelling arbitration where key documentation is in the Defendants' possession and there are allegations of misconduct.
With respect to the Defendants' motion to dismiss claims under Fed.R.Civ.P. 9(b), the Trustee contends that the allegations give the Defendants adequate notice to allow them to respond to the Complaint.[102] While the allegations may not provide the specific who, what, when, and where, the Trustee argues that the Complaint is sufficiently particular to suggest that the suit is not frivolous. The Trustee also notes that pleading fraud with more specificity would be difficult without further discovery as the key documentary evidence in the case is currently under the Defendants' control. In the event I find fraud was not plead sufficiently, the Trustee requests an opportunity to amend the Complaint.
IV. DISCUSSION
A. Arbitration
1. The Standard of the Review for the Motion to Compel
The Supreme Court of the United States has alternatively described arbitration *101 clauses as "contractual choice-of-forum provisions," or "a specialized kind of form-selection clause."[103] The United States Court of Appeals for the First Circuit has held that dismissal of a complaint based on a forum selection clause falls under Fed.R.Civ.P. 12(b)(6) for failure to state a claim upon which relief can be granted, stating that a forum selection clause "merely constitutes a stipulation in which the parties join in asking the court to give effect to their agreement by declining to exercise its jurisdiction."[104] Therefore, I must treat the Motion to Compel procedurally as one for dismissal under Fed.R.Civ.P. 12(b)(6). For purposes of this case, this means I must accept as true all well pleaded factual allegations of the Complaint.[105] Moreover, as the agreements attached to the Complaint and the Motion to Compel are "matters fairly incorporated within [the Complaint]," I need not apply a summary judgment standard.[106]
2. The Standard for Enforcing an Applicable Arbitration Clause
The FAA provides that arbitration agreements "shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract."[107] It further provides that the court, "upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such an agreement, shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement...."[108] "The Supreme Court of the United States has long recognized that `federal statutory claims can be appropriately resolved through arbitration, and [has] enforced agreements to arbitrate that involve such claims.'"[109] To determine whether statutory claims are arbitrable, the Supreme Court of the United States articulated the following two part inquiry in Randolph:
In determining whether statutory claims may be arbitrated, we first ask whether the parties agreed to submit their claims to arbitration, and then ask whether Congress has evinced an intention to preclude a waiver of judicial remedies for the statutory rights at issue.[110]
By resisting the Motion to Compel, the Plaintiffs bear the burden of showing that Congress intended to preclude a waiver of judicial remedies for the statutory rights at issue.[111]
The United States Court of Appeals for the First Circuit has held that courts may presume that parties have *102 committed to arbitration of a dispute where the parties have entered into a valid arbitration agreement and the arbitration agreement covers the subject matter of the underlying dispute between them.[112] Any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration.[113]
With respect to the second prong of the Randolph test, the Supreme Court of the United States in McMahon set forth the following standard:
If Congress did intend to limit or prohibit a waiver of judicial forum for a particular claim, such an intent `will be deducible from [the statute's] text or legislative history,' ... or from an inherent conflict between arbitration and the statute's underlying purposes.[114]
Applying these principles, courts have generally accepted that bankruptcy courts have no discretion to refuse to compel the arbitration of non-core matters, as they are unlikely to present a conflict sufficient to override the presumption in favor of arbitration.[115] Courts applying the same approach to core matters, however, have reached "widely-divergent conclusions both with respect to what qualifies as an `inherent conflict,' and what constitutes `interference' in the administration of the estate."[116]
In In re White Mountain Mining Co., L.L.C.,[117] the United States Court of Appeals for the Fourth Circuit held that the bankruptcy court did not abuse its discretion by refusing to enforce an international arbitration agreement in a Chapter 11 bankruptcy case. Finding an inherent conflict between arbitration and the underlying purposes of bankruptcy laws in an action seeking a declaration as to whether pre-petition cash advances were debt or equity, the court stated:
"[T]he very purpose of bankruptcy is to modify the rights of debtors and creditors," and Congress intended to centralize disputes about a debtor's assets and legal obligations in the bankruptcy courts. Arbitration is inconsistent with centralized decision-making because permitting an arbitrator to decide a core issue would make debtor-creditor rights "contingent upon an arbitrator's ruling" rather than the ruling of the bankruptcy judge assigned to hear the debtor's case.[118]
While heavily influenced by the core/non-core distinction, the Fourth Circuit stopped short of holding that the bankruptcy court's core jurisdiction, by itself, reveals a congressional intent to choose *103 those courts in exclusive preference to all other adjudicative bodies to decide core claims.[119] In In re Brown, however, the United States District Court for the District of Rhode Island held that where a conflict exists between the Bankruptcy Code and the FAA, the bankruptcy court retains discretion to decide whether to compel arbitration of a core matter.[120] Recognizing what it characterized as a conflict of "polar extremes" between the purpose of Bankruptcy Code and the FAA, the district court concluded that the core/ non-core distinction represented the best approach for resolving conflicts because it creates a bright-line test while heeding McMahon's directive.[121]
In contrast, the United States Court of Appeals for the Fifth Circuit stated:
[W]e believe that nonenforcement of an otherwise applicable arbitration provision turns on the underlying nature of the proceeding, i.e., whether the proceeding derives exclusively from the provisions of the Bankruptcy Code and, if so, whether the arbitration of the proceeding would conflict with the purposes of the Code.
* * *
The core/non-core distinction conflates the inquiry set forth in McMahon and Rodriguez [de Quijas v. Shearson/American Express, Inc., 490 U.S. 477, 109 S.Ct. 1917, 104 L.Ed.2d 526 (1989)] with the mere identification of the jurisdictional basis of a particular bankruptcy proceeding. Certainly not all core bankruptcy proceedings are premised on provisions of the Code that "inherently conflict" with the Federal Arbitration Act; nor would arbitration of such proceedings necessarily jeopardize the objectives of the Bankruptcy Code. Although, as appellees suggest, "the core/non-core distinction is a practical and workable one," it is nonetheless too broad. The "discretion" ... should exist only where a particular bankruptcy proceeding meets the standard for nonenforcement of an arbitration clause set forth in McMahon and Rodriguez.
* * *
[Distinguishing between those actions derived from the debtor and those created by the Bankruptcy Code explains the consistent reluctance to permit arbitration of actions brought to adjudicate bankruptcy rights. There can be little dispute that where a core proceeding involves adjudication of federal bankruptcy rights wholly divorced from inherited contractual claims, the importance of the federal bankruptcy forum provided by the Code is at its zenith. Arguably, these actions are simply beyond the coverage of most, if not all, arbitration provisions. But, assuming an otherwise applicable arbitration provision, the adjudication of these actions outside the federal bankruptcy forum could in many instances present the type of conflict with the purpose and provisions of the Bankruptcy Code alluded to in McMahon. See Hays, 885 F.2d at 1155 ("Claims asserted by the trustee under section 544(b) are not derivative of the bankrupt. They are creditor claims that the Code authorizes the trustee to asset on their behalf."); In re Barney's Inc., 206 B.R. 336 (Bankr. S.D.N.Y.1997) (finding Chapter 11 debtor's section 544(a) avoidance action, section *104 549 avoidance action, and section 542 turnover action were not subject to arbitration); In re Dunes Hotel Associates, 194 B.R. 967, 992 (Bankr.D.S.C. 1995) (finding Chapter 11 debtor's section 544(a) avoidance action, section 542 turnover action, and section 365 rejection action were not subject to arbitration); In re Arentson, 126 B.R. 236, 238 (Bankr.N.D.Miss.1991) (refusing to order arbitration of a wrongful termination action brought by a Chapter 7 debtor under section 525(b), which provides redress for discrimination against an individual because of a bankruptcy filing, because it was a cause of action "exclusively related to a bankruptcy statute ... that literally begs for resolution in a bankruptcy forum"); cf. In re Pate, 198 B.R. 841, 846 (Bankr.S.D.Ga. 1996) (finding Chapter 13 debtor's Federal Truth in Lending Act claim involving the financing of a mobile home, which was core under 28 U.S.C. ง 157(b)(2)(C) (counterclaims by the debtor's estate), was arbitrable).
We think that, at least where the cause of action at issue is not derivative of the pre-petition legal or equitable rights possessed by a debtor but rather is derived entirely from the federal rights conferred by the Bankruptcy Code, a bankruptcy court retains significant discretion to assess whether arbitration would be consistent with the purpose of the Code, including the goal of centralized resolution of purely bankruptcy issues, the need to protect creditors and reorganizing debtors from piecemeal litigation, and the undisputed power of a bankruptcy court to enforce its own orders.[122]
The analysis set forth in In re Nat'l Gypsum Co. has been adopted by a the United States Court of Appeals for the Second, Third, Fifth, and Eleventh Circuits, as well as bankruptcy courts within this circuit.[123] As this reasoning best explains the application of the Supreme Court's standard set forth in McMahon, I will follow suit and adopt this rationale as well. While use of the core/non-core distinction has superficial appeal, it is ultimately too broad as it fails to consider that not all core proceedings are premised on provisions of the Bankruptcy Code that "inherently conflict" with the FAA. In contrast, the In re Gypsum Co. analysis strikes the correct balance between the relevant considerations by focusing on the underlying nature of the proceeding.
3. Whether the Parties Agreed to Submit Their Claims to Arbitration
As previously stated, I may presume the parties have committed to the arbitration of a dispute where they have entered into a valid arbitration agreement and the dispute falls within the scope of the arbitration clause. It cannot be fairly disputed that at one time the parties agreed to arbitrate certain matters between them. This is evidenced by the Consignment Terms, the Extended Payment Terms, the Bullet Auction Document, the Terms of Sale, the Standard Auction Terms, and the Participation Agreement. The Trustee concedes this point, but disputes the continued validity and/or applicability of these agreements.
*105 The Trustee argues that on September 30, 2008, all outstanding transactions were included in the Bill of Sale, which does not contain an arbitration clause, superceding all prior agreements related to those transactions and rendering them non-arbitrable. I disagree as "the well settled jurisprudence ... holds arbitration agreements to a life and validity separate and apart from the agreement in which they are embedded."[124] The Supreme Court of the United States held that "where the dispute is over a provision of the expired agreement, the presumptions favoring arbitrability must be negated expressly or by clear implication."[125] "If a post-expiration claim `arises under' the expired contract, ... then the agreement to arbitrate survives expiration, but only with respect to that claim."[126] The Supreme Court further explained:
A postexpiration grievance can be said to arise under the contract only where it involves facts and occurrences that arose before expiration, where an action taken after expiration infringes a right that accrued or vested under the agreement, or where, under normal principles of contract interpretation, the disputed contractual right survives expiration of the remainder of the agreement.[127]
In the present case, there is no language in the Bill of Sale which expressly negates any prior arbitration clauses and therefore, I must presume their validity was unaffected by the Bill of Sale transaction. Similarly, the Trustee's argument that the Employment Agreement, which contains no agreement to arbitrate, supercedes the Participation Agreement fails for the same reasons.
Having disposed of the Trustee's initial arguments, I must now consider whether the parties' dispute falls within the scope of a valid arbitration clause. This question is complicated by the Trustee's generalized allegations with respect to thousands of individual transactions and the Defendants reliance on several agreements without identifying the transactions subject to these agreements. To illustrate the problem, transaction specific agreements, like the Consignment Agreement or Extended Payment Terms, are too narrow as they apply only to specific sales without further reference to what was purchased, sold, or consigned. Others, like the Terms of Sale or the Standard Auction Terms, are too broad in as much as each could have applied to every transaction between the parties or none. Terms, by themselves, are not a contract. In order for them to be an agreement, the parties must mutually agree to apply them to a specific transaction. The Defendants' assertion that Paul agreed to the Standard Auction Terms by bidding or otherwise participating at Heritage's auction is insufficient without first demonstrating that Paul bid or otherwise participated at an auction subject to the Standard Auction Terms.
In this case, the Participation Agreement represents the most encompassing agreement with respect to auction related transactions. The Participation Agreement sets forth the terms by which Heritage and Paul, as an independent contractor, *106 would engage in the purchase, resale, and conservation of numismatic items.[128] These terms included how the parties would share the profits from resold numismatic items and Paul's right to an accounting of his purchases.[129] Paragraph 18 of the Participation Agreement is a merger clause which acknowledges that the parties had previously entered into a series of transactional agreements and indicates that "[a]ny and all prior agreements of the parties with respect to the subject matter hereof, whether oral or in writing, are superceded by the terms of this Agreement."[130] As such, all outstanding transactions prior to May 1, 2003, became subject to the Participation Agreement. Moreover, the automatic renewal provisions of the Participation Agreement provided that it would automatically renew every six months until terminated by either party.[131] Here, the Participation Agreement would have terminated roughly around November, 2005, when Heritage terminated Paul's employment. This means that all auction transactions up to November, 2005, were subject to the Participation Agreement and the arbitration clause contained therein.
The Participation Agreement's arbitration clause provides in relevant part:
Arbitration. Agreement for Arbitration. Company, Participant and Paul hereby agree that any dispute arising [sic] pertaining to this Agreement or its termination, shall be resolved in Dallas, Texas, by final and binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association and AAA's National Rules for the Resolution of Employment Disputes in effect on the date the dispute arises....[132]
Construing this arbitration clause liberally, as I am bound to do, I conclude that all disputes relating to the purchase, sale, resale, accounting, and profit sharing with respect to transactions involving numismatic items prior to November, 2005, are within the scope of this arbitration clause. Moreover, any dispute with respect to Paul's compensation as an independent contractor would also fall within the scope of the Participation Agreement's arbitration clause.
Notably, the Participation Agreement makes no reference to memorabilia. The Bill of Sale, however, purports to transfer title to goods listed on the attached schedules. Four invoices attached to the Bill of Sale describe various items of memorabilia. While the Trustee argues that these invoices have a "run date" of October 7, 2005, after the execution of the Bill of Sale, these invoices clearly have transaction dates prior to September 30, 2005. The "run date" is likely when these invoices were printed and not when the sale took place. As previously stated, each contain the following acknowledgment: "I have read and agree to the Terms and Conditions of Sale as they appear in the catalogue." Assuming that the Terms of Sale is the document referenced by the invoices, these items would be subject to the following arbitration clause:
If any disputes arise regarding payment, authenticity, or grading or any other matter pertaining to the sale, the bidder or a participant in the Auction Sale and/or the Auctioneer agree that the dispute shall be submitted ... to binding *107 arbitration ... in Dallas, Texas....[133]
I note, however, that only memorabilia specifically identified in those four invoices are subject to this arbitration clause.
Having determined the scope of the applicable arbitration clauses, it appears that several disputes between the parties fall outside the scope of any arbitration agreement. First, there clearly is no agreement to arbitrate Paul's claim for tortious interference. There is simply nothing before me that explains the nature of Paul's participation in Heritage's auctions after his termination. As Paul's status as an independent contractor under the Participation Agreement was terminated by November, 2005, its provisions cannot apply actions taken against him, as an employee of RCW, in January, 2007. As such, Count I is not arbitrable.
Second, the Plaintiffs' claims for promissory estoppel, negligent misrepresentation, deceit, breach of the Employment Agreement, and wrongful termination do not fall within the scope of any arbitration clause. The allegations underlying these claims all relate to Paul's compensation under the Employment Agreement. There is no allegation that the parties agreed to arbitrate disputes arising under the Employment Agreement. Moreover, contrary to the Defendants' argument, the Employment Agreement is not an impermissible oral alteration, amendment, rescission, or waiver of the Participation Agreement. Accepting the Trustee's allegations as true, the Employment Agreement was a new distinct agreement between the parties with respect to Paul's compensation and status as an employee of Heritage. As the Participation Agreement outlines the terms of Paul's independent contractor status and relationship with Heritage, the Employment Agreement supercedes those provisions and is not subject to the arbitration clause. I note, however, that the Employment Agreement, as described, does not reference the purchase, sale, resale, accounting, or profit sharing with respect to any items, and therefore those matters remain subject to prior agreements. Accordingly, Counts II, III, IV, V, and XIII are not arbitrable.
Third, the Plaintiffs' claims under Texas Bus. & Com.Code Ann. ง 17.50 and Mass. Gen. Laws Ch 93A, ง 11, largely fall outside the scope of any arbitration clause. With perhaps the exception of Paul's allegation that Heritage's settlement documentation is purposefully confusing, which could fall within the scope of the Participation Agreement as it contemplates accounting and reconciliation, the remainder of these allegations are not contractually based. Instead, they are allegations of systemic fraud with respect to Heritage's business practices not expressly linked to any particular transaction.[134] As such, Counts XXIII and XXIV are not arbitrable.
Finally, to the extent that any other count of the Complaint concerns a dispute regarding: 1) the purchase, sale, resale, accounting, or profit sharing with respect to items involved in transactions after November, 2005, 2) memorabilia not listed on the four invoices, and 3) deceptive practices not contemplated by the Participation Agreement (1, 2, and 3 collectively, the "Non-Covered Transactions"), there is nothing before me to demonstrate that they fall within an existing *108 arbitration clause. Even if the Non-Covered Transactions were incorporated into the Bill of Sale, I find that there is nothing on the face of that document to suggest that it incorporates an arbitration clause. The Defendants' reliance on the phrase "[Heritage] is a secured party on the Auction Purchases under the terms of its sales to which [Paul] as an auction purchaser has agreed," is misplaced. First, in order for the Bill of Sale to incorporate the whole "terms of its sales," that phrase would need to modify "Auction Purchases," rather than "secured party on the Auction Purchases." While this document is poorly drafted, such a reading of the sentence is ungrammatical. The clear import of the sentence's construction is that "terms of its sale" modifies "secured party on the Auction Purchases," indicating that the "terms of its sale" further defines Heritage's secured status. Second, the "terms of its sale" is not an identified term in the agreement and is ambiguous in light of Heritage's use of both the Terms of Sale and Standard Auction Terms. While currently there is no basis to find the Non-Covered Transactions arbitrable, it is possible such a basis may be found upon further discovery.[135]
The Trustee's assertion that neither he, nor Ivy and Halperin, are parties to any arbitration agreement is unavailing. When stepping into the shoes of the Debtors, the Trustee is equally bound to arbitrate causes of action derivative of the Debtors.[136] It is also irrelevant that Ivy and Halperin are not signatories of the arbitration agreements as the United States Court of Appeals for the First Circuit has held that non-signatories may enforce an arbitration agreement against a signatory.[137] In sum, all disputes in Counts VI through XII, XXV (collectively, the "Contract Claims") other than those with respect to the Non-Covered Transactions, and Counts XIV through XXII (collectively, the "Bankruptcy Claims") have met the first prong of the Randolph test.
4. Whether an "Inherent Conflict" Exists
Turning now to the second prong of the Randolph test, I must follow the McMahon standard and determine whether there is an inherent conflict between arbitration and the Bankruptcy Code's underlying purpose. Having adopted the Fifth Circuit's rationale from In re Nat'l Gypsum Co., I must look to the underlying nature of the proceeding and determine whether the proceeding derives exclusively from the provisions of the Bankruptcy Code, and if so, whether arbitration would conflict with the purpose of the Bankruptcy Code.[138] If such a conflict exists, I have discretion to refuse to compel the arbitration of the Covered Transactions. Noting that "the importance of the federal bankruptcy forum provided by the Code is at its zenith" in "actions brought to adjudicate bankruptcy rights," I will begin my analysis with the Trustee's claims brought under the Bankruptcy Code.[139]
The avoidance claims brought by the Trustee under 11 U.S.C. งง 547, 548, *109 549, and 550 are statutory causes of action created by the Bankruptcy Code that belong to the Trustee.[140] They are not derivative of the Debtors' claims, but are unique rights given to bankruptcy trustees on behalf of the creditors of the estate and are not available to debtors outside the bankruptcy court.[141] Similarly, the Trustee's fraudulent transfer claims under Texas Bus. & Com.Code Ann. ง 24.005-6, and Mass. Gen. Laws Ch. 109A, งง 5 and 6, are creditor claims which 11 U.S.C. ง 544(b)(1) allows the Trustee to assert on behalf all creditors of the estate.[142] As such, these claims are proceedings derived exclusively from the Bankruptcy Code. Having made such a determination, I must turn to the second part of the In re Nat'l Gypsum Co. analysis and consider whether arbitration inherently conflicts with the purpose of the Bankruptcy Code.
I note that the fact that only the Trustee can bring these claims in bankruptcy court may evidence Congressional intent to preclude arbitration of such claims and satisfy the Randolph test. In any event, I find that an inherent conflict exists as arbitration will not serve the goal of centralized resolution of purely bankruptcy issues, the need to protect creditors from piecemeal litigation, or the undisputed power of a bankruptcy court to enforce its own orders. This is particularly the case where there are allegations of unauthorized post-petition transfers which could diminish the Debtors' estates and harm the other unsecured creditors. Therefore, having satisfied the second prong of the Randolph test, I have discretion to refuse to compel arbitration of Counts XV through XX, which I will exercise.
The Trustee's claim for equitable subordination also arises exclusively under the Bankruptcy Code and is unique to bankruptcy proceedings.[143] With respect to the second part of the In re Nat'l Gypsum Co. analysis, I find that arbitration of this claim inherently conflicts with all the previously mentioned purposes of the Bankruptcy Code.[144] An arbitrator could not subordinate Heritage's claim against the Debtors' estates under 11 U.S.C. ง 510(c) without effecting the rights of other creditors. As such, the determination of the priority of claims is solely a function of the bankruptcy courts and cannot be arbitrated. Accordingly, I have discretion under the Randolph test, and will use it to decline to compel arbitration of Count XXII.
In a slightly different vein, an objection to claim is not a cause of action, but a proceeding derived exclusively from 11 U.S.C. ง 502(b). The United States Court of Appeals for the Fifth Circuit explained the claims objection process as follows:
A claim against the estate is instituted by filing a proof of claim as provided by the bankruptcy rules. The filing of the proof invokes the special rules of bankruptcy concerning objections to the claim, estimation of the claim for allowance purposes, and the rights of the *110 claimant to vote on the proposed distribution. Understood in this sense, a claim filed against the estate is a core proceeding because it could arise only in the context of bankruptcy. Of course, the state-law right underlying the claim could be enforced in a state court proceeding absent the bankruptcy, but the nature of the state proceeding would be different from the nature of the proceeding following the filing of a proof of claim.
The Court's language would seem equally applicable in the case at bar. Only in bankruptcy court are there these peculiar, summary procedures for resolving claim objections. While the underlying rights at issue in the objection might be enforceable outside the bankruptcy context, different, unique procedures are utilized to resolve the claim in the bankruptcy court.[145]
Courts interpreting In re Nat'l Gypsum Co. have noted that its two part analysis requires an examination of the underlying proceeding and not necessarily the cause of action asserted.[146] While the court of appeals in In re Nat'l Gypsum Co. explained that bankruptcy courts have the most discretion when adjudicating bankruptcy rights, it clearly recognized that discretion exists "where a particular bankruptcy proceeding meets the standard for nonenforcement of an arbitration clause set forth in McMahon and Rodriguez."[147] Reading In re Nat'l Gypsum Co. in this light, the court in In re Mirant Corp. concluded that "[w]hile the substance of a dispute may be governed by law peculiar to bankruptcy, the court does not perceive the first part of the Nat'l Gypsum test to require that the substantive issues in dispute be derived from the Code."[148] As such, the court found that it had discretion to refuse to compel arbitration of an objection to claim.[149]
In the present case, the Trustee's objection to claim, although partly sounding in contract, is clearly a proceeding derived exclusively from the provisions of the Bankruptcy Code. Moreover, while the core/non-core distinction is not determinative, courts have held that resolving a disputed claim is a core matter under 28 U.S.C. ง 157(b)(2)(B) to be decided by the bankruptcy court, even where the basis for the creditor's claim involves a pre-petition breach of contract claim.[150] As such, the Debtors' Contract Claims, as well as the Trustee's claim for Turnover pursuant to 11 U.S.C. ง 542, may be procedurally characterized as a defense to Heritage's proof of claim within the objection to claim *111 proceeding.[151]
With respect to the second part of the In re Nat'l Gypsum Co. analysis, arbitration of the Trustee's objection to claim proceeding, which includes the determination of the Contract Claims, would contravene the Bankruptcy Code's purpose of providing a central forum for the resolution of claims. As other claims have been filed in this case, arbitration of these claims would require the Trustee to resolve claims in multiple fora. Moreover, where at least sixteen out of twenty-five causes of action in these adversary proceedings will not be sent to arbitration, and where the remaining counts include a subset of Non-Covered Transactions which are not arbitrable, arbitration of these final claims would result in piecemeal, and possibly duplicative, litigation. While admittedly neither Debtor is reorganizing, resolution of these remaining counts in the bankruptcy court would also serve the purpose of expeditiously and equitably distributing the Debtors' assets. I find that arbitration of the Trustee's objection to claim, Contract Claims, and Turnover claim inherently conflict with the purposes of the Bankruptcy Code, granting me discretion to refuse to compel the arbitration of these claims under the Randolph test. As such, I will not refer Counts VI through XII, XIV, XXI, and XXV to arbitration.
As I will not refer the Plaintiffs' fraud claims to arbitration, I must now consider whether they should be dismissed for failure to plead fraud with the requisite particularity.
B. Dismissal of Fraud Claims Under Fed.R.Civ.P. 9(b)
Fed.R.Civ.P. 9(b) provides:
Fraud or Mistake; Conditions of Mind. In alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake. Malice, intent, knowledge, and other conditions of a person's mind may be alleged generally.[152]
"Generally, there are three purposes behind Rule 9(b)'s particularity requirement: (1) to place the defendants on notice and enable them to prepare meaningful responses; (2) to preclude the use of a groundless fraud claim as a pretext to discovering a wrong or as a `strike suit'; and (3) to safeguard defendants from frivolous charges which might damage their reputations."[153] The United States Court of Appeals for the First Circuit has held that where Plaintiffs plead fraud under Fed.R.Civ.P. 9(b), "the pleader usually is expected to specify the who, what, where, and when of the allegedly false or fraudulent representation."[154] "[T]he particularity *112 requirement of Rule 9(b) must be relaxed where the plaintiff lacks access to all facts necessary to detail his claim."[155] Courts have noted that where the information needed to plead the particulars of fraud are in the hands of the defendant, allegations of fraud that are sufficiently particular to suggest that the plaintiff is not engaged in a frivolous suit and enables the defendants to respond will not be dismissed prior to discovery.[156]
Here, the Plaintiffs' promissory estoppel, negligent misrepresentation, and deceit claims are premised on allegations that on or about February 7, 2005, Heritage, Ivy, and Halperin outlined the Employment Agreement which included favorable terms of compensation and conditioned Paul's employment on him first doing a number of things, including: selling his Massachusetts home and establishing permanent residency in Dallas, Texas; abandoning all business interests; immediately settling all pending litigation; and consigning personal and RGI collectible inventories to Heritage for auction.[157] They further allege that subsequent negotiations among Paul, Ivy, and Halperin took place, but that an agreement was reached no later than March 15, 2005.[158] Moreover, the Plaintiffs allege that in reliance on the terms of the Employment Agreement, Paul settled all pending litigation on otherwise disadvantageous terms.[159] Despite alleged reassurances from Ivy, Heritage never provided the promised terms of employment.[160]
The Plaintiffs allegations successfully state: the "who," i.e., Ivy, Halperin, and Heritage; the "what," i.e., representations of generous employment terms; and the "when," i.e., on or around February 7, 2005, with negotiations culminating in an agreement by March 15, 2005. Admittedly, they do not allege where such representations took place. This failure, however, does not require dismissal of these claims because this fact is known, or readily ascertainable, to the Defendants.[161] Moreover, I disagree with the Defendants assertion that the Plaintiffs' failed to state the role of each actor in the alleged fraud as the Plaintiffs' plead in the conjunctive, indicating that each Defendant made the representation during the course of negotiations.
With respect to his fraudulent transfer claims, the Trustee asserts the following:
To the extent that any transfers of interest of the property of the Debtors[,] Mr. Paul or RGI were made to Heritage and were not properly credited by Heritage, such transfers were transfers of interest of one or both of the Debtors in property, for which the Debtor received less than a reasonably equivalent value in exchange for such transfers, at a time when the Debtor was insolvent on the date that such transfers were made.[162]
The Defendants, therefore, seek dismissal of these claims because the Trustee has not identified the alleged fraudulent transfers *113 with particularity. While true, without an opportunity for discovery, the Trustee has no ability to specifically identify which transfers out the thousands that have allegedly taken place between the Debtors and Heritage are fraudulent. Moreover, as the documentation the Trustee requires to identify these transfers is in the possession of Heritage, grounds currently exist to relax the otherwise strict standard under Fed.R.Civ.P. 9(b).[163]
V. CONCLUSION
In light of the foregoing, I will enter an order denying the Motion to Compel.
NOTES
[1] According to a footnote in the Motion to Compel, Heritage Auction Galleries, Inc., is not the correct name of any Defendant or any entity affiliated with the Defendants.
[2] The parties have filed identical papers in each case using a joint caption. Although these adversary proceedings have not been consolidated, I note that consolidation is appropriate under Fed.R.Civ.P. 42(a), made applicable to adversary proceedings by Fed. R. Bankr.P. 7042, because both involve the same nucleus of material fact and questions of law. In the interest of clarity and expediency, I will refer to the adversary pleadings in the singular, and all docket citations will refer to Adv. P. No. 08-1070 unless stated otherwise.
[3] Complaint, Docket No. 1, ถ 2.
[4] Id.
[5] Id. at ถ 3.
[6] Id.
[7] Id. at ถถ 8-9.
[8] Id. at ถ 9.
[9] Id. at ถ 9(a).
[10] Id.
[11] Id. at ถ 9(b).
[12] Id. at ถ 9(c).
[13] Id.
[14] Id.
[15] Id.
[16] Id. at ถ 9(d).
[17] Terms and Conditions of Auction, Exhibit A-2, ถ 45, 48, 50, Docket No. 10. I note that the footer to this document indicates that this page of the Standard Terms was revised on April 15, 2008.
[18] See Exhibits B, B-1, B-2, Docket No. 10.
[19] Exhibit A-6, Docket No. 10.
[20] Exhibit A-6, Docket No. 10, ถ 10.
[21] Exhibit A-5, Docket No. 10.
[22] Id.
[23] Id.
[24] Id.
[25] Id.
[26] Id.
[27] Id.
[28] Id.
[29] Invoices A627376, A633482, A695848, A695849, Exhibit A, Docket No. 2.
[30] Id.
[31] Exhibit A-7, Docket No. 10.
[32] Id. at ถ 16.
[33] Id.
[34] Exhibit A-1, Docket No. 10, ถ 2.
[35] Id. at ถ 1.
[36] Id.
[37] Id. at ถ 5.
[38] Exhibit A-1, Docket No. 10, ถถ 4, 18, 24 (emphasis added).
[39] See Case No. 03-18371-WCH.
[40] Schedule D, Docket No. 16, Case No. 03-18371.
[41] Complaint, Docket No. 1, ถ 13.
[42] Id.
[43] Id.
[44] Id. at ถ 14.
[45] Id. at ถ 15.
[46] Id.
[47] Id.
[48] Id.
[49] Id. at ถ 16.
[50] Id.
[51] Id.
[52] Id. at ถ 17.
[53] Id.
[54] Id.
[55] Id.
[56] Exhibit A-1, Docket No. 2.
[57] Complaint, Docket No. 1, ถ 27.
[58] Exhibit A-1, Docket No. 2.
[59] Id.
[60] Id. (emphasis added).
[61] Id.
[62] Complaint, Docket No. 1, ถ 24.
[63] Exhibit A-1, Docket No. 2.
[64] Id.
[65] Id.
[66] Complaint, Docket No. 1, ถ 22.
[67] Id. ถ 24.
[68] Id.
[69] See Case No. 05-22881-WCH.
[70] Complaint, Docket No. 1, ถ 18; see also Schedule I-Current Income of Individual Debtor(s), Docket No. 23, Case No. 05-22881-WCH ("In November, 2005, Debtor's employer, Heritage Auction Galleries, terminated its [sic] employment with the Debtor.").
[71] Complaint, Docket No. 1, ถ 18.
[72] Id. at ถ 21.
[73] Id. at ถ 19.
[74] Id. at ถ 21.
[75] See Claims Nos. 13, 14, Case No. 05-22881-WCH.
[76] Docket No. 16, Case No. 03-18371-WCH.
[77] Id.
[78] Complaint, Docket No. 1, ถ 30.
[79] Id.
[80] Id. at ถ 31.
[81] Docket No. 287, ถ 4(b), Case No. 03-18371-WCH.
[82] Complaint, Docket No. 1, ถ 32.
[83] Id. at ถ 32; Exhibit B, Docket No. 2.
[84] Id. at ถ 33.
[85] Id.
[86] Complaint, Docket No. 1, ถถ 37-39.
[87] The Motion to Compel was originally scheduled for hearing on May 21, 2008, but the parties continued the hearing several times by agreement to afford the Trustee an opportunity to analyze and respond to the Motion to Compel.
[88] 9 U.S.C. ง 1 et seq.
[89] See 9 U.S.C. ง 2.
[90] See, e.g., McCarthy v. Azure, 22 F.3d 351 (1st Cir.1994).
[91] Sourcing Unlimited, Inc. v. Asimco Int'l. Inc., 526 F.3d 38 (1st Cir.2008).
[92] Nolde Brothers, Inc. v. Local No. 358, 430 U.S. 243, 255, 97 S.Ct. 1067, 51 L.Ed.2d 300 (1977); Riley Mfg. Co., Inc. v. Anchor Glass Container Corp., 157 F.3d 775, 781 (10th Cir. 1998); Homestake Lead Co. of Missouri v. Doe Run Resources Corp., 282 F.Supp.2d 1131, 1142 (N.D.Cal.2003); Berkery v. Cross Country Bank, 256 F.Supp.2d 359, 368-369 (E.D.Pa. 2003).
[93] Shearson/Am. Express, Inc. v. McMahon, 482 U.S. 220, 227, 107 S.Ct. 2332, 96 L.Ed.2d 185 (1987).
[94] 11 U.S.C. ง 1 et. seq.
[95] See Hays and Co. v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 885 F.2d 1149, 1156-61 (3rd Cir.1989); Merrill v. MBNA Am. Bank, N.A. (In re Merrill), 343 B.R. 1, 11 (Bankr. D.Me.2006); Bezanson v. Consolidated Constructors & Builders (In re P & G Drywall and Acoustical Corp.), 156 B.R. 704, 706 (Bankr. D.Me.1993).
[96] Id.
[97] See The Whiting-Turner Contracting Co. v. Elec. Mach. Enters., Inc. (In re Elec. Mach. Enters., Inc.), 479 F.3d 791 (11th Cir.2007); Mintze v. Am. Gen. Fin. Servs., Inc. (In re Mintze), 434 F.3d 222 (3rd Cir.2006); Ins. Co. of N. Am. v. NGC Settlement Trust & Asbestos Claims Mgmt. Corp. (In re Nat'l Gypsum Co.), 118 F.3d 1056 (5th Cir.1997).
[98] Alternative Sys. Concepts, Inc. v. Synopsys, Inc., 374 F.3d 23, 29 (1st Cir.2004).
[99] Cibro Petroleum Products, Inc. v. Albany (In re Winimo Realty Corp.), 270 B.R. 108 (S.D.N.Y.2001).
[100] Brown v. Mortgage Elec. Registration Sys., Inc. (In re Brown), 354 B.R. 591 (D.R.I.2006).
[101] See Cavanaugh v. Conseco Fin. Serv. Corp. (In re Cavanaugh), 271 B.R. 414 (Bankr. D.Mass.2001).
[102] Frontier Mgmt. Co. v. Balboa Ins. Co., 658 F.Supp. 987 (D.Mass.1986).
[103] Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 615, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985); Scherk v. Alberto-Culver Co., 417 U.S. 506, 519, 94 S.Ct. 2449, 41 L.Ed.2d 270 (1974).
[104] LFC Lessors, Inc. v. Pacific Sewer Maintenance Corp., 739 F.2d 4, 6-7 (1st Cir.1984); see also Lambert v. Kysar, 983 F.2d 1110, 1112 n. 1 (1st Cir.1993).
[105] Braunstein v. Panagiotou (In re The McCabe Group, P.C.), Adv. P. No. 06-1242, 2006 WL 2604685 *3 (Bankr.D.Mass. Sept. 11, 2006).
[106] See Banco Santander de Puerto Rico v. Lopez-Stubbe (In re Colonial Mortgage Bankers Corp), 324 F.3d 12, 16 (1st Cir.2003).
[107] 9 U.S.C. ง 2.
[108] 9 U.S.C. ง 3.
[109] In re Merrill, 343 B.R. at 5 (quoting Green Tree Fin. Corp.โAlabama v. Randolph, 531 U.S. 79, 89, 121 S.Ct. 513, 148 L.Ed.2d 373 (2000)).
[110] Randolph, 531 U.S. at 90, 121 S.Ct. 513.
[111] McMahon, 482 U.S. at 227, 107 S.Ct. 2332; In re Cavanaugh, 271 B.R. at 421.
[112] Nat'l Cas. Co. v. First State Ins. Group, 430 F.3d 492, 500 (1st Cir.2005); Paine-Webber Inc. v. Elahi, 87 F.3d 589, 599 (1st Cir.1996).
[113] Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983).
[114] McMahon, 482 U.S. at 227, 107 S.Ct. 2332 (quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 627, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985))
[115] See In re Elec. Mach. Enters., Inc., 479 F.3d at 796; Crysen/Montenay Energy Co. v. Shell Oil (In re Crysen/Montenay Energy Co.), 226 F.3d 160 (2d Cir.2000); In re Nat'l Gypsum Co., 118 F.3d at 1064; Merrill Lynch, Pierce, Fenner & Smith, Inc., 885 F.2d at 1152; MCI Telecommunications Corp. v. Gurga (In re Gurga), 176 B.R. 196 (9th Cir. BAP 1994).
[116] In re Brown, 354 B.R. at 599.
[117] Phillips v. Congelton, L.L.C. (In re White Mountain Mining Co., L.L.C.), 403 F.3d 164 (4th Cir.2005).
[118] In re White Mountain Mining Co., L.L. C., 403 F.3d at 169 (quoting 1 Collier on Bankruptcy, ถ 3.02[2] (15th ed. rev.2005)) (citations omitted).
[119] Id.
[120] In re Brown, 354 B.R. at 603.
[121] Id. at 594, 603.
[122] In re Nat'l Gypsum Co., 118 F.3d at 1067-1069.
[123] See In re Elec. Mach. Enters., Inc., 479 F.3d at 796; In re Mintze, 434 F.3d at 231; In re Crysen/Montenay Energy Co., 226 F.3d at 166; Gandy v. Gandy (In re Gandy), 299 F.3d 489, 495 (5th Cir.2002); In re Merrill, 343 B.R. at 9; In re Cavanaugh, 271 B.R. at 424-426.
[124] Berkery, 256 F.Supp.2d at 368. See also Litton Fin. Printing Div. v. NLRB, 501 U.S. 190, 205-206, 111 S.Ct. 2215, 115 L.Ed.2d 177 (1991); Nolde Brothers, Inc., 430 U.S. at 255, 97 S.Ct. 1067; Koch v. Compucredit Corp., 543 F.3d 460 (8th Cir.2008); Riley Mfg. Co., Inc., 157 F.3d at 781; Homestake Lead Co. of Missouri, 282 F.Supp.2d at 1140.
[125] Nolde Brothers, Inc., 430 U.S. at 255, 97 S.Ct. 1067.
[126] Hinnant v. Am. Ingenuity, LLC, 554 F.Supp.2d 576, 583 (E.D.Pa.2008).
[127] Litton Fin. Printing Div., 501 U.S. at 205-206, 111 S.Ct. 2215 (1991).
[128] Exhibit A-1, Docket No. 10, ถถ 1-2.
[129] Id. ถถ 5, 9.
[130] Id. ถ 18.
[131] Id. ถ 4.
[132] Id. at ถ 24 (italics added, bold in original).
[133] Id. at ถ 16.
[134] I note, however, that the Plaintiffs' failure to connect these allegations to specific transactions involving Paul or RGI may ultimately speak to whether or not they were damaged by such "systemic fraud."
[135] As will be discussed in the next section, a trial on the discrete issue of whether the Non-Covered Transactions do in fact fall within the scope of an arbitration clause is not necessary.
[136] See Hays, 885 F.2d at 1161; In re Merrill, 343 B.R. at 11; In re P & G Drywall and Acoustical Corp., 156 B.R. at 706.
[137] Sourcing Unlimited, Inc., 526 F.3d at 47.
[138] In re Nat'l Gypsum Co., 118 F.3d at 1067.
[139] Id. at 1068-1069.
[140] See 11 U.S.C. งง 547(b) ("Except as provided in subsection (c) or (i) of this section, the trustee may avoid any transfer of interest of the debtor in propertyโ..."), 548(a)(1) ("The trustee may avoid any transfer ..."), 549(a) ("Except as provided in subsection (b) or (c) of this section, the trustee may avoid a transfer of property of the estateโ..."), 550.
[141] See, e.g., Allegaert v. Perot, 548 F.2d 432 (2d Cir.1977) (refusing to compel arbitration of trustee's preference and fraudulent transfer claims under the Bankruptcy Act).
[142] Hays, 885 F.2d at 1155; In re Barney's, Inc., 206 B.R. 336 (Bankr.S.D.N.Y.1997).
[143] See 11 U.S.C. ง 510(c).
[144] See In re Transport Associates, Inc., 263 B.R. 531 (Bankr.D.Kan.2001).
[145] Wood v. Wood (In re Wood), 825 F.2d 90, 97 (5th Cir.1987) (citations omitted) (emphasis added).
[146] See In re Mirant Corp., 316 B.R. 234 (Bankr.N.D.Tex.2004); Martinez v. Beneficial of Texas, Inc. (In re Martinez), Adv. P. No. 06-3669, 2007 WL 1174186 (Bankr.S.D.Tex. Apr. 19, 2007); cf. Erie Power Tech., Inc. v. Ref-Chem, L.P., 315 B.R. 41 (Bankr.W.D.Pa.2004) (arbitrating claims objection did not inherently conflict with the Bankruptcy Code where the Debtor initiated the arbitration proceedings, which were set to begin, and no other causes of action specific to the Bankruptcy Code existed); In re Winimo Realty Corp., 270 B.R. at 108 (reversing the bankruptcy court's refusal to compel arbitration because there was no evidence that arbitration would jeopardize the underlying policy of the Bankruptcy Code).
[147] In re Nat'l Gypsum Co., 118 F.3d at 1067 (emphasis added).
[148] In re Mirant Corp., 316 B.R. at 238 (emphasis in original).
[149] Id.
[150] See Systolic Networks, Inc. v. Bizfon, Inc. (In re Bizfon, Inc.), No. 01-12547 JMD, 2002 WL 181975 (Bankr.D.N.H. Jan. 29, 2002).
[151] While Heritage only filed a proof of claim in Paul's bankruptcy case, I note that it was not required to do so in RGI's. "A secured creditor may, but need not, file a proof of claim. Under the express provisions of ง 501, if it does so, and no objection is filed, its secured claim is `deemed allowed.' If it files no proof of claim and no action is taken with regard to its lien, the lien is unaffected by bankruptcy. In other words, unless the secured creditor is hailed into bankruptcy court to respond to an effort to alter, amend or avoid its position, it may ignore the bankruptcy proceedings. The lien passes through bankruptcy." In re Maylin, 155 B.R. 605, 611-613 (Bankr.D.Me.1993); see also In re Tinker, 355 B.R. 380, 384-385 (Bankr.D.Mass. 2006).
[152] Fed.R.Civ.P. 9(b).
[153] New England Data Servs., Inc. v. Becher, 829 F.2d 286, 288 (1st Cir.1987).
[154] Alternative Sys. Concepts, Inc., 374 F.3d at 29 (emphasis added); Powers v. Boston Cooper Corp., 926 F.2d 109, 111 (1st Cir. 1991); McGinty v. Beranger Volkswagen, Inc., 633 F.2d 226, 228 (1st Cir.1980).
[155] Corley v. Rosewood Care Center, Inc., 142 F.3d 1041, 1051 (7th Cir. 1998).
[156] See, e.g., Frontier Mgmt. Co., Inc. v. Balboa Ins. Co., 658 F.Supp. 987, 992-993 (D.Mass.1986).
[157] Complaint, Docket No. 1, ถถ 13, 15.
[158] Id. at ถ 13-14.
[159] Id. at ถ 15.
[160] Id. at ถถ 16-18.
[161] Vincent v. Ameriquest Mortgage Co. (In re Vincent), 381 B.R. 564, 574 (Bankr.D.Mass. 2008).
[162] Complaint, Docket No. 1, ถถ 101, 108.
[163] See Alternative Sys. Concepts, Inc., 374 F.3d at 29; Frontier Mgmt. Co., Inc., 658 F.Supp. at 992-993. While the Trustee must ultimately amend his Complaint, ordering him to do so at this time is inappropriate as a discovery schedule is not yet in place.
|
547 N.E.2d 1073 (1989)
Randy P. LIGHT, Appellant (Defendant below),
v.
STATE of Indiana, Appellee (Plaintiff below).
No. 61S00-8709-CR-861.
Supreme Court of Indiana.
December 15, 1989.
Transfer Denied March 20, 1990.
*1075 James A. Bruner, Rockville, for appellant.
Linley E. Pearson, Atty. Gen., Louis E. Ransdell, Deputy Atty. Gen., Indianapolis, for appellee.
SHEPARD, Chief Justice.
A jury found appellant Randy P. Light guilty of murder, a felony. Ind. Code § 35-42-1-1 (Burns 1985 Repl.). The trial court sentenced him to the maximum term of 60 years in prison. We affirm.
When Cindy Lloyd Starr was last seen alive on August 27, 1986, she was with Randy Light. The two ventured to an area known locally as Fallen Rock, a heavily wooded area in Parke County across the county line from Brazil, Indiana.
*1076 Once there, they engaged in sexual intercourse. According to Light's responses during a tape-recorded interrogation, Light became enraged when Starr called him a "bastard" and other derogatory terms. Light reacted by striking Starr with an object resembling a tire iron. An autopsy revealed that Starr's death was caused by three crushing blows to her face and head.
The State presented the deposition of a truck driver who died before trial. The truck driver stated that he observed Light's brother, Gary, push the victim into a car earlier on the same day. Randy Light was already in the car. The three drove away. The truck driver said he observed that incident while following the truck route through Brazil. Pat Puff and Kimberly Snowden also saw Starr in this area at the same time.
The truck driver's testimony was contradicted by a defense witness, the former chief of police in Brazil. He testified that if the truck driver followed the truck route, the truck driver would not have passed the intersection where he claimed to have seen Gary Light force the victim into a car.
The victim's nude and partially decomposed body was found September 6, 1986, in a ravine in the Fallen Rock area. Her head, neck, upper back and arms were charred.
Light raises ten issues in this direct appeal, the most important one being admissibility of his own statement to the police.
I. Admissibility of Light's Statements
Light argues that the trial court erroneously admitted inculpatory statements, violating his fifth amendment right against self-incrimination and his fourteenth amendment right to due process.[1] Light asserts that his statements made during custodial interrogation were not voluntarily given and therefore should have been excluded.
We review separately Light's voluntary waiver of his right to remain silent and right to counsel under the Miranda doctrine. Although Light argues these issues together, they are subject to separate analysis.[2]
In reviewing the voluntariness of statements made by defendants, courts look at the "totality of the circumstances." Blackburn v. Alabama, 361 U.S. 199, 206, 80 S.Ct. 274, 280, 4 L.Ed.2d 242, 248 (1960). Unlike the standard appellate review of sufficiency of the evidence, the standard of review for the voluntariness of confessions takes into consideration the total record. See id. Customarily a review for sufficiency of the evidence only looks to the evidence favorable to the verdict. Loyd v. State (1980), 272 Ind. 404, 398 N.E.2d 1260, cert. denied, 449 U.S. 881, 101 S.Ct. 231, 66 L.Ed.2d 105. A review of constitutional voluntariness is not a factual issue but "a legal question meriting independent consideration ..." Miller v. Fenton, 474 U.S. *1077 104, 115, 106 S.Ct. 445, 452, 88 L.Ed.2d 405, 414 (1985).[3]
A review of voluntariness of statements made during a custodial interrogation involves looking at all the evidence. See Blackburn, 361 U.S. 199, 80 S.Ct. 274, 4 L.Ed.2d 242. Among the considerations are the defendant's low level of intelligence, Davis v. North Carolina, 384 U.S. 737, 86 S.Ct. 1761, 16 L.Ed.2d 895 (1966); inconsistencies in the defendant's statement, Clewis v. Texas, 386 U.S. 707, 87 S.Ct. 1338, 18 L.Ed.2d 423 (1967); explicit or implicit promises by police interrogators, Malloy v. Hogan, 378 U.S. 1, 84 S.Ct. 1489, 12 L.Ed.2d 653 (1964); and the coercive nature of the interrogation atmosphere, Blackburn, 361 U.S. 199, 80 S.Ct. 274, 4 L.Ed.2d 242
The question presented is whether the trial court erred by admitting the statements. The trial judge must determine that a confession was freely and voluntarily given before allowing a jury to hear it, and the judge's "conclusion that the confession is voluntary must appear from the record with unmistakable clarity." Sims v. Georgia, 385 U.S. 538, 544, 87 S.Ct. 639, 643, 17 L.Ed.2d 593, 598 (1967).
Recent U.S. Supreme Court opinions focus on two areas of inquiry: 1) whether the alleged coercive police activity violated the U.S. Constitution and 2) whether the defendant's will was overborne by such coercive activity. Coercive police activity is a necessary prerequisite to finding a confession is not "voluntary" within the meaning of the due process clause of the fourteenth amendment. Colorado v. Connelly, 479 U.S. 157, 167, 107 S.Ct. 515, 522, 93 L.Ed.2d 473, 484 (1986). A review of the trial court's decision essentially examines the defendant's "will to resist," Rogers v. Richmond, 365 U.S. 534, 544, 81 S.Ct. 735, 741, 5 L.Ed.2d 760, 768 (1961),[4] which must not be overborne; nor can his "capacity for self determination [be] critically impaired." Culombe v. Connecticut, 367 U.S. 568, 602, 81 S.Ct. 1860, 1879, 6 L.Ed.2d 1037, 1057-58 (1961). This analysis ultimately turns "on the effect of the totality of the circumstances on the defendant's will." United States v. Ballard, 586 F.2d 1060, 1062 (5th Cir.1978). It matters not whether the statement was true or false or even if there is ample evidence aside from the confession to support the verdict. See Rogers v. Richmond, 365 U.S. at 540-41, 81 S.Ct. at 739-40. What matters is only whether the statement would not have been given but for coercive government influences. See Blackburn, 361 U.S. 199, 80 S.Ct. 274, 4 L.Ed.2d 242.
Light argues that several factors militate against admitting his statements: Light's lack of experience in police procedures, the privacy of the interrogation room, coercive psychological techniques employed by police, false legal advice given, his lower than average intelligence and illiteracy, inconsistencies in his statements and the explicit *1078 or implicit promises made to him by police. Under the totality of the circumstances, Light argues, these factors show that his statements were involuntary because his mental will was overborne by coercive police interrogation. Light cites various cases in support of his argument which describe scenarios that have caused courts to hold confessions involuntary: Davis v. North Carolina, 384 U.S. 737, 86 S.Ct. 1761, 16 L.Ed.2d 895 (1966) (defendant with third- or fourth-grade intelligence level not advised of Miranda warnings held in solitary for 16 days and interrogated at least once each day taken on a 14-mile hike while handcuffed to police on the 16th day when he confessed); Bram v. United States, 168 U.S. 532, 580, 18 S.Ct. 183, 42 L.Ed. 568 (1897) (police stripped defendant of his clothing and induced confession by asking a question that would imply guilt no matter the answer); Clewis v. Texas, 386 U.S. 707, 87 S.Ct. 1338, 18 L.Ed.2d 423 (1967) (defendant with no prior experience with police procedures, given no Miranda warnings held for 38 hours of intermittent interrogation, impaired by inadequate food, sleep and sickness, given several polygraph tests and taken on a trip to the grave site by police). He also cites Smith v. State (1969), 252 Ind. 425, 249 N.E.2d 493, a case in which admission of the defendant's statement was upheld. Smith, a 26-year-old man with an eighth grade education and no previous arrest record, was in contact with police ten hours and confessed while holding a Bible telling officers somebody was healing him.
The entire interrogation of Light lasted approximately four hours. Only a portion of it was tape recorded. Before the tape-recorded statement, Sheriff Wayne Lucas, Officers Doug Smiley and Mike Lankford and Deputy Charles Jones each observed or participated in part of the interrogation. Deputy Jones testified: "... Wayne was asking most of the questions. Then if he didn't like the answer he stormed out of the room and come [sic] back in and then he would blurt it out some more and then [sic] got a little bit heated and out of control so I decided to leave. I was there about fifteen minutes." Police Officer Eugene Hardman testified that when he arrived at the Clay County Sheriff's Department, Wayne Lucas said about the initial interrogation of Light: "We've torn down two of his alibis and there's one more to go." It is Clay County procedure to file a Miranda statement sheet after a suspect is read his rights. Police officers testified that they gave Light Miranda warnings before questioning him but were unable to produce a record of doing so. The record does demonstrate that Light was read his rights before the tape-recorded interrogation.
Light dropped out of school at age 15 and was enrolled primarily in a special education curriculum. He was 28 years old at the time of the trial. Light said in the statement he was drowsy during the tape-recorded interrogation. At several points, Officer Hardman audibly smacked Light's arm, ostensibly to keep Light alert. Hardman also used the technique of persistently positing Light's guilt in every question. He also repeatedly stated to Light: "I can't help you unless you tell us what happened. I want to help you... ." On cross-examination by Light's attorney, Officer Hardman admitted lying to Light:
Q. You allowed him to believe that you knew more than you did?
A. I allowed him to believe that we had a lot of evidence.
Q. In fact you deceived him, didn't you?
A. Deceived him in which way?
Q. Well you recall some conversation about a letter?
A. Correct.
Q. There was a letter that Randy told you ... that his brother, Gary had a letter that had ... that knew of a girl who had a letter with the person who did this's (sic) name on it, didn't you?
A. That's correct.
Q. And you told him that you knew about that letter?
A. Yes.
Q. That letter never existed, did it?
*1079 A. No, it did not. That's the point that the defendant broke.
While Light's case resembles in some respects cases in which confessions have been suppressed, there are important factual differences. As opposed to cases where the statements by a suspect during a custodial interrogation were held involuntary, the police in this case interrogated Light for only four hours. In most of the cases where the statements were held involuntary, the interrogation lasted for a matter of days, not hours. The promises made by Officer Hardman were not specific promises of legal assistance but generalized offers.
Light's assertion of mental slowness has been neither doubted nor disproven, but the evidence revealed sufficient intelligence to pass a driver's test, hold a full-time job as a truck driver for twelve years, and support a wife and five children. The defense did not offer any evidence which would support Light's statement that he was functionally illiterate, although one police officer testified that Light told him he could not read or write. On the other hand, Light's ability to pass an Indiana driver's license test points in the other direction. Officer Hardman did make physical contact with Light, but from the transcript and the tape recording, it seems to be just what it was described to be a mild smack or tap on the arm to keep him alert. Labelling the fifteen or so touches on the arm as "physical force or violence" is not a legitimate characterization. The nature of the physical contact between the interrogator and his subject naturally varies, and varying physical contacts should tell us different things about the effects of the contact on the interrogation. A slap in the face, for instance, would suggest something different than a smack on the arm while the subject is yawning, especially when the subject talks straight through it. The interrogating officer did admit to lying to Light. We do not condone such tactics, and they must be considered as evidence against voluntariness. See generally White, Police Trickery in Inducing Confessions, 127 U.Pa.L.Rev. 581-90, 599-600, 628-29 (1979). On the other hand, as Justice Thurgood Marshall has written for the U.S. Supreme Court, the relevance of such evidence does not mean that it compels a finding of constitutional violation. Frazier v. Cupp, 394 U.S. 731, 89 S.Ct. 1420, 22 L.Ed.2d 684 (1969).
Finally, the "totality of the circumstances" test is meant to keep the inquiry focused on the entire interrogation, not any single act by police or condition of the suspect. In the end, we must judge whether the police conduct in relation to the specific suspect was overbearing. After reviewing these tapes and transcripts, we find the evidence substantially supports the trial court's determination that Light's statement was voluntary. While there was considerable evidence to the contrary, we are not persuaded that the trial court erred by admitting Light's statements under the fifth and fourteenth amendments of the U.S. Constitution.
Next, we examine Light's argument that he did not knowingly, voluntarily and intelligently waive his right to remain silent or his right to counsel. Knowing, voluntary and intelligent waiver of these rights is required before the statements may be properly admitted. Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966). Light points to the same facts to support this argument as he did to support his claim that his statements were given involuntarily.
The standard of review for waiver of Miranda rights is that the State must prove waiver by a preponderance of the evidence. Colorado v. Connelly, 479 U.S. at 168-69, 107 S.Ct. at 523, 93 L.Ed.2d at 485. This is a lower standard than for proof of voluntariness of a statement given to police during an interrogation. See Blackburn, 361 U.S. 199, 80 S.Ct. 274, 4 L.Ed.2d 242. Waiver may be inferred from the actions and words of the person interrogated. North Carolina v. Butler, 441 U.S. 369, 99 S.Ct. 1755, 60 L.Ed.2d 286 (1979). The analysis begins with a presumption that the defendant did not waive his Miranda rights, and the State must carry the burden of proof. Tague v. Louisiana, 444 *1080 U.S. 469, 100 S.Ct. 652, 62 L.Ed.2d 622 (1980). While Light relies on the same facts supporting his voluntary confession claim, a Miranda voluntary waiver analysis affords a different weight to some events than the voluntary statement analysis does. The police testimony that Light was read his rights and understood them before any interrogation commenced recorded or unrecorded and that Light consented to be interviewed (while relinquishing his constitutional right to counsel and silence) is adequate to support the trial court's finding that Light waived his Miranda rights. People v. Parks, 48 Ill.2d 232, 269 N.E.2d 484 (1971), cert. denied, 404 U.S. 1020, 92 S.Ct. 692, 30 L.Ed.2d 669 (1972); A Model Code of Pre-Arraignment Procedure § 130.4 note 4 and accompanying text (1975).
II. Corpus Delicti
Light argues that the trial court erred by admitting Light's inculpatory statements without a sufficient showing of corpus delicti by the State.
A crime may not be proven solely on the basis of a confession. We require some other proof of the crime, in order to prevent confessions to crimes which never occurred. Smith v. State (1975), 167 Ind. App. 428, 339 N.E.2d 118.
Dr. Dean Hawley, a forensic pathologist, testified that "the remains of Cindy Starr show in the bones a series of injuries, the pattern of which leads us to the direct conclusions of cause of death." Dr. Hawley also testified that three skull injuries to the victim were fatal. He stated that those type of injuries indicated a hammer, a General Motors tire tool or a large rock.
Light asserts that this testimony was inadequate because the doctor did not specifically state that his opinions were based on reasonable medical certainty, citing Palace Bar, Inc. v. Fearnot (1978), 269 Ind. 405, 415, 381 N.E.2d 858, 864 (doctor's statement that a certain conclusion is possible is "no evidence at all"). We see no tentativeness in Dr. Hawley's opinions. His testimony adequately established corpus delicti.
III. Motion for Mistrial
Light argues that the trial court erred by denying his motion for mistrial when Officer Hardman violated an order in limine by testifying that Light "had a reputation for being violent with his wife." Light says this violation was especially harmful because sudden heat was an issue at trial. The court sustained Light's objection and admonished the jury to disregard that testimony.
The granting or denial of a motion for mistrial rests with the sound discretion of the trial court. Jones v. State (1978), 269 Ind. 543, 381 N.E.2d 1064. The court should grant a mistrial if the violation wrongly places the defendant in grave peril. Blood v. State (1980), 272 Ind. 417, 398 N.E.2d 671. We will reverse only for manifest abuse of its discretion on this issue.
Light's inculpatory statements, which were properly admitted, contained evidence of similar character. At several points in the tape recording of Light's statements, he admits to a problem controlling his anger. "I just loose control," he stated, "I can't ... I don't know, when my temper goes I can't ... I don't know what I'm doing." With this information already before the jury, it was within the discretion of the trial court to deny a motion for mistrial based on Officer Hardman's single violation.
IV. Gruesome Photographs
Light argues that the trial court erred by admitting State's exhibits 6, 8, and 9. He contends that they were gruesome and cumulative, failed to provide any additional assistance, and had the singular effect of arousing the emotions of the jury.
These photographs of the victim's body where it was discovered are repulsive, as the State readily admits. They show a nude and charred body, badly decomposed after having laid on damp, heavily wooded grounds for ten days in late summer.
Admission of photographs is within the trial court's sound discretion and will not *1081 be reversed unless the trial court abused its discretion. Wilson v. State (1978), 268 Ind. 112, 374 N.E.2d 45. Mindful that revolting crimes generate revolting evidence, we conclude that admission of just three photographs revealing the reality of the offense was not error.
V. Instruction No. 5
Light argues that the trial court erred by giving the jury final instruction no. 5:
The intent to kill can be found from the acts, declarations, and conduct of the defendant at or just prior to the commission of the offense, from the character of the weapon used, and from the part of the body on which the wound was inflicted.
Light argues that the instruction was not supported by the evidence. For example, there was no evidence Light made any "declarations ... at or just prior to" the commission of the offense. He also claims that the evidence did not establish the "character" of the weapon used.
This instruction was a generally accurate statement of law. Dr. Hawley described the character of the weapon used and Light's statement supported his description. As for the absence of evidence about any declarations by Light at or just prior to the commission of the offense, we are satisfied that the jury was not confused by the surplusage in the instruction.
VI. Definition of Motive
Light argues that the trial court erred by giving the jury final instruction no. 4. It reads:
The State is not required to prove that the accused had a motive that is, some understandable reason for committing the crime with which he is charged.
Light contends that defining "motive" as "some understandable reason" is a misstatement of law and tends to confuse the jury. This Court has described "motive" with those same words. Bruce v. State (1978), 268 Ind. 180, 256, 375 N.E.2d 1042, 1082, cert. denied, 439 U.S. 988, 99 S.Ct. 586, 58 L.Ed.2d 662. The trial court did not err in giving this instruction.
VII. Reasonable Doubt Instruction
Light asserts that the trial court erred by giving the jury final instruction no. 8. It reads:
The Court further instructs you that you should not indulge in purely speculative doubts, and the bare possibility that the defendant may be innocent does not raise a reasonable doubt. The question of defendant's guilt must be determined by each of you in view of your obligation to act honestly and fairly in weighing the evidence and reaching a decision which your oaths impose.
Light argues that this instruction characterizes "reasonable doubt" as a "bare possibility." He asserts that it placed "undue influence upon the notion of speculation as to innocence." Further, Light states that reasonable doubt was adequately and properly defined by another instruction.
The trial court did give Indiana Pattern Instruction 11.01 on reasonable doubt, which would have been adequate. We do not agree that Instruction No. 8 characterizes "reasonable doubt" as a "bare possibility." If anything, it said the opposite. The instruction was proper.
VIII. Hearsay
Light asserts that the trial court erred by sustaining the State's hearsay objection to testimony by Light's witness, Donna Sarver. We reverse a trial court's hearsay ruling only if the court has abused its discretion. See Emory v. State (1981), Ind., 420 N.E.2d 883; see also Payne v. State (1987), Ind. App., 515 N.E.2d 1141. We will sustain the trial court if it can be done on any legal ground apparent in the record. Cain v. State (1973), 261 Ind. 41, 300 N.E.2d 89.
Light argues that the hearsay testimony should have been admissible for two reasons: first, the evidence was not offered for the truth of the matter asserted but to corroborate similar earlier testimony by Kimberly Snowden, and, second, the evidence was not offered for the truth of the matter asserted but to show the victim's state of mind.
Light, in effect, urges that because the State failed to object to earlier hearsay *1082 when he elicited testimony from Kimberly Snowden, the State waived the right to object to later hearsay by Donna Sarver. Such a rule would allow litigants to piggyback into evidence all subsequent inadmissible hearsay once their own inadmissible hearsay was admitted.
We also reject Light's argument that this hearsay was admissible because it falls under the state of mind exception, described in Dunaway v. State (1982), Ind., 440 N.E.2d 682, 686. In Dunaway, the Court held that otherwise inadmissible hearsay is admissible when testimony is not offered for the truth of the matter asserted but to show the victim's state of mind toward the defendant.
Light argues that Starr's state of mind was in issue to show she was "not afraid of whoever was waiting for her in the car." Light further contends that "the testimony of Sarver would be particularly relevant for this purpose as rebutting evidence presented by the State that Starr was forced into a car by Gary Light."
This argument fails because whether Starr was afraid of Gary Light, the defendant's brother, was not in issue. Certainly deciding whether this was in issue and therefore admissible under the state of mind exception was within the trial court's discretion.
IX. Sufficiency of the Evidence
Light asserts that the State failed to sufficiently prove the corpus deliciti, that there was not sudden heat, the element of "knowingly," and any involvement of Light.
First, as noted above, the State demonstrated corpus deliciti. Second, when sudden heat is in issue, the State must disprove its existence beyond a reasonable doubt. Palmer v. State (1981), Ind., 425 N.E.2d 640. The evidence favorable to the jury verdict is found in the sexual nature of Light's trip with Starr to the wooded area, his attempt to hide the crime, and the likelihood that Light chased the victim or carried her body from the scene of the killing. We conclude that the evidence permitted the jury to conclude that Light acted with the requisite culpability for murder and not under sudden heat.
Third, the State carries the burden of proof on the "knowingly" element of murder. Intent to kill may be inferred from the use of a deadly weapon in a manner likely to cause death or great bodily harm. Rhinehardt v. State (1985), Ind., 477 N.E.2d 89. Three separate fatal blows were inflicted upon the victim, according to the forensic pathologist. The State met its burden.
Fourth, Light argues that there is insufficient proof of his involvement "to any extent" because of Light's equivocal responses during his taped interrogation. We agree that many of Light's responses were equivocal. On the other hand, while Light's statements were the only direct evidence linking him to the crime, other circumstantial evidence connected him to it.
X. Sentence
Light contends that the trial court's decision to impose the maximum sentence was manifestly unreasonable, given the evidence presented at sentencing. He argues the evidence showed three mitigators: 1) Light had never been arrested before, 2) Light was the sole supporter of his wife and five children, and 3) substantial evidence tended to show the offense was manslaughter or reckless homicide. Light also asserts that the court improperly considered the victim's physical disability and Light's greater physical strength, facts he claims were not supported by the evidence. Further, Light argues that the notion that he would commit future crimes was conjecture. He argues that no credible evidence demonstrates that Starr was struck three times. It shows only that she had three areas of injury, he says.
The trial court specifically stated that the aggravators outweighed the mitigators. The trial court cited three aggravators that supported the maximum sentence: (1) a lesser sentence would depreciate the seriousness of the crime (2) the victim was unable to escape because of a disability, and (3) the degree of violence involved in *1083 the crime. We disagree with Light's arguments that the evidence does not support a finding that the victim had a disability. The victim's mother testified that the victim suffered from cerebral palsy. The evidence amply demonstrated that the offense was an extremely violent act.
The trial court must state facts particular to the defendant and the crime when exercising its discretion to enhance a sentence. Totten v. State (1985), Ind., 486 N.E.2d 519. We find the court's imposition of the maximum sentence reasonable given the nature of the offense and character of the offender.
We affirm the judgment of the trial court.
GIVAN and PIVARNIK, JJ., concur.
DeBRULER, Justice, dissenting.
I deem myself bound to vote to reverse this conviction because of the erroneous admission of appellant's confessions. They were tape recorded at the tail end of a three-hour interrogation at the Clay County jail which commenced when appellant voluntarily appeared there in response to a request that he do so. That interrogation started out with an advisement and explanation of the privilege against self-incrimination and the right to counsel. Appellant acknowledged that he understood those rights and, as was the case in North Carolina v. Butler, 441 U.S. 369, 99 S.Ct. 1755, 60 L.Ed.2d 286 (1979), he then also refused to sign a written waiver of those rights. However, unlike the situation in Butler, the refusal here was not followed by a statement like "I will talk to you but I am not signing any form." Id., at 371, 99 S.Ct. at 1756, 60 L.Ed.2d at 291. Instead, what followed so far as this record is concerned was an intensive hour or more of questioning in a small crowded room, punctuated by conduct of the interrogators involving cursing, falsifying of evidence, and conduct described by one of the officers as "out of control." Toward the end of this period of interrogation, appellant made seriously incriminating statements from which guilt could be inferred. It was not until this point that appellant was provided a new advisement of Miranda rights and signed a written waiver. This signing was followed by the tape recording of the confessions admitted at trial.
Appellant was very tired, lacking in experience with police procedures, and of lower than average intelligence, having been assigned to special education classes while in high school and never graduated. When one places him in the circumstances described in the above paragraph, no inference is warranted that appellant knowingly and voluntarily waived his privilege against self-incrimination and his right to counsel either from his conduct during the interrogation or from his belated signing of the waiver form after the coercive actions of his interrogators.
DICKSON, J., concurs.
DICKSON, Justice, dissenting.
I am deeply concerned that the majority opinion may be misread by some as condoning the use of force during police interrogation. If so, conduct which the majority today tolerates as a smack on the arm will be urged to justify tomorrow's slap in the face, or worse. Inquisitional interrogation, abominable under our system of justice, is absolutely intolerable.
I confidently expect that today's ruling will be a mere aberration, and that future decisions will steadfastly hold that resort to physical force or violence during police interrogation necessarily compels the exclusion of resulting evidence.
DeBRULER, J., concurs.
NOTES
[1] Light also cited art. 1, §§ 13 and 14 of the Indiana Constitution without providing any legal analysis. He thus waives the argument. St. John v. State (1988), Ind., 523 N.E.2d 1353 (failure to provide argument for independent standard waives state constitutional law issue).
[2] As Justice O'Connor stated recently:
The Miranda rule is not, nor did it ever claim to be, a dictate of the Fifth Amendment itself. The Miranda Court implicitly acknowledged as much when it indicated that procedures other than the warnings dictated by the Court's opinion might satisfy constitutional concerns, See Miranda v. Arizona, 384 U.S. 436, at 444 [86 S.Ct. 1602, 1612, 16 L.Ed.2d 694 (1966)], and what was implicit in the Miranda opinion itself has been made explicit in our subsequent cases. See, e.g., Oregon v. Elstad, 470 U.S. 298, 306-310 [105 S.Ct. 1285, 1291-1293, 84 L.Ed.2d 222] (1985) (noting that the Miranda rule `sweeps more broadly than the Fifth Amendment itself' and `may be triggered even in the absence of a Fifth Amendment violation'); accord New York v. Quarles, 467 U.S. 649 [104 S.Ct. 2626, 81 L.Ed.2d 550] (1984); Michigan v. Tucker, 417 U.S. 433, 442-446 [94 S.Ct. 2357, 2362-2365, 41 L.Ed.2d 182] (1974). Like all prophylactic rules, the Miranda rule `overprotects' the value at stake. In the name of efficient judicial administration of the Fifth Amendment guarantee and the need to create institutional respect for Fifth Amendment values, it sacrifices society's interest in uncovering evidence of crime and punishing those who violate its laws. Duckworth v. Eagan, ___ U.S. ___, 109 S.Ct. 2875, 2883, 106 L.Ed.2d 166 (1989) (O'Connor, J., concurring).
[3] [T]he admissibility of a confession turns as much on whether the techniques for extracting the statements, as applied to this suspect, are compatible with a system that presumes innocence and assures that a conviction will not be secured by inquisitorial means as on whether the defendant's will was in fact overborne... . [T]he critical events surrounding the taking of a confession almost invariably occur in a secret and inherently more coercive environment. [T]ogether with the inevitable and understandable reluctance to exclude an otherwise reliable admission of guilt, they elevate the risk that erroneous resolution of the voluntariness question might inadvertently frustrate the protection of federal right. We reiterate our confidence that state judges, no less than their federal counterparts, will properly discharge their duty to protect the constitutional rights of criminal defendants. Miller v. Fenton, 474 U.S. at 117-16, 106 S.Ct. at 452-53, 88 L.Ed.2d at 414-16 (citations omitted) (emphasis in original).
[4] "Our decisions under [the fourteenth amendment] have made clear that convictions following the admission into evidence of [involuntary confessions] cannot stand ... not so much because such confessions are unlikely to be true but because the methods used to extract them offend an underlying principle in the enforcement of our criminal law: that ours is an accusatorial and not an inquisitorial system... . Indeed, in many of the cases [reversing] state convictions involving the use of confessions obtained by impermissible methods, independent corroborating evidence left little doubt of the truth of what the defendant had confessed." Rogers v. Richmond, 365 U.S. at 540-41, 81 S.Ct. at 739-40, 5 L.Ed.2d at 766-67.
|
294 S.C. 69 (1987)
362 S.E.2d 639
In re ROBERT M., a minor under the age of sixteen years, Appellant.
22806
Supreme Court of South Carolina.
Heard November 2, 1987.
Decided November 23, 1987.
Deputy Chief Attorney Elizabeth C. Fullwood, of S.C. Office of Appellant Defense, Columbia, for appellant.
Atty. Gen. T. Travis Medlock, Asst. Atty. Gen. Harold M. Coombs, Jr., Columbia, and Sol. John R. Justice, Chester, for respondent.
Heard Nov. 2, 1987.
Decided Nov. 23, 1987.
HARWELL, Justice:
Appellant was adjudicated delinquent, tried and convicted on charges of first degree criminal sexual conduct with a minor. The trial judge committed appellant to the custody of the South Carolina Department of Youth Services for an indeterminant term not to exceed his twenty-first birthday.
*70 At the time of the alleged sexual misconduct, appellant was twelve years old and the alleged victim was four years old. Appellant contends that the trial judge erred in failing to make a preliminary determination of witness competency before considering the testimony of the four-year-old complainant.
In State v. Pitts, 256 S.C. 420, 182 S.E. (2d) 738 (1971), this Court held that when confronted with a timely objection to witness competency, the trial judge has a duty to "make such examination as will satisfy [him] as to the competency or incompetency of the person to testify, and thereupon to rule on the objection accordingly." Id. at 429, 182 S.E. (2d) at 743; See also State v. Green, 267 S.C. 599, 230 S.E. (2d) 618 (1976) (question of witness competency to be determined by trial judge). In State v. Pitts and State v. Green we specified age, capacity, and moral and legal accountability as factors to be considered by a trial judge in determining witness competency.
The State concedes in its brief, and the following exchange demonstrates, that there was no informed exercise of judicial discretion in ruling upon the witness's competency. The State argues, however, that appellant interposed no timely objection:
Mr. Barfield: I call [the four year old witness].
The Court: I am not going to attempt to even qualify her. (emphasis added).
Mr. Davis: Of course, your Honor, I would register my objection with respect to her age and so forth. She will not be credible and be a reliable witness.
The Court: Well, I respect she is four years old?
Mr. Davis: Yes, sir.
Mr. Barfield: Can I sit down, your Honor?
The Court: Yes.
The solicitor then elicited testimony from the child implicating appellant in sexual misconduct.
The record clearly reflects that appellant made a timely and sufficiently specific objection to the four-year-old's competency to testify. Equally obvious is the trial judge's failure to carry out his State v. Pitts duty to satisfy himself of the witness's competency.
*71 We recently held that witness qualification is within a trial judge's discretion, and his ruling will be reversed only for an abuse thereof. State v. Hudnall, 293 S.C. 97, 359 S.E. (2d) 59 (1987). Here the trial judge's refusal to exercise his discretionary authority by means of a competency examination constituted reversible error. See State v. Smith, 276 S.C. 494, 280 S.E. (2d) 200 (1981) (abuse of discretion to refuse to exercise discretionary authority when it is warranted).
Appellant's next exception alleges trial court error in allowing the four-year-old's parents to testify as to the child's out of court statements accusing appellant of sexual misconduct. The State concedes that since we hold the trial judge did not make a proper competency determination after a timely objection, there was, in effect, no testimony from the four-year-old. The victim must testify as a condition to admitting corroborative evidence of the victim's complaint or report. State v. Cox, 274 S.C. 624, 266 S.E. (2d) 784 (1980). Thus, the parents' testimony here was inadmissible hearsay. See Orangeburg County Department of Social Services v. Schlins, 291 S.C. 477, 354 S .E. (2d) 388 (1987).
In the event of retrial we note for benefit of bench and bar the limited admissibility of complaints or reports of sexual misconduct. State v. Cox, supra; See also State v. Munn, 292 S.C. 497, 357 S.E. (2d) 461 (1987) (corroborative evidence of complaint or report limited to so much of complaint as identifies the time and place with that of misconduct charged).
We reverse the adjudication of delinquency and the commitment order and remand for a new trial.
Reversed and remanded.
NESS, C.J., and GREGORY, CHANDLER and FINNEY, JJ., concur.
|
FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
IN RE CWS ENTERPRISES, INC., No. 14-17045
Debtor,
D.C. Nos.
2:10-cv-00779-KJM
SPILLER MCPROUD, 2:10-cv-00780-KJM
Plaintiff-Appellee, 2:12-cv-00142-KJM
v.
CHARLES W. SILLER,
Defendant-Appellant,
and
DAVID D. FLEMMER, Chapter 11
Trustee; CWS ENTERPRISES,
INC.,
Defendants.
2 IN RE CWS ENTERPRISES
IN RE CWS ENTERPRISES, INC., No. 14-17046
Debtor,
D.C. Nos.
2:10-cv-00779-KJM
SPILLER MCPROUD, 2:10-cv-00780-KJM
Plaintiff-Appellee, 2:12-cv-00142-KJM
v.
OPINION
CWS ENTERPRISES, INC.;
CHARLES W. SILLER,
Defendants,
and
DAVID D. FLEMMER, Chapter 11
Trustee,
Defendant-Appellant.
Appeal from the United States District Court
for the Eastern District of California
Kimberly J. Mueller, District Judge, Presiding
Argued and Submitted October 21, 2016
San Francisco, California
Filed September 14, 2017
IN RE CWS ENTERPRISES 3
Before: Andrew J. Kleinfeld and Milan D. Smith, Jr.,
Circuit Judges, and Edward R. Korman,* District Judge.
Opinion by Judge Kleinfeld
SUMMARY**
Bankruptcy
The panel affirmed the district court’s reversal of the
bankruptcy court’s decision reducing a claim for pre-petition
attorneys’ fees pursuant to 11 U.S.C. § 502(b)(4), which
limits claims for services rendered by the debtor’s attorney to
the extent that such claims exceed the reasonable value of
such services.
Agreeing with the Tenth Circuit, the panel held that
section 502(b)(4) acts as a federal cap on a fee already
determined pursuant to state law. The proper mode of
analysis is: (1) an acknowledgment or determination that the
fee contract was breached; (2) an assessment of the damages
for the breach under state law; (3) a determination under
section 502(b)(4) of reasonableness of the damages claim
afforded by state law; and (4) a reduction of the claim by
whatever extent, if any, it is deemed excessive. The panel
held that it is error for a bankruptcy court to bypass this
*
The Honorable Edward R. Korman, United States District Judge for
the Eastern District of New York, sitting by designation.
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
4 IN RE CWS ENTERPRISES
analysis and determine for itself in the first instance a
reasonable contingent fee using the lodestar method.
Agreeing with the Third Circuit, which analyzed section
502(b)(7), the panel held that the bankruptcy code’s
reasonableness cap limits a pre-petition obligation for a
debtor’s attorneys’ fees, even if such fees were allowable
under state law, and even if such fees had been reduced to a
state court judgment.
The panel held that the bankruptcy court was required to
give full faith and credit to a state court’s judgment,
confirming an arbitration award and entitling the attorneys to
their fees, to the same extent that California res judicata law
would give that judgment preclusive effect. The panel
affirmed the district court’s conclusion that issue preclusion
applied because the arbitration proceeding establishing the
reasonableness of the fees was fully contested and later
confirmed by the judgment of a California court. The panel
held that, although there might in some cases be room for a
reduction, under section 502(b)(4)’s reasonableness cap, of a
state court judgment confirming an arbitration award for a
contingent fee, there was no room in this case because the
relationship between the contracted-for amount the service
the attorneys provided was not such as to make enforcement
of the contract or payment of the fee unreasonable.
COUNSEL
Bradley A. Benbrook (argued) and Stephen M. Duvernay,
Benbrook Law Group PC, Sacramento, California; David A.
Cheit, DLA Piper LLP (US), Sacramento, California; for
Defendant-Appellant David D. Flemmer.
IN RE CWS ENTERPRISES 5
Randy Michelson (argued), Michelson Law Group, San
Francisco, California, for Defendant-Appellant Charles W.
Siller.
Steven T. Spiller (argued), Spiller McProud, Nevada City,
California; Walter R. Dahl, Dahl Law, Sacramento,
California, for Plaintiff-Appellee Spiller McProud.
OPINION
KLEINFELD, Senior Circuit Judge:
We address the bankruptcy code’s provision on claims for
pre-petition attorneys’ fees, 11 U.S.C. § 502(b)(4).
FACTS
Charles Siller has been litigating with his brothers over
his interest in the family business since 1982. The family
business, Siller Brothers, Inc., held among its assets some 500
pieces of real estate, and Siller owned 40% of the stock. By
2001, Siller Brothers, Inc. had obtained a $10 million
judgment against Siller, and it was threatening to execute on
his shares. To fight this litigation, Siller retained several law
firms at various times.
In 2001, Charles Siller hired the law firm Cotchett, Pitre
& Simon1 to represent him both in his lawsuit with his
brothers and a legal malpractice dispute with some of his
former lawyers. The Cotchett firm agreed to a contingent fee
1
The firm would later be renamed Cotchett, Pitre & McCarthy.
6 IN RE CWS ENTERPRISES
of 28% of the net settlement or trial award after subtraction
of a $10 million judgment against Siller in favor of his
brothers. The engagement agreement said that Siller was
“without funds to pay hourly fees.” The arbitration provision,
initialed by Siller when he signed it, stated that “any dispute”
relating to the fee agreement or the Cotchett firm’s
performance of services would be submitted to arbitration.
Two and a half years later, Siller retained the Spiller •
McProud law firm. Siller hired the Spiller firm “not as
additional trial attorneys, but to assist, advise and discuss
these legal matters personally” with Siller, and to act as “an
interface” for Siller “with the attorneys at the Cotchett law
firm.” The Spiller firm was to work to ensure that Siller
could “fully understand and [be] in agreement with the
Cotchett law firm’s trial strategy, trial preparation (including
selection of experts), and conduct of the trial itself.” The
Spiller firm was to serve as Siller’s “general counsel” and “to
communicate to the Cotchett law firm [Siller’s] ideas,
suggestions, and requests.”
Siller wanted Spiller • McProud to convince the Cotchett
firm to pursue a theory that Siller’s brother’s death entitled
Siller to purchase his brother’s shares for a small fraction of
what they were worth, under a separate contract Siller had
with his deceased brother. The Spiller firm agreed, but Siller
and the Spiller firm expressly agreed that the contingent fee
would not depend on the success of this theory. The Spiller
firm was to get 8% of the same net amount from which the
Cotchett firm’s 28% contingent fee was to be calculated.
Siller and the Spiller firm also incorporated the other terms of
Siller’s agreement with the Cotchett firm, including the
arbitration provision.
IN RE CWS ENTERPRISES 7
The Cotchett firm, consulting with the Spiller firm, won
Siller’s case against Siller Brothers, Inc. After a failed
mediation and a stay of execution on Siller Brothers, Inc.’s
$10 million judgment against Siller, the case went to trial in
California Superior Court. The judge issued a proposed
judgment valuing Siller’s shares at over $56 million. Pending
appeal and cross appeal, the parties settled for $10 million
cash to Siller and $20.5 million worth of real estate in
exchange for Siller’s shares. Consistent with Siller’s fee
agreements with the firms, the contingent fees were to be
based upon the $30.5 million value of the settlement.
Documentation was delayed while Siller’s counsel, working
with tax experts, created for Siller a new corporate spinoff,
CWS Enterprises, Inc., so that Siller could mitigate the tax
impact of his lawyers’ victory.
The firms also tried other cases that Siller insisted on.
While the dissolution case was ongoing, the Cotchett and
Spiller firms filed a separate action against Siller Brothers,
Inc. and pursued Siller’s preferred theory (that Siller had
acquired a right to buy his deceased brothers’ shares cheaply
under a separate contract). They lost that case. The two
firms also lost a malpractice case Siller brought against one
of his previous lawyers, and they negotiated a $41,000
settlement in another case where Siller had refused to pay a
different set of previous lawyers. (Siller then refused to pay
even the $41,000 settlement, so those disputes remained
pending after he moved on from the Cotchett and Spiller
firms.)
Nor would Siller pay the 28% and 8% fees he had agreed
to pay the Cotchett and Spiller firms, respectively. Siller’s
failure to pay the Spiller firm its 8% contingent fee is the
subject of the appeal before us. Siller and the two firms
8 IN RE CWS ENTERPRISES
arbitrated the fee dispute before a retired state judge acting as
arbitrator, presenting two days of testimony and extensive
argument.
Every aspect of the arbitration, including whether it
should take place, was hotly contested. Despite his
agreement to arbitrate “any dispute,” Siller refused to do so
until the Superior Court denied his ex parte application to
prevent such arbitration. Siller then continued his attempt to
evade arbitration by way of unsuccessful motions in limine
before the arbitrator.
During the arbitration, Siller’s counsel led off his cross
examination of the attorneys’ lead witness, Mr. Pitre of
Cotchett, Pitre, by asking what his and his associates’ hourly
rates were. Siller’s lawyer then asked why they had
contracted for a contingent fee. Pitre replied, “Because Mr.
Siller didn’t have any money,” so the attorneys would have
to be paid “[o]ut of a recovery, hopefully.” The lawyers
advanced about $400,000 in expenses, as well as their time
and effort. Pitre was initially reluctant to pursue the case
against Siller’s deceased brother under the buy-sell agreement
(the theory under which Siller would buy his brother’s shares
for a valuation price that was a small fraction of what the
shares were worth) because he doubted that agreement’s
enforceability. But, as Spiller had agreed to do in his retainer
agreement, he consulted with Pitre and came up with a theory
that the two firms could advance with a straight face. (They
lost that portion of the case, as they did the malpractice case
Siller had started against one of his previous lawyers.)
As Siller’s attorney presented his case during the
arbitration, (1) the real estate accounting for two thirds of the
settlement had declined in value since the settlement, so if a
IN RE CWS ENTERPRISES 9
contingent fee applied at all, it should be against much less
than the $30.5 million; (2) the value of the legal services was
far less than the contingent fee would yield; (3) much of the
work, including the failed lawsuits against the deceased
brother’s estate and the failed lawsuit against one of Siller’s
previous attorneys, produced no value, so the attorneys
should not be compensated for it; (4) Spiller had participated
actively in the successful trial, but had only been retained as
“general counsel” to consult, so he ought not to be
compensated for any of that time; and (5) the money went to
the spinoff created for Siller to avoid taxes, not to Siller, and
the spinoff had not signed the fee agreement, so no fees were
due.
Siller’s case focused largely on the reasonable value of
the Cotchett and Spiller firms’ respective services, both as an
alternative to the contingent fee agreement and as
justification for not holding him to his contingent fee
agreement. Siller’s attorney urged the arbitrator to limit
compensation to “the reasonable value of the services
rendered” because the Cotchett and Spiller firms had “failed
to fulfill” their contracts. He argued that “[i]f you have a
breach of contract then the answer’s in quantum meruit.”
“And even if it’s a contract, the law says you must prove
reasonable value of the services, and that goes to the
performance.” Siller’s attorney argued that the hours were
also relevant to “the issue of conscionability.” “[T]he
conscionability of this fee will be determined also based upon
. . . [the] hours they devoted to matters that they failed to
bring to conclusion through their own errors,” referring to the
unsuccessful malpractice case against one of Siller’s prior
lawyers.
10 IN RE CWS ENTERPRISES
The Cotchett and Spiller firms objected to all this
evidence, which was the bulk of Siller’s case, on the theory
that evidence as to quantum meruit was not necessary in a
breach of contract action. But they conceded that Siller could
“inquire about the amount of time put into the matters . . . the
time for their quantum meruit,” because it was an issue the
arbitrator could reach if he deemed the contract void.
Siller’s attorney pointed out that the arbitrator had not yet
ruled on whether the contingent fee agreement was binding,
so “quantum meruit is still an issue.” He argued that if the
contract was not deemed to be binding, then quantum meruit
would determine the proper amount of the fee, and even if the
contract were binding, counsel would still have to show a
reasonable effort to justify the amount of the fee under state
bar rules. So “[u]ltimately this comes down to hours,”
Siller’s attorney argued, which apparently is why Siller’s
presentation was largely a challenge to how many hours
ought not to be compensated because they were either not
contracted-for or led to no success.
The arbitrator overruled the Cotchett and Spiller firms’
objections and let in all of Siller’s evidence going to the value
of the attorneys’ services, including evidence concerning the
reasonableness of the attorneys’ contingent fees, the hours the
attorneys worked, and the reasonableness of the time they
spent relative to the results (except for some details regarding
valuation of the parcels of real estate they won for Siller),
evidently because that evidence might bear on quantum
meruit or unconscionability if the arbitrator decided the case
on either basis.
Spiller testified that he put in 1,760 hours and that his
usual rate was $250 per hour. He and Pitre had told Siller
IN RE CWS ENTERPRISES 11
that the actions to enforce the buy-sell agreement and for
legal malpractice were likely to be unsuccessful (and they
were), but Siller insisted on pursuing them anyway.
After hearing all of this testimony and argument, the
arbitrator chose to view the case as a claim on a contract, the
written fee agreements. He concluded that the fee agreements
were not unconscionable, that they were “reasonable,” and
that the two firms were entitled to every penny of the fees
they and Siller had agreed to, as well as the expenses the
firms had advanced on Siller’s behalf. The Cotchett firm and
Siller have since settled, so we need discuss only the Spiller
firm’s claim.
The arbitrator found that Siller provided extensive advice
almost daily for the three years of the litigation, working “full
bore” for “over 1,760 hours on Siller’s behalf.” (The dispute
had been litigated through multiple trials and proceedings in
multiple courts on multiple theories, including Siller’s
disputes with several of his former attorneys.) The arbitrator
also concluded that, as Siller himself admitted in his
testimony, he had hired Spiller to assist trial counsel, not just
to advise.
The arbitrator wrote a detailed, 26-page, single-spaced
opinion explaining his decision. After rejecting Siller’s
theories for why the arbitration should not proceed, and why
it should not bind CWS (the corporate spinoff created so that
Siller could avoid taxes on his $30.5 million settlement), the
arbitrator made findings of fact regarding the fee agreements.
He found that Spiller “worked . . . alongside [the Cotchett
lawyers] on all litigation.” As for Siller’s contention that
Spiller was not supposed to do that, just act as his “general
counsel” to advise and inform him and the Cotchett firm, the
12 IN RE CWS ENTERPRISES
arbitrator found otherwise. “Siller testified that he hired
Spiller to ‘help Frank [Pitre] and not just to advise . . .
although Spiller did provide Siller with extensive advice
about the progress of the litigation on an almost daily basis
throughout three years of representation.” The arbitrator
further found that Spiller spent less than 5% of his time on
the unsuccessful malpractice litigation against one of Siller’s
previous lawyers and sought no fees for that work.
As for not completing the contract, the arbitrator credited
Spiller’s contention that Siller fired his lawyers “hoping to
avoid paying his now former counsel” by “actions clearly
designed to avoid payment of his legal obligations attendant
to the extraordinary result obtained,” a $30.5 million
settlement on a $45.7 judgment obtained after years of
representation in complex litigation.
The critical question for this appeal, as argued on Siller’s
behalf, is whether the arbitrator resolved only the issue of
whether the contingent fee was unconscionable as applied to
the $30.5 million result, or whether the arbitrator also
determined the reasonable value of the legal services
performed. The transcripts show, and the arbitrator found,
that Siller’s attorney “devoted most of his cross examination
to a detailed attack on how Mr. Pitre and Mr. Spiller spent
their time on the case, on the theory that the Arbitrator might
find the contract to be unconscionable (it is not) and that
quantum meruit would be relevant.” The arbitrator
concluded, though, that quantum meruit was not relevant
because the contingent fee agreement was a valid contract.
He expressly found that the contracted-for percentages were
“reasonable” based on the work put into the case, the risks,
and the need for counsel to finance the litigation.
IN RE CWS ENTERPRISES 13
Siller did not pay what the arbitrator concluded he owed,
so the Cotchett and Spiller firms sought and obtained
confirmation of the award in California Superior Court. The
Superior Court entered a money judgment in their favor for
the amount of the award. But Siller did not pay the judgment,
either; instead, he prevented its execution by filing for
chapter 11 bankruptcy.
The bankruptcy court took a fresh look at the “reasonable
value” of Spiller’s services under section 502(b)(4) and
applied a lodestar approach, multiplying Spiller’s hourly rate
by those hours that the bankruptcy court adjudged to be
productive on the portions of the litigation on which Spiller
was successful. Using this approach, the bankruptcy court
concluded that Spiller’s fee was unreasonably high and
should have been $440,250 (rather than the arbitrator’s figure
of just under $2.5 million).
The bankruptcy court’s view was that there were “two
tiers of reasonableness scrutiny,” first under state law, which
if not satisfied required disallowance of the claim as
“unenforceable,” and then under bankruptcy law,
independently of state standards. The bankruptcy court did
not articulate what the federal standard of reasonableness
was, just that it was not necessarily satisfied by
reasonableness under state standards. As the bankruptcy
court saw it, the arbitrator had not determined reasonableness
because he merely conducted a contract analysis under the
contingent fee agreement. Responding to the attorneys
argument that full faith and credit should be given to the
Superior Court judgment, the bankruptcy court held that “as
a matter of the Supremacy Clause, and regardless of the state
preclusion law, the state-court judgment based on state law
cannot trump the specific provision in Bankruptcy Code
14 IN RE CWS ENTERPRISES
502(b)(4).” As for claim and issue preclusion, the bankruptcy
court’s view was that since section 502(b)(4) of the
bankruptcy code could not have been raised in the arbitration
(because Siller had not yet filed for bankruptcy), the claim
arbitrated did not involve the same “primary right.” The
bankruptcy court thus could determine reasonableness on a
clean slate without taking account of the arbitration award
and the California Superior Court judgment.
The district court, on the Spiller firm’s appeal, reversed.
The controlling determination in the district court decision
was that “the similarity between the standard for determining
the unconscionability of a contingent fee agreement, which
was before the arbitrator, and the bankruptcy court’s standard
for determining the reasonable value of the fees suggests that
the issue of an appropriate fee for appellant’s work was
necessarily determined and actually litigated in the formal
arbitration that took place here.” The district court noted that
the bankruptcy court “did not consider the transcript of the
arbitration proceedings in determining what was before the
arbitrator.” The district court did consider the transcript to
see whether reasonableness was at issue. It noted that Siller’s
position in the arbitration, fully litigated, was that, despite a
contingent fee agreement, the attorneys still had to prove
“reasonable effort . . . to justify the fee.” The arbitrator heard
evidence about the time spent and the complexities and risks
of the litigation, not just the contract itself, and evaluated all
of these factors for reasonableness. The district court
concluded that “[b]y considering both the reasonable nature
of the contingent fee contracts and rejecting the claim that the
contracts were unconscionable, and applying California’s
tests for both determinations, the arbitrator necessarily
decided that the fees were reasonable within the
contemplation of § 502(b)(4).”
IN RE CWS ENTERPRISES 15
After a trial in the bankruptcy court, Siller and the trustee
argued in a second appeal to the district court that the issues
adjudicated by the arbitrator were not “identical,” as required
by California res judicata law, to the reasonableness
determination under the bankruptcy code, so the judgment
confirming the arbitration award should have no preclusive
effect. But the district court, based on the arbitration
transcript and arbitrator’s decision, found that “the arbitrator
determined that Spiller’s fees were not unconscionable
applying a test equivalent to the federal reasonableness test,”
so the California Superior Court judgment was entitled to
preclusive effect. Because the case required no further
proceedings in bankruptcy court once the amount of Spiller’s
claim was liquidated, and because that condition had
occurred, the district court held that Spiller was entitled to the
full amount of his claim as adjudicated.
Siller and his new spinoff corporation appeal.
ANALYSIS
Two statutes are at issue in this case, the bankruptcy
code’s provision on claims for pre-petition attorneys’ fees,
11 U.S.C. § 502(b)(4), and the Full Faith and Credit Act,
28 U.S.C. § 1738. The first limits claims after the objection
of an interested party. Here is its text:
(b) Except as provided in subsections (e)(2),
(f), (g), (h) and (I) of this section, if such
objection to a claim is made, the court, after
notice and a hearing, shall determine the
amount of such claim in lawful currency of
the United States as of the date of the filing of
16 IN RE CWS ENTERPRISES
the petition, and shall allow such claim in
such amount, except to the extent that–
...
(4) if such claim is for services of an insider
or attorney of the debtor, such claim exceeds
the reasonable value of such services.2
Here is the text of the Full Faith and Credit Act:
The Acts of the legislature of any State,
Territory, or Possession of the United States,
or copies thereof, shall be authenticated by
affixing the seal of such State, Territory or
Possession thereto.
The records and judicial proceedings of any
court of any such State, Territory or
Possession, or copies thereof, shall be proved
or admitted in other courts within the United
States and its Territories and Possessions by
the attestation of the clerk and seal of the
court annexed, if a seal exists, together with a
certificate of a judge of the court that the said
attestation is in proper form.
Such Acts, records and judicial proceedings or
copies thereof, so authenticated, shall have the
same full faith and credit in every court within
the United States and its Territories and
Possessions as they have by law or usage in
2
11 U.S.C. § 502.
IN RE CWS ENTERPRISES 17
the courts of such State, Territory or
Possession from which they are taken.3
There is little circuit court authority on section 502(b)(4)
of the bankruptcy code. It limits claims for services rendered
by the debtor’s attorney to the extent that such claims exceed
“the reasonable value of such services.”4 The text leaves
room for argument about how to apply it, especially in
conjunction with any prior determination regarding attorneys’
fees and with the Full Faith and Credit Act.5 The district
court concluded that a Tenth Circuit decision, Landsing
Diversified Properties v. First National Bank and Trust Co.
(In re Western Real Estate Fund, Inc.),6 provided a sound
analysis, and so do we. There are a number of bankruptcy
court, bankruptcy appellate panel, and district court decisions
taking both consistent and different views.7 We adopt the
Tenth Circuit’s position. Federal law benefits from
consistency between circuits, and we agree with our sister
circuit’s reasoning.
3
28 U.S.C. § 1738.
4
11 U.S.C. § 502(b)(4).
5
28 U.S.C. § 1738.
6
922 F.2d 592 (10th Cir. 1990), modified sub nom. Abel v. West,
932 F.2d 898 (10th Cir. 1991).
7
See, e.g., In re Placide, 459 B.R. 64 (B.A.P. 9th Cir. 2011); In re
Solar Trust of America, LLC, No. 12-11136, 2015 WL 1011548 (Bankr.
D. Del. Jan. 12, 2015); In re Boulder Crossroads, LLC, No. 09-10381,
2010 WL 4924745 (Bankr. W.D. Tex. Dec. 1, 2010); In re Heritage
Organization, L.L.C., No. 04-35574, 2006 WL 6508182 (Bankr. N.D.
Tex. Jan. 6, 2006); In re Russell Cave Co., 253 B.R. 815 (Bankr. E.D. Ky.
2000); In re Nelson, 206 B.R. 869 (Bankr. N.D. Ohio 1997).
18 IN RE CWS ENTERPRISES
In Western Real Estate, the bankrupt entered into a pre-
petition fee agreement with counsel for a reduced hourly rate
plus a 25% contingent fee.8 Agreeing with our decision in In
re Yermakov, the Tenth Circuit reasoned that, subject to
section 502(b)(4), “a pre-petition contingency fee agreement
between the debtor and an attorney is . . . ‘like any other
contract claim against the estate.’”9 Citing our decision in In
re Pacific Far East Line, the Tenth Circuit concluded that the
source of allowable contract damages for a breached
attorney’s fee agreement is state law.10 Western Real Estate
rejects the notion that under section 502(b)(4), federal law
provides for a bankruptcy court to establish the
reasonableness of an attorney’s fee in the first instance,
independently of state law. Instead, 502(b)(4) works as a
federal cap on a fee already determined pursuant to state
law.11 The proper mode of analysis, Western Real Estate
holds, is:
(1) an acknowledgment or determination
that the fee contract was breached;
(2) an assessment of the damages for the
breach under state law;
(3) a determination under section
502(b)(4) of the reasonableness of the
8
Western Real Estate, 922 F.2d at 594.
9
Id. (citing Yermakov, 718 F.2d 1465, 1470 (9th Cir. 1983)).
10
Id. (citing Pacific Far East Line, Inc., 654 F.2d 664, 668–70 (9th
Cir. 1981)).
11
See id. at 595–97.
IN RE CWS ENTERPRISES 19
damages claim afforded by state law;
and
(4) a reduction of the claim by whatever
extent, if any, it is deemed excessive.12
Western Real Estate holds that it is error for a bankruptcy
court to bypass this analysis, as the bankruptcy court did in
this case, and determine for itself in the first instance a
reasonable contingent fee using the lodestar method.13
Western Real Estate also holds that contingent fee
agreements “provide reasonable alternatives to the hourly
retainer, despite the fact that, as a result of their contingent
and therefore risky nature, such agreements typically generate
fees . . . substantially in excess of” lodestar calculations
when the lawyer succeeds.14 Citing our decision in Venegas
v. Skaggs,15 Western Real Estate holds that the contingent and
therefore risky nature of a contingent fee is itself an element
of the reasonableness analysis.16
In the case before us, the Spiller firm’s fee had been
reduced to judgment pursuant to state law in a California state
12
See id. at 597.
13
See id. at 597–98.
14
Id. at 597.
15
867 F.2d 527 (9th Cir. 1989), aff’d sub nom. Venegas v. Mitchell,
495 U.S. 82 (1990).
16
Id. at 532 (citing Hamner v. Rios, 769 F.2d 1404, 1409 (9th Cir.
1985)).
20 IN RE CWS ENTERPRISES
court. It had also been “deemed allowed” under section
502(a) subject to Siller’s section 502(b)(4) objection.17 Siller
had argued that because he fired the Cotchett and Spiller
firms before the settlement was collected, he did not owe
them their contingent fees. But the arbitrator found that this
attempt by Siller to evade the fees should fail. The Superior
Court judgment established that under California law, the
Spiller firm was entitled to $2,497,325.07 for his fees and
$800 for costs (plus 10% interest beginning November 25,
2008). So the first and second steps of the Western Real
Estate analysis are complete.
Applying the section 502(b)(4) reasonableness test and
reducing the claim to the extent of any excess are the third
and fourth steps of the analysis, not the first. The bankruptcy
court performed its reasonableness analysis from scratch,
using the lodestar method, rather than treating it as a cap on
the amount allowed under state law. We therefore conclude
that the bankruptcy court’s analysis was mistaken in this case
for the same reason as the bankruptcy court’s analysis in
Western Real Estate.
So far, we have glossed over another question: whether
section 502(b)(4) of the bankruptcy code leaves any room to
reduce an attorney’s fee that a state court has deemed
reasonable as a matter of state law, that is, whether the
section 502(b)(4) reasonableness cap can ever require a
reduction in such a fee. And we also have not yet spoken to
the res judicata effect of a judgment entered prior to the filing
of a bankruptcy petition.
17
11 U.S.C. § 502(a).
IN RE CWS ENTERPRISES 21
The Third Circuit, in Anthony v. Interform,18 answered
these questions for another of the section 502(b) exceptions.
As in our case, the bankruptcy claim in Anthony was based on
a pre-petition state court judgment confirming an arbitration
award.19 Anthony construes section 502(b)(7) of the
bankruptcy code, which limits a claimant’s damages from the
termination of an employment contract to one year’s pay after
termination or after the employer filed for bankruptcy (even
if the employer breached a multi-year employment contract
and left more than a year unfulfilled).20 The employer in
Anthony thwarted the employee’s attempt to execute on his
state court judgment by filing for chapter 11 bankruptcy
relief,21 so the employee filed a bankruptcy claim for the
amount of the judgment.22
Anthony rejects the proposition that the 502(b)(7) cap
applies only to executory contracts and not to judgments.23
Even though the employee obtained a state court judgment
amounting to several years’ pay after his employer’s breach,
18
96 F.3d 692 (3d Cir. 1996).
19
Id. at 693.
20
11 U.S.C. § 502(b)(7).
21
Anthony, 96 F.3d at 693.
22
Id.
23
Bankruptcy courts have gone both ways on this issue. Compare,
e.g., In re Vic Snyder, Inc., 23 B.R. 185, 186–87 (Bankr. E.D. Pa. 1982)
with In re Networks Elec. Corp., 195 B.R. 92, 99–100 (B.A.P. 9th Cir.
1996).
22 IN RE CWS ENTERPRISES
in bankruptcy he was entitled only to one year’s pay.24 The
Anthony court looked through the employee’s state court
judgment to the claim upon which it was based, applying the
section 502(b)(7) cap to that underlying claim.25
Reasonable arguments may be made against extending the
Third Circuit’s position to the section 502(b)(4)
reasonableness cap at issue in our case. The section
502(b)(7) cap is specific and calculable. The section
502(b)(4) cap, which limits attorneys’ fees to a “reasonable”
amount, is indefinite in application. The section 502(b)(7)
cap applies only to a future expectancy and only where the
bankrupt has before filing paid the employee for services
rendered. The section 502(b)(4) cap limits fees for services
already performed.
Perhaps most strikingly, our sister circuit’s approach is
inconsistent with the common law doctrine of merger. In
California (as in most, if not all, common law jurisdictions),
a claim that has been reduced to a judgment merges into the
judgment. That is to say, an employee who was terminated
before his employment contract ran out, having filed suit and
obtained a judgment on that contract, no longer has a claim
for unpaid wages. He now has a claim for what used to be
called “debt on a judgment.” The employee can no longer
sue for breach of contract, as he otherwise might prefer to do
if that theory entitled him to more, because he no longer has
a claim for breach of contract. All that remains is his
24
Anthony, 96 F.3d at 697.
25
See id. at 695–97. Anthony cited with approval our circuit’s
Bankruptcy Appellate Panel decision in Networks Elec. Corp., 195 B.R.
at 92.
IN RE CWS ENTERPRISES 23
entitlement to the debt owed him on the earlier judgment.
The Anthony approach, which looks through the judgment to
the underlying claim and then caps the amount of the
judgment according to statutory criteria, is contrary to this
common law doctrine.
On the other hand, merger is a common law principle, not
a constitutional one. Subject to the Full Faith and Credit
Act,26 discussed below, Congress has the power to
promulgate bankruptcy law that supersedes what would
otherwise be binding state law. The bankruptcy code’s one-
year cap on claims for post-breach wage and salary, for
example, balances the employee’s interest in recovering his
damages against other creditors’ interests in their claims.27
There is also much to be said for aligning Ninth Circuit law
with our sister circuits, removing the reward from forum
shopping and providing law that is useful and predictably
applied nationwide.
The distinction between the clear, mathematically
calculable cap under section 502(b)(7), and the indefinite
“reasonableness” cap under section 502(b)(4), might support
distinguishing them, so that looking through a state court
judgment might be appropriate under section 502(b)(7) but
not under section 502(b)(4). We conclude, though, that this
distinction should not make a difference. Reading section
502(b)(4) in its entirety, rather than limiting our analysis to
the attorneys’ fees phrase, shows why.
26
28 U.S.C. § 1738.
27
See Networks Elec. Corp., 195 B.R. at 100.
24 IN RE CWS ENTERPRISES
The text of section 502(b)(4) limits to a “reasonable
value” not only the services of attorneys but also the “services
of an insider.” It imposes this limitation “if such claim is for
services of an insider or attorney of the debtor.”28 Among
others,29 “insiders” include family members, partners, and
28
11 U.S.C. § 502(b)(4).
29
Defined at 11 U.S.C. § 101(31), the term “insider” includes–
(A) if the debtor is an individual–
(i) relative of the debtor or of a general partner of
the debtor;
(ii) partnership in which the debtor is a general
partner;
(iii) general partner of the debtor; or
(iv) corporation of which the debtor is a director,
officer, or person in control;
(B) if the debtor is a corporation–
(i) director of the debtor;
(ii) officer of the debtor;
(iii) person in control of the debtor;
(iv) partnership in which the debtor is a general
partner;
(v) general partner of the debtor; or
(vi) relative of a general partner, director, officer,
or person in control of the debtor;
IN RE CWS ENTERPRISES 25
corporations the debtor controls. Collier suggests that
Congress sought to protect creditors from “over-
generosity,”30 an obvious hazard when the debtor is taking
money from creditors to pay his own family members,
partners, or corporation. And that concern arises even if the
claim has been reduced to judgment, since the judgment
might be a consent judgment or otherwise collusive. Such
“over-generosity,” that is, intentionally paying more than a
service is reasonably worth due to the close relationship
between the debtor and creditor, may be likely with a relative,
but it is not likely with the debtor’s attorney.
(C) if the debtor is a partnership–
(i) general partner in the debtor;
(ii) relative of a general partner in, general partner
of, or person in control of the debtor;
(iii) partnership in which the debtor is a general
partner;
(iv) general partner of the debtor; or
(v) person in control of the debtor;
(D) if the debtor is a municipality, elected official of the
debtor or relative of an elected official of the debtor;
(E) affiliate, or insider of an affiliate as if such affiliate
were the debtor; and
(F) managing agent of the debtor.
30
4 COLLIER ON BANKRUPTCY ¶ 502.03[5][c] (Alan N. Resnick &
Henry J. Sommer eds., 16th ed. 2012).
26 IN RE CWS ENTERPRISES
But, not least because they are in the same subsection, the
reasonableness cap for payment of services to insiders should
not be distinguished from the reasonableness cap for payment
of services to attorneys. There are other contexts where
courts decide the reasonableness of attorneys’ fees due to, for
example, the lack of an adversarial relationship or the risk of
collusion, and such concerns may apply to an attorneys’ fee
even if that fee has been reduced to a judgment. Among
these contexts are cases where attorneys’ fees are shifted
from the client to the losing party, as in English rule awards31
and class action settlements. We therefore adopt the Third
and Tenth Circuit’s approaches to attorneys’ fees under
section 502(b)(4). The bankruptcy code’s reasonableness cap
limits a pre-petition obligation for a debtor’s attorneys’ fees,
even if such fees were allowable under state law, and even if
such fees had been reduced to a state court judgment.
Finally, we must consider how the state court judgment in
this case may have had preclusive impact on the
“reasonableness” analysis under section 502(b)(4). The Full
Faith and Credit Act applies in bankruptcy courts.32 The
bankruptcy court in this case was thus required to give full
faith and credit to the California Superior Court’s judgment
31
See, e.g., 42 U.S.C. § 1988(b) (permitting the award of fees to the
prevailing party under the English rule in many actions brought under
federal law); Alaska R. Civ. P. 82 (requiring generally that the losing party
pay the prevailing party’s fees); Ariz. Rev. Stat. § 12-341.01 (permitting
the award of fees to the prevailing party under the English rule in contract
cases); APL Co. Pte. v. UK Aerosols Ltd., 582 F.3d 947, 957 (9th Cir.
2009) (applying the law of Singapore and noting that it follows the
English rule for attorneys’ fees).
32
28 U.S.C. § 1738; In re Nourbakhsh, 67 F.3d 798, 800 (9th Cir.
1995).
IN RE CWS ENTERPRISES 27
entitling Spiller to his fees to the same extent that California
res judicata law would give that judgment preclusive effect.33
The relevant question is not whether the California judgment
for the amount of Spiller’s fees establishes that Siller was
contractually obligated to pay him (it does), but whether
Siller was precluded from arguing in the bankruptcy court
that the amount of the California judgment exceeded the
“reasonable value” of Spiller’s services. In other words, the
question is not whether a state court judgment always has
preclusive effect on the “reasonableness” analysis under
section 502(b)(4) (we have already explained why it does
not), the question is whether the state court judgment had
preclusive effect on the reasonableness analysis in the
particular circumstances of this case.
Issue preclusion, under California law,34 requires that
(1) “the issue sought to be precluded from relitigation must
be identical to that decided in a former proceeding,” (2) the
“issue must have been actually litigated in the former
proceeding,” (3) the issue “must have been necessarily
decided in the former proceeding,” (4) “the decision in the
former proceeding must be final and on the merits,” and
(5) “the party against whom preclusion is sought must be the
same as, or in privity with, the party to the former
33
Nourbakhsh, 67 F.3d at 800.
34
In the past, California courts have referred to issue preclusion using
the older terms “collateral estoppel” or “estoppel by judgment” or the
broader term “res judicata.” They now use the modern term “issue
preclusion.” For an explanation of the use of these terms in California
courts, see Lucido v. Superior Court, 795 P.2d 1223, 1225 n.3 (Cal. 1990)
and Olson v. Cory, 134 Cal. App. 3d 85, 103 n.9 (1982).
28 IN RE CWS ENTERPRISES
proceeding.”35 The party asserting preclusion bears the
burden of establishing these elements.36 California courts
have recognized exceptions to California’s preclusion law,
but none applies here.37
Using those standards, the district judge concluded that
issue preclusion applied here, and so do we. The arbitration
proceeding establishing the reasonableness of Spiller’s fee
was fully contested and later confirmed by the judgment of a
California court.
Siller argues that the arbitrator could not have decided
section 502(b)(4) reasonableness because that is a bankruptcy
standard and he had not yet filed for bankruptcy. We reject
the notion that the word “reasonable” in section 502(b)(4) is
a bankruptcy term of art with a meaning different from its
ordinary usage. There is no special definition of “reasonable”
in the bankruptcy code. “Reasonable” under section
502(b)(4) means what it means in ordinary English.
Determining a “reasonable” contingent fee cannot be reduced
to a mechanical formulation. It calls upon the judgment of
the tribunal in the particular circumstances of the matter
before it. Some (but not all) of the factors bearing on
reasonableness of a fee are whether the client had a fair
opportunity to understand what he was agreeing to, the time
the lawyer spent, the risk of not collecting, the need to
35
Lucido, 795 P.2d at 1225; see also In re Harmon, 250 F.3d 1240,
1245 (9th Cir. 2001).
36
Lucido, 795 P.2d at 1225; Harmon, 250 F.3d at 1245.
37
Such preclusion exceptions include public policy, unforeseeability,
and the inability or lack of incentive to litigate the prior adjudication. See
Olson, 134 Cal. App. 3d at 103 n.9.
IN RE CWS ENTERPRISES 29
advance time or expenses, the effect of representation on the
lawyer’s ability to take on other cases, the ease or difficulty
of working with a particular client, the legal market in the
locality regarding hourly rates and contingent fee
percentages, and — especially important here — whether the
fee is contingent upon success.
Reasonableness, so understood, can be (and quite often is)
decided in an arbitration proceeding like the one conducted
here. Arbitration is a common method of resolving fee
disputes under the bar rules of many states. Overall
reasonableness is the usual criterion. And in the typical fee
arbitration, the ex ante agreement between the lawyer and
client is strong evidence of reasonableness, particularly where
the fee was a contingent one.
Siller argues that even if reasonableness could have been
determined in an arbitration proceeding, it was not
determined in this one. The arbitrator decided that the
parties’ fee agreement, not quantum meruit, established the
amount. But the arbitration consisted in large part of Siller
presenting not just his arguments that the contract was
unconscionable and Spiller failed to perform, but also his
arguments and evidence to show that the Cotchett and Spiller
firms’ fees were unreasonable. Siller devoted his
presentation almost entirely to making this point. He cross-
examined extensively and put on his own evidence, including
an expert witness, to prove that the fees were so unreasonable
as to be unconscionable, and to establish a lower number for
a quantum meruit award if the arbitrator accepted his
challenge to the fee agreements.
After hearing all of Siller’s arguments and evidence, the
arbitrator concluded that Siller’s positions were wrong and
30 IN RE CWS ENTERPRISES
the Cotchett and Spiller firms’ right. The quantum meruit
analysis was irrelevant and Spiller’s fee was not
unconscionable (a standard different from unreasonable). But
that was not all the arbitrator concluded. He also concluded
that Siller’s contract with the Spiller firm for an 8%
contingent fee was “reasonable.” And he based his
reasonableness determination on the work the parties
anticipated, the work Spiller actually put into the case, the
risks assumed by the parties, and Siller’s need for Spiller to
finance his litigation.
Siller urges us to accept the bankruptcy court’s use of the
lodestar method to determine the reasonableness of Spiller’s
fee. But we explained in Venegas v. Skaggs that a continent
fee may be reasonable where “it reflect[s] the risk of
nonrecovery . . . assumed in accepting [a] case.”38 In this
case, a lodestar fee would be unreasonable and could not, for
that reason, serve as a cap under section 502(b)(4). No
sensible attorney would undertake to represent a client at his
usual hourly rate in these circumstances — where the client
had been litigating for decades, had no money to pay, and had
a history of declining to pay his lawyers and suing them for
malpractice, the case was likely to take all or most of the
lawyer’s time for the next several years, and the lawyer could
get paid — if at all — only if he won. A “reasonable” fee
must be reasonable for the lawyer as well as the client.
Had the arbitrator concluded that the amount of Spiller’s
fee was unreasonable, but not so unreasonable as to make the
contract’s formation or enforcement unconscionable, then the
section 502(b)(4) reasonableness cap might have room to
operate, because in that case the issue of 502(b)(4)
38
867 F.2d at 534.
IN RE CWS ENTERPRISES 31
reasonableness would not be identical to any of the issues
arbitrated. But that is not how this case was arbitrated and
decided. Under California law, one element of
unconscionability is reasonableness,39 and a contingent fee
contract can be rejected as unconscionable if it is sufficiently
unreasonable in the circumstances.40 The arbitrator rejected
that conclusion in this case. After hearing Siller’s arguments
and extensive evidence to show unreasonableness, the
arbitrator not only concluded that Spiller’s 8% contingent fee
ought to be enforced, he specifically decided that it was
“reasonable.”
So, although there might in some cases be room for a
reduction, under section 502(b)(4)’s reasonableness cap, of a
state court judgment confirming an arbitration award for a
contingent fee, there is no room here. The performance in
this case was difficult and demanding. And the relationship
between the contracted-for amount and the service Spiller
provided was not such as to make enforcement of the contract
or payment of the fee unreasonable. The Full Faith and
Credit Act requires, in the circumstances of this case, that the
judgment of the state court confirming Spiller’s arbitration
award for his fee be given full faith and credit in Siller’s
bankruptcy proceeding.
The judgment of the district court is AFFIRMED.
39
See Ketchum v. Moses, 17 P.3d 735, 742 (Cal. 2001).
40
See Carlson v. Home Team Pest Def., Inc., 191 Cal. Rptr. 3d 29, 40
(Cal. Ct. App. 2015).
|
434 B.R. 131 (2010)
In re NEW YORK CITY OFF-TRACK BETTING CORPORATION, Debtor.
No. 09-17121 (MG).
United States Bankruptcy Court, S.D. New York.
August 5, 2010.
*134 Richard Levin, Esq., Cravath, Swaine & Moore LLP, New York, NY, for Debtor New York City Off-Track Betting Corporation.
Michael S. Fox, Esq., Herbert C. Ross, Esq., David Y. Wolnerman, Esq., Olshan Grundman Frome Rosenzweig & Wolosky LLP, New York, NY, Marvin Newberg, Esq., Law Offices of Marvin Newberg, Monticello, NY, for Empire Resorts, Inc.
Deborah Piazza, Esq., Hodgson Russ LLP, New York, NY, Steven W. Wells, Esq., Michael E. Reyen, Esq., Hodgson Russ LLP, Buffalo, NY, for Finger Lakes Racing Association, Inc.
MEMORANDUM OPINION AND ORDER DENYING IN PART AND ABSTAINING IN PART TO MOTIONS TO COMPEL THE DEBTOR TO COMPLY WITH THE REQUIREMENTS OF THE NEW YORK RACING, PARI-MUTUEL WAGERING AND BREEDING LAW AND MAKE CERTAIN STATUTORY DISTRIBUTIONS
MARTIN GLENN, Bankruptcy Judge.
Finger Lakes Racing Association ("Finger Lakes") and Empire Resorts, Inc. ("Empire" collectively the "Tracks") move the Court to compel New York City Off-Track Betting Corporation ("OTB") to immediately pay certain post-petition statutory distributions currently owed and which will allegedly come due under the New York Racing, Pari-Mutuel Wagering and Breeding Law (the "Racing Law"). The Tracks argue that these payments must be made because (i) state law mandates the payments and OTB is required to conduct its ongoing business as a chapter 9 debtor in compliance with state law; and (ii) the payments are "actual, necessary costs and expenses of preserving the estate" entitled to administrative expense treatment under Bankruptcy Code § 503(b). OTB, for its part, admits it owes the Tracks amounts under the Racing Law, but contends that the Racing Law does not require that the payments be made immediately or on any particular schedule, and the amounts due cannot be treated as bankruptcy administrative claims.
On July 13, 2010, the Court held an evidentiary hearing and heard argument on these motions. Following the hearing the Court requested briefing on whether the bankruptcy court should resolve the state law issue of when the Racing Law *135 requires the payment of statutory distributions, or whether the bankruptcy court should lift the automatic stay and require the parties to seek a determination of this state law issue from the New York State Racing and Wagering Board ("Racing and Wagering Board"). The parties filed the requested additional briefs on July 21, 2010. (ECF # s 128 & 129.)
For the reasons discussed below the Court determines that the post-petition statutory distributions OTB owes the Tracks are not administrative expenses under section 503(b) of the Bankruptcy Code. The Court further concludes that the bankruptcy court is not the appropriate forum to resolve the state law issue of when these statutory payments must be made. This issue involves important legal and policy questions involving many stakeholders in the horse racing business in New York State, and not simply the concerns of OTB and the Tracks that are parties to these Motions. The Court therefore abstains from deciding the state law issue, lifts the automatic stay and directs the parties to commence an appropriate proceeding within seven (7) days from the date of this Order to obtain a determination from the Racing and Wagering Board.
I. BACKGROUND[1]
OTB is a public benefit corporation, established and governed by the Racing Law, that operates an off-track pari-mutuel betting system within New York City. (Joint Pre-Trial Stipulation at ¶¶ 4, 7.) OTB was created to earn money from horse betting activities and halt illegal wagering and bookmaking on horse races. (Id. at ¶ 7.) OTB is operated by a board of directors consisting of five persons appointed by the Governor of New York. (Id. at ¶ 8.) Lawrence S. Schwartz is currently Chairman on OTB, having succeeded Meyer Frucher, who was Chairman at the time this case was filed. Shortly after his appointment, Schwartz hired Greg Rayburn, a former employee of FTI Consulting, as the new CEO of OTB. (Id. at ¶ 86.)
OTB operates under the Racing Law and is heavily regulated by the Racing and Wagering Board, which governs all off-track and on-track pari-mutuel betting in New York, as well as all entities engaged in those activities. (Id. at ¶ 9.) Pari-Mutuel betting is a system where particular types of bets on a single race are pooled together. (Id. at ¶ 12.) The pool of total bets OTB receives on a race is called the "Handle." Approximately 80% of the Handle is set aside for the benefit of winning bettors. The Racing Law requires OTB to distribute certain percentages of the Handle to the state, local governments, horse breeding funds, and certain race tracks including those operated by Empire and Finger Lakes. (See id. at ¶ 13.)
As discussed in this Court's March 22, 2010 opinion, OTB has faced economic troubles for years. In re New York City Off-Track Betting Corp., 427 B.R. 256, 262 (Bankr.S.D.N.Y.2010). Despite cost-cutting efforts and an eventual state takeover, OTB could not avoid filing for bankruptcy *136 on December 3, 2009. See id. at 262-63. OTB's financial troubles have been caused, at least in part, by the Racing Law's requirement that OTB make distributions of its Handle to stakeholders in the New York racing industry. OTB has lobbied for the past five years for changes to the Racing Law's mandatory statutory distributions. Id. at 262; (Joint Pre-Trial Stipulation at ¶¶ 59-65). As of today, no legislative action appears imminent and the New York Legislature may wait as much as a full year to make any changes. (See Minutes of the Meeting of the Board of Directors of OTB, Apr. 17. 2010 (Ex. S to Joint Pre-Trial Stipulation).)
OTB's financial results demonstrate its troubles. In fiscal years ending June 30, 2006, 2007, 2008, and the nine-month period ending on March 31, 2009, OTB had operating deficits of approximately $121 million, $30 million, $76 million, and $25 million respectively. (Joint Pre-Trial Stipulation at ¶ 58.) Due to these losses OTB has repeatedly requested that the state legislature change the payments required by the Racing Law. (See id. at ¶ 59.) The legislature has recently made clear that it now favors a "short-term" solution to OTB's woes. Any permanent resolution will likely be deferred for as much as a year. (Id. at ¶¶ 73-74.)
A. Statutory Commissions
The Racing Law sets certain fees OTB must pay to tracks based on the total betting Handle OTB receives for races held at those tracks. For purposes of this motion, these required statutory payments are deemed "Direct Commissions." (Id. at ¶ 15.) OTB also simulcasts and accepts bets on races from tracks outside of New York as well as on races from tracks inside of New York but outside of OTB's region. The Racing Law requires OTB to make payments from the Handle received on these races to certain tracks within New York State. These sums, deemed "Indirect Commissions" for purposes of these motions, differ for harness racetracks and thoroughbred racetracks. (Id.) In addition to the Direct and Indirect Commissions, OTB has select contractual agreements with certain New York State thoroughbred racing tracks. OTB continues to make payments as required by these contracts (the "Contractual Payments"). (Id. at ¶ 16.)
1. OTB's Direct Commissions to the Tracks
Empire owns and operates Monticello Casino and Raceway ("Monticello Raceway"), which conducts approximately 200 harness race programs a year. (Id. at ¶ 5.) OTB simulcasts races held by Empire and other New York State harness racing tracks. Thus, pursuant to the Racing Law, OTB owes Direct Commissions to these tracks. The Racing Law does not specify when these Direct Commissions must be paid, but post-petition OTB pays these commissions within 30 days after the month they are incurred. (Id. at ¶ 17.)
Similarly, Finger Lakes owns and operates Finger Lakes Gaming and Racetrack which holds numerous thoroughbred horse races and provides employment opportunities for New York's racing and breeding industry. (Id. at ¶ 6.) As OTB does with the harness tracks, OTB simulcasts races held at New York State thoroughbred racing tracks and accepts bets on those races. The Racing Law requires OTB to pay Direct Commissions to the thoroughbred tracks. Direct Commissions to thoroughbred tracks accrue at rates set by the Racing Law and are only paid to the track that hosts the races on which the bets are taken. Since filing for chapter 9 protection, OTB has paid Direct Commissions to the thoroughbred tracks 30 days after the month they were incurred. (Id. at ¶ 29.)
*137 2. OTB's Indirect Commissions to`the Tracks
In addition to the Direct Commissions, the Racing Law also requires OTB to pay Indirect Commissions to harness racing tracks, including Monticello Raceway, for simulcasting and taking bets on out-of-state harness races. (See id. at ¶¶ 19-20.) The Racing Law requires OTB to pay a fixed percentage of the Handle it receives on out-of-state harness races it simulcasts to certain New York State harness racing tracks. (Id. at ¶ 20.) The calculation of the precise amount due varies on a number of factors including whether the New York State harness tracks run races on the day the out-of-state races are simulcast. (Id.) The Racing Law also requires OTB to pay Indirect Commissions to harness racing tracks within its region (Monticello Raceway, Yonkers Raceway, and Tioga Downs (the "Regional Harness Tracks")), on the Handle OTB collects on New York State harness races it simulcasts that occur outside of OTB's region. The Indirect Commissions the Regional Harness Tracks are due on these races are based on a formula within the Racing Law. (Id. at ¶¶ 14, 21.)
Similar to the harness racing tracks, the Racing Law also requires OTB to make Indirect Commission payments to New York State thoroughbred tracks based on the Handle it receives from out-of-state thoroughbred races. Under the Racing Law, OTB may simulcast any out-of-state thoroughbred race so long as (i) it simulcasts and accepts bets on New York State thoroughbred races; and (ii) it receives approval from the Racing and Wagering Board to carry the out-of-state races and accept wagers on those races. (Id. at ¶¶ 32-33.) The precise formula governing the Indirect Commission owed to each thoroughbred track is provided by the Racing Law and includes whether the thoroughbred track operated races on the day the Indirect Commissions were incurred. (Id. at ¶ 34.)
The Racing Law also provides for payments to the Regional Harness Tracks based on the Handle OTB receives on thoroughbred races held at Finger Lakes' track. The Regional Harness Tracks are only entitled to these payments (i) on days when New York Racing Association ("NYRA")[2] is not running races; and (ii) if the Regional Harness Track is not simulcasting thoroughbred races and therefore does not receive bets on thoroughbred races. (Id. ¶ 22.) The Racing Law similarly requires OTB to make payments to the Regional Harness Tracks based on the Handle it receives when simulcasting out-of-state thoroughbred races. (Id. at ¶ 23.) On days when tracks operated by NYRA are not operating (i.e. are "dark"), OTB is allowed to accept bets on out-of-state thoroughbred races. If a harness track is open on such a day when NYRA is dark and they do not take bets on any thoroughbred races that day, the Racing Law requires OTB to pay a portion of the commission it earned on the Handle received from the out-of-state thoroughbred races to the Regional Harness Tracks. These so-called "Dark Day" Indirect Commissions accrue in the amount of 1.5% of OTB's Handle on the thoroughbred races run outside of New York. (Id. at ¶¶ 24-25.)
In addition to the Dark Day Indirect Commissions, the Racing Law also contemplates *138 so-called "Maintenance of Effort" Indirect Commissions. Maintenance of Effort payments require OTB to pay each Regional Harness Tracks at least the same amount it paid to that track in calendar year 2002. This amount is calculated from the Handle OTB received each day on wagers placed on evening out-of-state harness races. The calculations are not adjusted to account for demand, economic decline, or similar factors. (Id. at ¶¶ 26-27.) The Racing Law also contemplates a second type of "Maintenance of Effort" Indirect Commission: once OTB's total Handle on out-of-state night time thoroughbred racing reaches $100 million, OTB must pay an additional 2% commission to its Regional Harness Tracks on the Handle from bets placed on future simulcast out-of-state night time thoroughbred races. (Id. at ¶ 28.)
B. Timing of Payments
While the Racing Law provides the formulas for calculating Indirect Commissions, the statute is silent about when the payments must be made. The Racing and Wagering Board has not adopted any regulations specifying the required timing of these payments. Over the past five years, OTB has slowed the pace of payments on Indirect Commissions. In 2005 OTB paid Indirect Commissions 30 days after they were incurred. In 2006, however, OTB started making Indirect Commission payments two months after they were incurred. By 2007, OTB delayed Indirect Commission payments three months. The delay reached five months by the end of 2009. (Id. at ¶ 41.)
Shortly after filing for chapter 9 protection, OTB stated its intent to pay both Direct and Indirect Commissions on a one month lag, and OTB made payments on that schedule for the first three months of its bankruptcy case. (Id. at ¶ 46.) In March and April 2010, however, OTB claimed it was running out of money and, faced with the prospect of shutting its doors, it sent notice to its employees that operations would cease on April 11, 2010. (Id. at ¶ 47.) Instead of closing, however, OTB decided to continue operating while the New York State legislature debated a solution. In order to save cash, OTB began deferring payment of Indirect Commissions. (Id. ¶¶ 48-51.) Since making this decision, OTB has continued its operations, but it has not paid any Indirect Commissions. (Id. at ¶¶ 52, 84.)
As a result of these current and historical delays, OTB owes Empire prepetition Indirect Commissions in the amount of $3,616,588 and post-petition Indirect Commissions of $782,073. (Id. at ¶ 42.) OTB owes Finger Lakes $2,044,051.20 in prepetition Indirect Commissions and $1,259,851.10 in post-petition Indirect Commissions. (Id. at ¶ 43.) OTB has not paid any Indirect Commissions to Empire or Finger Lakes since March 2010. (Id. at ¶ 46.)
Unlike the Indirect Commissions, during OTB's bankruptcy case, OTB has paid Direct Commissions one month after incurred. (Id. at ¶ 53.) Prepetition, however, OTB had fallen behind on Direct Commission payments to Empire. OTB owes Empire $1.7 million in prepetition arrears for Direct Commissions. (Id. at ¶ 55.) Before OTB's bankruptcy filing Empire filed an action against OTB in New York State court, requesting the $1.7 million in prepetition Direct Commissions. (Id. at ¶ 56.) The state court action is currently stayed.
OTB's delay of payments has reduced the size of purses at Monticello Raceway. Historically approximately 50% of all Dark Day Indirect Commissions received by Monticello were put towards purses for races. And Monticello Raceway has also *139 traditionally relied on Indirect Commission payments from OTB to account for 50% of all racing revenue earned by the track. Therefore, OTB's statutory commissions are vital to the continuing health of Monticello Raceway and the harness racing industry in New York. (See id. at ¶¶ 88-89.) Finger Lakes also relies on statutory payments from OTB. Monticello Raceway and Finger Lakes rely on Indirect Commissions based on OTB's simulcasting and accepting of wagers on out-of-state races to make purse size competitive with those in other states. (Id. at ¶¶ 90-91.) Failure of OTB to make its Indirect Commission payments could result in a reduction of races at Monticello and the shutdown of Finger Lakers. (Id. at ¶ 93.)
C. Required Segregation of Funds
Recent acts of the Racing and Wagering Board have forced OTB to begin sequestering funds for payment of Indirect Commissions. Under the Racing Law and federal laws, see 15 U.S.C. § 3001(a)(1) ("the States should have primary responsibility for determining what forms of gambling may legally take place within their borders"), OTB must receive approval from the Racing and Wagering Board to simulcast out-of-state races and accept bets on those races. OTB must receive authorization for each separate out-of-state "race meet" it plans on simulcasting and accepting wages on. (Id. at ¶ 75.) Prior to April 17, 2010, authorization was routinely requested and received. On April 21, 2010, however, the Racing and Wagering Board requested additional information regarding what OTB intended on doing with the funds it received from simulcasting out-of-state races, including whether they would be used to make statutory payments to New York racing agencies. OTB responded on April 23, 2010, informing the Racing and Wagering Board that it intended on deferring payment of Indirect Commissions to racing entities. (Id. at ¶ 76.)
Following OTB's April 23 response, the Racing and Wagering Board delayed decisions on a number of OTB's applications to simulcast out-of-state races, effectively denying those applications. (Id. at ¶ 77.) Following these denials, OTB and the Racing and Wagering Board held discussions that resulted in two letters from OTB. One of these letters, dated May 26, 2010, committed OTB to deposit commissions computed under the Racing Law from accepting bets on out-of-state races into a special segregated bank account. (Id. at ¶¶ 78-79.) Specifically, the letter stated that OTB would start depositing "portions of retained commissions from wagering payable to New York State racing entities (i.e., New York State licensed race tracks and Breeding Funds) in accordance with applicable provisions of the Racing Law arising from acceptance by [OTB] of wagering on out-of-state races." (Id. at ¶ 81.) The letter called for weekly calculation and deposits into the segregated bank account. Under the terms of the letter, OTB may withdraw funds from the account to fund statutory payments or, with 24 hours written notice to the Racing and Wagering Board, for purposes other than funding the statutory distributions under the Racing Law. Any written notice must include the "nature, amount and corporate purpose for the withdrawal." (Id. at ¶ 82.)
OTB did not pay or segregate funds to pay the Tracks' statutory distributions for the period from March 1, 2010 through May 27, 2010. OTB maintains that, if forced to make these payments, OTB would have been forced out of business. (See id. at ¶¶ 83, 105.) The Tracks, however, seek precisely the relief OTB maintains will likely cause it to halt operations: immediate payment of post-petition Indirect Commissions.
*140 II. DISCUSSION
The Tracks maintain that OTB must promptly pay its Indirect Commissions. The Tracks further argue that these sums must be paid as administrative expenses under section 503(b) of the Bankruptcy Code, at least to the extent that they were incurred post-petition. OTB responds, acknowledging that it owes the Tracksplus other racing entities in New York State Indirect Commissions, but arguing that the Racing Law does not require OTB to pay these sums on any set schedule. OTB further argues that the post-petition Indirect Payments are not entitled to administrative expense status in a chapter 9 case.
A. Section 904 of the Bankruptcy Code
Before examining the issues at bar the Court must first address whether it has the constitutional and statutory authority to decide the issues raised by these motions. As a general matter, section 904 of the Bankruptcy Code places severe limits on the power of courts to compel any action from chapter 9 debtors. Specifically, section 904 states:
Notwithstanding any power of the court, unless the debtor consents or the plan so provides, the court may not, by any stay, order, or decree, in the case or otherwise, interfere with
1) Any of the political or governmental powers of the debtor;
2) Any of the property or revenues of the debtor; or
3) The debtor's use or enjoyment of any income-producing property.
11 U.S.C. § 904.
This section codifies the Tenth Amendment's general prohibition on a bankruptcy court's power to interfere with a state entity. See 6 COLLIER ON BANKRUPTCY ¶ 904.01 (Alan N. Resnick & Henry J. Sommer eds., 16th ed. rev.) ("Section 904 compliments section 903 in providing a constitutional shield for chapter 9 by limiting federal intrusion upon States' rights."). Section 904's command is clear. A bankruptcy court may not interfere with a chapter 9 debtor's political or governmental powers, or the use of the debtor's property, without the debtor's consent. The first subsection of the statute shields chapter 9 debtors from federal meddling with their political or governmental powers. Id. at ¶ 904.01[1]. The remainder of the statute halts bankruptcy courts from controlling a state entities' use of its property or revenues. Id. at ¶ 904.01[2]. In practice, this section prohibits bankruptcy courts from mandating that a chapter 9 debtor make specific payments in violation of the Tenth Amendment. See, e.g., In re County of Orange, 179 B.R. 195, 199-200 (Bankr.C.D.Cal.1995) (finding that ordering the interim payment of professional fees would violate section 904 of the Bankruptcy Code and opining that the rational for section 904 "was to circumvent any possible Tenth Amendment objection to municipal bankruptcy legislation"); 6 COLLIER ON BANKRUPTCY ¶ 904.01[2] ("[A] municipal debtor is not restricted in its ability to use, sell or lease its property, and the court is not to involve itself with the day to day operations of the municipality.").
The statute carves out an exception to the command that a bankruptcy court may not interfere with a chapter 9 debtor's use of property. Specifically, a chapter 9 debtor may consent to an order of a bankruptcy court that would interfere with the use of the debtor's property. 11 U.S.C. § 904; In re County of Orange, 179 B.R. 185, 189-90 (Bankr.C.D.Cal.1995) (observing that a chapter 9 debtor may consent to treatment that would otherwise violate section 904 of the Bankruptcy Code). See also 6 COLLIER ON BANKRUPTCY ¶ 904.02[1] ("If the debtor has consented to an order of the court, the *141 court's action will not be deemed interference with the affairs or property of the debtor. . . ."). The ability of a chapter 9 debtor to consent under section 904 is limited by section 903 of the Bankruptcy Code and federalism concerns. Specifically, a chapter 9 debtor cannot consent to a court order that would violate a state law or administrative order. 6 COLLIER ON BANKRUPTCY ¶ 904.02[2][a] (observing that a "municipality could not, by it consent, empower the court to order the municipality to do an act that would be in violation of a law or administrative order of the state controlling its municipalities").
As demonstrated by OTB's submissions and through clarification at oral argument, OTB has consented to have this Court determine (i) whether the Indirect Commissions are administrative expenses and, if so, the schedule on which they must be paid; and (ii) whether the Racing Law, 28 U.S.C. § 959(b), or applicable bankruptcy law requires OTB to make immediate payment of post-petition Indirect Commissions. (See OTB Opp. Br. at 5 (ECF # 105); July 13, 2010 Hr'g Tr. at 88:9-89:13.)
The Tracks argue, based on a mere utterance of OTB's counsel at a hearing, that OTB has consented to have this Court determine every issue presented by the motions. A review of the record, however, demonstrates that this is not the case. OTB initially tailored its consent to have this Court determine "whether either the bankruptcy law or the Racing Law requires [OTB] to make the payments" on Indirect Commissions under a particular schedule requested by the Tracks. (Initial Resp. of OTB (ECF # 98); June 16, 2010 Hr'g Tr. 14:9-15:9.) OTB, in its formal response to the motions, refined this position to include whether 28 U.S.C. § 959(b) required immediate payment of the Indirect Commissions. (See OTB Opp. Br. at 5.) Finally, at the July 13, 2010 hearing, OTB expanded its consent to have this Court determine whether the post-petition Indirect Commissions are administrative expenses and whether they must be paid on a schedule in accordance with the Track's wishes. (July 13, 2010 Hr'g Tr. at 88:9-89:13.) Thus, the Court rejects the Tracks' position and will limit itself to considering the issues to which OTB has consented.
B. The Indirect Commissions Are Not Administrative Expenses
The Tracks argue that the Indirect Commissions that have accrued post-petition are entitled to administrative expense status under section 503(b) of the Bankruptcy Code. (Empire Mot. to Compel at ¶ 18 (ECF #86); Finger Lakes Mot. to Compel at ¶ 24 (ECF #90).) OTB responds, arguing that because there is no "estate" in chapter 9 cases the Indirect Commissions cannot be administrative expenses. (OTB Opp. at 10.)
Section 503 of the Bankruptcy Code applies to chapter 9 debtors. See 11 U.S.C. § 901(a). Section 503(b) contemplates the creation of administrative expenses for "the actual, necessary costs and expenses of preserving the estate" of the bankrupt entity. 11 U.S.C. § 503(b)(1)(A) (emphasis added). But, as recently explained by the Bankruptcy Court for the Central District of California, chapter 9 does not incorporate section 541 of the Bankruptcy Code, which provides for the creation of a bankruptcy "estate." In re Valley Health Sys., 429 B.R. 692, 714 (Bankr.C.D.Cal.2010). Indeed, courts have clearly established that in chapter 9 cases, there is no "estate" property. See In re JZ L.L.C., 371 B.R. 412, 419 n. 4 (9th Cir.BAP2007) (observing that "there is no property of the estate in chapter 9"); In re City of Vallejo, 403 B.R. 72, 78 n. 2 (Bankr. *142 E.D.Cal.2009) ("In a chapter 9 case there is no estate."). Commentators agree with this approach. 6 COLLIER ON BANKRUPTCY ¶ 901.04[13][a] ("In a chapter 9 case there is no `estate.'"); 5 WILLIAM J. NORTON, JR. WILLIAM L. NORTON III, NORTON BANKRUPTCY LAW AND PRACTICE § 90:3 (3d ed.2009) (no estate of the debtor is created under chapter 9).
Because a chapter 9 debtor's property remains its own and does not inure into a bankruptcy estate as provided by section 541 of the Bankruptcy Code, there can be no administrative expenses for "the actual and necessary costs of preserving the estate" as contemplated by section 503(b)(1)(A) of the Bankruptcy Code. Both leading bankruptcy treatises concur with this approach. Collier observes that because there is no estate in a chapter 9 case, administrative expense claims under section 503 must be limited to "expenses incurred in connection with the chapter 9 case itself" and not operating expenses. 6 COLLIER ON BANKRUPTCY ¶ 901.04[13][a]. Norton agrees, observing in passing that no operating administrative expenses are permitted in a chapter 9 bankruptcy case. 5 WILLIAM J. NORTON, JR. WILLIAM L. NORTON III, NORTON BANKRUPTCY LAW AND PRACTICE § 90:3.
In response, the Tracks argue that because OTB has consented to have the Court determine whether the Indirect Commissions are administrative claims, it somehow permits the Court to order administrative expenses pursuant to section 503(b)(1)(A) for "the actual necessary costs and expenses of preserving the estate." (Joint Reply Br. of Tracks ¶¶ 27-29 (ECF # 112).) The Tracks' reasoning does not convince.
The Tracks maintain that the only factor limiting a bankruptcy court's ability to deem an operating expense an administrative expense under section 503(b)(1) is section 904's prohibition on a bankruptcy court's power to interfere with the property of a chapter 9 debtor. Thus, the Tracks argue, because OTB has consented to have the Court determine whether the Indirect Commissions are administrative claims, the Court may deem any of OTB's operating expenses administrative expenses under 503(b). But this line of reasoning ignores the crucial fact that no bankruptcy estate exists in a chapter 9 case. As explained above, the plain language of chapter 9 does not contemplate the creation of an estate. As there is no bankruptcy estate in a chapter 9 case, there can be no "necessary costs and expenses" of preserving the estate. Moreover, when the Tracks invoke the limitations of section 904 in support of their position, they tacitly acknowledge that a chapter 9 debtor retains full title and control over its property in a bankruptcy case. See Valley Health, 429 B.R. at 714 ("By virtue of § 904, a debtor in chapter 9 retains title to, possession of, and complete control over its property and its operations, and is not restricted in its ability to sell, use, or lease its property"). This further confirms that no bankruptcy estate exists in a chapter 9 case and therefore no operating administrative expenses may be awarded pursuant to section 503(b)(1) in a chapter 9 case.
This conclusion is supported by the policies inherent to chapter 9 cases. As this Court has previously recognized, chapter 9 is permeated with dual sovereignty concerns. Respect for the sovereignty of state entities, including OTB, substantially constrains the Court's powers when dealing with a chapter 9 debtor. Section 903 makes clear that chapter 9 "does not limit or impair the power of a State to control, by legislation or otherwise, a municipality . . . in the exercise of the political or governmental powers of *143 such municipality, including expenditures for such exercise. . . ." 11 U.S.C. § 903. These constitutional underpinnings strongly caution against the Court intruding upon a chapter 9 debtor's operations, despite any consent they may have offered for the Court to do so. Cf. 6 COLLIER ON BANKRUPTCY ¶ 904.02[1][a] (observing that a municipal debtor's consent must not violate section 903 of the Bankruptcy Code and that section 903 may be violated where consent would lead to a bankruptcy court interfering too greatly into the affairs of the chapter 9 debtor).
C. No Applicable Law Requires the Payment of Indirect Commissions on a Specific Schedule
The Tracks argue forcefully that OTB violates New York State law by not making immediate payment of the Indirect Commissions. The Tracks maintain that the Indirect Commissions should be immediately paid as administrative expenses and that principles of equity require OTB to make these payments promptly. The Tracks further argue that 28 U.S.C. § 959 requires OTB to operate in accordance with state law, including making prompt payment of post-petition Indirect Commissions. Finally, the Tracks maintain that principles of federalism require the immediate payment of the Indirect Commissions. The Court rejects all of these arguments.
As an initial matter, as demonstrated above, the Court rejects the Tracks' argument that there can be any administrative expenses for the preservation of the estate in chapter 9 cases, as no estate exists in those bankruptcies. Therefore, all of the Tracks' arguments that the Court should use its discretion to require the immediate payment of the Indirect Commissions as administrative expenses are inapposite. (See Joint Reply Br. of Tracks ¶¶ 41-50.) The Court is also not convinced that equity requires the immediate payment of the Indirect Commissions. The Tracks argue that the Indirect Commissions must be paid immediately because OTB is earning revenue from the races taking place at the Tracks. (Empire Mot. to Compel at ¶ 17; Finger Lakes Mot. to Compel at ¶ 23.) The Tracks essentially argue that OTB is being unjustly enriched by refusing to pay the Indirect Commissions. But the Indirect Commissions do not emanate from any products or services the Tracks provide to OTB. Instead, as described above, the Racing Law alone requires the payment of Indirect Commissions to the Tracks. Indeed, the Tracks earn Indirect Commissions merely for being in existence when OTB accepts wagers on other races. Thus, the situation before the Court is not one of unjust enrichment. Unjust enrichment requires the performance of services and the acceptance of those services. See, e.g., Economist's Advocate, LLC v. Cognitive Arts Corp., No. 01 Civ. 9468, 2004 WL 728874, at *10 (S.D.N.Y. Apr.6, 2004) (observing that, under New York law, a claim of unjust enrichment requires "(1) performance of services by plaintiff; (2) the defendant accepts and benefits from the services performed by plaintiff; and (3) the defendant under principles of equity and good conscience should not be permitted to keep the value of the services without restitution to the plaintiff"). In contrast, here the Tracks have not made any performance that has benefited OTB. Therefore, because the Indirect Commissions are not provided in direct exchange for anything offered to OTB by the Tracks, the Court does not believe that principles of equity require the immediate payment of the Indirect Commissions.
The Tracks' remaining argumentsthat 28 U.S.C. § 959(b) and principles of federalism *144 require the immediate payment of the Indirect Commissionsdistilled to their essence are requests for the Court to enforce the Racing Law, as currently in effect in New York State. Section 959(b) of title 28 requires most debtors to comply with the laws of the state where their property is located. See 28 U.S.C. § 959(b) ("a trustee, receiver or manager appointed in any cause pending in any court of the United States . . . shall manage and operate the property in his possession. . . according to the requirements of the valid laws of the State in which such property is situated. . . ."). This statute reflects Congress's concern that debtors continuing to operate in bankruptcy comply with state laws. See In re Old Carco LLC, 424 B.R. 633, 644 (Bankr.S.D.N.Y. 2010) (intimating that section 959(b) reflects the "federal policy concern with ensuring compliance by trustees with state law"). Principles of federalism, embodied in section 903 of the Bankruptcy Code, also mandate that chapter 9 debtors follow state law.
Section 903 of the Bankruptcy Code is the "constitutional mooring" for municipal debt readjustment and makes clear that nothing in chapter 9 should be interpreted to limit a State's power to control its municipalities. Section 903 also indicates that with regards to debt readjustment of municipal entities, chapter 9 preempts any coordinate state law. 6 COLLIER ON BANKRUPTCY ¶ 903.01. As nothing in chapter 9 may be interpreted to interfere with the power of a State to control its municipalities, it necessarily follows that debtors under chapter 9 must follow state laws, at least those that are not preempted by federal law.
In its papers OTB seemingly argued that it did not need to comply with New York State lawincluding the Racing Lawarguing through a highly technical statutory analysis that section 959(b) does not apply to chapter 9 debtors. (See OTB Opp. Br. at 6-10.) At the July 13, 2010 hearing counsel for OTB retreated from this position and admitted that OTB must comply with applicable state law, unless those state laws are preempted by the Bankruptcy Code. (July 13, 2010 Hr'g Tr. at 100:7-101:12 ("The Court: Do you agree that OTB must comply with state law in its operations, even if 959 doesn't apply to Chapter [9]? Mr. Levin: Yes. . . . OTB must comply with state law. . . .").) Counsel for OTB does not argue that the provisions of the Racing Law concerning Indirect Commissions are preempted. (Id. at 100:13-101:12 (acknowledging that the Bankruptcy Code does not preempt state law with regards to post-petition Indirect Commission payments).) Therefore, it is unnecessary for the Court to decide whether section 959 applies to chapter 9 cases. Thus, the only issue remaining to be determined is the schedule on which the Racing Law requires payment of the Indirect Commissions.
1. The Racing Law is Ambiguous Regarding the Payment of Indirect Commissions
Both the Tracks and OTB admit that the Racing Law does not include any timeline or deadline for OTB to pay the Indirect Commissions. (See Joint Reply Br. of Tracks ¶ 3; OTB Opp. Br. at 6.) The Court cannot determine from examining the language and structure of the statutes establishing the Indirect Commissions what schedule the New York State Legislature contemplated for payment.
From the inclusion of detailed tables with payment percentages, the New York Legislature clearly intended for OTB to pay Indirect Commissions on some type of regular schedule. See, e.g., N.Y. RAC. PARI-MUT. WAG. BREED. LAW § 1017 (McKinney 2009). This interpretation is *145 buttressed by the New York Legislature's statement of intent when creating off-track betting parlors, including OTB. The Legislature concluded:
It is also the intention of this article to ensure that off-track betting is conducted in a manner compatible with the well-being of the horse racing and breeding industries in this state, which industries are and should continue to be major sources of revenue to state and local government and sources of employment for thousands of state residents.
N.Y. RAC. PARI-MUT. WAG. BREED. LAW § 518 (McKinney 2009). Permitting OTB to withhold payments indefinitely is simply not consistent "with the well-being of the horse racing and breeding industries in" New York State. Moreover, elsewhere the Legislature has concluded that the revenues OTB distributes "plays an integral role in sustaining the viability of the entire horse racing industry in New York state." 2008 N.Y. LAWS 3083.
Despite these pronouncements, the New York State Legislature has also concluded that "the continued operation of [OTB] is of paramount importance to the public interest." Id. Thus, it appears that the New York Legislature intends a balance between the financial well-being of the horse racing and breeding industries in New York and the continued operation of OTB. Indeed, OTB has tacitly supported a balancing effort by admitting that it cannot defer paying the Indirect Commissions indefinitely. (July 13, 2010 Hr'g Tr. at 93:12-24 ("The Court:. . . . Do you agree that the racing law should not be read so as to provide the unilateral authority to OTB to decide to defer payment of indirect commissions indefinitely? Mr. Levin: Underscoring the word `indefinitely', yes, I agree.").) What balance the New York Legislature desires, however, is not clear. The New York Court of Appeals, the final authority for interpretations of New York State statutes, concurs with the Courts assessment of the clarity of the Racing Law. When interpreting statutes at issue here, Chief Judge Kaye opined that the "Racing, Pari-Mutuel Wagering and Breeding Law remains an imbroglio, being born out of the union of diverse racing industry interests and legislative compromise." Suffolk Reg. Off-Track Betting Corp. v. New York State Racing and Wagering Bd., 11 N.Y.3d 559, 569-70, 872 N.Y.S.2d 419, 900 N.E.2d 970 (2008) (internal quotation marks and citation omitted).
Nor should the Court extrapolate the intent of the New York Legislature from the previous performance of the parties. The history of OTB's payments to the Tracks does not offer any clarity regarding what schedule of payments the Racing Law requires. The payment of Indirect Commissions is contemplated by statute, not contract. If the Indirect Commissions arose by virtue of a contract between the Tracks and OTB, then the Court could look to the parties' previous course of dealings to determine what payment schedule is appropriate. See, e.g., Atateks Foreign Trade Ltd. v. Private Label Sourcing, LLC, No. 07CV6665(HB), 2009 WL 1803458, at *4 (S.D.N.Y. June 23, 2009) ("Evidence of the parties' course of dealing over the course of their business relationship may be used to assist the Court's interpretation of the contracts where they are ambiguous.") (citations omitted). But OTB and the Tracks cannot amend New York law through conduct alone. Indeed, the Court is unaware of any canon of statutory construction that allows a court to consider the previous course of dealings between entities when interpreting the statute. See generally 2A NORMAN J. SINGER J.D. SHAMBIE SINGER, SUTHERLAND STATUTORY CONSTRUCTION §§ 47:148:20 (7th ed.2010) (canvassing *146 statutory interpretation aids and omitting any "course of conduct" canon of statutory construction).
And even if the Court could consider the parties' previous course of dealings, it would not assist in interpreting the requirements of the Racing Law. The undisputed evidence shows that prior to bankruptcy, OTB paid Indirect Commissions in periods varying from 30 to 150 days. Immediately following filing for bankruptcy, OTB paid the Tracks Indirect Commissions 30 days' in arrears, at least through April 2010. At that point OTB began withholding payment of Indirect Commissions. Thus, even if the Court could look to the previous course of dealings, it would be forced to choose from a wide range of potential deadlines for payment of the Indirect Commissions.
The lack of a contractual relationship between OTB and the Tracks also prohibits the court from looking to industry norms regarding the payment schedules of Indirect Commissions to assist in interpreting the Racing Laws. Cf. JA Apparel Corp. v. Abboud, 682 F.Supp.2d 294, 303 (S.D.N.Y.2010) (observing that courts may examine usage of trade, or how an issue is commonly dealt with in an industry when interpreting contracts). Nor could the Court do so, as there is no evidence in the record regarding how other regional off-track betting entities pay the Indirect Commissions commanded by the Racing Law. (See July 13, 2010 Hr'g Tr. at 78:6-79:2.)
D. The Regulatory Structure of Racing and Wagering Board and the Ambiguity of the Racing Laws Compel the Court to Abstain From Determining a Payment Schedule for the Indirect Commissions
Confronted with this ambiguous statuteand keenly aware of the federalism concerns that permeate chapter 9 bankruptcy casesthe Court questioned the parties at the July 13, 2010 hearing whether the Racing and Wagering Board would be a more appropriate forum to determine the schedule on which OTB must pay the Indirect Commissions. (July 13, 2010 Hr'g Tr. at 51:2452:7, 93:2594:10.) The Court requested and received additional briefing on this matter. OTB argues that the Court must abstain pursuant to 28 U.S.C. § 1334(c)(2). Alternatively, OTB argues that the Court should use its discretion to abstain from resolving this matter under 28 U.S.C. § 1334(c)(1). In response the Tracks argue that neither mandatory nor permissive abstention can or should be applied.
Most practitioners are aware of general federal court abstention principles. Cf. Erwin Chemerinsky, FEDERAL JURISDICTION 735-834 (3rd ed.1999) (discussing the various judge-made federal abstention doctrines). Those unfamiliar with bankruptcy law, however, would likely be surprised to learn that Congress has passed a statute, 28 U.S.C. § 1334(c), codifying abstention principles in bankruptcy cases. Section 1334 generally discusses the jurisdiction of bankruptcy courts and 1334(c)(1) provides:
Except with respect to a case under chapter 15 of title 11, nothing in this section prevents a district court in the interest of justice, or in the interest of comity with State courts or respect for State law, from abstaining from hearing a particular proceeding arising under title 11 or arising in or related to a case under title 11.
Abstention pursuant to this subsection of 1334 is not mandatory; "it merely gives the district court the discretion to abstain if abstention is in the interest of justice, or in the interest of comity with State courts or respect for State law." 1 COLLIER ON *147 BANKRUPTCY ¶ 3.05[1]. In contrast, section 1334(c)(2) of title 28 provides for certain situations where a bankruptcy court is required to abstain from making a determination and reads:
Upon timely motion of a party in a proceeding based upon a State law claim or State law cause of action, related to a case under title 11 but not arising under title 11 or arising in a case under title 11, with respect to which an action could not have been commenced in a court of the United States absent jurisdiction under this section, the district court shall abstain from hearing such proceeding if an action is commenced, and can be timely adjudicated, in a State forum of appropriate jurisdiction.
28 U.S.C § 1334(c)(2). This section is only applicable to proceedings based on state law claims or causes of action merely "related to" bankruptcy cases, not those causes of action that arise under the Bankruptcy Code or a bankruptcy case. Id.; 1 COLLIER ON BANKRUPTCY ¶ 3.05[2]. Collier opines that the difference between the two sections of the statute give a court greater discretion to abstain from hearing a matter under 1334(c)(1) than 1334(c)(2). ¶ Collier on Bankruptcy ¶ 3.05[1].
Courts in this Circuit have developed twelve factors to assist in determining when abstention is appropriate pursuant to section 1334(c)(1):
1) the effect or lack thereof on the efficient administration of the estate if a Court recommends abstention,
2) the extent to which state law issues predominate over bankruptcy issues,
3) the difficulty or unsettled nature of the applicable state law,
4) the presence of a related proceeding commenced in state court or other nonbankruptcy court,
5) the jurisdictional basis, if any, other than 28 U.S.C. § 1334,
6) the degree of relatedness or remoteness of the proceeding to the main bankruptcy case,
7) the substance rather than form of an asserted "core" proceeding,
8) the feasibility of severing state law claims from core bankruptcy matters to allow judgments to be entered in state court with enforcement left to the bankruptcy court,
9) the burden on the court's docket,
10) the likelihood that the commencement of the proceeding in a bankruptcy court involves forum shopping by one of the parties,
11) the existence of a right to a jury trial, and
12) the presence in the proceeding of nondebtor parties.
In re Ephedra Prods. Liab. Litig., No. 04 MDL 1598(JSR), 2010 WL 882988, at *2 n. 2 (S.D.N.Y. Mar.8, 2010) (quoting N.Y. City Employees' Ret. Sys. v. Ebbers (In re WorldCom, Inc. Sec. Litig.)), 293 B.R. 308, 332 (S.D.N.Y.2003)). See also In re Bozel S.A., 434 B.R. 86, 2010 WL 2816369, at *910 (Bankr.S.D.N.Y. July 20, 2010) (listing factors courts consider when determining when to abstain pursuant to section 1334(c)) (quoting In re Cody, Inc., 281 B.R. 182, 190-91 (S.D.N.Y.2002)).
Little guidance exists, however, regarding the interplay between section 1334(c)(1) and traditional federal abstention doctrines. Some courts maintain that section 1334(c)(1) grants bankruptcy courts broader discretion than permitted by traditional federal abstention doctrines to abstain from hearing matters. Bricker v. Martin, 348 B.R. 28, 32-33 (W.D.Pa. 2006) (concluding that, unlike normal abstention situations, section 1334(c)(1) grants bankruptcy courts "broad discretion" to determine whether to abstain from *148 determining a claim) (quoting Wood v. Wood, 825 F.2d 90, 93 (5th Cir.1987)). And at least one court has opined in passing that the existence of section 1334(c) makes traditional abstention doctrines inapplicable. Life Flight of Puerto Rico Inc. v. Triple-S, Inc. (SSS) (In re Life Flight of Puerto Rico, Inc.), Nos. 09-00057, 08-08870 BKT, 2009 WL 2885109, at *1 (Bankr.D.P.R. Aug.18, 2009) (determining certain traditional abstention doctrines as "inapplicable in the face of" section 1334(c)).
The Second Circuit has determined that section 1334(c) "was intended to codify judicial abstention doctrines. . . ." In re Pan Am. Corp., 950 F.2d 839, 845 (2d Cir.1991). The Second Circuit only reached this determination after researching and finding a dearth of legislative history for section 1334(c). Given the lack of legislative history on section 1334(c), the court turned to legislative history for former section 1471(d) of title 28 of the Bankruptcy Act, as the two statutes are substantially similar. The court observed that the legislative history of section 1471(d) clearly stated that the statute "codifie[d] present case law relating to the power of abstention in particular proceedings by the bankruptcy court." Id. (quoting H.R.REP. No. 595, 95th Cong., 1st Sess. 51 (1977), reprinted in 1978 U.S.Code Cong. & Admin.News 5963, 6012). Thus, the court concluded that Congress "intended that section 1334(c)(1) be informed by principles developed under the judicial abstention doctrines." Id. (internal citation and quotation marks omitted).[3]
Despite this guidance, courts in this Circuit have not fully addressed how to reconcile the twelve factors used to assist in the application of section 1334(c)(1) with traditional abstention doctrines. Some courts use traditional abstention doctrines to buttress their analysis of the twelve section 1334(c) factors. In re Taub, 417 B.R. 186, 194 (Bankr.E.D.N.Y.2009) (employing traditional abstention doctrines in analysis of the twelve section 1334(c) factors). Other courts seemingly ignore the existence of the various federal abstention doctrines in favor of an analysis of the twelve section 1334(c)(1) factors. See, e.g., Baker v. Simpson, 413 B.R. 38, 45 (E.D.N.Y.2009) (limiting review of bankruptcy court's decision to abstain to section 1334(c)(1) and omitting an examination of other federal abstention principles); Langston Law *149 Firm v. Mississippi, 410 B.R. 150, 156 (S.D.N.Y.2008) (same). Yet other courts have focused their analysis on federal abstention doctrines instead of the section 1334(c)(1) factors. See Kurtzman v. Mut. Benefit Life (In re Philips Offset Co.), 152 B.R. 836, 838 (Bankr.S.D.N.Y.1992) (referencing section 1334(c)(1), but concentrating abstention analysis on traditional federal abstention doctrine).
This Court need not harmonize these approaches as it concludes that abstention is appropriate under analyses of both section 1334(c)(1) and traditional abstention doctrines. Because the Court concludes that it should abstain under these theories, it is unnecessary to examine whether mandatory abstention under section 1334(c)(2) is required in this case. See In re Taub, 417 B.R. at 197 (omitting discussion of mandatory abstention as the court had decided to abstain under section 1334(c)(1)).
1. Permissive Abstention Pursuant to Section 1334(c)(1)
The Tracks argue vehemently that the twelve factors used to examine section 1334(c)(1) do not warrant permissive abstention. The Court does not agree. While the Court acknowledges its "virtually unflagging obligation . . . to exercise the jurisdiction" given to it by Congress, the extraordinary circumstances present in this case require abstention. Kirschner v. Grant Thornton LLP (In re Refco, Inc. Secs. Litig.), 628 F.Supp.2d 432, 446 (S.D.N.Y.2008) (quoting Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 817, 96 S.Ct. 1236, 47 L.Ed.2d 483 (1976)) (internal quotation marks omitted).
As observed by the Supreme Court, abstention is born of a desire to "soften the tensions inherent in a system that contemplates parallel judicial processes." Pennzoil v. Texaco, Inc., 481 U.S. 1, 11 n. 9, 107 S.Ct. 1519, 95 L.Ed.2d 1 (1987). And the Second Circuit has concluded that abstention doctrines embody "federal respect for State law and policy." In re Pan Am., 950 F.2d at 846. As discussed above, federalism concerns resonate loudly in chapter 9 bankruptcies. Indeed, this Court can think of no instance where respect for State law is more paramount than in a municipal bankruptcy case under chapter 9 of the Bankruptcy Code. These strong federalism concerns weigh heavily on the Court's analysis of the twelve factors used when examining abstention under section 1334(c)(1).
a. The effect or lack thereof on the efficient administration of the estate if a Court recommends abstention
The Tracks argue that abstention will greatly impede the progress of this case. The Tracks maintain that the Racing and Wagering Board has historically resisted making any determinations regarding disputes between the various regional off-track betting entities and race tracks. The Tracks claim that the Racing and Wagering Board's history on making these determinations is so poor that abstention is tantamount to denial of their motions. (Supplemental Joint Mem. of Tracks at 8-9.) While there is some evidence in the record to support the Tracks' position, recent acts of the Racing and Wagering Board illustrates willingness to take an active role in OTB's payments.
The parties do not dispute the Racing and Wagering Board's power to issue a regulation or otherwise determine when the Indirect Commissions must be paid. (Supplemental Joint Mem. of Tracks at 3 ("accepting that the Board has jurisdiction to determine when [OTB] must pay commissions"); Supplemental Statement of OTB at 2.) Indeed, the Racing and Wagering *150 Board has the necessary adjudicative powers to determine this dispute. The relevant racing regulation states that disputes between any regional OTB and a race track "with respect to the purposes or objectives set forth in section 518 of the Racing, Pari-Mutuel Wagering and Breeding Law shall be submitted in writing to the board for determination." N.Y. COMP. CODES R. & REGS. tit. 9, § 5201.04 (2010). Section 518 of the Racing Law is a general provision discussing the purpose of off-track betting. The statute reads as follows:
In the exercise of the power vested in it by subdivision one of section nine of article one of the state constitution, the legislature hereby prescribes that off-track pari-mutuel betting on horse races, conducted under the administration of the state racing and wagering board in the manner and subject to the conditions provided for in this article, shall be lawful, notwithstanding the provisions of any other law, general, special or local, including any law prohibiting or restricting lotteries, pool-selling or bookmaking or any other kind of gambling; it being the purpose of this article to derive from such betting, as authorized by this article, a reasonable revenue for the support of government, and to prevent and curb unlawful bookmaking and illegal wagering on horse races. It is also the intention of this article to ensure that off-track betting is conducted in a manner compatible with the well-being of the horse racing and breeding industries in this state, which industries are and should continue to be major sources of revenue to state and local government and sources of employment for thousands of state residents.
N.Y. RAC. PARI-MUT. WAG. BREED. LAW § 518 (McKinney 2009). Thus the Racing and Wagering Board has power to determine when the Indirect Commissions should be paid. Specifically the final clause regarding the requirement that off-track betting occur in a manner compatible with the well-being of the horse racing and breeding industries in the state gives the Racing and Wagering Board wide power to resolve the dispute at bar.
While the Racing and Wagering Board has not yet used its adjudicative powers to require payment of the Indirect Commissions, it has taken steps consistent with these powers as recently as April and May of this year. Specifically, as indicated above, OTB must seek approval from the Racing and Wagering Board to simulcast and accept bets on out-of-state races. (Joint Pre-Trial Stipulation at ¶ 75.) On April 21, 2010, in response to a request to simulcast an out-of-state meet, counsel for the Racing and Wagering Board requested information from OTB regarding how it intended to use the proceeds OTB would earn from accepting bets on this meet. The Racing and Wagering Board was specifically concerned whether OTB would use the proceeds to make the statutory payments contemplated by the Racing Law. (Id. ¶ 76.) OTB answered the Racing and Wagering Board, noting that it would defer paying the required Indirect Commissions due to the Tracks. (See id. at ¶ 76; Letter from Ira H. Block, Executive Vice President OTB, to Robert A. Feuerstein, Counsel New York State Racing and Wagering Board (Apr. 23, 2010) (Ex. J to Joint Pre-Trial Stipulation).) In response, the Racing and Wagering Board delayed ruling on OTB's request to simulcast out-of-state races, effectively denying OTB's application. (Joint Pre-Trial Stipulation at ¶ 77.) In an effort to start simulcasting out-of-state races once more, OTB agreed with the Racing Board to begin depositing the amounts of Indirect Commissions otherwise due into a separate account, reporting weekly to the Racing Board on its *151 computation of amounts due. (Id. at ¶¶ 78, 82; Letter from Ira H. Block, Executive Vice President OTB, to Robert A. Feuerstein, Counsel New York State Racing and Wagering Board (May 26, 2010) (Ex. L to Joint Pre-Trial Stipulation).) And OTB admits that it must obtain the approval of the Racing and Wagering Board before simulcasting an out-of-state race. (July 13, 2010 Hr'g Tr. at 37:15-25.)
As the Racing and Wagering Board has recently withheld approval from OTB to simulcast out-of-state races, it seems clear that the Racing and Wagering Board is exercising its authority to regulate the horse racing and pari-mutuel businesses while this chapter 9 case is pending. Indeed, OTB concedes that the Racing and Wagering Board has power to do so while OTB is a chapter 9 debtor. (July 13, 2010 Hr'g Tr. 101:22-24 ("The Court: And you agree that that form of regulation [withholding approval to simulcast out-of-state races] is not preempted by the Bankruptcy Code? Mr. Levin: Correct.").)
The Court therefore concludes that abstention will not have an overwhelmingly adverse effect on the administration of this case. It is clear that the Racing and Wagering Board has the authorityand has taken recent stepsto resolve the issues on which the Court abstains. In the highly-regulated horse racing and pari-mutuel wagering businesses, this exercise of regulatory powers is wholly appropriate and should not be interfered with by a bankruptcy court. This appears to an appropriate exercise of state police power, respected in all bankruptcy cases, and especially appropriate in a chapter 9 case.
b. The extent to which state law issues predominate over bankruptcy issues
The Tracks argue that the issues raised in their motionsspecifically the payment of the Indirect Commissions as administrative expensesare pure bankruptcy issues. With regards to administrative expense issues, the Tracks are correct. Whether the Tracks are entitled to administrative expense claims under section 503 for post-petition Indirect Commissions, assuming that state law requires that Indirect Commissions be paid on a current basis, is indeed a core bankruptcy issue. The Court, however, disposed of this issue in the discussion above, concluding that section 503 does not apply to operating expenses of a chapter 9 debtor.
In contrast, the lone issue on which the Court now abstainsthe schedule on which OTB must pay Indirect Commissions to the Trackis a pure question of state law. Moreover, a state entity exists that is able to balance the various competing interests in the New York racing and pari-mutuel industry required to make this determination. Thus, this factor weighs heavily in favor of abstention.
c. The difficulty or unsettled nature of the applicable state law
The Tracks maintain that the issues of state law at issue here are "not difficult" and thus the Court should decide when OTB must pay the Indirect Commissions. But both the language of the statutes and the history of the dealings between the parties belie the Tracks' position.
As demonstrated above, the Racing Law is, at best, ambiguous regarding when OTB must pay the Indirect Commissions to the Tracks. It clearly lacks any provision stating when the Indirect Commissions must be paid. Moreover, there is a clear tension in the Racing Law between proclamations that off-track betting should be "conducted in a manner compatible with the well-being of the horse racing and breeding industries in" New York and statements that "the continued operation *152 of [OTB] is of paramount importance to the public interest." Compare N.Y. RAC. PARI-MUT. WAG. BREED. LAW § 518 (McKinney 2009) with 2008 N.Y. LAWS 3083. Requiring OTB immediately to pay all indirect commissions will likely result in a shut down of OTB, with adverse consequences to the State and to many other stakeholders that benefit from distributions from OTB. Balancing these competing interests is more appropriately done by the State Legislature and the State Agency that regulates the business. Further, from the history of payments, it appears that the parties themselves have never determined the appropriate schedule for payment of the Indirect Commissions. The record clearly demonstrates that OTB previously paid Indirect Commissions between 30 to 150 days after accrual.
As the statute is silent on when the Indirect Commissions must be paid, the competing policy interests behind the Racing Law are of paramount importance. The Racing and Wagering Board is better able to balance competing New York policy interests, and it has authority to issue regulations and adjudicate disputes regarding the Racing Law. This Court will not usurp the role of the Racing and Wagering Board in balancing these competing interests. Cf. Piccolo v. Commodity Futures Trading Comm'n, 388 F.3d 387, 391 (2d Cir.2004) (observing that courts in the Second Circuit "accord[ ] a high degree of deference to administrative agencies where their special expertise is implicated") (internal quotation marks and citation omitted). Thus, this factor weighs in favor of abstention.
d. The presence of a related proceeding commenced in state court or other nonbankruptcy court
There is no proceeding currently pending before the Racing and Wagering Board to determine the appropriate schedule for paying the Indirect Commissions. The Tracks maintain that this factor is of particular importance when determining whether to abstain under section 1334(c)(1). This Court does not agree. The cases that articulate the twelve factors used to assist in determining whether abstention is appropriate do not indicate that any single factor is of more importance than the others. In contrast, courts opine that not all twelve factors must be considered. In re Bozel S.A., 2010 WL 2816369, at *14 n. 23 (observing that courts need not consider all twelve factors when determining whether to abstain under section 1334(c)(1)) (citing In re Cody, Inc., 281 B.R. at 190-91); Langston Law Firm, 410 B.R. at 156 (same).
While this factor weighs against abstention, the Court gives it little weight. Given the recent actions of the Racing and Wagering Board to force OTB to segregate funds for Indirect Commissions, there is little indication that abstention would cause undue delay. Moreover, whatever need the Tracks have for a quick resolution of these issues pales in comparison to issues of federalism, the idea of comity, and respect for state law inherent in section 1334(c)(1). In the first instance the Wagering and Racing Board should make a determination with wide-ranging effects on New York's racing and pari-mutuel industry even though no proceeding has so far been commenced.
e. The jurisdictional basis, if any, other than 28 U.S.C. § 1334
This factor weighs in favor of abstention. If this matter was brought in a district court, there would be no federal question jurisdiction over the determination of when the Indirect Payments are due. Moreover, as both entities are only located in New York, there would be no diversity jurisdiction. As this dispute is only in federal court due to the Bankruptcy Code, *153 it weighs in favor of abstention. See Bricker, 348 B.R. at 35-36 (concluding that this factor weighs in favor of abstention where there is no federal question or diversity jurisdiction for a dispute).
f. The degree of relatedness or remoteness of the proceeding to the main bankruptcy case
This factor weighs against abstention. From the start of this litigation it has been clear that legislative changes are required to statutory distributionsincluding the Indirect Commissionsto ensure the continued operation of OTB. See In re New York City Off-Track Betting Corp., 427 B.R. at 278 (observing that legislative changes are needed for OTB's survival). Moreover, OTB has admitted that a determination regarding when the Indirect Commissions must be paid would likely impact the ability OTB to continue operating. (July 13, 2010 Hr'g Tr. at 34:15-18.) Thus, it is clear that the timing of payments of the Indirect Commissions is central to OTB's bankruptcy case.
g. The substance rather than form of an asserted "core" proceeding
This factor focuses on ensuring that parties do not clothe an issue of pure state law as a core bankruptcy proceeding. See Bricker, 348 B.R. at 36 (quoting In re Republic Reader's Serv., Inc., 81 B.R. 422, 427-28 (Bankr.S.D.Tex.1987)). Here, there is no question that the issue to be decided is one of pure state law; therefore this factor weighs in favor of abstention.
h. The feasibility of severing state law claims from core bankruptcy matters to allow judgments to be entered in state court with enforcement left to the bankruptcy court
This factor weighs in favor of abstention. While the Tracks argue that it is not feasible to sever the determination of when the Indirect Commissions must be paid because it would be a de facto denial of their motions, the Tracks misapply this factor. First, as demonstrated above, it is not clear that the Racing and Wagering Board will wait an unreasonable period of time before making a determination on this issue. Second, the Tracks' arguments have little to do with feasibility. Feasible means "capable of being done, accomplished or carried out; possible, practicable." WEBSTER'S THIRD NEW INTERNATIONAL DICTIONARY UNABRIDGED (2002). Thus, even if the Court accepted the Tracks' position that requiring the parties to seek a determination on the schedule of payments would cause a lengthy delay, this argument is irrelevant to whether severing is possible. As the Racing and Wagering Board exists and has recently taken an active role in matters regarding the payment of the Indirect Commissions by OTB, the Court determines that the Board may determine the proper payment schedule. This determination may then be enforced by this Court.
i. The burden on the courts docket
This factor neither weighs in favor or against abstention. This Court will promptly decide the matters properly before it, regardless of the burdens it may impose on the Courts docket.
j. The likelihood that the commencement of the proceeding in a bankruptcy court involves forum shopping by one of the parties
This factor is also neutral. There is nothing in the record to indicate that the Tracks engaged in forum shopping by bringing their motions in this Court. In fact, many of the Tracks' initial arguments regarding administrative expenses could only be determined by a bankruptcy court. The Tracks also argue that the Racing and Wagering Board has essentially deferred to allow this Court to determine when the Indirect Commissions must be paid. (Supplemental *154 Joint Mem. of Tracks at 12.) The Tracks further maintain that deference of the Racing and Wagering Board is appropriate in this case for internal state political reasons. (Id. at 12-13.) Specifically, the Tracks claim that it is inappropriate for the Racing and Wagering Board, constructed of members appointed by the Governor, to resolve a dispute with OTB, an executive entity.
As an initial matter, the Court is uncertain what bearing these arguments have on forum shopping issues. Even if they were relevant to forum shopping, the Court does not believe that internal state political reasons make it appropriate for the Racing and Wagering Board to defer to this Court. The Tracks argue that deference of the Racing and Wagering Board is appropriate to this Court merely because it is an executive entity, with members appointed by the Governor of New York, and it would need to review the actions of OTB, another executive entity. Yet this precise situation occurs in administrative law courts across the country every day.
In addition, the Court concludes, given the strong competing state policy interests at play in determining the proper schedule to pay the Indirect Commissions, it would be inappropriate for the Racing and Wagering Board to defer to this Court's judgment. At best, it would not be consistent with comity and respect for state institutions to have this Court usurp the role of the Racing and Wagering Board and determine these issues. Moreover, even if the Racing and Wagering Board were to abdicate its responsibilities, this Court cannoteven when invited to do sodisplace the role of a state administrative entity. Such an act is clearly prohibited by principles of federalism and the Tenth Amendment of the United States Constitution.
k. The existence of a right to a jury trial
This factor is neutral. The parties will not be entitled to a jury trial either before this Court or the Racing and Wagering Board.
l. The presence in the proceeding of non-debtor parties
This factor weighs heavily in favor of abstention. The Tracks, just two entities, are the only non-debtor moving parties on these motions. The Racing Law, and in particular the provisions dealing with Indirect Commissions, reflect important policy choices by the State Legislature regarding the entire racing industry, with its many different constituencies. Any decision by this Court with respect to the meaning and application of the Racing Law has broad implications not just for the parties before this Court, but for the entire industry. Yet the Tracks ask the Court to make a determination on an issue that will likely implicate the rights of every track and other entity that receives statutory distributions in New York State. This strongly favors deferring to the Racing and Wagering Board, where the opinions and desires of other stakeholders in the New York racing industry may be canvassed and incorporated into a decision without the filing of formal motion papers, as is required in this Court.
2. Burford Abstention
In addition to abstention under section 1334(c), the Court concludes that another basis for abstention exists. In Burford v. Sun Oil Co., 319 U.S. 315, 63 S.Ct. 1098, 87 L.Ed. 1424 (1943), the Supreme Court identified that federal court abstention was appropriate in certain situations "to avoid needless conflict with the administration by a state of its own affairs." 17A Charles Alan Wright, Arthur R. Miller, Edward H. Cooper & Vikram David Amar, Federal Practice and Procedure *155 § 4244, at 382 (3d. ed 2007). The Burford Court reviewed an action brought by Sun Oil assailing a decision of the Texas Railroad Commission allowing Burford to drill oil wells on a particular oil field in eastern Texas. Burford, 319 U.S. at 316-17, 63 S.Ct. 1098. The Court observed the various policy interests that the Texas Railroad Commission balanced when granting authority to drill. Specifically, the Court acknowledged that the Texas Commission must balance the conservation of oil and gas with the generation of tax revenueand was granted broad discretion to do so. Id. at 320, 63 S.Ct. 1098. The Court also noted the practical needs for consistent and thorough regulation of oil fields to encourage economic and efficient oil drilling and acknowledged that the order in question was "part of the general regulatory system devised for the conservation of oil and gas in Texas." Id. at 319, 63 S.Ct. 1098. The Court also noted that judicial state review of the Railroad Commission's decision was available and concentrated in certain Texas courts. Id. at 326, 63 S.Ct. 1098. The Court then determined that the issues at bar "so clearly involve[d] basic problems of Texas policy that equitable discretion should be exercised to give Texas Courts the first opportunity to consider them." Id. at 332, 63 S.Ct. 1098.
Throughout the years the Supreme Court has refined this general concept into a doctrine now known as Burford abstention. The Court's latest attempt to articulate the doctrine is as follows:
Where timely and adequate state-court review is available, a federal court sitting in equity must decline to interfere with the proceedings or orders of state administrative agencies: (1) when there are "difficult questions of state law bearing on policy problems of substantial public important whose importance transcends the results in the case at bar"; or (2) where the "exercise of federal review of the question in a case and in similar cases would be disruptive of state efforts to establish a coherent policy with respect to a matter of substantial public concern."
New Orleans Pub. Serv. v. Council of New Orleans, 491 U.S. 350, 361, 109 S.Ct. 2506, 105 L.Ed.2d 298 (1989) (quoting Colorado River, 424 U.S. at 814, 96 S.Ct. 1236). More recently, however, the Supreme Court has cautioned against the mechanical application of the Burford doctrine and the cases on which it is based.[4] The Court stressed that the Burford doctrine emanates "from the discretion historically enjoyed by courts of equity," and indicated that courts must look to "principles of federalism and comity" when exercising discretion to abstain under Burford. Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 727-28, 116 S.Ct. 1712, 135 L.Ed.2d 1 (1996) (quoting Growe v. Emison, 507 U.S. 25, 32, 113 S.Ct. 1075, 122 L.Ed.2d 388 (1993)) (internal quotation marks omitted). When making this equitable decision, the Supreme Court has instructed lower courts to balance competing interests:
*156 This equitable decision [of whether to abstain] balances the strong federal interest in having certain classes of cases, and certain federal rights, adjudicated in federal court, against the States interests in maintaining uniformity in the treatment of an essentially local problem and retaining local control over difficult questions of state law bearing on policy problems of substantial public import.
Id. at 728, 116 S.Ct. 1712 (internal citations and quotation marks omitted). As indicated above, concern for "principles of federalism and comity" are at their zenith in chapter 9 cases. Moreover, New York State has great interest in maintaining uniform treatment of the schedule of payments of Indirect Commissionsadjudication of which raises difficult questions of state law and significant public policy issueswhile the federal government has little interest in having the matter resolved in federal court.
The Second Circuit has identified three factors to assist in determining when Burford abstention is appropriate: "(1) the degree of specificity of the state regulatory scheme; (2) the need to give one or another debatable construction to a state statute; and (3) whether the subject matter of the litigation is traditionally one of state concern." Liberty Mut. Ins. Co. v. Hurlbut, 585 F.3d 639, 650 (2d Cir.2009) (quoting Hachamovitch v. DeBuono, 159 F.3d 687, 697 (2d Cir.1998)) (quotation marks omitted). All three factors support abstention here.
The first factor does not rest on the mere specificity of the state regulatory scheme a court is being asked to review. Instead, it focuses on "on the extent to which the federal claim requires the federal court to meddle in a complex state scheme." Kshel Realty Corp. v. City of New York, No. 01 Civ. 9039(LMM), 2003 WL 21146650, at *6 (S.D.N.Y. May 16, 2003) (quoting Hachamovitch, 159 F.3d at 697) (internal quotation marks omitted). Thus, if a party claims that a state regulatory structure violates the Constitution, so long as a federal court can limit its review to the constitutional issue, this factor typically will not weigh in favor of abstention. See Hachamovitch, 159 F.3d at 697 (observing that because a federal constitutional claim did not require review of substantive provisions of a complex state scheme, it did not weigh in favor of abstention). See also Kshel Realty Corp., 2003 WL 21146650, at *6 (same). In contrast, here the Tracks request the Court directly interfere with the interpretation of a detailed scheme of state statutory distributions to various racing entities by determining when the Indirect Commissions must be paid. As this case requires the Court to intrude in New York's complex scheme for remuneration of statutory commissions to race tracks and other racing industry stakeholders, possibly disrupting future attempts by the Racing and Wagering Board to establish a coherent policy, this factor weighs in favor of abstention.
The second factor, whether this Court would need to "give one or another debatable construction to a state statute," also weighs in favor of abstention. The Racing Law is silent on the schedule when the Indirect Commissions must be paid. Thus, the Court would be forced to create, essentially out of whole cloth, a timeline for payments when making a determination in this case. This situation is far worse than that which concerned the Second Circuit when it formulated factors to guide courts in determining when Burford abstention is appropriate. Here the Court would not be deciding between two different debatable interpretations of a statute; it would essentially be reading an entirely new term into a state statute. This clearly demonstrates that difficult questions of *157 state law exist in this case that would require the Court to balance the important policy interests of OTB and New York's various racing constituencies.
The third factor also weighs in favor of abstention. The United States government is not an active participant in regulating pari-mutuel bets on horse races. Indeed, Congress has specifically stated that "the States should have primary responsibility for determining what forms of gambling may legally take place within their borders." 15 U.S.C. § 3001(a)(1). Congress has passed limited legislation, however, "to ensure States will continue to cooperate with one another in the acceptance of legal interstate wagers." 15 U.S.C. § 3001(a)(3). This legislation is limited to a single section of the U.S.Code which lays out procedures for the acceptance of interstate bets on horse races and does not contemplate the structure of payments to different constituencies or the timing of those payments. See 15 U.S.C. § 3004. Thus, this factor also supports abstention.
In sum, the Court concludes that the proper timing of payment of the Indirect Commissions is a difficult question of state law that would require the Court to balance state policy interests between OTB and the recipients of its statutory distributions. This decision would affect not just OTB and the Tracks, but all of the entities receiving distributions from OTB. Moreover, it is likely that this Court's interpretation of the Racing Law would be used in other proceedings against other off-track betting entities in New York. Any interpretation this Court would make would also disrupt the New York Legislature's intent to have the Racing and Wagering Board create a coherent policy regarding horse racing and betting issues in the state. Thus, abstention is appropriate in this case under either section 1334(c) or the Burford abstention doctrine.
This conclusion is consistent with the recent decision of the Second Circuit in Liberty Mutual Insurance Co. v. Hurlbut. The court, invoking Burford, concluded that a district court's decision to abstain from a suit challenging certain amendments to New York's Workers' Compensation Law ("WCL") was correct. The court reasoned that the WCL is a complex statute that governs an intricate system that seeks to balance the interests of New York employers and employees. Hurlbut, 585 F.3d at 650. The court also observed that its intervention could lead to inconsistent results to the extent its conclusions differed from those of the state Workers' Compensation Board ("WCB"). Id. at 651. Here, too, there is a complex state statute governing a system of statutory distributions that seeks to balance interests of different state constituencies. There is also a possibility that this Court's determination for the proper timing for payment of the Indirect Commissions could differ from a future determination of the Racing and Wagering Board, resulting in inconsistent results.[5]
*158 III. CONCLUSION
Deferring to the Racing and Wagering Board for a determination of the meaning and application of the Racing Law with respect to Indirect Commissions does not strip this Court of its power and responsibility with respect to the administration of this case. While arguing that the Racing Law does not require payment of Indirect Commissions within a specified time period, OTB acknowledges that the payments cannot be deferred indefinitely. Indeed, the Stipulation of Facts highlights the potentially grave consequences to the Tracks and the entire industry if these statutorily required payments continue to be withheld. At bottom, if OTB is going to be successfully reorganized, the state legislature must modify portions of the Racing Law regarding required payments. For at least five years, no legislative solution has emerged. Time, at least for OTB and more likely for many parts of the racing and wagering industry, is running out. This Court cannot mandate the necessary legislative changes. The hearing record reflects comments attributed to the Legislature that it wants to wait another year before considering basic changes to the formulas for payments required by the Racing Law. The State Legislature may be able to wait a year, but this Court cannot. The Court therefore orders the parties to formally seek resolution of the timing for payment of the Indirect Commissions from the Racing and Wagering Board within seven days from the date of this Opinion and Order.
As the Court advised the parties at the argument, section 930 permits the Court to dismiss a chapter 9 case for cause, including "unreasonable delay by the debtor that is prejudicial to creditors...." 11 U.S.C. § 930(a)(2). The record clearly establishes that many of OTB's creditors are being substantially harmed by OTB's failure to complete a plan for the adjustment of its debts, and to pay undisputed amounts due to creditors during the administration of this case. While the Court does not have the power to order OTB to pay particular creditors, the Court does have the power to dismiss the case where unreasonable delay by the debtor is prejudicial to creditors. The free-for-all that may ensue if the case is dismissed is unlikely to benefit any of the parties in interest, but it will leave the important decisions where they properly belong, namely with the Governor, the New York State Legislature and the Racing and Wagering Board.
Finally, given the impasse that has existed for many years in resolving the industry-wide issues that have afflicted many of the parties in interest in this case, the Court will also enter an order requiring the parties to mediate the broad issues in dispute. If the various racing industry constituencies can resolve or at least substantially narrow their disagreements about the restructuring of OTB, and the statutory changes required to accomplish it, they will increase the chances of legislative or regulatory changes. The parties can simultaneously pursue both avenues-administrative proceedings before the Racing and Wagering Board and mediation of the disputes. Consequently, the Court will abstain from deciding the state law issues, and lift the automatic stay so the parties can commence an appropriate proceeding before the Racing and Wagering Board to obtain a resolution of the state law issues. OTB is further ordered within seven days from the date of this Order to seek such a determination from the Racing and Wagering *159 Board. Also, within the same seven day period, the parties shall confer on the selection of a mediator. If the parties cannot agree upon a mediator within that time, the Court will appoint one.
IT IS SO ORDERED.
NOTES
[1] This section is based on a Joint Pre-Trial Stipulation entered into by the parties. Under the Joint Pre-Trial Stipulation the Tracks and OTB have agreed that certain facts are undisputed for purposes of determining these motions. (See Joint Pre-Trial Stipulation, ECF #113.) In some instances only Empire, not Finger Lakes, has stipulated to relevant facts. Counsel for Finger Lakes, however, agreed at the July 13, 2010 hearing that the Court could consider each of these facts as proven for purposes of resolving these motions. (July 13, 2010 Tr. 17:7-18:16.) Thus, the Court will treat all facts in the Joint Pre-Trial Stipulation as undisputed for the purpose of resolving the motions currently before the Court.
[2] NYRA operates Aqueduct Racetrack, Belmont Park and Saratoga Race Course. NYRA was a chapter 11 debtor in an earlier case in this court, see Case No. 06-12618(JMP). The successful reorganization of NYRA required the New York legislature to amend the Racing Law. Compare Modified Third Amended Plan of Debtor Pursuant to Chapter 11 of the United States Bankruptcy Code ¶ 2.1(a)-(b), Case No. 06-12618(JMP) (ECF # 1009) with 2008 N.Y. LAWS 77-81.
[3] As noted by the Second Circuit, the legislative history of historical section 1471(d) references a Supreme Court abstention case, Thompson v. Magnolia Petroleum Co., 309 U.S. 478, 60 S.Ct. 628, 84 L.Ed. 876 (1940). In re Pan Am., 950 F.2d at 845. The Magnolia Court concluded that abstention is most appropriate where state law issues predominate or when a case raises unresolved state law questions. Rosetta Res. Operating LP v. Pogo Producing Co. (In re Calpine Corp.), 361 B.R. 665, 669-70 (Bankr.S.D.N.Y.2007) (interpreting the holding of Magnolia) (citing Magnolia, 309 U.S. at 483, 60 S.Ct. 628). The Court notes that the reference to Magnolia in the legislative history could be interpreted to somehow limit the codification of abstention principles in section 1334(c) to the concepts within Magnolia, but observes that any such conclusion is at odds with the Second Circuit's clear direction that "section 1334(c)(1) should be informed by principles developed under judicial abstention doctrines"not just the concept announced in Magnolia. In re Pan Am., 950 F.2d at 846. Indeed, the district court decision the Second Circuit cited in support of its statement that section 1334(c) should be viewed through the prism of judicial abstention doctrines specifically stated that section 1334(c) "may summarize and incorporate federal non-bankruptcy abstention doctrines found in Railroad Commission v. Pullman Co., 312 U.S. 496, 61 S.Ct. 643, 85 L.Ed. 971 (1941), Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746, 27 L.Ed.2d 669 (1971), and Burford v. Sun Oil Co., 319 U.S. 315, 63 S.Ct. 1098, 87 L.Ed. 1424 (1943)." In re Gen. Am. Commcns Corp., 130 B.R. 136, 146 (S.D.N.Y.1991).
[4] Commentators agree with this approach. The leading treatise on federal practice and procedure observes that "it seems too narrow to try to confine Burford, and the later case of Alabama Public Service Commission v. Southern Railway Co. to their own facts and to hold that this kind of abstention is proper only when a case involves basic matters of state policy, complicated by nonlegal considerations of a predominantly local nature, and the state has specially concentrated all judicial review of administrative orders of the sort involved in a single state court." 17A CHARLES ALAN WRIGHT, ARTHUR R. MILLER, EDWARD H. COOPER & VIKRAM DAVID AMAR, FEDERAL PRACTICE AND PROCEDURE § 4244, at 383-84 (footnotes omitted).
[5] The Court observes in coming to this determination that a factor present in many cases where courts find Burford abstention appropriate, the consolidation of judicial review of administrative actions in a single state court, is not present here. See, e.g., Ala. Pub. Serv. Comm'n v. S. Ry. Co., 341 U.S. 341, 348, 71 S.Ct. 762, 95 L.Ed. 1002 (1951) (observing that state statute contemplated review of agency decisions by a single appellate court); Burford, 319 U.S. at 326, 63 S.Ct. 1098 (noting that state legislation provided for review of agency decisions by a single court). The Second Circuit, however, has determined that this factor is not "indispensible to Burford abstention." Bethphage Lutheran Serv. Inc. v. Weicker, 965 F.2d 1239, 1245 (2d Cir.1992). Moreover, any such mechanical approach is anathema to the Supreme Court's command that abstention doctrines "be applied in a pragmatic, flexible manner with a view to the realities of the case at hand." Id. at 1244 (quoting Moses H. Cone Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 21, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983)).
|
203 S.E.2d 102 (1974)
20 N.C. App. 746
G. L. JONES, t/a Jackson Park Supply Company,
v.
M. F. MURDOCK, Contractor, and J. C. Parks.
No. 7419DC30.
Court of Appeals of North Carolina.
February 20, 1974.
*103 Robert H. Irvin and Williams, Willeford, Boger & Grady by Samuel F. Davis, Jr., Concord, for plaintiff-appellee.
Clarence E. Horton, Jr., Concord, for defendant-appellant.
CARSON, Judge.
The only assignment of error presented on appeal is in the failure of the trial court to make findings of fact and conclusions of law to support judgment. The only finding or conclusion is that the defendant Parks is indebted to the plaintiff in the amount of $1,484.85 plus interest. Rule 52(a)(1) of the Rules of Civil Procedure dictates the necessary ingredients for the judgment when the matter is heard without a jury. It states:
(a) Findings1. In all actions tried upon the facts without a jury or with an advisory jury, the court shall find the facts specially and state separately its conclusions of law thereon and direct the entry of the appropriate judgment.
The plaintiff, while conceding that the trial court did not comply with provisions above stated, maintains that the error was a mere technical one which would not warrant a new trial. The deficiency, however, is more than a technical one. The necessity for the finding of facts and entry thereof, and for the conclusions of law to be drawn from the facts, is to allow review by the appellate courts. Without such findings and conclusions, we are unable to determine whether or not the judge correctly found the facts or applied the law thereto. Morehead v. Harris, 255 N.C. 130, 120 S.E.2d 425 (1961); Jamison v. Charlotte, 239 N.C. 423, 79 S.E.2d 797 (1954); Watts v. Supt. of Building Inspection, 1 N.C.App. 292, 161 S.E.2d 210 (1968). Without such findings we may only surmise what the trial court found. Hence, a new trial must be awarded.
New trial.
BROCK, C. J., and MORRIS, J., concur.
|
64 F.3d 661
NOTICE: Fourth Circuit Local Rule 36(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Fourth Circuit.UNITED STATES of America, Plaintiff-Appellee,v.Otavio de MIRANDA SANTOS, Defendant-Appellant.
No. 95-5008.
United States Court of Appeals, Fourth Circuit.
Submitted: July 27, 1995.Decided: August 21, 1995.
John M. MacDaniel, Miami, FL, for appellant.
Helen F. Fahey, U.S. Atty., James L. Trump, Asst. U.S. Atty., Alexandria, VA, for appellee.
Before ERVIN, Chief Judge, MOTZ, Circuit Judge, and PHILLIPS, Senior Circuit Judge.
OPINION
PER CURIAM.
1
Otavio de Miranda Santos was convicted by a jury of participating in a money laundering conspiracy, 18 U.S.C.A. Sec. 1956 (West Supp.1995), and was sentenced to a term of 37 months imprisonment. Santos appeals his conviction, alleging that he was entrapped as a matter of law. He also argues that the district court clearly erred in sentencing him by denying him a minimal role reduction and by refusing to depart downward. We affirm in part and dismiss in part.
2
Santos was the manager of a travel agency in Ft. Lauderdale, Florida, called AP Travel Tours. It was a branch of his brother's travel agency in Miami. In conjunction with the travel agency, Santos individually operated a remittance company which transferred money nationally and internationally as an agent of Vigo Remittance Corporation. He was acquainted with Paulo Finamore, another travel agent and Vigo remittance agent who had a business in Washington, D.C., and who was a customer of his brother's Miami travel agency.
3
In June 1992, during an investigation of Finamore by the Drug Enforcement Administration (DEA), Finamore suggested to a confidential informant (CI) that $100,000 in cocaine profits belonging to a cocaine dealer who had been arrested should be transferred out of the country. Finamore had been a customer of the dealer and reportedly had transferred money for him in the past. The CI agreed, and Finamore transferred the money to an account in Mexico.
4
In October 1992, the CI introduced an undercover DEA agent posing as a drug dealer to Finamore. In the following year, Finamore repeatedly transferred large sums to accounts in Canada and England for the agent. Eventually, the agent asked whether money could be transferred from other locations. Finamore said he knew someone in Ft. Lauderdale who could help. On June 18, 1993, he called Santos in the agent's presence and told Santos he was sending him a customer who was "in computers" and who wanted to move some money from Miami with false identification. He explained that the customer would pay a 9% fee. This call was conducted in Portuguese because Santos, Finamore, and the CI are all Brazilian. The agent understood enough Portuguese to get the gist of the conversation.
5
Prior to the agent's meeting with Santos on June 24, 1993, several calls from Finamore to Santos concerning the mechanics of the agent's transaction were intercepted and recorded. Finamore told Santos that contraband but no drugs were involved, and again informed him that false identification would be used. Finamore also told Santos to shred or throw away the receipt which would normally go to a remittance customer.
6
The CI accompanied the agent when he met with Santos, and told Santos in Portuguese that the agent dealt in "stuff" ("coisa") rather than computers. He testified at trial that the slang term was understood in Brazil to mean cocaine. Santos replied that he understood, and completed the transaction. Immediately following the meeting, Santos called Finamore and laughingly told him that the money was all small bills. The next day, Santos again called Finamore and said he believed the money was drug profits. Nonetheless, he transferred the money to a Canadian bank. Santos subsequently transferred money to Canada for the agent in September 1993 and in March 1994. Each time, the agent paid a 9% commission, of which Santos received 5%. Finamore received 2%, and Vigo Remittance Corporation received 2%. The total amount transferred by Santos for the agent was $95,000, all of which he believed to be drug profits.
7
Santos asserted an entrapment defense at trial. He testified in essence that he was afraid to refuse to make the illegal transfers. On appeal, he argues that he was entrapped as a matter of law because he would never have broken the law if the undercover agent had not come to him. He relies chiefly on United States v. Hollingsworth, 27 F.3d 1196 (7th Cir.1994), which reversed two money laundering convictions on entrapment grounds because the government did not prove predisposition.
8
The government may solicit or present an opportunity to commit a crime to one predisposed to illegal activity, but may not "implant in an innocent person's mind the disposition to commit a criminal act, and then induce commission of the crime so that the Government may prosecute." Jacobson v. United States, 503 U.S. 540, 548 (1992). Thus, if the government arguably has induced the defendant to commit a crime, the government must show that the defendant was already disposed to commit it before he was approached. The government may meet this burden by showing that the defendant readily responded to the offered inducement, so that it is apparent that his decision was his own, and not the result of government persuasion. United States v. Jones, 976 F.2d 176, 179-80 (4th Cir.1992), cert. denied, 61 U.S.L.W. 3772 (U.S.1993) (citations omitted). If the issue of entrapment is submitted to the jury, a conviction encompasses a finding of no entrapment, which may be overturned on appeal only if no rational fact finder could have found predisposition. Id. at 180.
9
Here, the evidence showed that Santos readily responded to Finamore's initial offer of a customer who wanted an illegal transfer. Even when he learned that the money was supposedly drug profits, Santos did not hesitate. Although Santos later complained to Finamore about the difficulty of depositing a large number of small bills, no persuasion was ever required by the agent. Therefore, viewed in the light most favorable to the government, the jury could rationally find beyond a reasonable doubt that Santos was predisposed to commit the crime.
10
Santos argued at sentencing that he had a minimal role deserving of a four-level downward adjustment, United States Sentencing Commission, Guidelines Manual Sec. 3B1.2(a) (Nov.1994), because he did not seek out the illegal business and had to be instructed by Finamore how to conduct the transaction. The adjustment is appropriate for a defendant who is among the least culpable of those involved in the conduct of a group. A defendant's lack of knowledge or understanding of the scope and structure of the enterprise and of the activities of others is indicative of a minimal role. Id., comment. (n.1). Although Santos was far less involved than Finamore, he laundered $95,000 in purported drug proceeds. Consequently, we cannot say that the district court clearly erred in finding that Santos had more than a minimal role.
11
Finally, Santos requested a downward departure on various grounds. The district court decided not to depart. We lack jurisdiction to review the court's discretionary decision. United States v. Bayerle, 898 F.2d 28 (4th Cir.), cert. denied, 498 U.S. 819 (1990).
12
We therefore affirm the conviction and sentence. That portion of the appeal which contests the district court's decision not to depart is dismissed. 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.
13
AFFIRMED IN PART, DISMISSED IN PART.
|
United States Court of Appeals
Fifth Circuit
F I L E D
REVISED FEBRUARY 16, 2006
UNITED STATES COURT OF APPEALS January 23, 2006
FOR THE FIFTH CIRCUIT Charles R. Fulbruge III
Clerk
No. 04-20752
In The Matter Of: RAMBA INC.
Debtor
LOWELL T. CAGE,
Appellant,
v.
WYO-BEN, INC.; GEORESOURCES, INC.; TRANS-CAPITAL,INC.;
M-I, LLC, doing business as Federal Wholesale Drilling
Mud; SCHLUMBERGER TECHNOLOGY CORP., doing business as
Dowell Schlumberger; AMCHEM, INC.; ENTERPRISE FLEET
SERVICES; DANOS & CUROLE MARINE CONTRACTORS, INC.;
MILWHITE, INC.; EXCALIBAR MINERALS, INC.
Appellees.
Appeal from the United States District Court
for the Southern District of Texas
Before REAVLEY, GARZA, and BENAVIDES, Circuit Judges.
BENAVIDES, Circuit Judge:
This case involves a trustee’s attempt to avoid transfers to
creditors in a Chapter 7 bankruptcy. The district court granted
summary judgment to the Appellees, holding that indirect transfers
to ten creditors did not constitute voidable preferences. It
reached this conclusion after holding that the transfers were in the
ordinary course of business and that the transfers were made from
property in which the debtor had no interest. We AFFIRM on the
grounds of the second holding and therefore do not reach the first.
The district court also considered one direct transfer. It erred
when it found that the transfer was in the ordinary course of
business. Therefore, we AFFIRM in part and VACATE and REMAND in
part.
I. FACTUAL AND PROCEDURAL BACKGROUND
On November 21, 2000, Ramba, Inc. filed for Chapter 7
bankruptcy. The Trustee, Lowell Cage, filed numerous proceedings
against entities who received transfers from Ramba, including
actions against the Appellees. The Appellees are ten vendors who
provided materials, equipment, and services to Ramba’s drilling
division.1 After a request for a jury trial, the proceedings were
removed to the district court and consolidated into one case.
All but one of the transfers at issue resulted from the sale
of Ramba’s drilling division to a subsidiary of Patterson Energy,
Inc. Ramba and Patterson entered an “Asset Purchase Agreement” on
September 30, 2000, two months prior to the bankruptcy filing, while
Ramba was doing business as Ambar, Inc. The transaction required
Ramba to sell all the assets of its drilling division, and, as part
1
The Appellees are: M-I, L.L.C.; Danos & Curole Marine
Contractors, Inc.; GeoResources, Inc.; Milwhite, Inc.; Excalibar
Minerals, Inc.; Amchem, Inc.; Schlumberger Technology Corp.; Wyo-
Ben, Inc.; Trans-Capital, Inc.; and Enterprise Fleet Services.
2
of the consideration, Patterson assumed some of Ramba’s liabilities.
Those liabilities included debts owed to the Appellees. Ramba also
sold Patterson the rights to the name “Ambar.” A Patterson
subsidiary later began doing business as “Ambar Drilling.”
Prior to the selling of the division, Ramba owed Citibank more
than $25 million under a credit agreement dated August 14, 1997.
Pursuant to that agreement, Ramba granted Citibank liens on all its
assets, including the assets ultimately sold to Patterson. The
result was that Citibank’s security interests wholly encumbered
Ramba’s assets, exceeding their fair market value. As part of and
essential to the sale to Patterson, Citibank agreed to release its
security interests in the assets of the drilling division and to
allow some of the purchase price to go toward paying Ramba’s debts.
The result of the deal was that Patterson received the assets “free
and clear” of all liens and paid Citibank $15.6 million in full and
final satisfaction of its liens. Patterson then paid the remainder
of the consideration, approximately $10 million, to Ramba’s
creditors, the Appellees.
The Trustee attempts to set aside as preferential the transfers
to the Appellees that resulted from the sale to Patterson and one
“direct” transfer made by Ramba to Appellee GeoResources. The
district court held that these transfers did not constitute voidable
preferences. The decision constituted an appealable final judgment.
See Zink v. United States, 929 F.2d 1015, 1020 (5th Cir. 1991) (“A
3
judgment is final when it terminates litigation on the merits and
leaves the court with nothing to do except execute the judgment.”)
II. STANDARD OF REVIEW
This Court reviews a district court’s grant of a summary
judgment de novo, applying the same standards as the district court.
Hirras v. Nat’l R.R. Passenger Corp., 95 F.3d 396, 399 (5th Cir.
1996). The evidence should be viewed in the light most favorable
to the nonmoving party, and the record should not indicate a genuine
issue as to any material fact. Am. Home Assurance Co. v. United
Space Alliance, 378 F.3d 482, 486 (5th Cir. 2004). This Court
reviews factual findings for clear error. In re Mercer, 246 F.3d
391, 402 (5th Cir. 2001).
III. DISCUSSION
A. Indirect Transfers to Appellees
Section 547(b) of the Bankruptcy Code establishes the six
elements of any preference action. To be a preference there must
be:
(1) “a transfer of an interest of the debtor in
property; ”
(2) “to or for the benefit of a creditor;”
(3) “for or on account of an antecedent debt owed by
the debtor before such a transfer was made;”
(4) “made while the debtor was insolvent;”
(5) “made on or within 90 days before the date of the
filing of the petition” (or one year if an insider);
4
and
(6) one “that enables such creditor to receive more
than such creditor would receive” if (A) the debtor
filed under Chapter 7, and (B) the transfer had not
been made.
11 U.S.C. § 547(b) (2000). The transfers at issue fail to meet the
first element.
A debtor has an interest in property if that property would
have been part of the debtor’s bankruptcy estate had the transfer
not occurred. See In re Criswell, 102 F.3d 1411, 1416 (5th Cir.
1997). A trustee cannot avoid transfers of property unless the
property would have been in the estate and therefore available to
the debtor’s general creditors. Warsco v. Preferred Technical
Group, 258 F.3d 557, 564 (7th Cir. 2001). Essentially, a voidable
preference must have depleted the estate. Gulf Oil Corp. v. Fuel
Oil Supply & Terminaling, Inc., 837 F.2d 224, 230–31 (5th Cir.
1988). A trustee bears the burden of proving that the debtor had
an interest in the transferred property. Warsco, 258 F.3d at 564.
The Bankruptcy Code offers further explanation of what assets
fall within a bankruptcy estate. Section 541 of the Code states:
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
. . . 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). There can be no preference when a debtor
transfers property in which the debtor has no equitable interest.
See In re Bean, 252 F.3d 113, 117 (2d Cir. 2001); In re Parham, 72
5
B.R. 604, 605 (Bankr. M.D. Fla. 1987); In re Central States Press,
57 B.R. 418, 422 (Bankr. W.D. Mo. 1985) (“Even the most liberal
rules permitting recovery under § 547 . . . apply only to the extent
that the value of the collateral transferred exceeds the
indebtedness of the debtor on the security interest.”).
In In re Maple Mortgage, Inc., 81 F.3d 592, 595 (5th Cir.
1996), we held that funds at issue in a preference dispute must have
been available for distribution to general creditors. “[I]f funds
cannot be used to pay the debtor’s creditors, then they generally
are not deemed an asset of the debtor’s estate for preference
purposes.” Id. While Maple Mortgage did not specifically address
whether a debtor’s bankruptcy estate includes fully encumbered
property, it recognized the common sense reasoning that funds must
be available to pay creditors. Other courts have reached similar
results, holding that a bankruptcy estate is made up of equity, as
opposed to legal title alone. See, e.g., In re Mahendra, 131 F.3d
750, 755 (8th Cir. 1997) (holding that “[a]ny portion of a debtor’s
property that is unencumbered by mortgage—the equity—is part of the
bankrupt’s estate.”); U.S. v. Rauer, 963 F.2d 1332 (10th Cir. 1992)
(same).2
2
When a debtor holds only legal title to fully encumbered
property during a Chapter 7 bankruptcy, the trustee typically
abandons the property because the estate cannot benefit from its
sale. For that reason, few cases exist that involve a dispute as
to whether fully encumbered property can be property of an
estate.
6
At the time of the drilling division sale, it is undisputed
that Ramba’s assets were fully encumbered by Citibank’s liens.3
Ramba had no equity in the proceeds of the sale, and, therefore, the
funds never would have been available to general creditors in the
bankruptcy. The Trustee argues that upon Citibank’s acceptance of
$15.6 million from Patterson, the “assumed liability” portion of the
purchase price was converted into unencumbered funds, which
presumably Ramba could then distribute to creditors as it wished in
the resulting bankruptcy. This theory fails because there is no
evidence that Citibank agreed to create equity for the benefit of
Ramba. The consideration from the sale of Citibank’s collateral
belonged to Citibank, the secured lender.
The problem with Ramba’s lack of equity is illustrated by the
remedy the Trustee is requesting. The Trustee wants a refund of the
$10 million paid to the Appellees by Patterson. By doing so, he
essentially is asking for the benefit of the deal with Patterson
while cancelling one of the underlying terms of the bargain. The
district court points out that without the debt assumption
provision, it is likely that there would never have been a deal with
Patterson. The court opined, “A drilling outfit that has difficulty
getting basic materials like mud and care is not an attractive
3
During oral argument, the attorney for the Trustee admitted
that “the debt and the assets are roughly equivalent,” describing
the assets as “fully encumbered.” Indeed, the record shows that
the Trustee stipulated to the fact that “Citibank was owed in
excess of the fair market value of the Debtor’s total assets.”
7
asset.” The Patterson transaction was structured so that the
drilling division would operate without interruption, as seen by
Patterson’s choice in adopting the “Ambar” name. The district court
found that only one of the Appellees even knew the division had a
new owner. The Trustee’s request threatens to undo the entire
Patterson transaction. Such an undoing would leave Citibank holding
liens on the drilling division and the Trustee having an asset that
would not benefit general creditors.
The Trustee’s reliance on In re Conard Corporation, 806 F.2d
610 (5th Cir. 1986), is misplaced. In Conard, the debtor sold pizza
restaurants to a third party. As part of the transaction, the buyer
agreed to assume and be bound by eighty-four installments on an
unpaid promissory note. Id. at 611. This Court held that those
payments were voidable preferences because the assumption of debt
provision prevented the debtor’s estate from benefitting from a
higher selling price. Id. Conard, however, is easily
distinguished. The restaurants were unencumbered at the time of the
sale, giving the debtor an equitable interest in the asset. Here,
Ramba only held legal title at the time of the Patterson
transaction. Had Patterson been willing to pay a higher price for
the assets rather than assuming the debt, the increase in funds
would have gone to Citibank, not the estate.4
4
The Trustee also fails in his argument that the district
court and the Appellees misinterpret section 541(d). He says
“equitable” as used in section 541(d) only applies to secondary
8
Ramba had no interest in the transferred property other than
bare legal title. This is insufficient for avoiding the transfers
to the Appellees. Because we affirm on this ground, we need not
address the district court’s holding that the transfers occurred in
the ordinary course of business. Similarly, we need not address
alternative arguments presented by the Appellees.5
B. Direct Transfer to Appellee GeoResources
The Trustee attempts to recover one “direct” payment to
GeoResources in the amount of $28,396.83 paid on September 8, 2000.6
The September payment totaled $31,899.03, but only $28,396.83 is at
mortgage situations where a real estate purchaser has paid the
full amount due but has not yet received a deed. Id. He
concludes that section 541(d) does not apply to Ramba and relies
on section 541(a)(1), which provides that the bankruptcy estate
is comprised of “all legal and equitable interests.” 11 U.S.C. §
541(a)(1) (emphasis added). The United States Supreme Court and
this Court, however, have applied section 541(d) outside the
equitable mortgage context. See, e.g., Begier v. IRS, 496 U.S.
53, 59 (1990) (examining trust funds paid to the IRS under
section 541(d)); In re Haber Oil Co., Inc., 12 F.3d 426 (5th Cir.
1994) (examining constructive trusts under section 541(d)). In
addition, this Court reads section 541(d) in conjunction with
section 541(a)(1) rather than as two distinct, inconsistent
provisions. In re Maple Mortgage, 81 F.3d at 595 (explaining
that section 541(d) “further explains” section 541(a)(1)).
5
Appellees argue that the payments are not voidable
preferences because Ramba contemporaneously received new value in
exchange for the transfers. Appellees also argue that they did
not receive more than they would have under a liquidation, a
requirement under section 547(b).
6
The briefs varied in their descriptions of the direct
transfer payments at issue. At oral argument, the attorney for
the Trustee clarified the discrepancies, stating that the Trustee
only sought to avoid $28,396.83 of the September payment.
9
issue. This payment came directly from Ramba as opposed to being
paid by Patterson.
The parties disagree as to whether the GeoResources payment
satisfies the Bankruptcy Code’s exception for payments made in the
ordinary course of business. The disagreement centers on the timing
of the payments and whether the timing met the requirement that the
payment be “made according to ordinary business terms.” 11 U.S.C.
§ 547(c)(2)(C). The record shows that this payment was for invoices
more than 180 days old. The district court found that the industry
standard for payment of invoices was 120 days.7 Therefore, this
issue turns on the sixty-day difference between the industry
standard and the actual payment date.
In In re Gulf City Seafoods, Inc., this Court adopted an
“objective test” for determining when a credit arrangement is within
the ordinary course of business. 296 F.3d 363, 367–68 (5th Cir.
2002). “[T]he question must be resolved by consideration of the
practices in the industry—not by the parties dealings with each
other.” Id. at 369. This Court was careful to ensure that the test
did not “place businessmen in a straightjacket” by enforcing “strict
conformity” to a standard or requiring “identical” credit
7
The court stated that the parties “admitted” that this was
the correct standard. The Trustee, however, disputes this
standard and asserts that he never made such an admission.
Whether or not the Trustee ever admitted the standard was 120
days is not significant here. No fact issue was created as the
only summary judgment evidence presented with respect to this
issue was that the standard was 120 days.
10
arrangements. Id. at 368. Instead, the ordinary business term
“sets an outer boundary to the parties’ practices” presenting the
question of “whether a particular arrangement is so out of line with
what others do that it fails” to be ordinary. Id. at 369.
The district court found that although the GeoResources payment
was “outside the industry standard, [it] reflected historical
relations between GeoResources and Ambar.” The district court’s
analysis contradicts the test outlined in Gulf City Seafoods.
According to the teachings of Gulf City Seafoods, the “historical
relations” between GeoResources and Ambar should not be the focus
of an objective inquiry. The Appellees argue that the payment still
satisfies the “ordinary business” requirement, pointing to cases
that have held that late payments are not per se “unordinary.” See
In re Grand Chevrolet, Inc., 25 F.3d 728, 732 (9th Cir. 1994);
Lovett v. St. Johnsbury Trucking, 931 F.2d 494, 497 (8th Cir. 1991);
In re Yurika Foods Corp., 888 F.2d 42, 44 (6th Cir. 1989).
The Gulf City Seafoods test allows for some late payments, as
seen by its language that warns against enforcing “strict
conformity” or requiring “identical” transactions. Gulf City
Seafoods, 296 F.3d at 368. The question under Gulf City Seafoods
becomes whether the sixty-day delay fails to be in the ordinary
course of business because it is “so out of line with what others
do.” Id. at 369. The GeoResources payment was approximately sixty
days late according to its own witnesses. The 180 days it took to
11
pay GeoResources is 150 percent of the industry standard. The
Trustee challenges the accuracy of the “120 day” figure, suggesting
that in practice it is much shorter. Even under the “120 day”
standard, the payment to GeoResources is significantly out of line
with what others do. The delay in payment here cannot be deemed
ordinary. For these reasons, it fails to be in the ordinary course
of business and therefore is a voidable preference.
VI. CONCLUSION
The district court did not err in its holding that Ramba had
no interest in the property transferred during the Patterson
transaction. For that reason, the court’s judgment that the
indirect transfers did not constitute voidable preferences is
AFFIRMED. The district court did err in its determination that a
direct transfer to GeoResources was made in the ordinary course of
business. For that reason, we VACATE the court’s judgment that the
direct transfer did not constitute a voidable preference and REMAND
for a decision consistent with this opinion.
12
|
618 F.2d 98
Ferrellv.Hutto
79-6673
UNITED STATES COURT OF APPEALS Fourth Circuit
1/31/80
1
E.D.Va.
AFFIRMED
|
331 F.2d 414
UNITED STATES of America, Appellant,v.Margery Thayer MILLER, Appellee.
No. 18281.
United States Court of Appeals Ninth Circuit.
April 8, 1964.
John W. Douglas, Asst. Atty. Gen., Charles A. Muecke, U.S. Atty., Alan S. Rosenthal and David J. McCarthy, Jr., Attys., Dept. of Justice, Washington, D.C., appellant.
O'Connor, Anderson, Westover, Killingsworth & Beshears, John F. Swartz, Harry J. Cavanagh, and John P. Otto, Phoenix, Ariz., for appellee.
Before CHAMBERS, HAMLEY and HAMLIN, Circuit Judges.
CHAMBERS, Circuit Judge.
1
The main question here is: Did the United States gain a windfall when Margery Thayer Miller made an election to take an award of the Arizona Industrial Commission after the death of her husband in September, 1958?
2
One year, ten months and fourteen days after the first written election, she made a second election; this time it was to sue the United States under the Federal Tort Claims Act. The government concedes its negligence caused the death of Cutler R. Miller, Margery Miller's husband. The district court sustained Mrs. Miller's contention that her first written election was made in ignorance of the law and the facts, and that, therefore, she could make another election at the Industrial Commission to pursue the United States and it would be all right. We agree and affirm.
3
This is not a case where someone really relied on Mrs. Miller's first election. One can go along with Mrs. Miller's position and still believe in the sanctity of a promise.
4
The facts are not quite the same but our decision here, to us, is clearly forecast by our Merritt-Chapman & Scott Corporation v. Frazier, 289 F.2d 849, and Taylor v. Hubbell, 188 F.2d 106.
5
Here we should relate that Cutler Miller, the deceased was an employee of Motorola, Inc., a radio-television company doing business in Phoenix and apparently at Fort Huachuca, Arizona. While an authorized passenger in an army plane and within the scope of his Motorola employment, the plane crashed due to someone's negligence in the army. Mrs. Miller and three young sons survived.
6
Six days after Miller's death, his wife, in behalf of herself and their three minor children, filed a claim with the Industrial Commission of Arizona for benefits under Arizona's Workmen's Compensation Law. Motorola was self insured and obligated to pay any proper award made by the Commission to Mrs. Miller.
7
On October 29, 1958, 34 days after filing the claim, Mrs. Miller upon request appeared at the Commission office and was interviewed by a claims officer. At his suggestion she signed an 'Election of Remedy' paper. Under the blank document three options were listed:
8
1. Waive claims under the compensation law and proceed against a third party defendant.
9
2. Proceed against third party defendant, but look to compensation law for any deficiency not obtained from the third party.
10
3. Take only the benefits of the compensation law. (The three options follow 23-1023, A.R.S.)
11
It is to be noted that no named third party was in the form and none was inserted. Further, the form reads more as if it was prepared for an injured workman to sign, not his widow. Be that as it may, Mrs. Miller elected the third option, which was to take the benefits of the compensation act exclusively.1 Previously on October 1, 1958, the Commission had made an award, but apparently on October 29, the date of the election document, the first monthly payment had not been made.
12
Mrs. Miller accepted monthly payments until the fall of 1960. Then on September 12, 1960, she filed at the Industrial Commission of Arizona, using the same type of form, an election of option No. 2. This permits a claim against a third party. Then she promptly filed suit against the United States. The purpose of the second election was to supersede the first. But the United States says it acquired vested rights under the first election. But the district court excused Mrs. Miller on her pleading and testimony that she had made a mistake of both law and fact. Mrs. Miller was a highly educated woman. She apparently was advised promptly that there was some fault on the part of the government, but she also had learned the historical concept of sovereign immunity: 'You can't sue your government.' She had not been advised of the existence of the Federal Tort Claims Act. She had no advice from the attorney probating her husband's estate and the Commission's man gave none.
13
We shall not catalogue the Arizona constitutional and statutory provisions or the applicable Arizona state cases. They can all be found by reference to our Merritt-Chapman & Scott case, supra.
14
Arizona, our research indicates, has not expressly reached either the question of Merritt-Chapman or of this case. This case is a variation of Merritt-Chapman. In Merritt-Chapman the change in election was made during the period when the Commission's award was still subject to rehearing. Essentially, the third party in Merritt-Chapman argued that a contract had been made of which it was entitled to the benefit; that the election had to be tied in to the award. This court met the third party upon the ground which the party chose and answered that there was nothing final about the award during the period that it was open to reconsideration.
15
Here in Miller the election was made after the award and the 20 day period for an ordinary rehearing had gone by.
16
We need not repudiate Merritt-Chapman to sustain Miller on a different ground. We are of the opinion that the Arizona Supreme Court would not hold Mrs. Miller to her first election by filing a claim with the Commission or by the first written election. We are satisfied from our reading of the Pressley cases, Pressley v. Industrial Commission, 73 Ariz. 22, 236 P.2d 1011, and State ex rel. Industrial Commission v. Pressley, 74 Ariz. 412, 250 P.2d 992, that Arizona would say that the filing of the claim with the Commission and the first written election were voidable by the claimant if there had not been an intentional abandonment of a known right or privilege and even though almost two years had elapsed when Mrs. Miller discovered her rights.
17
The Arizona court's policy of liberality for the injured workman is well established. One small instance is illustrated in the second Pressley case, supra, where the court gives two different (and opposite) constructions in favor of the workman on the word 'compensation' appearing in Section 23-1023, A.R.S., in two different places. The court is quite frank about its policy and even refers one to West Publishing Key Number 51 of Workman's Compensation to see its recurring examples of its policy. (The foregoing is not intended in any way as a criticism of the Court. Its candor helps us predict what it would do with Mrs. Miller's case.)
18
The government relies on Arizona cases, most of which are cited in Merritt-Chapman, where on coverage elections made by a workman on entering employment, the workman was held to his election.2 Of course, that is essentially a bilateral matter. Other persons rely on the election. And it is hard for the workman to make a mistake on that. (He may later recognize a mistake in judgment.) But if he initially waives workman's compensation under the act, it is hard for him to not know he is doing it and he usually knows someone is relying on his election.
19
Much different it is in a post accident claim with a widow. The Arizona law in matters such as this holds mistake of law is as good as mistake of fact.3 We cannot find the trial court's finding of mistake clearly erroneous. Further, we hold that the change of election was timely.4 The government's brief is an excellent one, but we think fundamentally wrong. We hold that Mrs. Miller's first election did not make the government a present of the damages here. (We recognize that Motorola might have had and may still have some rights against the United States.)
20
Finally, the government objects that the district court did not 'find the facts specially' on the damage. Rule 52(a), Federal Rules of Civil Procedure. The court just found one lump sum. Appellee makes a pretty fair explanation of how the court arrived at a total award, but we believe the government should have been told something more about the award of $225,000.
21
We do not believe the appellant was entitled to a long list of details, but the court should have separated the loss of earnings (support) from the loss of affection and related items. In saying this, we do not wish to encourage minutiae in findings.
22
However, we believe the error, if such it was, was harmless. About 85 per cent of the award would seem to be justified as the present value of the loss of support. The rest would not seem 'monstrous' for the less tangible factors allowable in Arizona. We are not required to assume the preposterous that the judge allowed, for example, $220,000 for loss of affection and $5,000 for loss of earnings. Our powers of review of damage are so limited5 that we believe that the possible error was harmless. In another case, the failure to make some split of the damages might be reversible error. Findings on one hand ordinarily should go further than 'guilty' or 'not guilty.' They should be succinct and should not be cumbersome or analyze the evidence. The ultimate facts are what is wanted.
23
It would appear that also pending in the same district court is Motorola's case against the United States, presumably to recover the former's payments to Mrs. Miller which ought to be deducted from her award against the United States. Consolidation would seem desirable. The district court is authorized to open up the judgment herein, to make such consolidation of cases and adjustment of Motorola's claim vis-a-vis Mrs. Miller and the United States as may seem necessary.
24
The judgment is affirmed, but proceedings as indicated above are authorized.
1
23-1024 A.R.S. provides:
'Choice of remedy as waiver of alternate remedy
'A. An employee, or his legal representative in event death results, who makes application for an award, or with the consent of the commission accepts compensation from an employer, waives the right to exercise any option to institute proceedings in court.
'B. An employee, or his legal representative in event death results, who exercises any option to institute proceedings in court waives any right to an award or direct payment of compensation from his employer.'
The first written waiver here really is of less import as a waiver than the filing of the claim.
2
E.g., Bradley v. Industrial Commission, 51 Ariz. 291, 76 P.2d 745
3
Merritt-Chapman & Scott Corporation v. Frazier, cited supra
4
How long one has to discover one's mistake we would assume would probably be governed ordinarily by the statute of limitations on suing the third party
5
Southern Pacific Co. v. Guthrie, 9 Cir., 186 F.2d 926; Baldwin v. Warwick, 9 Cir., 213 F.2d 485; Union Pacific R. Co. v. Johnson, 9 Cir., 249 F.2d 674
|
917 F.2d 561
Brownv.Stalder*
NO. 90-4209
United States Court of Appeals,Fifth Circuit.
OCT 03, 1990
1
Appeal From: W.D.La.
2
DISMISSED.
*
Fed.R.App.P. 34(a); 11th Cir.R. 34-3
|
SUPREME COURT OF THE STATE OF NEW YORK
Appellate Division, Fourth Judicial Department
467
CA 10-02240
PRESENT: SMITH, J.P., CENTRA, PERADOTTO, GORSKI, AND MARTOCHE, JJ.
KENNETH J. WILLIAMS, INDIVIDUALLY AND AS
ADMINISTRATOR OF THE ESTATE OF CHARLEE C.
FETZNER, DECEASED, PLAINTIFF-APPELLANT,
V ORDER
LATTIMORE ROAD SURGICENTER, INC., ET AL.,
DEFENDANTS,
JOHN D. MARQUARDT, M.D. AND LATTIMORE
ORTHOPAEDICS, P.C., DEFENDANTS-RESPONDENTS.
CARL L. FEINSTOCK, ROCHESTER, FOR PLAINTIFF-APPELLANT.
BROWN & TARANTINO, LLC, BUFFALO (ANN M. CAMPBELL OF COUNSEL), FOR
DEFENDANTS-RESPONDENTS.
Appeal from an order and judgment (one paper) of the Supreme
Court, Monroe County (Ann Marie Taddeo, J.), entered April 13, 2010.
The order and judgment, inter alia, dismissed the complaint upon a
jury verdict.
It is hereby ORDERED that the order and judgment so appealed from
is unanimously affirmed without costs.
Entered: June 10, 2011 Patricia L. Morgan
Clerk of the Court
|
859 F.2d 927
Leev.Secretary of HHS*
NO. 88-8160
United States Court of Appeals,Eleventh Circuit.
SEP 19, 1988
1
Appeal From: M.D.Ga.
2
AFFIRMED.
*
Fed.R.App.P. 34(a); 11th Cir.R. 23
|
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