Datasets:

gen-law

/

tim-cl-extracted

like 0

Follow

genlaw 10

2013-10-30 06:35:54.09096+00

Irenas

901 F. Supp. 900 (1995) Jeanne AMOROSO, in her own right, Administratrix and Administratrix Ad Prosequendum of the Estate of Michael Amoroso, Deceased, Plaintiffs, v. BURDETTE TOMLIN MEMORIAL HOSPITAL, et al., Defendants. Civ. A. No. 94-2799 (JEI). United States District Court, D. New Jersey. October 11, 1995. *901 Levy, Angstreich, Finney, Baldante, Mann & Burkett by Michael Coren, Cherry Hill, NJ, for plaintiff Jeanne Amoroso. Paarz, Master & Koernig by Robert E. Paarz, Pleasantville, NJ, for defendants Burdette Tomlin Memorial Hospital, Theresa Bridge-Jackson, M.D., and Warren Ventriglia, M.D. George and Korin by Jay J. Blumberg, Woodbury, NJ, for defendant Vinayak M. Sabnis, M.D., P.A. *902 James A. Waldron, Cape May Court House, NJ, for defendant Carmen J. Alameno, M.D. Slimm and Goldberg by Robert M. Kaplan, Westmont, NJ, for defendant North Wildwood Rescue Squad. Carson, Astorino, McLarty, Howarth & Demille by Robert A. McLarty, Jr., Trenton, NJ, for defendants Donald and Mary Loder. Stagliano and Deweese by Ronald J. Stagliano, Wildwood, NJ, for defendant Twin Power, Inc., t/a A.C. Chambers, Real Estate. Goldfein and Joseph by Roseann Lynn Brenner, Princeton, NJ, for defendant Stephen Freeman. Swartz, Campbell & Detweiler by Daniel D. Krebbs, Philadelphia, PA, for defendant Michael James Discher. Gruccio, Pepper, Giovinazzi, DeSanto & Farnoly, P.A. by E. Edward Bowman, Vineland, NJ, for defendant Michael Jerome Quinn. AMENDED OPINION IRENAS, District Judge: Michael Amoroso, a Pennsylvania citizen, was stabbed on June 16, 1992, during a fight in North Wildwood, New Jersey at a "Senior Week" party. He was transported by the North Wildwood Rescue Squad to Burdette Tomlin Memorial Hospital for treatment. Amoroso died on June 17, 1992, while on the operating table. On June 15, 1994, Jeanne Amoroso, the mother of the deceased, brought wrongful death and survival damage claims against the various health care providers who rendered assistance to Michael Amoroso subsequent to the stabbing and immediately prior to his death. She also named as defendants the owners and property managers of the duplex where the stabbing occurred. The plaintiff made a motion in limine on July 27, 1995, to determine the law applicable to her wrongful death and survival damages claims. She argues that Pennsylvania law should apply to the accident because there is no true conflict between Pennsylvania and New Jersey law and because, if there is a conflict, Pennsylvania has a greater interest in the outcome of the case. Defendants respond that there is a conflict between the states and that New Jersey law should apply because its interests in the result surpass Pennsylvania's interests. The Court finds that there is a true conflict between Pennsylvania and New Jersey law. Although the wrongful death statutes of both states are identical, New Jersey's survival statute, N.J.S.A. 2A:15-3, does not permit the recovery of prospective lost earning capacity which is permitted in Pennsylvania under 20 Pa.C.S.A. § 3373 and 42 Pa. C.S.A. § 8302. The New Jersey Survival Act will be applied to determine the recovery under plaintiff's survival claim because i) all major acts occurred in New Jersey, ii) the deceased's presence in New Jersey was not fortuitous, and iii) New Jersey has an interest in determining the extent of the recovery to be afforded to non-residents who vacation in this state as well as in the extent of liability of New Jersey medical services professionals and property owners. STATEMENT OF FACTS Donald and Mary Loder own property at 209 E. 17th Street in North Wildwood, New Jersey which they rent to vacationers at the New Jersey shore. Powell, Inc. (the successor to McAlarnen Realty, Inc.) and Twin Power, Inc. (known as A.C. Chambers, Real Estate) were rental agents for the property. The Loders and the agents are New Jersey citizens. On November 3, 1991, A.C. Chambers, Real Estate acted as agent and executed lease agreements with Laura Maguire and Michael Seeds, high school students in Pennsylvania, to lease the two units at 209 E. 17th Street for the week of June 13, 1992, to June 20, 1992. On June 14, 1992, the decedent, Michael Amoroso, travelled with friends to Cape May, New Jersey to participate in "Senior Week," a time when graduating seniors from Pennsylvania high schools go to New Jersey shore towns to celebrate. Michael Amoroso visited friends at 209 E. 17th Street in North Wildwood, New Jersey on June 16, 1992. Stephen Freeman, Michael Quinn, Michael Discher, and Paul Pellechia were also visiting with friends there at the same time. *903 While at the house, Michael Amoroso and Stephen Freeman fought. Freeman contends that he was attacked by Discher, Quinn, and Pellechia. Amoroso was stabbed in the chest by Freeman during the fight. The North Wildwood Rescue Squad and Atlantic/Cape Mobile Intensive Care Consortium were contacted for assistance. The North Wildwood Rescue Squad transported Michael Amoroso to the Emergency Department of Burdette Tomlin Memorial Hospital in Cape May Court House, New Jersey. Theresa Bridge-Jackson, M.D. and Warren Ventriglia, M.D. treated Amoroso in the emergency room of the hospital at approximately 11:00 p.m. on June 16, 1992. Both doctors are licensed to practice medicine in New Jersey and they work in the Cape May area. Amoroso was moved to the operating room of Burdette Tomlin Memorial Hospital by 11:38 p.m. Carmen Alameno, M.D. and Vinayak Sabnis, M.D., surgeons in the Cape May area who are licensed in New Jersey and are on staff at the Burdette Tomlin Memorial Hospital, performed a thoracotomy and sutured the right ventricle and right atrial appendage. Michael Amoroso died in the operating room at about 12:25 a.m. on June 17, 1992. PROCEDURAL HISTORY The plaintiff, Jeanne Amoroso, is the mother of the decedent and has been granted Letters of Administration for the Estate of Michael Amoroso, deceased, by the Register of Wills of Delaware County, Pennsylvania, and Letters of Administration Ad Prosequendum for said decedent by the Surrogate of Cape May County. On June 15, 1994, plaintiff instituted an action against Burdette Tomlin Memorial Hospital, Carmen J. Alameno, M.D., Vinayak M. Sabnis, M.D., Vinayak M. Sabnis, M.D., P.A., Theresa Bridge-Jackson, M.D., Warren Ventriglia, M.D., North Wildwood Rescue Squad, Donald and Mary Loder, Powell, Inc., Twin Power, Inc., and a variety of John/Jane Doe defendants. These defendants are all New Jersey citizens. North Wildwood Rescue Squad brought a third-party claim against Stephen Freeman and Atlantic/Cape Intensive Care Unit. Stephen Freeman brought a fourth-party claim against Michael Jerome Quinn, Michael James Discher, and Paul Joseph Pellechia, all of whom were allegedly involved in the fight during which Michael Amoroso was stabbed. Atlantic/Cape Intensive Care Unit is a New Jersey citizen while Freeman, Quinn, Discher, and Pellechia are Pennsylvania citizens. DISCUSSION A. Choice of Law Rules In a diversity action, a federal district court applies the choice of law rules of the state in which it sits. Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496, 61 S. Ct. 1020, 1021-22, 85 L. Ed. 1477 (1941); McFarland v. Miller, 14 F.3d 912, 917 (3d Cir.1994). New Jersey applies a "governmental interest" test to choice of law issues. Veazey v. Doremus, 103 N.J. 244, 510 A.2d 1187 (N.J.1986). Under this test, the court must first "determine whether a conflict exists between the law of the interested states." Id. at 248, 510 A.2d at 1189. This determination must be made "on an issue-by-issue basis." Id. If the court finds that a conflict does exist, it must then determine "the state with the greatest interest in governing the particular issue." Id. at 248, 510 A.2d at 1189. To do this, the court must "identify the governmental policies underlying the law of each state and how those policies are affected by each state's contacts to the litigation and the parties." Id. It is "the qualitative, not the quantitative, nature of a state's contacts [that] ultimately determines whether its law should apply." Id., at 248, 510 A.2d at 1190. B. Choice of Survival Statute 1. Existence of a Conflict The New Jersey Survival Act, N.J.S.A. 2A:15-3 (West 1987), allows for a recovery of damages for pain and suffering between the time of injury and death, while the Pennsylvania Survival Act, 20 Pa.C.S.A. § 3373 (1982) and 42 Pa.C.S.A. § 8302 (1982), allows recovery not only for those damages but also for loss based on the prospective earning capacity of the deceased. See Bortner v. Gladfelter, 302 Pa.Super. 492, 448 A.2d 1386 (1982). Where the decedent is a young person with a limited earning history and no *904 dependents this difference is significant. In urging the applicability of Pennsylvania law plaintiff argues that New Jersey has no interest in the administration of estates of non-resident decedents, Foster v. Maldonado, 315 F. Supp. 1179 (D.N.J.1970), and that New Jersey's law was passed to establish a recovery for plaintiffs, not to limit the liability of defendants, Pollock v. Barrickman, 610 F. Supp. 878 (D.N.J.1985). See also, Canino v. New York News, Inc., 96 N.J. 189, 475 A.2d 528 (1984) (reviewing the history of tort remedies in the context of whether an action for liable survives the death of the defamed party). District courts in New Jersey have addressed this issue and have disagreed in their interpretation of the policies underlying the New Jersey survival statute. Judge Gerry has suggested that the legislative history of the survival statute demonstrates that it was principally, if not solely, passed as a remedial measure to create a cause of action for survivors of a decedent and not as a limitation of liability for defendants. Pollock, 610 F.Supp. at 880-81. See also, Canino, 96 N.J. at 191-94, 475 A.2d at 529-30. On the other hand, Judge Brotman and Judge Cohen have found that the survival statute was intended to protect New Jersey resident defendants from large recoveries. Mathis v. Motley, 649 F. Supp. 38, 40 (D.N.J.1986) (Brotman, J.) (citing Colley v. Harvey Cedars Marina, 422 F. Supp. 953, 955 (D.N.J.1976) (Brotman, J.) and Nolen v. Found. and Structures, No. 83-1372, 1984 WL 3580, DCTU database (D.N.J. April 19, 1984) (Cohen, J.)). The Third Circuit has recognized that a wrongful death statute inherently concerns the rights of both parties: Inasmuch as N.J.Stat.Ann. § 2A:31-5 (West Supp.1987) sets forth the type of damages that may be recovered in a wrongful death action, it reflects the New Jersey Legislature's determination both of what is fair for a plaintiff to recover and a defendant to pay in such a case. Accordingly, New Jersey's interest in this case is no less that Florida's and the judge correctly held that its law of damages should be applied. Petrella v. Kashlan, 826 F.2d 1340, 1343 (3d Cir.1987). See also Richardson v. Hill, No. 89-5022, 1991 WL 149872, 1991 U.S.Dist. LEXIS 10678 (D.N.J. July 29, 1991) (Fisher, J.); Scuorzo v. Spinazzola, No. 89-4626, 1991 WL 5741, 1991 U.S.Dist. LEXIS 518 (D.N.J. January 16, 1991) (Wolin, J.). Similarly, New Jersey and Pennsylvania were concerned with the rights of both plaintiffs and defendants when they passed their survival statutes. These states dealt with the same societal concerns in creating a cause of action for survivors. See W. Page Keeton et al., Prosser and Keeton on the Law of Torts § 126 (5th ed. 1984). A true conflict exists not because the underlying purposes of the two laws differ. Both laws attempt to balance a state's interest not only in providing a recovery for wrongful death, but also in determining the extent of the tortfeasor's liability. But because each state resolved differently the conflicting societal interests involved in a law measuring damages, a true conflict exists in the survival laws of New Jersey and Pennsylvania. 2. Governmental Interest Analysis a. Law of the State Where the Injury Occurred Although New Jersey has abandoned the strict application of the rule of lex loci delecti in tort cases, see Pfau v. Trent Aluminum Co., 55 N.J. 511, 526, 263 A.2d 129, 136-37 (1970), it has recognized that the place of the injury is an important factor to consider in determining what state has the greatest interest in a case. Mowrey v. Duriron Co., Inc., 260 N.J.Super. 402, 413, 616 A.2d 1300, 1305 (App.Div.1992). The Second Restatement of Conflict of Laws indicates that "the local law of the state where the injury occurred determines the rights and liabilities of the parties, unless with respect to a particular issue, some other state has a more significant relationship" under the general conflict principles set forth in § 6. Restatement (Second) of Conflict of Laws § 146 (1971). It is noted in a later Restatement comment dealing with damages that "[t]he state of conduct and injury will not, by reason of these contacts alone, be the state that is primarily concerned with the measurement *905 of damages in a tort action." Id., at § 171 cmt b. See Cianfrani v. Kalmar-Ac Handling Systems, Inc., No. 93-5640, 1995 WL 563289 (D.N.J. Sept. 11, 1995) (Irenas, J.). In determining whether to apply the law of the state where the injury took place, a court will consider whether the occurrence of the accident there was "merely fortuitous" or whether "[t]he key parties regularly engaged in their occupations and their business" in that state. Moye v. Palma, 263 N.J.Super. 287, 292, 622 A.2d 935, 938 (App. Div.1993). The Third Circuit has held that when "the place where the injury occurred was not fortuitous, as for example, in an airplane crash, the place of injury assumes much greater importance and in some instances may be determinative." Blakesley v. Wolford, 789 F.2d 236, 243 (3d Cir.1986), quoted in Cannon v. Hilton Hotels Corp., 664 F. Supp. 199, 200 (E.D.Pa.1987). Here the deceased had purposefully chosen to visit the New Jersey shore for Senior Week. He did not merely pass through New Jersey in a car or arrive in the state by happenstance. See, e.g., Pollock, 610 F. Supp. 878 (car accident in New Jersey). While his ties to New Jersey are not as extensive as those of a Pennsylvania citizen who opted to work in New Jersey or travelled into the state on a regular basis, we nevertheless find that his choice to be in New Jersey was clearly more than fortuitous. In addition, all major actions relevant to the complaint occurred in New Jersey. The deceased attended a party while in New Jersey at a house leased in New Jersey from a New Jersey property owner through a New Jersey agent. He was stabbed in New Jersey and all medical care was provided in New Jersey. New Jersey courts have reached a similar conclusion in determining what law to apply in areas other than survival statutes. In O'Connor v. Busch Gardens, 255 N.J.Super. 545, 605 A.2d 773 (App.Div.1992), the court considered a personal injury suit by a New Jersey citizen who was hurt at an amusement park in Virginia. The court applied Virginia's contributory negligence law rather than New Jersey's comparative negligence law because it found that Virginia had an interest in discouraging unsafe local property conditions and unsafe conduct. Id. See also Mowrey v. Duriron Co., Inc., 260 N.J.Super. 402, 616 A.2d 1300 (App.Div.1992) (applying a choice of law analysis in decision to dismiss case because Connecticut was sight of the event and had greater interest in the outcome). These cases properly recognize that the interest of the state where the accident occurred in protecting those within its boundaries will normally outweigh the interest of the plaintiff's residence in providing its citizens with recovery, especially where the plaintiff has a significant relationship with the state where the accident occurred. b. The Nature of the States' Interests Pennsylvania clearly has an interest in the well-being of its citizens and the administration of its decedents' estates. Cannon, 664 F.Supp. at 201 (citing Griffith v. United Air Lines, 416 Pa. 1, 203 A.2d 796 (1964)). Michael Amoroso was a resident of Pennsylvania at the time of his death. His mother still resides there, and she is administering his estate there. This gives Pennsylvania an interest in having its survival statute applied to this case. However, every state has an interest not only in the welfare of its own citizens, but also in the welfare of non-citizens who are temporarily in the state for a lawful purpose, particularly where that presence is non-fortuitous. Moye v. Palma, 263 N.J.Super. 287, 622 A.2d 935 (App.Div.1993); Blakesley v. Wolford, 789 F.2d 236 (3d Cir.1986). Tourism at the "Jersey Shore" is a major industry in this state, and New Jersey has a significant interest in the well-being of the tourists who travel to the state each year to enjoy vacation areas such as North Wildwood. It is certainly in New Jersey's interest to ensure the welfare of these tourists. This interest includes a concern that a non-resident's estate be adequately compensated for harms that befall him in New Jersey. Were the court to consider the relative state interests solely from the plaintiff's point of view, both New Jersey and Pennsylvania would have significant interests in applying their own survival statute, a law which deals with the measurement of damages as opposed *906 to defining what actions will impose liability. See discussion supra section B.2(a). However, New Jersey also has an interest in the measurement of damages for which its resident medical service providers and home-owners can be held liable, an interest of no real concern to Pennsylvania. All of the medical defendants in this case are New Jersey citizens who have chosen to work in the state and who have the right to expect that New Jersey law will govern their actions. New Jersey property owners and agents also have an expectation that any disputes regarding persons injured on New Jersey property will be judged under New Jersey law. c. Risks of Travel to Another State Plaintiff argues that Pennsylvania law should apply because plaintiff is a Pennsylvania citizen, the decedent was a Pennsylvania citizen, the decision to travel to New Jersey was made in Pennsylvania by a group of Pennsylvania citizens, and many of the personal relationships underlying this case were forged in Pennsylvania. Citizens do not, however, carry their home state's laws with them wherever they go. As Professor Cavers stated, "By entering the state or nation, the visitor has exposed himself to the risks of the territory and should not expect to subject persons living there to a financial hazard that their law had not created." D.F. Cavers, The Choice-of-Law Process 146-47 (1965), cited in Colley, 422 F.Supp. at 957. See also, Cipolla v. Shaposka, 439 Pa. 563, 567, 267 A.2d 854, 856 (1970); Blakesley, 789 F.2d at 242-43. Even though the fight that resulted in Michael Amoroso's death was between Pennsylvania citizens, the parties sued by the plaintiff are all New Jersey citizens and the claims she makes are based on actions that occurred in New Jersey. C. Choice of Wrongful Death Statute There is no conflict between the wrongful death laws of New Jersey and Pennsylvania. N.J.S.A. 2A:31-1 et seq.; 42 Pa.C.S.A. § 8301. The two states allow the same recovery of damages in a wrongful death action. See, e.g., Scuorzo v. Spinazzola, No. 89-4626, 1991 WL 5741, 1991 U.S.Dist. LEXIS 518 (D.N.J. January 16, 1991). New Jersey's law will be applied to plaintiff's wrongful death claim. CONCLUSION The court finds that there is a true conflict between the survival statutes of Pennsylvania and New Jersey, as Pennsylvania allows recovery for lost potential earning capacity while New Jersey does not. New Jersey has a greater interest in applying its law to the survival claim against the defendants, all of whom are New Jersey citizens, because the significant events regarding the claim occurred in the state and because New Jersey has a strong interest both in the extent of the recovery of non-residents vacationing in the state and in the extent of the liability of its domestic medical providers and property owners. Finally, because there is no conflict between the wrongful death laws of New Jersey and Pennsylvania, the court will apply New Jersey's law to this claim.

2013-10-30 06:35:55.815843+00

Garibaldi

152 N.J. 337 (1998) 704 A.2d 1285 JESENIA JIMENEZ, PLAINTIFF-RESPONDENT, v. WILLIAM BAGLIERI, JOHN DOE (NAME BEING FICTITIOUS), ABC CORP. (NAME BEING FICTITIOUS) AND MATERIAL DAMAGE ADJUSTMENT CORP., AS SERVICING CARRIER FOR THE MARKET TRANSITION FACILITY, DEFENDANTS, AND SAMUEL FORTUNATO, COMMISSIONER OF INSURANCE AND UNSATISFIED CLAIM AND JUDGMENT FUND BOARD, DEFENDANTS-APPELLANTS. The Supreme Court of New Jersey. Argued October 20, 1997. Decided January 29, 1998. *339 Jeffrey L. Love, argued the cause for appellants (Beattie Padovano, attorneys). Douglas D. Burgess, argued the cause for respondent (Bross, Strickland & Burgess, attorneys). The opinion of the Court was delivered by GARIBALDI, J. This appeal presents the issue of whether individuals injured by hit-and-run motorists must satisfy the verbal threshold pursuant to N.J.S.A. 39:6-70(n), to recover noneconomic damages from the Unsatisfied Claim and Judgment Fund (Fund or UCJF). We conclude the Legislature intended that claimants injured in hit-and-run accidents must satisfy the verbal threshold to recover noneconomic damages from the Fund. I On July 2, 1991, while on her way to work, plaintiff Jesenia Jimenez was struck by a car. The car slowed momentarily, allowing plaintiff to catch a glimpse of the driver, but did not stop. Plaintiff got up and walked to her bus stop, where she caught a bus and went to work. Within minutes of her arrival, she told her employer about the incident and he told her to call the police. Plaintiff's employer then took her to the hospital because she was complaining of a headache, dizziness, and leg and back pain. The hospital took x-rays and found no fractures. The emergency room *340 physicians treated her with ice packs and analgesics for her head, back, and leg pain, and released her. Subsequently, plaintiff sought treatment from Dr. Gary Bozian, a chiropractor. He treated her with massage therapy and spinal stimulation, and eventually referred her to Dr. John Burger, a neurologist, for tests related to her continuing headaches. Dr. Burger concluded that plaintiff would continue to suffer chronic periodic episodes of muscle spasm following physical or stressful events. Based on a witness's partial identification of the license plate, plaintiff filed suit against William Baglieri, as the operator of the vehicle that had injured her. Plaintiff also named Samuel Fortunato, State of New Jersey Commissioner of Insurance (Commissioner), and the Unsatisfied Claim and Judgment Fund Board as defendants pursuant to N.J.S.A. 39:6-78. Plaintiff sought medical expenses from the Fund and personal injury protection benefits from the Material Damages Adjustment Corporation (MDA), the servicing carrier for Baglieri's insurance provider. After it was established that neither Baglieri nor his car were involved in the accident, the Law Division granted summary judgment in favor of Baglieri and MDA. The Commissioner and the Fund filed a motion for summary judgment, asserting that the claim should be dismissed because plaintiff failed to present sufficient evidence of injuries satisfying the verbal threshold, as required by N.J.S.A. 39:6-70(n) (Section 70(n)). The court denied that motion and held as a matter of law that the verbal threshold did not apply. A jury trial on the liability portion of the case resulted in a judgment against the unknown tortfeasor, holding that person one hundred percent liable for the accident and plaintiff's injuries. The damages portion of the case was set for trial on October 13, 1995; however, it was rescheduled for November 1, 1995 because plaintiff's attorney was involved in an automobile accident. On November 1, 1995, defendants moved for a one-day adjournment because their medical expert was unavailable to testify on the *341 rescheduled trial date. The court denied the motion. The jury returned a verdict in favor of plaintiff in the amount of $25,000. On November 17, 1995, judgment was entered on behalf of plaintiff in the reduced amount of $15,000 pursuant to N.J.S.A. 39:6-73. Subsequently, an amended judgment was entered pursuant to N.J.S.A. 39:6-69, requiring the Fund to pay personal injury protection (PIP) benefits to plaintiff. Defendants appealed, and the Appellate Division affirmed the trial court's denial of the Fund's summary judgment motion. The panel, relying on Rivera v. Fortunato, 285 N.J. Super. 168, 666 A.2d 619 (Law Div. 1995), concluded that the verbal threshold does not apply to plaintiffs injured by hit-and-run motorists. 295 N.J. Super. 162, 684 A.2d 969 (1996). The court also held that the trial court had abused its discretion in denying the one-day adjournment, and therefore, the court remanded the case for a new trial on damages. We granted the Commissioner's petition for certification, 148 N.J. 461, 690 A.2d 608 (1997). II In 1952, as part of an automobile insurance reform package, the Legislature enacted the Unsatisfied Claim and Judgment Fund Law, L. 1952, c. 174 (codified at N.J.S.A. 39:6-61 to -91) (Fund Act),[1] to provide for the establishment, maintenance, and administration of a fund for the payment of damages for personal injuries or property damage arising out of accidents involving uninsured or unknown owners of automobiles. Only claimants who are statutorily qualified under N.J.S.A. 39:6-62 may recover benefits under the Fund. A "qualified person" is defined as one who lacks *342 recourse to uninsured motorist benefits under an applicable insurance policy. N.J.S.A. 39:6-62. Benefits are provided to two classes of individuals, those injured by known uninsured motor vehicles, N.J.S.A. 39:6-69, and those injured by hit-and-run drivers, N.J.S.A. 39:6-78. That plaintiff is a "qualified person" to recover benefits under the Fund Act is undisputed. The issue is whether, as a victim of a hit-and-run driver, she is subject to the verbal threshold requirements established in N.J.S.A. 39:6A-8. The Commissioner asserts that Section 70(n) applies and, therefore, for an eligible claimant injured in a hit-and-run accident to recover noneconomic damages from the UCJF, he or she must have suffered an injury that satisfies the verbal threshold. Plaintiff asserts, however, that Section 70(n), and thus the verbal threshold, is limited in application to cases involving known uninsured drivers, and does not apply to accidents involving hit-and-run motorists. To resolve that issue, we first review the Legislature's intent in enacting the Fund Act and the verbal threshold. A. The Fund Act The purpose of the UCJF is to "provide a measure of relief to persons who sustain losses inflicted by financially irresponsible or unknown owners and operators of motor vehicles, where such persons would otherwise be remediless." Dixon v. Gassert, 26 N.J. 1, 5, 138 A.2d 14 (1958); Douglas v. Harris, 35 N.J. 270, 279, 173 A.2d 1 (1961); Corrigan v. Gassert, 27 N.J. 227, 233, 142 A.2d 209 (1958). "The [L]egislature created the Fund `to provide the kind of protection a liability insurance policy would provide.'" Unsatisfied Claim and Judgment Fund Bd. v. New Jersey Mfrs. Ins. Co., 138 N.J. 185, 189, 649 A.2d 1243 (1994) (quoting Esdaile v. Hartsfield, 245 N.J. Super. 591, 595, 586 A.2d 334 (App.Div. 1991)) (citations omitted). However, the Fund was never intended to make every claimant whole or to compensate all accident victims; rather, it was intended to "offer some measure *343 of relief to those who come within the class intended to be protected, to prevent a claimant from being forced to absorb the entire economic loss caused by the accident." Ibid. The amounts recoverable from the Fund consist of basic PIP coverage, see N.J.S.A. 39:6-86.1 and -86.4, and recovery for bodily injury and property damage not covered by PIP, limited to $15,000 per person, $30,000 per accident for bodily injury and amounts in excess of $500, but not more than $5,000, for property damage per accident, N.J.S.A. 39:6-69. To be eligible for Fund benefits, claimants must comply with numerous procedural requirements. See, e.g., N.J.S.A. 39:6-65, -80. The Fund Act contains separate sections governing hearings for those injured by known uninsured drivers from whom damages cannot be recovered, N.J.S.A. 39:6-70, and for those injured in hit-and-run accidents, N.J.S.A. 39:6-78. For hit-and-run accidents, the Fund Act provides that "no judgment against the Commissioner shall be entered unless the court is satisfied, upon the hearing of the action," that: (a) the plaintiff has given the Board written notice of intent to make a claim within the time permitted by N.J.S.A. 39:6-65, (b) the injuries are not covered by workers' compensation laws, (c) the plaintiff was not the owner of an uninsured motor vehicle at the time of the accident or operating an automobile in violation of an order of suspension or revocation, (d) the plaintiff has a cause of action against the operator or owner of the hit-and-run vehicle, (e) all reasonable efforts have been made to identify the vehicle and its owner, and (f) the action is not brought on behalf of an insurer under the circumstances prohibited by N.J.S.A. 39:6-70(l). N.J.S.A. 39:6-78(a)-(f); Rivera, supra, 285 N.J. Super. at 172, 666 A.2d 619. The hearing requirements in N.J.S.A. 39:6-70 for accidents involving known uninsured automobiles are similar to the provisions of N.J.S.A. 39:6-78. There are, however, requirements for victims of known uninsured drivers that are unique to those accidents. Such claimants must first recover a judgment against the driver of the automobile and execute on that judgment before *344 seeking payment from the Fund. N.J.S.A. 39:6-70(h)-(k). Because the victim of a known uninsured driver, unlike the victim of a hit-and-run driver, is seeking a judgment against a known person, that additional requirement is self-explanatory. B. Verbal Threshold Law During the past three decades, the Legislature has passed several statutes intended to reduce New Jersey's ever-increasing automobile insurance premiums. See New Jersey Automobile Reparation Reform Act (No-Fault Act), L. 1970, c. 70, subsequently amended by L. 1972, c. 203 (codified at N.J.S.A. 39:6A-1 to -18); New Jersey Automobile Insurance Freedom of Choice Act and Cost Containment Act of 1984, L. 1983, c. 362, § 2 (Cost Containment Act); "Verbal Threshold Law," L. 1988, c. 119 (codified at N.J.S.A. 39:6A-8, -8.1). In 1988, the Legislature enacted the Verbal Threshold Law, which requires those purchasing automobile insurance to choose between two types of coverage for recovery for noneconomic losses resulting from automobile-related injuries. N.J.S.A. 39:6A-8; Oswin v. Shaw, 129 N.J. 290, 297, 609 A.2d 415 (1992). The verbal threshold option allows recovery for noneconomic losses only for those personal injuries that fit into one of nine specified categories.[2]N.J.S.A. 39:6A-8(a); Shaw, supra, 129 N.J. at 297, 609 A.2d 415. The traditional tort option, on the other hand, *345 permits unrestricted recovery of noneconomic damages. N.J.S.A. 39:6A-8(b). An insured who elects the tort option pays a higher premium in return for the unlimited right to sue. N.J.S.A. 39:6A-8.1(a); Shaw, supra, 129 N.J. at 297, 609 A.2d 415. An insured who fails to select a form of coverage is deemed to have chosen the verbal threshold. N.J.S.A. 39:6A-8.1(b); Shaw, supra, 129 N.J. at 297, 609 A.2d 415. As originally enacted, the verbal threshold applied to all insureds who did not elect the tort option, and to PIP claimants lacking any insurance, such as pedestrians or passengers. New Jersey Mfrs. Ins. Co., supra, 138 N.J. at 188, 649 A.2d 1243. In 1990, N.J.S.A. 39:6A-8(b) was amended to provide that claimants who are not required to purchase automobile insurance, such as passengers and pedestrians who do not own vehicles or who are not immediate family members of vehicle owners, such as plaintiff in this case, are no longer deemed to have chosen the verbal threshold. Sumner v. Unsatisfied Claim and Judgment Fund, 288 N.J. Super. 384, 388, 672 A.2d 731 (App.Div. 1996). Accordingly, had plaintiff been struck by a known insured driver, she would not have been subject to the verbal threshold and would have recovered damages from the tortfeasor driver's insurance company. However, as the victim of a hit-and-run driver, plaintiff's only recourse for recovery is to the Fund, and that recovery is governed by the provisions of the Fund Act. III We turn now to an examination of the critical section of the Fund Act, Section 70(n), which provides: In order to recover for noneconomic loss, as defined in section 2 of P.L. 1972, c. 70 (C. 39:6A-2) for accidents to which the benefits of section 7 and 10 of P.L. 1972, c. 198 (C. 39:6-86.1 and C. 39:6-86.4) [PIP benefits] apply, the injured person shall have sustained an injury described in subsection a. of section 8 of P.L. 1972, c. 70 (C. 39:6A-8) [the verbal threshold].[3] *346 Section 70(n) is included in the portion of the Fund Act that relates to known uninsured drivers. However, Section 70(n) explicitly states that an injured person must have sustained an injury described in N.J.S.A. 39:6A-8(a) (i.e., satisfy the verbal threshold) "[i]n order to recover noneconomic loss ... for accidents to which the benefits of ... section ... 39:6-86.4 apply." Section 39:6-86.4 deals exclusively with hit-and-run claimants and contains the requirements that hit-and-run claimants must meet to recover PIP benefits. Notwithstanding the reference to a section applicable only to victims of hit-and-run accidents, plaintiff asserts that the inclusion of Section 70(n) in the section governing known uninsured drivers, rather than in the separate section controlling hit-and-run accidents, indicates the Legislature's intention to subject only those claimants injured by known uninsured vehicles to the verbal threshold. We disagree. A. Although we find that the plain language of Section 70(n) offers support for the conclusion that it applies to hit-and-run drivers, that language does not plainly resolve the issue because of the section's placement in the provision governing victims of known uninsured drivers. Additionally, courts faced with the question of whether victims of hit-and-run accidents must satisfy the verbal threshold have reached different conclusions. See, e.g., Rivera, supra, 285 N.J. Super. at 176, 666 A.2d 619 (finding verbal threshold does not apply); Cureton v. Eley, 294 N.J. Super. 321, 683 A.2d 248 (Law Div. 1996) (finding verbal threshold does apply). As we observed previously, where "[e]ach [party's interpretation] is plausible, but no more persuasive than that ... [t]he intent of [the Legislature] ... must be deduced." Martin v. Home Ins. Co., 141 N.J. 279, 285, 661 A.2d 808 (quoting EEOC v. Arabian Am. Oil Co., 499 U.S. 244, 250-51, 111 S.Ct. 1227, 1231-32, 113 L.Ed.2d 274, 283 (1991)) (alterations in original). And, "[i]n the absence of specific guidance, our task is to discern the intent of the Legislature not only from the terms of the Act, but also from *347 its structure, history and purpose." Martin, supra, 141 N.J. at 285, 661 A.2d 808 (quoting Fiore v. Consolidated Freightways, 140 N.J. 452, 471, 659 A.2d 436 (1995)). Ultimately, "[i]t is not the words but the internal sense of the law that controls." Roig v. Kelsey, 135 N.J. 500, 516, 641 A.2d 248 (1994) (quoting Wollen v. Fort Lee, 27 N.J. 408, 418, 142 A.2d 881 (1958)). Also, in interpreting the Fund Act, we must bear in mind that "[t]hat which is clearly implied is as much a part of the law as that which is expressed." Giles v. Gassert, 23 N.J. 22, 35, 127 A.2d 161 (1956). Since its enactment, the Legislature has continuously sought to preserve the Fund's assets. In 1972, the Legislature amended the No-Fault Act. L. 1972, c. 203. "One of the motivating thrusts behind the 1972 reform package was the extraordinary pressures on the ... Fund by reason of the claims of individuals injured by uninsured motorists." Craig & Pomeroy, supra, § 1:2-4(b)(3). Because that statutory scheme failed to slow the increase in premium rates, the Legislature enacted the Cost Containment Act, L. 1983, c. 362, § 2. The primary goal of that Act, of which Section 70(n) was a part, was to bring about "long sought after reductions in premiums for New Jersey motorists." Statement of Governor Thomas H. Kean on signing Bill No. A-3981 (Oct. 4, 1983). In 1988, the Legislature enacted the Verbal Threshold Law. To protect the assets of the UCJF and to reduce the number of lawsuits, the Legislature included the requirement in Section 70(n) that Fund claimants must satisfy the verbal threshold. See, e.g., Oswin v. Shaw, supra, 129 N.J. at 318, 609 A.2d 415 (holding that the purpose of the verbal threshold and no fault statute is "to reduce the amount of litigation and to hold down the cost of premiums"); Governor's Reconsideration and Recommendation Statement, 3-4 (Aug. 4, 1988) (finding verbal threshold's "essential purpose [is] closing the door to all lawsuits except those involving bona fide serious injuries"). *348 B. The history of the Fund Act also demonstrates the Legislature's intent to treat claimants injured in hit-and-run accidents and claimants injured by known uninsured drivers alike. When originally enacted, the Fund Act contained a $200 monetary threshold that applied only to hit-and-run cases. L. 1952, c. 174, § 18. In 1958, the Fund Act was amended to eliminate certain "inequities and objectionable features." Sponsor Statement to Assembly Bill No. A422 (Mar. 31, 1958). Among the changes, the Legislature amended N.J.S.A. 39:6-78 to eliminate the $200 threshold applicable only to actions involving hit-and-run accidents, resulting in both classes of claimants being treated the same. Subsequently, in 1972, with the enactment of the No-Fault Act, the Legislature continued to treat both classes of claimants the same by making PIP benefits available to both. See N.J.S.A. 39:6-86.1 and -86.4. The Legislature's desire to treat both classes equally is further supported by looking at the requirements for the two classes of claimants to collect from the Fund set forth in N.J.S.A. 39:6-70 and -78. In those sections, only sections, only section 70(n) "does not on its face appear to be sui generis to uninsured motorist claims [and] is neither restated nor incorporated by reference in [the sections] governing hit-and-run claims." Rivera, supra, 285 N.J. Super. at 176, 666 A.2d 619. Although it could be argued that its placement signals a desire to apply Section 70(n) solely to victims of known uninsured drivers, ibid., we believe that the Legislature's purpose was to treat both classes of claimants the same. Indeed, there is no indication that the Legislature intended to treat the two classes of claimants differently. Nor is there any reason why the Legislature would subject victims of known uninsured drivers to the verbal threshold, while excluding victims of hit-and-run accidents from the verbal threshold. From the Fund's perspective such a distinction is unjustifiable. It makes no sense. Neither the victim of a hit-and-run driver nor the victim of a known uninsured driver is able to recover benefits from the tortfeasor who caused the accident. Because the intent of the Legislature is to treat the two *349 classes of claimants alike, we see no reason to impose an arbitrary distinction between them. C. Courts have been reluctant to construe the language of the Fund Act strictly, particularly where the words could be read as creating a distinction between the two classes of claimants. For example, in Giles v. Gassert, supra, this Court held that a provision for extending the thirty-day period for filing a notice of claim because of incapacity applied to actions involving hit-and-run accidents and to accidents involving known uninsured drivers. 23 N.J. at 31, 127 A.2d 161. Although the language of the statute supported the argument that the extension was limited to accidents involving known uninsured drivers, we stated: "Deferment of notice for physical disability where the tortfeasor is known and not where he is unknown would be illusory, a wholly arbitrary distinction not at all in keeping with the spirit and the indubitable reason and policy of the statute." Id. at 33, 127 A.2d 161. Similarly, in Serkes v. Parsekian, 73 N.J. Super. 344, 348, 179 A.2d 785 (1962), the Law Division held that the guest exclusion clause of N.J.S.A. 39:6-70 was applicable to hit-and-run accidents, even though that clause was neither restated nor incorporated in N.J.S.A. 39:6-78. In rejecting the claim that, by placing the guest exclusion clause in the section governing accidents involving known uninsured drivers, the Legislature intended to limit its application to accidents involving known uninsured vehicles, the court concluded: "To summarily so confine the application of the `exclusion clause' would be to disregard the essential legislative policy." Ibid. The court explained that the failure of the Legislature to include the exclusion clause in N.J.S.A. 39:6-78 was more likely due to the Legislature's failure to foresee the exclusion clause's applicability to hit-and-run accidents than to a desire to treat hit-and-run claimants differently. Ibid. *350 IV Courts have repeatedly stressed their role in protecting the assets of the Fund because "[i]n essence, the judiciary ... is the guardian of the trust monies represented by our statutory Fund." Szczesny v. Vasquez, 71 N.J. Super. 347, 358, 177 A.2d 47 (App.Div. 1962); Garcia v. Snedeker, 199 N.J. Super. 254, 261, 489 A.2d 175 (App.Div. 1985). In Giles, supra, we stated "[t]he statute is to be liberally construed to advance the remedy, due regard being had to the protection of the Fund against fraud and abuse and to the fulfillment of the essential legislative policy." 23 N.J. at 34, 127 A.2d 161. We have also stressed that the Fund was not intended to make every claimant whole, but was intended to provide limited relief to prevent a claimant from being forced to shoulder the entire loss caused by the accident. New Jersey Mfrs. Ins. Co., supra, 138 N.J. at 189, 649 A.2d 1243. Rather than protecting the Fund from fraud and abuse, we are convinced that plaintiff's proffered interpretation would encourage fraud and abuse. Under plaintiff's construction of the Fund Act, claimants injured by known uninsured drivers who do not satisfy the verbal threshold cannot recover for noneconomic damages, whereas claimants injured in hit-and-run accidents can recover without limitations. That construction might encourage those injured by uninsured drivers to claim they were injured in a hit-and-run accident, and would discourage those injured in hit-and-run accidents from making reasonable efforts to ascertain the identity of the vehicle involved. That result would not only be contrary to our responsibility to protect the Fund from fraud and abuse, but also would vitiate N.J.S.A. 39:6-78(e)'s requirement that claimants take reasonable efforts to ascertain the identity of the driver and owner of the vehicle. Moreover, eliminating the verbal threshold for hit-and-run claims would deplete the Fund because the Commissioner cannot exercise his right of subrogation against unknown tortfeasors. It would also result in more lawsuits and court congestion, resulting in increased costs that ultimately will be passed on to New Jersey *351 insureds. Assets of the UCJF consist of assessments levied by the Commissioner against insurers writing motor vehicle policies in New Jersey, "in the proportion that the net written premiums of each bear to the aggregate net direct written premiums of all insurers." N.J.S.A. 39:6-63(d). All insurers doing business in New Jersey are informed annually of their assessed contribution to the Fund. Ibid. If, after receiving the assessed amounts, the Fund lacks sufficient assets, the Commissioner reassesses the insurers. Ibid. If the Fund is depleted by hit-and-run claimants seeking noneconomic damages, insurers will be assessed greater amounts by the Commissioner. The insurers undoubtedly will attempt to recoup those costs by passing them on to insureds. V "In the interpretation of a statute our overriding goal has consistently been to determine the Legislature's intent in enacting a statute." Roig, supra, 135 N.J. at 515, 641 A.2d 248. "It is the obvious reason of a law that gives it life, not the strict, literal sense of terms." Giacobbe v. Gassert, 29 N.J. 421, 425, 149 A.2d 214 (1959). "[S]tatutes are to be read sensibly rather than literally." Roig, supra, 135 N.J. at 515, 641 A.2d 248 (quoting Schierstead v. Brigantine, 29 N.J. 220, 230, 148 A.2d 591 (1959)). "The inquiry in the ultimate analysis is to determine the true intention of the law; and, to this end, the particular words are to be made responsive to the essential purpose of the law." Wollen, supra, 27 N.J. at 418, 142 A.2d 881. "From the inception of the no-fault statutory scheme, the Legislature intended to eliminate minor personal-injury-automobile-negligence cases from the court system." Roig, supra, 135 N.J. at 510, 641 A.2d 248; see Statement by Governor Kean on Senate Bill No. 2637 (1988) (reprinted at N.J.S.A. 17:28-1.4). Requiring eligible hit-and-run claimants to satisfy the verbal threshold furthers that goal and also furthers the Fund Act's goal of providing limited relief to claimants to prevent those injured from having to absorb the entire economic loss. Even if eligible hit-and-run *352 claimants do not satisfy the verbal threshold, they still receive PIP benefits, see N.J.S.A. 39:6-86.4, and recover for bodily injury and property damage not covered by PIP, see N.J.S.A. 39:6-69. We are convinced the Legislature did not intend to exempt eligible claimants injured in hit-and-run accidents from satisfying the verbal threshold. If the Legislature disagrees with our construction of the Fund Act, it may, of course, enact clarifying legislation. VI Although we decide that plaintiff must satisfy the verbal threshold, we express no opinion on whether plaintiff's injuries satisfy the threshold. The Commissioner moved for summary judgment on the ground that plaintiff's injuries did not satisfy the verbal threshold, and the trial court denied the motion, holding that the verbal threshold did not apply. We therefore remand to the Law Division for reconsideration of the Commissioner's motion for summary judgment. The judgment of the Appellate Division is reversed. For reversal — Chief Justice PORITZ and Justices HANDLER, POLLOCK, O'HERN, GARIBALDI, STEIN, and COLEMAN — 7. Opposed — None. NOTES [1] On the same date, the Legislature enacted the Motor Vehicle Security-Responsibility Law, L. 1952, c. 173 (codified at N.J.S.A. 39:6-23 to -57), to assure "financial responsibility for damages caused by automobile accidents." Cynthia M. Craig & Daniel J. Pomeroy, New Jersey Auto Insurance Law, § 1:2-2 (1997 ed.) (Craig & Pomeroy). [2] The nine categories are: death; dismemberment; significant disfigurement; a fracture; loss of a fetus; permanent loss of use of a body organ, member, function or system; permanent consequential limitation of use of a body organ or member; significant limitation of use of a body function or system; or a medically determined injury or impairment of a non-permanent nature which prevents the injured person from performing substantially all of the material acts which constitute that person's usual and customary daily activities for not less than 90 days during the 180 days immediately following the occurrence of the injury or impairment.... [N.J.S.A. 39:6A-8(a).] [3] N.J.S.A. 39:6A-2 defines "noneconomic loss" as "pain suffering and inconvenience."

2013-10-30 06:35:55.820501+00

Teel

431 B.R. 522 (2009) In re William Haymore BRAMMER, Jr., and Heili Kim, Debtors. No. 09-00608. United States Bankruptcy Court, District of Columbia. December 16, 2009. Charles M. Maynard, Rockville, MD, for Debtors. Cynthia A. Niklas, Washington, DC, Trustee. MEMORANDUM DECISION AND ORDER RE TRUSTEE'S MOTION TO DISMISS WITH PREJUDICE BASED ON 11 U.S.C. § 101(30) AND § 109(e) INELIGIBILITY AND BAD FAITH AND NOTICE OF DEAD-LINE AND OPPORTUNITY TO OBJECT S. MARTIN TEEL, Jr., Bankruptcy Judge. This addresses the trustee's Motion to Dismiss with Prejudice Based on 11 U.S.C. *523 § 101(30) and § 109(e) Ineligibility and Bad Faith. For the reasons set forth below, I will deny the motion to the extent it seeks dismissal based on § 109(e) debt limitation grounds. I The facts underlying the trustee's Motion to Dismiss and relevant to this Memorandum Decision are as follows. On July 13, 2009, the debtors in this case filed for relief under chapter 13 of the Bankruptcy Code. In their schedules, as amended, the debtors disclose no unsecured claims and secured claims of $219,647.48, secured by collateral valued at $752,500. Notwithstanding the debtors' schedules, Aurora Loan Services, Inc. filed a proof of claim in the case of $1,019,830.48 secured by the debtors' principal residence, to which the debtors have filed an objection. Although not included on the debtors' schedule D, this amount is, curiously, reflected in their summary of schedules. Assuming the proof of claim is valid, this brings the debtors' total lien claims to $1,047,830.48. II In her motion, the trustee raises multiple grounds for dismissal. I will limit this decision, however, to determining whether grounds exist for dismissing the case based on ineligibility under § 109(e)'s debt limitation provision. Section 109(e) of the Bankruptcy Code provides that: Only ... an individual with regular income and such individual's spouse ... that owe, on the date of the filing of the petition, noncontingent, liquidated, unsecured debts that aggregate less than $336,900 and non-contingent, liquidated, secured debts of less than $1,010,650 may be a debtor under chapter 13 of this title. In her motion, the trustee argues that because the debtors' secured debts exceed $1,010,650, they are ineligible under § 109(e) to file for relief under chapter 13 and must instead convert to chapter 11. To arrive at this result, however, the trustee must first get past § 506(a), which mandates that the court bifurcate lien claims into secured and unsecured claims to the extent the amount of the claim exceeds the value of the collateral in determining the amount of allowed secured claims in a case. If § 506(a) applies, the debtors have secured claims totaling $752,500 (the scheduled value of the debtor's house and car) and unsecured claims of $295,330.45, qualifying them under § 109(e) for relief under chapter 13. In her motion, the trustee argues that § 1322(b)(2) prevents the debtors from using § 506(a) to bifurcate Aurora Loan Services' claim secured by their home for purposes of determining eligibility under § 109(e). Section 1322(b)(2), in part, limits the ability of a debtor to modify through a chapter 13 plan the rights of a holder of a claim that is secured only by the debtor's principal residence. In operation, it stops a debtor from bifurcating a claim on their home and stripping off the unsecured portion of the claim for different treatment under the plan. Because, however, the antimodification clause of § 1322(b)(2) does not extend to determining eligibility for purposes of § 109(e), the trustee's argument is without merit. A. This conclusion is justified, first, by the apparent rationale behind the § 109(e) limit on unsecured debts. In general, if a debtor has unsecured debt (as measured by § 506(a)) in excess of $336,900, § 109(e) makes such debtor ineligible to reorganize under the simplified procedures of chapter 13, and the debtor must instead reorganize *524 under the more complicated procedures of chapter 11. See Brown & Co. Secs. Corp. v. Balbus (In re Balbus), 933 F.2d 246 (4th Cir.1991). The rationale of § 109(e) appears to be that when unsecured debts exceed the specified debt limit, the holders of unsecured claims ought to enjoy the protections of chapter 11 (if the debtor is to reorganize), including the issuance of a disclosure statement and the right of each holder to vote on confirmation of a plan if the plan impairs its class of claims. Nothing in § 1322(b)(2) warrants abandoning that rationale and jettisoning § 506(a) in the determination of the amount of unsecured claims for purposes of § 109(e). When some of those unsecured debts arising from the application of § 506(a) in making the eligibility determination under § 109(e) are attributable to the undersecured portion of a claim secured by a security interest on the debtor's principal residence, the holders of unsecured claims still ought to enjoy the same protections of chapter 11 if the unsecured claims (determined by applying § 506(a)) exceed the § 109(e) unsecured debt limit. This demonstrably is true because the debtor's principal residence might be sold at a postpetition foreclosure sale. The resulting deficiency claim would be an unsecured claim notwithstanding § 1322(b)(2) (if the case were allowed to proceed in chapter 13) and notwithstanding § 1123(b)(5) (if the case were to be converted to chapter 11). If that deficiency claim and the other unsecured claims exceed the debt limit amount for unsecured claims under § 109(e), those claims ought to enjoy the protections of chapter 11, and according them those protections cannot await the passing of time to see if a foreclosure actually results. A § 109(e) eligibility determination is based on measuring debts as of the filing of the petition when it cannot be known whether a foreclosure will result. Extending the reach of § 1322(b)(2) to prevent the application of § 506(a) to eligibility determinations under § 109(e), as the trustee urges, would limit the protections that § 109(e) is meant to provide to unsecured claims, including both the undersecured portion of a claim secured by a debtor's principal residence and other unsecured claims. This is an extension of § 1322(b)(2) that neither the language of that provision nor the policy underlying § 109(e) will allow. B. Notwithstanding the foregoing, the trustee cites to several cases in support of her argument that § 1322(b)(2) does not allow bifurcation of a claim secured by a debtor's principal residence for purposes of determining eligibility under § 109(e). None of the cases on which the trustee relies are persuasive on this point. First, the trustee cites Nobelman v. American Savings Bank, 508 U.S. 324, 113 S. Ct. 2106, 124 L. Ed. 2d 228 (1993). In Nobelman, the Supreme Court addressed the issue of whether, despite § 1322(b)(2), a chapter 13 debtor could bifurcate a claim secured only by a lien on the debtor's home, thereby allowing for different treatment under a plan as to the unsecured portion of the claim. In answering that question in the negative, the Court stated that "[t]he portion of the bank's claim that exceeds $23,500 [(the value of the collateral)] is an unsecured claim component under § 506(a)." Id. at 2110 (citing United States v. Ron Pair Enterprises, 489 U.S. 235, 239 n. 3, 109 S. Ct. 1026, 103 L. Ed. 2d 290 (1989)). This statement by the Court undermines the trustee position and indicates that § 506(a) should apply under § 109(e). Moreover, although the Court decided that § 1322(b)(2) prevented the *525 debtor from bifurcating the claim secured by the debtor's home for plan purposes, it only did so because allowing bifurcation and different treatment of the unsecured portion of the claim pursuant to a plan would necessarily result in a modification of the terms of the mortgage, Id. at 2111, which is what § 1322(b)(2) expressly prohibits. Consequently, § 1322(b)(2) only prevents the operation of § 506(a) in the limited circumstance of when it could work a modification through a plan of the rights of a holder of a claim secured in part by a lien on a debtor's principal residence. Nothing in Nobelman stands for the proposition that § 1322(b)(2) prevents the operation of § 506(a) in other contexts, including eligibility determinations under § 109(e). To the contrary, the language quoted above indicates that § 1332(b)(2) only functions to limit the reach of § 506(a) in the context of a plan. Furthermore, two cases on which the trustee relies do not even reach the issue before me today. First, in In re Prosper, 168 B.R. 274 (Bankr. D. Conn. 1994), the court expressly declined to reach the issue because it was not properly before the court. Id. at 280. Likewise, in Soderlund v. Cohen, 236 B.R. 271 (9th Cir. BAP 1999), although the court opined that a different question might be presented if the debt in question were entitled to the protections of § 1322(b)(2), the panel did not address the issue because the claims were not secured by an interest in the debtor's principal residence. Id. at 275 n. 5. The only case the trustee cites that reaches the issue and agrees with her analysis is In re Smith, 2009 WL 4048015 (Bankr.C.D.Cal. Oct.9, 2009). In making the determination that § 506(a) should not apply in determining eligibility under 109(e) when dealing with an undersecured claim secured by a lien on a debtor's principal residence, the court in Smith concluded that: In order to avoid treating a lien one way for confirmation and another for eligibility, and to treat the partially secured senior trust deeds consistent with Nobelman and Zimmer, [313 F.3d 1220 (9th Cir.2002)], any lien which is partially secured on debtor's primary residence will be treated as a secured debt for § 109(e) purposes as well. Nothing in the Smith decision, however, does anything to address my concerns about the protections § 109(e) is intended to afford unsecured creditors and my concern that Nobelman mandates applying § 506(a) to determine the extent to which a claim is secured, regardless of whether § 1322(b)(2) bars modification of the rights of a holder of a claim that is only partially secured by the primary residence.[1] Accordingly, I find Smith unpersuasive. III For the foregoing reasons it is hereby ORDERED that the trustee's Motion to Dismiss with Prejudice Based on 11 U.S.C. § 101(30) and § 109(e) Ineligibility and Bad Faith is DENIED to the extent the motion seeks dismissal based on ineligibility under § 109(e)'s debt limitation provision. NOTES [1] The Zimmer decision cited in Smith dealt with a wholly unsecured claim on the debtor's principal residence and acknowledged the Supreme Court's holding in Nobelman that applying § 506(a) is the first step in determining the extent to which the creditor is a holder of a secured claim entitled to the protections of § 1322(b)(2). Zimmer, 313 F.3d at 1226-27. Accordingly, Zimmer supports my view of this issue.

2023-08-23 14:17:52.162312+00

Greenhill

GREENHILL, Chief Justice. The main question in this workmen’s compensation case is the power of the trial court to order the insurance company to pay the attorney’s fees of the workman in a lump sum when the compensation to the injured employee, under the jury’s verdict, is to be paid in weekly installments. This *396is the first time that this question has been presented to this court. The court of civil appeals affirmed the judgment of the trial court which directed the lump sum payment of attorney’s fees, and we agree with that holding. 483 S.W.2d 709. The second question deals with the acceleration of the weekly payments to the workman. Our holding is that since no jury issue was requested as to a need for an acceleration of payments, the issue was waived. We therefore reverse the judgments of both courts below which accelerated the payments and remand the cause to the district court for the entry of judgment in accordance with this opinion. The injured employee, O. H. Motley, suffered a general injury and was awarded compensation for total and permanent disability. There is no complaint of that. The jury found that it would not result in a manifest hardship if Motley’s compensation were payable in weekly installments. There is no complaint as to that either. And Motley has no complaint as to action of the trial court as to the payment of his attorney. The complaint of the insurance company is that the trial court, exercising his discretion, directed the payment of Motley’s attorney’s fees by the insurance company in a lump sum. Its contention is that the attorney’s fee must be taken each week from the sums recovered by Motley, and that the trial court, under the statutes, had no power to direct otherwise. Our decision turns on statutory construction, and the question is as to the power of the trial court. The statutes make different provisions for recoveries before the Industrial Accident Board and for recoveries obtained by a judgment in court.1 When the compensation is based on an award of the Board and is in weekly installments, the statute provides that the Board “shall fix . the proportion of each installment to be paid [to the attorney] on account of said legal services.” Section 7c of Article 8306. The statute thus spells out that when the workman is to receive his compensation in installments as a result of an order of the Board, so is his lawyer. One reason for this is that when there is no death claim and when recovery is based on an award of the Board for a general injury, the total amount that the insurance company is to pay in installments may not be definitely ascertainable at the time of the award. The Board retains the right to modify the award. Moreover, if the employee dies before he receives all of the compensation awarded him in weekly payments, the cases say that the liability of the insurance company ceases; i. e., the unmatured portions of the claim are extinguished by his death. Texas Employers Ins. Assn. v. Phillips, 130 Tex. 182, 107 S. W.2d 991 (1937). Since this is so, the portion recoverable by the attorney may not be ascertainable with certainty at the time of the Board’s award. Hence a lump sum recovery to the attorney would present problems. On the other hand, if the compensation is based upon a judgment in court, which judgment has either become final or is affirmed, the amount awarded by the court does survive the workman’s death and is not subject to modification or reduction. Bailey v. Travelers Insurance Co., 383 S.W.2d 562 (Tex. 1964). The attorney’s fees, therefore, may be fixed or approved with certainty by the trial court in the light of the amount which will be recovered by the workman or those claiming under him. As pointed out, there is a restriction as to what the Board can do in awarding attorney’s fees which was not placed by the Legislature in its authorization of the court to act. The Board, in these circumstances, can only approve the amount of weekly payments to the attorney. The *397statute, Section 7d, authorizes the court to “fix and allow” such fees without the restriction as to such periodic installments. It is true that in context, Section 7d begins by speaking to the legality of a contingent fee contract between the workman and his attorney, not to exceed 25% of the amount recovered by the workman. But this court has construed the rest of that Section to give the court independent discretion as to the fixing of attorney’s fees. This court has held that the amount of the attorney’s fees to be allowed in compensation cases is a matter for the trial court to determine without the aid of a jury, and the amount of the recovery is within its discretion. Texas Employers Ins. Assn. v. Hatton, 152 Tex. 199, 255 S.W.2d 848 (1953) ; Brooks v. Texas Employers Ins. Assn., 358 S.W.2d 412, Tex.Civ.App.I962, writ ref., n. r. e. Since the Legislature has not restricted the trial court in the handling of attorney’s fees as it did the Industrial Accident Board, we hold that the trial court had the power and the discretion to order a lump sum payment by the insurance company of the attorney’s fees. There are, to us, other reasons to support this view. When the workmen’s compensation act was passed, the weekly payments were to be in lieu of wages which the workman could not earn because of his incapacity. There was, as we understand it, a feeling that it might not be wise to give the laborer, unskilled in money management, a large sum of money in a lump sum. It might be best for him, and his family, if the money were paid to him weekly, — as he had been receiving his wages. Provision was made, however, in Section 15 of Article 8306, for payment to the workman in a lump sum if to do otherwise would result in manifest hardship. We interpret the “manifest hardship” as used in Section 15 to mean manifest hardship to the workman, not his attorney. On the other hand, the Legislature has not deemed it necessary to protect the attorney from the receipt of a lump sum where the matter can be passed upon by a trial court. Indeed the attorney may have incurred substantial expense in the preparation of the case for trial; and the need for his payment of such expenses is now. In discussing lump sum payments of attorney’s fees, Larson in his work on Workmen's Compensation says, “One of the most troublesome difficulties in compensating the claimant’s attorney is that, under the normal practice of paying income benefits in weekly installments, the payment of the attorney’s fees from week to week out of these installments means that the attorney gets paid in driblets over a long period, with a disproportionate amount of bother for everyone.” (Volume 3, § 83.13, page 354.-54). If the attorney’s fees could only be paid in installments out of the weekly compensation to the workman, the attorney might be facing a dilemma. It might be best for the workman to receive the payments in installments; and it would be the duty of the attorney to argue for the best interest of his client for payments in installments. At the same time, if it is best for the attorney to receive his fee in a lump sum, he would be arguing against his own interest to best serve his client’s interest. We need not consider the temptation to argue for a lump sum for the workman so the attorney could receive his fee in a lump sum. The fact is that the two problems are not similar ; and unless they are controlled by statute, the trial court should have discretion to look at the problems separately. We perceive that the Legislature may have intentionally left room for judgments which provide installment payments to the workman and to lodge in the trial court discretion as to whether to provide for the attorney’s fee in a lump sum. As noted above, the question is one of statutory construction. The statutes in the various states are so different that we find difficulty in arriving at any majority or *398minority view. See Annotation 159 A.L.R. 899 where this point is discussed beginning on page 955. There are a great many supplemental citations, but the annotators have not attempted to state any newer conclusions. In Texas Indemnity Insurance Co. v. Bush, 163 S.W.2d 224 (Tex.Civ.App.1942), the trial court had directed the payment of attorney’s fees in installments out of the workman’s award; but the insurance company appealed on the grounds that no proof was offered as to any contract between the workman and his attorney and that no proof was offered that the attorney’s efforts were necessary. Referring to Section 7d of the statute discussed above, the court wrote that “[T]he attorney’s fee allowed ... is a matter pertaining only to the claimant and his attorney, [and it] is ordinarily of no concern to the insurance carrier, and is particularly within the discretion of the trial court.” [citing cases] “The appellant [insurance company] having shown no injury by the court’s action in this respect, this assignment will be overruled.” We see no injury to the insurance company here. It owes the money under the judgment, and the amount of the payment has been discounted to its present value from that which it would have had if paid in installments. The insurance company points out that the attorney’s fee, by statute, is to come from that amount “recovered” by the workman. The argument is that the money is not actually “recovered” by the workman until he gets it in hand in installments. If this were a contest between the workman and his attorney, and the attorney were insisting on being paid in a lump sum by the workman before the workman got his money from the insurance company, we would probably agree with the workman. But such is not the case here. Whether the insurance company owes the attorney’s fee now is, of course, the problem in the case; so whether the money is “recovered,” or recoverable now is likewise the question in the case. But we are not impressed with the analogy to the attorney’s trying to exact his fee from the workman before he gets his money. Acceleration There are two statutory alternatives to the payment to the workman of the regular compensation on a weekly basis. One is for a complete lump sum payment, and the other is for weekly payments but on an accelerated basis. Both are provided for on the basis of need. Section 15a of Article 8306 provides for an increase in the amount of weekly payments to the employee when it is” shown that the amount ordinarily payable to him is inadequate. But like the question of manifest hardship to bring about a lump sum, the question of need for an acceleration of payments is also a fact question for the jury. If the claimant seeks acceleration, it is his burden to request an issue and to obtain a favorable jury finding thereon. Since there was no such request here, the issue was waived. The holding of the court of civil appeals was, however, that there was not an acceleration here; and that being so, there was no necessity for any request or jury finding on acceleration. Because of his wage rate, the workman here was entitled to payments of $49 per week for 401 weeks. Out of this, by virtue of his contract with his attorney, his attorney was entitled to one-fourth, or $12.25 per week. So the workman was entitled to receive $36.75 per week for 401 weeks. But the workman desired to receive $49 per week for a fewer number of weeks. That, by definition, is an acceleration of his payments; and, as noted above, it takes a fact finding of a need for acceleration to accomplish that result. The court of civil appeals reasoned that if the attorney were paid off the top and the workman no longer owed any attorney’s fees, then there would be no reason not to pay the workman $49 per week for *399fewer weeks. The workman may indeed need the added amount per week; but if he does, he should obtain a jury finding for a need for acceleration. Changing his payments from $36.75 per week for 401 weeks to $49 per week for fewer weeks is still an acceleration of his payments. Our conclusion is that the action of the trial court in directing payments to him of $49 per week was not permitted under the statutes as written. The Legislature is now in session; and if we have misconstrued its enactments, it can, of course, amend its statutes to more clearly reflect its intent. The Judgment The record shows that as of the date of trial of this case, 86 weeks of compensation had already been paid or accumulated; and the amount due the attorney must be discounted. The entry of a proper judgment, then, calls for calculations which we think could best be made by the trial court with the assistance of counsel. We therefore order a remand of this cause to the trial court for the entry of a judgment in accordance with this opinion. While we agree with the opinion of the court of civil appeals as to the lump sum payment of attorney’s fees, we disagree with it as to the acceleration of the weekly payments to the workman. Accordingly, the judgments of the court of civil appeals and the trial court are reversed, and the cause is remanded to te district court with instructions. Dissenting opinion by REAVLEY, J., in which WALKER, J., joins. . All statutory references are to Vernon’s Texas Civil Statutes Annotated. All emphasis is ours.

2013-10-30 06:35:54.113693+00

Per Curiam

619 S.W.2d 363 (1981) Jesse L. BEBEE, Petitioner-Appellant, v. STATE of Missouri; Mr. Joe Abraniovitz, Sheriff, Newton County, Missouri; Warden, Department of Corrections, Jefferson City, Missouri, Respondents. No. 12320. Missouri Court of Appeals, Southern District, Division Two. July 9, 1981. Jesse L. Bebee, pro se. Gary C. Lentz, Pros. Atty., Neosho, for respondents. PER CURIAM: Petitioner filed a petition for writ of habeas corpus in the circuit court. It was denied and he filed a notice of appeal to this court. We are obligated to determine if we have appellate jurisdiction. Frey v. Gabel, 574 S.W.2d 38, 39 (Mo.App.1978). We have determined that we do not, as no appeal lies from a decision in a habeas corpus proceeding. Miller v. State, 615 S.W.2d 98 (Mo.App.1981); Hutchinson v. Wesley, 455 S.W.2d 21 (Mo.App.1970). The appeal is dismissed. All concur.

2013-10-30 06:35:54.118715+00

Per Curiam

878 A.2d 496 (2005) In re Andrew M. STEINBERG, Respondent. A Member of the Bar of the District of Columbia Court of Appeals (Bar Registration No. 350983). No. 05-BG-413. District of Columbia Court of Appeals. July 7, 2005. Before SCHWELB and RUIZ, Associate Judges, and KING, Senior Judge. *497 PER CURIAM: In this disciplinary proceeding against respondent, Andrew M. Steinberg, Esquire, a member of our Bar, the Board on Professional Responsibility ("Board") has found that respondent violated D.C. Rules of Professional Conduct 1.1(a) (failure to provide competent representation), 1.1(b) (failure to represent his client with the skill and care of similarly situated practitioners), 1.2(a) (failure to adhere to the objectives of his client), 1.3(a) (failure to represent client with diligence and zeal), 1.3(c) (failure to represent client with reasonable promptness), and 1.4(a) (failure to communicate with his client). We accept the Board's findings and adopt its recommended sanction of a sixty-day suspension with reinstatement conditioned on making restitution to the client. The respondent is no stranger to the D.C. disciplinary system. The Board considered respondent's disciplinary history, which includes three separate matters each of which resulted in a thirty-day suspension.[1]See In re Steinberg, 720 A.2d 900, 901 n. 1 (D.C.1998) (reciprocal discipline case from Virginia involving dishonest conduct, a failure to explain fees to his client, a failure to return the advancement of fees, a failure to keep his client reasonably informed, and a failure to maintain complete records of client funds); In re Steinberg, 761 A.2d 279, 280 (D.C.2000) (original discipline case involving failure to respond reasonably to Bar Counsel's requests for information in two separate disciplinary matters); In re Steinberg, 864 A.2d 120, 120 (D.C.2004) (original discipline case involving failure to respond reasonably to Bar Counsel's requests for information, and to comply with a Board Order, and serious interference with the administration of justice). Based largely on this disciplinary history, and after comparing the violations in this case with similar cases and the sanctions imposed in those cases, the Board recommends that respondent be suspended for sixty days and that reinstatement be conditioned on his making restitution to his client in the amount of $750.00 plus interest at 6% per annum. The Board further recommends that, because the violations in this case took place during a time frame different from the period of violations for which respondent was suspended last year in disciplinary case No. 03-BG-801, see In re Steinberg, 864 A.2d at 125-27, the sixty-day suspension in this case should run consecutively to respondent's thirty-day suspension in No. 03-BG-801.[2] We will accept the Board's findings as long as they are supported by substantial evidence in the record. See D.C. Bar R. XI, § 9(g)(1). Moreover, we will impose the sanction recommended by the Board "unless to do so would foster a tendency toward inconsistent dispositions for comparable conduct or would otherwise be unwarranted." Id. As no exceptions to the Board's Report and Recommendation have been filed, we give heightened deference to the Board's recommendation. See D.C. Bar R. XI, § 9(g)(2); In re Delaney, 697 A.2d 1212, 1214 (D.C.1997). We find substantial support in the record for the Board's findings, and accordingly, we accept them. We also adopt the sanction recommended by the Board, which takes into account respondent's disciplinary history, and is not inconsistent with discipline imposed in cases involving similar violations. See, e.g., In re Ontell, 593 A.2d *498 1038, 1041 (D.C.1991) (ninety-day suspension, with sixty days stayed and one-year probation with practice monitor, for neglect of client matters and making misrepresentations to his clients in two unrelated cases); In re Ontell, 724 A.2d 1204, 1204 (D.C.1999) (ninety-day suspension for failure to provide competent representation, failure to represent client with skill and care, failure to represent client with diligence and zeal and reasonable promptness, failure to communicate with client, failure to withdraw from representation, failure to protect client's interests following termination, and conduct that seriously interferes with the administration of justice); In re Mintz, 626 A.2d 926, 926-27 (D.C.1993) (two-year suspension with fitness requirement in a reciprocal discipline case for pattern of gross neglect of clients' matters, lack of due diligence, failure to communicate with clients, failure to cooperate with ethics authorities, and failure to maintain a bona fide office in foreign jurisdiction); In re Joyner, 670 A.2d 1367, 1368-69 (D.C.1996) (thirty-day suspension and requirement to take ethics course for neglect of client matters and failure to seek client's objectives). Accordingly, it is ORDERED that Andrew M. Steinberg, Esquire is suspended from the practice of law in the District of Columbia for the period of sixty days, with reinstatement conditioned on his making restitution to his client in the amount of $750.00 plus interest at 6% per annum. It is further ordered that the sixty-day suspension run consecutive to respondent's thirty-day suspension in No. 03-BG-801. We direct respondent's attention to the requirements of D.C. Bar R. XI, § 14(g), and their effect on his eligibility for reinstatement. See D.C. Bar R. XI, § 16(c). So ordered. NOTES [1] Additionally, respondent was informally admonished in 2001 for failure to communicate with his client, and in 1984 for failure to disburse settlement funds to his client. [2] In its Report, the Board noted that respondent had not yet filed the affidavit required by D.C. Bar R. XI, § 14(g) in that case.

2013-10-30 06:35:54.398956+00

Cornelius

619 S.W.2d 238 (1981) Gary Kent GALBRAITH, Appellant, v. Sally Jane GALBRAITH, Appellee. No. 8884. Court of Civil Appeals of Texas, Texarkana. June 16, 1981. *239 Jim Ammerman II, Ammerman & Ammerman, Marshall, for appellant. Ronald Ned Dennis, Dennis & Proctor, Marshall, for appellee. CORNELIUS, Chief Justice. Appellant instituted this action seeking to obtain an annulment of his marriage to appellee. He alleged that he was entitled to an annulment because at the time of his marriage to appellee she was prohibited from entering into a marriage by virtue of the provisions of Tex.Family Code Ann. § 3.66[1] and because appellee had induced him to marry her by fraud and duress, and had concealed the fact that she had previously been divorced. The latter two occurrences constitute grounds for annulment by virtue of §§ 2.44 and 2.46 of our Family Code.[2] Appellee filed a plea in abatement *240 and plea in bar to appellant's petition. The pleas were heard at the same time as all other issues on the merits and the trial court rendered judgment overruling the pleas and denying the annulment. Appellant asserts nine points of error. The parties began living together in Shreveport, Louisiana, in August of 1975 while they were both married to other persons. Appellee was divorced from her husband, Howard Sample, in Harris County, Texas. The trial judge granted the uncontested divorce by oral pronouncement at a hearing held on March 12, 1976, but did not sign the written decree until March 24, 1976. The oral pronouncement was not interlocutory. Appellant was divorced from his wife, Barbara Shaffer Galbraith, in Shreveport, Louisiana. The hearing was held on April 13, 1976, and the written decree was signed on April 14, 1976. Immediately after his divorce hearing on April 13, appellant drove to Denton, Texas, and married appellee that same day. He admitted that he knew of appellee's previous marriage and divorce, but testified that he did not find out about her alleged violation of the prohibition of § 3.66 until December of 1979. Appellant filed for divorce from appellee in Caddo Parish, Louisiana, on August 16, 1979, and on October 15, 1979, he filed for annulment in Caddo Parish, Louisiana, under the same cause number. Those actions were still pending as of January 30, 1980. Appellant testified, however, that the Louisiana court granted him a divorce from appellee on September 19, 1979. The following day he returned to Denton, Texas, where he married his current wife, Elsie N. Galbraith. Appellant's first two points of error urge that the undisputed evidence established that appellee's marriage to him prior to the expiration of the 30-day waiting period prescribed by § 3.66 constituted an impediment to their marriage which rendered it voidable and subject to annulment. See Gress v. Gress, 209 S.W.2d 1003 (Tex. Civ.App. — Galveston 1948, writ ref'd n. r. e.), and authorities there cited. These points are overruled. The evidence shows, and the trial court here found as a fact, that a non-interlocutory oral pronouncement of a judgment of divorce was made by the trial court in appellee's divorce on March 12, 1976, more than 30 days prior to her marriage to appellant. Although the written decree was not signed until March 24, 1976, the divorce was fully effective for all purposes, except calculation of the times for appeal, at the time it was pronounced from the bench. Dunn v. Dunn, 439 S.W.2d 830 (Tex.1969); Baugh v. State, 402 S.W.2d 768 (Tex.Cr.App.1966); Louwien v. Dowell, 534 S.W.2d 421 (Tex.Civ.App. —Dallas 1976, no writ); Tex.R.Civ.P. 306a. Furthermore, the trial court found, and there is evidence to support its findings, that appellant knew of appellee's divorce at the time of his marriage to her, that since his knowledge thereof they have cohabited together, and more than one year had elapsed between the parties' marriage and the bringing of this suit. Consequently, under § 2.46, appellee's divorce, even if within 30 days of her marriage to appellant, would not render their marriage voidable. Appellant also urges that the trial court erred in rendering judgment against him on the merits because appellee's pleas were only in bar or in abatement and were not sufficient to support a judgment on the merits. We disagree. Appellee's original plea in abatement was amended and supplemented several times before trial, and ultimately her pleas contained general and specific denials of the factual allegations forming the basis of the merits of appellant's suit. By the time the hearing was held the parties' pleadings adequately joined the issues upon which full evidence was received. In these circumstances we perceive no reversible error. Appellant also asserts that he was entitled to judgment on the duress issue because he testified that he married appellee *241 only because she threatened to testify against him in a custody suit involving his children of a former marriage, and since appellee did not deny his testimony the evidence on that point was conclusive and must have been accepted as true. This assertion is overruled. First, appellee specifically denied that she made any such threat. Second, appellant's testimony on the point was not so clear and free of circumstances tending to impeach it as to take it out of the rule that an interested witness' testimony, although uncontradicted, only raises a fact issue. Points of error 6 and 7 complain of the trial court's findings of fact 6 and 10. Finding number 6 was that appellant and appellee accumulated substantial property in the State of Louisiana. Number 10 was to the effect that appellant entered into his present marriage while still seeking dissolution of his marriage to appellee. These findings, even if unsupported by the evidence, are irrelevant to the issue of appellant's entitlement to an annulment, which was the only relief he sought in this proceeding, and thus would not constitute reversible error in any event. The last two points of error complain that the trial court erred in denying appellant's motion to receive additional testimony and in failing to hear all of the evidence before a judgment was decided upon. The trial court has broad discretion in determining whether or not to reopen proceedings to allow the presentation of additional testimony. The trial court's discretion in that regard will not be disturbed by the appellate court unless it appears that a clear abuse of such discretion has occurred. Musick v. Musick, 590 S.W.2d 582 (Tex.Civ.App. —Tyler 1979, no writ); Zodiac Corporation v. General Electric Credit Corporation, 566 S.W.2d 341 (Tex. Civ.App. — Tyler 1978, no writ); Matter Of Marriage Of Murphy, 561 S.W.2d 592 (Tex. Civ.App. —Amarillo 1978, no writ). In his motion to reopen, appellant claimed surprise and that he had no opportunity to present evidence to rebut appellee's testimony, but he did not make these claims at the trial or prior to the rendition of judgment, and his motion to reopen was not made until a month after the judgment was signed. There is also no showing that he was in any way denied the opportunity to conduct pretrial discovery. In these circumstances no reversible error is shown. The allegation that the trial court failed to consider all the evidence produced at the hearing is not borne out by the record. The fact that the trial judge began to develop and express certain opinions as to the validity of the legal issues involved before all the testimony was in does not mean that he failed to consider all of the evidence and legal issues in making his ultimate findings and conclusions. Those findings and conclusions are supported by the record and must be affirmed. The judgment of the trial court is affirmed. NOTES [1] "§ 3.66. Remarriage "Neither party to a divorce may marry a third party for a period of thirty days immediately following the date the divorce is decreed, but the parties divorced may marry each other at any time." [2] "§ 2.44. Fraud, Duress, Force "On the suit of a party to a marriage, the marriage is voidable and subject to annulment if: (1) the other party used fraud, duress, or force to induce the petitioner to enter into the marriage; and (2) the petitioner has not voluntarily cohabited with the other party since learning of the fraud or since being released from the duress or force." "§ 2.46. Concealed Divorce "(a) On the suit of a party to a marriage, the marriage is voidable and subject to annulment if: (1) the other party was divorced from a third party within the thirty day period preceding the day of the marriage ceremony; (2) at the time of the marriage ceremony, the petitioner did not know, and a reasonably prudent person would not have known, of the divorce; and (3) since the petitioner discovered, or a reasonably prudent person would have discovered, the fact of the divorce, the petitioner has not voluntarily cohabited with the other party. (b) A suit may not be brought under this section more than one year after the date of the marriage."

2013-10-30 06:35:54.164781+00

Leavitt

878 A.2d 977 (2005) WILKES-BARRE TOWNSHIP, Petitioner v. PENNSYLVANIA LABOR RELATIONS BOARD, Respondent. Commonwealth Court of Pennsylvania. Argued June 6, 2005. Decided July 13, 2005. *979 Bruce J. Phillips, Wilkes-Barre, for petitioner. Warren R. Mowery, Jr., Harrisburg, for respondent. Sean T. Welby, Harrisburg, for intervenor, Wilkes-Barre Twp. Police Benevolent Association. BEFORE: SMITH-RIBNER, J., LEAVITT, J., and JIULIANTE, Senior Judge. OPINION BY Judge LEAVITT. Wilkes-Barre Township (Township) petitions for review of an order of the Pennsylvania Labor Relations Board (Board) dismissing its exceptions to, and making final, a proposed decision and order of the Board's hearing examiner. In doing so, the Board concluded that the Township had committed unfair labor practices in violation of Sections 6(1)(a) and (e) of the Pennsylvania Labor Relations Act (PLRA)[1] and Act 111 of 1968 (Act 111)[2] by enacting an ordinance that unilaterally altered the pension benefit program of the Township's police officers. The Wilkes-Barre Township Police Benevolent Association (Association) is the exclusive recognized bargaining representative for the Township's police officers. The Association and the Township have been parties to a succession of collective bargaining agreements that govern, inter alia, the officers' pension benefit program. The pension program is further defined by ordinance. Pennsylvania's Auditor General audited the pension program for the years 1999, 2000 and 2001 and issued a report dated July 19, 2001. The Auditor General's report advised the Township that the pension program failed to comply in several respects with the act commonly known as Act 600.[3] Among the deficiencies identified by the Auditor General was the inclusion of payments made to officers for unused *980 vacation time in the computation of their monthly retirement benefit. Auditor General Report, Finding No. 3. The Auditor General opined that this aspect of the pension program violated Section 5(c) of Act 600, which provides, in pertinent part, as follows: Monthly pension or retirement benefits other than length of service increments shall be computed at one-half the monthly average salary of such member during not more than the last sixty nor less than the last thirty-six months of employment. 53 P.S. § 771(c). While acknowledging that Act 600 does not define "salary," the Auditor General concluded that "based on a line of court opinions ... the term does not encompass lump-sum payments for leave ... not earned during the pension computation period." Auditor General Report, Finding No. 3 (emphasis added). The Auditor General recommended that the Township eliminate this and other aspects of the pension program not authorized by Act 600. Id.[4] In 2002 the Township and the Association began collective bargaining to replace the agreement set to expire on December 31, 2002. In March 2003, the new agreement (CBA), at issue in this case, was executed and became effective on January 1, 2003.[5] Article 23 of the CBA governs pensions and provides, inter alia, that upon retirement, "[t]he monthly pension payment benefit shall be set at fifty-five (55) percent of the Officer's average monthly gross salary of the last twelve (12) months of full time service." Reproduced Record at 27a (R.R. ____) (emphasis added).[6] The term "gross salary" is not defined in the CBA. On December 1, 2003, the Township enacted Ordinance No.2003-12 entitled "Ordinance Amending Township of Wilkes-Barre Police Pension Plan Ordinance" (Ordinance). R.R. 1a. The Ordinance provides, inter alia, that, for police officers hired prior to January 1, 2003, "monthly pension or retirement benefits other than length of service increments shall be computed at fifty-five percent (55%) of the monthly average compensation of such member during the last twelve (12) months of employment...." Id. at 2a (emphasis added).[7] The Ordinance defines "compensation" as follows: *981 For a policeman hired prior to January 1, 2003, compensation shall be defined as monies received by a participant in each and every month, including base pay, longevity pay, night differential, overtime, and any other increments. This shall be defined as salary for purposes of this Ordinance. Payments made for unused vacation time for the twelve (12) month period prior to retirement will be included in the calculation of compensation for pension calculation purposes. Payments made for accumulated, but unused sick leave shall not be included in the calculation of compensation for pension calculation purposes. For a policeman hired on or after January 1, 2003, compensation shall be defined as monies received by a participant in each and every month, including base pay, longevity pay, night differential, overtime, and any other increments. This shall also be defined as salary for purposes of this Ordinance. Payments made for accumulated, but unused sick and vacation leave shall not be included in the calculation of compensation for pension calculation purposes. Id.[8] On December 22, 2003, the Association filed a charge of unfair labor practices with the Board alleging that the Township had violated Act 111 and Section 6(1)(a) and (e) of the PLRA[9] by unilaterally altering, and thereby repudiating, the pension terms agreed to in the CBA. Specifically, the Association challenged the Township's definition of the term "compensation" in the Ordinance, which the Association believed to ascribe a particular meaning to the undefined term "gross salary" that appeared in Article 23 of the CBA. The Association argued that "the parties agreed that the inclusion of pay for all accumulated, but unused, vacation, personal, and compensatory time in the calculation of final salary for pension purposes would not apply to any member hired after January 1, 2003, but would continue to apply to members hired before that date." R.R. 7a.[10] In response, the Township claimed contractual privilege and defended the Ordinance as a legislative response to the recommendations in the Auditor General's report. A hearing examiner conducted a hearing on the Association's charges and found them to be meritorious. In his proposed decision and order, the hearing examiner explained that the Township had violated its duty to bargain by (1) increasing the officers' contribution rate above the percentage established in the CBA and (2) eliminating the credit for prior military *982 service set forth in Article 23, Section 6 of the CBA. The examiner rejected the Township's contractual privilege defense, finding the Ordinance was directly contrary to the clear language of the CBA. The examiner also rejected the Township's defense that it was simply responding to the Auditor General's report, citing this Court's decision in Upper Chichester Township v. Pennsylvania Labor Relations Board, 153 Pa.Cmwlth. 446, 621 A.2d 1134 (1993).[11] The examiner ordered the Township to rescind the Ordinance and restore the status quo ante. The Township filed exceptions with the Board. On review, the Board found, inter alia, that the Ordinance unilaterally ascribed a certain meaning to "gross salary," a term undefined in the CBA.[12] The Board concluded that the Township had violated Act 111 and Section 6(1)(a) and (e) of the PLRA by unilaterally altering the contractual pension provisions with regard to officers hired before January 1, 2003, without first bargaining with the Association. Accordingly, the Board dismissed the Township's exceptions and made the examiner's proposed decision and order absolute and final. The Township now petitions for this Court's review and raises two issues, one pertaining to the Board's authority and the other challenging the Board's remedy.[13] The Township first argues that the Association sought an "interpretation" of the CBA, which does not define "gross salary" and which contains no provisions for including unused compensatory, personal and/or vacation time in the calculation of final salary for pension purposes. The Township avers that the Board exceeded its authority by interpreting the CBA, and, moreover, that it had a "sound arguable basis" for enacting the Ordinance. With respect to the proper role of the Board in labor disputes, this Court has explained that the Board "exists to remedy violations of statute, i.e., unfair labor practices, and not violations of contract." Pennsylvania State Troopers Association v. Pennsylvania Labor Relations Board, 761 A.2d 645, 649 (Pa.Cmwlth.2000). Where a breach of contract is alleged, it should be resolved by an arbitrator using the grievance procedure set forth in the parties' collective bargaining agreement. Id. However, the Board is empowered to review an agreement to determine whether the employer clearly has repudiated its provisions because such a repudiation may constitute both an unfair labor practice and a grievance. Id. In this case, the Association alleged just such a repudiation of the terms of the CBA. Specification of Charges ¶ 7; R.R. 7a — 8a. It did not allege a breach of *983 contract, nor did it seek an interpretation of the CBA. The Board properly reviewed the terms of the CBA to the extent necessary to resolve the Association's unfair labor practice charges. Turning to the Township's "sound arguable basis" defense, it is beyond peradventure that pensions are a mandatory subject of collective bargaining. Section 1 of Act 111, 43 P.S. § 217.1. As such, an employer is barred from acting unilaterally in this area without satisfying the statutory resolution procedure. Plumstead Township v. Pennsylvania Labor Relations Board, 713 A.2d 730, 733 (Pa.Cmwlth.1998). The Board, and this Court, recognizes "contractual privilege" as an affirmative defense to an unfair labor practice charge of failure to bargain in good faith. State Troopers, 761 A.2d at 651. "The defense calls for the dismissal of such charges where the employer establishes a `sound arguable basis' in the language of the parties' collective bargaining agreement ... for the claim that the employer's action was permissible under the agreement." Id. See also Jersey Shore Area Education Association v. Jersey Shore Area School District, 18 PA. PUB. EMP. R. ¶ 18117 (Final Order 1987) (quoting NCR Corporation, 271 NLRB ¶ 1212) ("Where an employer has a sound arguable basis for ascribing a particular meaning to his contract and his action is in accordance with the terms of the contract as he construes it, the NLRB will not enter the dispute to serve the function of arbitrator in determining which party's interpretation is correct."). The Board properly rejected the Township's contractual privilege defense. Article 23, Section 9 of the CBA sets an officer's monthly pension benefit at fifty-five percent of his or her "monthly gross salary of the last twelve (12) months of full time service." R.R. 27a. Notably, the term "gross salary" is not defined in the CBA. The Ordinance, on the other hand, bases the fifty-five percent contribution on an officer's "monthly average compensation," and specifically defines "compensation" as exclusive of payments made for accumulated but unused sick leave and inclusive of payments for unused vacation time made within the twelve-month period preceding retirement. R.R. 1a-2a. By effectively changing the CBA language from "gross salary" to "compensation," and then defining the latter term, the Township acted unilaterally with respect to a mandatory subject of bargaining — the officers' pension program. The Board astutely observed a distinction between an employer's application of terms in a collective bargaining agreement, which must have a sound arguable basis in the contract, and an action that attempts to expand contractual terms through unilateral adoption of managerial policies that are not in response to a specific contractual claim and have unit-wide application. In other words, the Township was not merely applying existing contract language to establish the calculation of pension benefits in its Ordinance. Rather, the Township unilaterally prescribed a certain meaning to the contractual language that is applicable to all bargaining unit members, in violation of its bargaining obligations.[14] *984 The Township also argues that the Board's order compels it to commit an illegal act: "to revise the Ordinance such that it violates the terms of Act [600] as determined by the [Auditor] General." Township's Brief at 11. This argument is without merit. First, the Board ordered the Township to rescind, not revise, the Ordinance. This was within the Board's broad power to fashion a remedy that will effectuate the purposes of the PLRA and restore the status quo ante. Section 8(c) of the PLRA, 43 P.S. § 211.8(c);[15]Plumstead Township, 713 A.2d at 736. See also Borough of Geistown v. Pennsylvania Labor Relations Board, 679 A.2d 1330, 1333 (Pa.Cmwlth.1996) ("We believe that a local ordinance may not be used as a `guise' by the Borough to sidestep Act 111...."). Moreover, while it may be true that the CBA pension provisions violate Act 600, this does not excuse the Township from its duty to bargain in good faith. Our Supreme Court, in rejecting a similar argument, has observed: "Good faith bargaining would require that questions as to the legality of the proposed terms of a collective bargaining agreement should be resolved by the parties to the agreement at the bargaining table." * * * Obviously the statutorily mandated obligation to bargain in good faith is not met by permitting the governmental employer to avoid the performance of a term by questioning its legality after having received the advantages that flowed from the term's acceptance. Fraternal Order of Police, E.B. Jermyn Lodge # 2 v. Hickey, 499 Pa. 194, 198-199, 452 A.2d 1005, 1007-1008 (1982) (quoting Grottenthaler v. Pennsylvania State Police, 488 Pa. 19, 25, 410 A.2d 806, 809 (1980)).[16] The Supreme Court's reasoning is especially relevant here given that the Auditor General's report on which the Township relies was dated July 19, 2001. The parties did not commence collective bargaining for the CBA until sometime in 2002. The Township should have raised *985 any potential conflicts with Act 600 at the bargaining table. In sum, we find no error by the Board. The Township, by enacting the Ordinance and prescribing a certain meaning to the term "gross salary," repudiated certain key provisions of the CBA. Such unilateral action constituted a violation of the Township's duty to bargain with the Association under Act 111. The Board acted within the scope of its authority by reviewing the relevant provisions of the CBA and fashioned a remedy that will effectuate the purposes of the PLRA and restore the status quo ante. Accordingly, the Board's order is affirmed. ORDER AND NOW, this 13th day of July, 2005, the final order of the Pennsylvania Labor Relations Board in the above-captioned matter, dated November 16, 2004, is hereby AFFIRMED. NOTES [1] Act of June 1, 1937, P.L. 1168, as amended, 43 P.S. § 211.6(1)(a) and (e). [2] Act of June 24, 1968, P.L. 237, as amended, 43 P.S. §§ 217.1-217.27. Act 111 grants to police officers and firefighters the right to bargain collectively with their public employers over the terms and conditions of employment. Section 1 of Act 111, 43 P.S. § 217.1. Because Act 111 lacks many of the specific provisions normally found in a collective bargaining statute, our Supreme Court has determined that it is to be read in pari materia with the PLRA. Philadelphia Fire Officers Association v. Pennsylvania Labor Relations Board, 470 Pa. 550, 555, 369 A.2d 259, 261 (1977). Consequently, unfair labor practice charges regarding violations of Act 111 are brought under the provisions of Section 6 of the PLRA. Delaware County Lodge # 27, Fraternal Order of Police v. Pennsylvania Labor Relations Board, 75 Pa.Cmwlth. 192, 461 A.2d 1337, 1338 n. 7 (1983). [3] Act of May 29, 1956, P.L. (1955) 1804, as amended, 53 P.S. §§ 761-778. Act 600 authorizes and directs the establishment of pension plans for municipal police officers; governs the administration and management of such funds; requires municipalities to set aside certain funds for the programs; and fixes the percentage of their salary that officers must contribute. [4] For example, the Auditor General concluded that the CBA, which prescribed a contribution rate of four percent of the officers' annual gross salary, violated Section 6(a) of Act 600, 53 P.S. § 772(a), which requires members to pay into the pension fund an amount equal to not less than five percent nor more than eight percent of their monthly compensation. See Auditor General's Report, Finding No. 2. The Auditor General also criticized the lack of any provisions in the program's governing documents regarding credit for an officer's prior intervening military service. Id. [5] It expires December 31, 2007. [6] Article 23, Section 1 of the CBA also requires each police officer to contribute four percent of his or her annual gross salary to the pension fund. R.R. 36a. This contribution shall be reduced to two percent based upon the financial status of the pension fund and actuarial studies. Id. Article 23, Section 16 of the CBA provides that any full-time police officer hired after January 1, 2003, "shall receive pension benefits as outlined in Act 600," and under no circumstances shall "receive benefits that are in excess of Act 600 requirements." R.R. 28a. Lieutenant William Clark, vice-president of the Association, later explained that this provision was included "to come into compliance with Act 600 for all new hires for the duration of [the CBA]." N.T. Hearing, 4/21/04, at 17. Benefits would remain the same for officers hired prior to January 1, 2003. Id. [7] With respect to officers hired on or after January 1, 2003, the Ordinance provides that monthly pension benefits will be fifty percent (50%) of the officers' monthly average compensation during the last thirty-six months of employment. R.R. 2a. [8] The Ordinance sets member contributions into the police pension fund at "an amount equal to not less than five percent (5%) nor more than eight percent (8%) of compensation." R.R. 2a. The prior pension ordinance established that the member contribution rate was to be in accordance with the amount specified in the CBA. Proposed Decision and Order at 2; Finding of Fact No. 6 (F.F.____). [9] The relevant provisions of Section 6 of the PLRA are as follows: (1) It shall be an unfair labor practice for an employer — (a) To interfere with, restrain or coerce employes in the exercise of the rights guaranteed in this act. * * * (e) To refuse to bargain collectively with the representatives of his employes, subject to the provisions of section seven (a) of this act. 43 P.S. § 211.6. [10] Presumably the Association wished to protect veteran officers who had accrued unused vacation time over a number of years with the expectation that they could "cash out" during the last year of their employment and have their retirement benefit calculated on an artificially high gross salary. [11] See n. 16, infra. [12] Contrary to the examiner's determination, the Board found no unfair labor practice with regard to the officers' right to purchase non-intervening military time. The Board noted that, since the Ordinance only amended prior ordinances and did not specifically address this issue, the language in the prior ordinances establishing that right was still effective and was identical to Article 23, Section 6 of the CBA. [13] Our scope of review of a final order of the Board is limited to determining whether there was a violation of constitutional rights, whether an error of law was committed or whether the Board's necessary findings are supported by substantial evidence. Pennsylvania State Troopers Association v. Pennsylvania Labor Relations Board, 761 A.2d 645, 649 n. 6 (Pa.Cmwlth.2000). It is well established that final orders of the Board are to be affirmed if they are reasonable. Plumstead Township v. Pennsylvania Labor Relations Board, 713 A.2d 730, 736 (Pa.Cmwlth.1998). [14] For this reason we note that the Township's reliance on North Cornwall Township Police Association v. North Cornwall Township, 33 PA. PUB. EMP. R. ¶ 33054 (Final Order 2002) is misplaced. In that case, the union and employer included a provision in their collective bargaining agreement authorizing a forty-hour work week consisting of either four ten-hour days or five eight-hour days. When the employer changed from a four-day to a five-day workweek the union filed an unfair labor practice charge claiming a unilateral change in working conditions. The Board dismissed the charge noting that the parties satisfied their statutory duty to bargain by negotiating the contractual scheduling option, which the employer was then free to exercise as a management prerogative. North Cornwall Township is, in fact, a good example of the proper application of the "sound arguable basis" defense. The case sub judice is distinguishable since the CBA does not define "gross salary" for purposes of calculating pension benefits. The Township, rather than interpreting an existing contractual provision, essentially used its legislative power to write in a definition of its own choosing. [15] Section 8(c) of the PLRA provides, in pertinent part, as follows: If ... the board shall determine that any person named in the complaint has engaged in or is engaging in any such unfair labor practice, the board shall ... issue and cause to be served on such person an order requiring such person to cease and desist from such unfair labor practice, and to take such reasonable affirmative action ... as will effectuate the policies of this act. 43 P.S. § 211.8(c). [16] This Court followed Hickey in a case virtually indistinguishable from the one at bar. In Upper Chichester Township v. Pennsylvania Labor Relations Board, 153 Pa.Cmwlth. 446, 621 A.2d 1134 (1993), the township unilaterally amended its police pension ordinance after an Auditor General's report identified areas of noncompliance with Act 600. We affirmed the Board's order charging the township with an unfair labor practice. In doing so we noted that mere recommendations by the Auditor General did not excuse the township from its obligation to bargain in good faith. We also reiterated that "a provision to which the township voluntarily agreed during the bargaining process cannot now be objected to by the township on the basis of its illegality." Id. at 1135.

2013-10-30 06:35:54.177086+00

Williams

901 F. Supp. 294 (1995) Don VAN VRANKEN, on behalf of himself and all others similarly situated, and Lew & Ted's Service, Inc., Plaintiffs, v. ATLANTIC RICHFIELD COMPANY, Defendant. Civ. No. 79-0627 SW. United States District Court, N.D. California. August 16, 1995. *295 Cooper & Kirkham, Josef Cooper, Tracy Kirkham, San Francisco, CA, Howrey & Simon, J. Michael Hennigan, Los Angeles, CA, Sommer & Barnard, William Barnard, Edward Harris, Indianapolis, IN, for plaintiffs. Morrison & Foerster, F. Bruce Dodge, San Francisco, CA, Steptoe & Johnson, David Roll, Alfred Mamlet, George Peirce, Washington, DC, for defendant. ORDER GRANTING ATTORNEYS' FEES, EXPENSES, AND AN INCENTIVE AWARD TO THE NAMED CLASS REPRESENTATIVE SPENCER WILLIAMS, District Judge. Plaintiffs brought this class action against Defendant Atlantic Richfield Company ("ARCO") alleging violations of § 201 of the Economic Stabilization Act ("ESA") based on ARCO's interaffiliate pricing policies and noncompliance with regulations governing import fees and duties. After trial and various appeals, the parties agreed to a settlement which this Court approved in February of 1994. Class Counsel now move for: 1) an award of attorneys fees; 2) reimbursement of expenses and; 3) an incentive award to the named class representative. Based on the following, the Court GRANTS Class Counsel $19,180,803.07 in fees and $2,406,606.90 in expenses. The Court also GRANTS Don Van Vranken, the named class representative, $50,000 for his efforts during this litigation. BACKGROUND Plaintiffs commenced this case on March 23, 1979, although the litigation did not begin in earnest until Plaintiffs filed their Second Amended Complaint in 1985 following the Court's lifting of the stay imposed during Department of Energy ("DOE") compliance proceedings. The Second Amended Complaint alleged four causes of action based on ARCO's interaffiliate pricing policies and violations *296 of DOE regulations governing import fees and costs. After many years of litigation, the case finally went to trial in June of 1992. The jury found for ARCO on the interaffiliate pricing claim, but for Plaintiffs on the import fees and duties claims. The jury awarded Plaintiffs $22,800,000 in damages. After the Court added pre and post-judgment interest, the total award amounted to $67,548,713.26. ARCO appealed the verdict to both the Ninth and Federal Circuit Courts of Appeal. Soon thereafter, Class Counsel petitioned for statutory fees under section 210(b) of the ESA. While the appeals and fee petition were still pending, the parties agreed to settle the case. Under the terms of the settlement, ARCO agreed to pay the class the full amount of the judgment, $67,548,713.26, plus taxable costs of $49,500. In addition, ARCO added $9,125,000 to the fund as settlement for Class Counsel's statutory fee application. Thus, the total settlement fund became $76,723,213.26. In exchange, ARCO received a reverter of up to $9,000,000 of any unclaimed money left in the fund after distribution to Class Counsel and to class members. The Court granted its preliminary approval for this settlement in December of 1994 and final approval in February of 1995. Now, Class Counsel has filed an application for attorneys' fees seeking an award of 40 percent of the fund, or $30,689,285.30, as compensation for their efforts during this case. Class Counsel also requests $2,406,606.90 as reimbursement for litigation expenses and $100,000 as an incentive award to Don Van Vranken, the named class representative. The Court has received numerous oppositions to Class Counsel's fee application, both from attorneys representing groups of class members, as well as from individual class members themselves. DISCUSSION I. ATTORNEYS' FEES Class Counsel characterizes its proposed 40 percent fee as "reasonable compensation" for its efforts in a case that "taxed [their] personnel and economic resources almost to the breaking point." In response, various class members and their attorneys have labelled Class Counsel's requested fee as "astounding," "unreasonable," "clearly excessive" and "way too much." See Objection of Class Member Thrifty Oil Co. To Class Counsel's Motion for an Aggregate Award of Attorneys' Fees; Memorandum in Support of the Notice of Opposition of the Class Members Comprising the ARCO Jobbers Group; Letter from Class Member Pellett Petroleum, Inc.; Letter from Class Members G. and Elaine Swank. In considering Class Counsel's fee application, the Court must first determine which method to employ in calculating the appropriate fees, the lodestar method or the percentage of the fund method. Thereafter, the Court must evaluate the specific circumstances of this case to determine what amount of fees should be awarded. A. Method of Calculating Fees In common fund cases such as this, the Ninth Circuit allows a district court to employ either the percentage of the fund method or the lodestar method when awarding fees. In re Washington Pub. Power Supply System Securities Litigation, 19 F.3d 1291, 1294 n. 2 (9th Cir.1994). The Ninth Circuit has not expressed any explicit preference for either method so long as the ultimate fee award is reasonable under the circumstances. Id. at 1296; Florida v. Dunne, 915 F.2d 542, 545 (9th Cir.1990). The decision of which method to employ is within the sound discretion of the district court. See In re Washington Public Power, 19 F.3d at 1296 ("in common fund cases, no presumption in favor of either the percentage or the lodestar method encumbers the district court's discretion to choose one or the other"). Here, the Court will employ both methods to arrive at a reasonable fee under the circumstances. First, the Court will calculate a rough estimate of an appropriate fee by employing the percentage of the fund method. Thereafter, the Court will use the *297 lodestar method to verify that the awarded fee is equitable. 1. The Percentage of the Fund Method Under the percentage of the fund method, the Court simply awards class counsel a certain portion of the fund as compensation for their efforts. In setting a common fund fee, the court's role is essentially to take the place of the face-to-face negotiations that otherwise would have occurred between class counsel and class members had they retained attorneys individually. The Ninth Circuit has established a "benchmark" of 25 percent for awards of attorneys' fees in common fund cases. Paul, Johnson, Alston & Hunt v. Graulty, 886 F.2d 268, 272 (9th Cir.1989). This percentage can be adjusted upwards or downwards to account for special or unusual circumstances. Id. The Ninth Circuit has not clearly defined what sort of factors constitute unusual circumstances other than to state they must "indicate that the percentage recovery would be either too small or too large in light of the hours devoted to the case or other relevant factors." Six Mexican Workers v. Arizona Citrus Growers, 904 F.2d 1301, 1311 (9th Cir.1990). Here, Class Counsel request a fee award of $30,689,285.30, representing 40 percent of the settlement fund. Class Counsel assert that such a percentage is within the proper range for attorney's fees in common fund cases as set out by the Ninth Circuit. Although Class Counsel admit that 40 percent is on the high end of this purported range, they claim that such an award is justified by the unusual circumstances of this case, such as the length of litigation, the complexity of issues, and so forth. Class Counsel cite numerous cases that they claim establish a range of permissible fee percentages extending from 20-50 percent of the fund. See, e.g., In re Warner Communications Securities Litigation, 618 F. Supp. 735, 749 (S.D.N.Y.1985) ("Traditionally, courts in this Circuit and elsewhere have awarded fees in the 20%-50% range in class actions"); In re Dun & Bradstreet Credit Services Customer Litigation, 130 F.R.D. 366, 372 (S.D.Ohio 1990) ("Fee awards in common fund cases generally are calculated as a percentage of the fund created, with the percentages awarded typically ranging from 20 to 50 percent of the common fund created"). Class Counsel have also cited 73 district court opinions in which fees in the range of 30-50 percent of the common fund were awarded. See, e.g., In re Ampicillin Antitrust Litigation, 526 F. Supp. 494, 503 (D.D.C.1981) (awarding 40.4 percent of $7.3 million fund); Van Gemert v. Boeing Co., 516 F. Supp. 412, 420 (S.D.N.Y.1981) (awarding 36 percent of $8.9 million fund); In re Control Data Corp. Securities Litig., No. 3-85-1311 (D.Minn. Sept. 21, 1994) (awarding 37 percent of $8 million fund). After reviewing the authority Class Counsel has submitted, the Court finds their requested 40 percent fee to be excessive under the circumstances of this case. There is no doubt that Class Counsel's commendable efforts during this lengthy and complicated case should be rewarded. However, Class Counsel's request for a 40 percent fee fails to account for the size of the $76 million common fund. See In re Washington Pub. Power, 19 F.3d at 1296 (affirming district court's decision to award $32 million in fees representing only 4.7 percent of the fund where the $687 million fund was so large that a $171.75 benchmark award of 25 percent would have been excessive compared to the time and efforts expended by class counsel); In re Domestic Air Transp. Antitrust Litigation, 148 F.R.D. 297, 350 (N.D.Ga.1993) ("percentage awards tend to decline as the size of the recovery increases"). Most of the cases Class Counsel have cited in which high percentages such as 30-50 percent of the fund were awarded involved relatively smaller funds of less than $10 million. See, In re Ampicillin, 526 F.Supp. at 503; Van Gemert, 516 F.Supp. at 420; In re Control Data Corp. Securities Litig., No. 385-1311. By contrast, in cases where common funds are in the range of $51-75 million, fees most often fall in the 13-20 percent range. In re Domestic Air Transp., 148 F.R.D. at 350-51; See, e.g., In re Gypsum Cases, 386 F. Supp. 959 (N.D.Cal.1974) (awarding 12.35 percent of $75 million fund), *298 aff'd 565 F.2d 1123 (9th Cir.1977); Brown v. Phillips Petroleum Co., 838 F.2d 451 (10th Cir.1988) (awarding 16.5 percent of $75 million fund), cert. denied, 488 U.S. 822, 109 S. Ct. 66, 102 L. Ed. 2d 43 (1988). Moreover, in megafund cases with class recoveries of $75-$200 million, courts are even more stringent, and fees in the 6-10 percent range and lower are common. In re Domestic Air Transp., 148 F.R.D. at 351; See, e.g., In re Folding Carton Antitrust Litig., 84 F.R.D. 245 (N.D.Ill.1979) (awarding fees amounting to 6.6 percent of $200 million fund); Sioux Nation of Indians v. U.S., 650 F.2d 244, 227 Ct. Cl. 404 (1981) (awarding 10 percent of $106 million fund); In re MGM Grand Hotel Fire Litigation, 660 F. Supp. 522 (D.Nev. 1987) (awarding 7 percent of more than $200 million fund). Therefore, after balancing Class Counsel's efforts during this litigation against the large size of the common fund, the Court finds that a benchmark award of 25 percent, or $19,180,803.07, is warranted under the circumstances. 2. The Lodestar Method To verify the reasonableness of a 25 percent fee award, the Court will also employ the lodestar method, and examine Class Counsel's time cards and billing records submitted to support their request for fees. Under the lodestar method, the Court first calculates the "lodestar" by multiplying the reasonable hours expended by a reasonable hourly rate. Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 478 U.S. 546, 565, 106 S. Ct. 3088, 3098, 92 L. Ed. 2d 439 (1986). The court may then enhance the lodestar with a "multiplier", if necessary, to arrive at a reasonable fee in light of all the circumstances of the case. The factors that may be relevant to a lodestar/multiplier analysis include: 1) the time and labor required; 2) the novelty and difficulty of the questions involved; 3) the requisite legal skill necessary; 4) the preclusion of other employment due to acceptance of the case; 5) the customary fee; 6) whether the fee is fixed or contingent; 7) the time limitations imposed by the client or the circumstances; 8) the amount at controversy and the results obtained; 9) the experience, reputation, and ability of the attorneys; 10) the "undesirability" of the case; 11) the nature and length of the professional relationship with the client and; 12) awards in similar cases. Kerr v. Screen Extras Guild, Inc., 526 F.2d 67, 70 (9th Cir.1975), cert. denied, 425 U.S. 951, 96 S. Ct. 1726, 48 L. Ed. 2d 195 (1976). Multipliers in the 3-4 range are common in lodestar awards for lengthy and complex class action litigation. See Behrens v. Wometco Enterprises, Inc., 118 F.R.D. 534, 549 (S.D.Fla.1988) (awarding multiplier of 3 and commenting that "[t]he range of lodestar multiples in large and complicated class actions runs from a low of 2.26 to a high of 4.5"); Keith v. Volpe, 86 F.R.D. 565, 575-77 (C.D.Cal.1980) (awarding multiplier of 3.5). Here, Class Counsel states that they have spent 38,768 hours on this case, amounting to a total expenditure of $10,692,067.25. Using Class Counsel's numbers, if the Court awards $19,180,803.07 in fees representing 25 percent of the common fund, the multiplier would be approximately 1.8 ($19,180,803.07 ÷ $10,692,067.25). This would be a relatively low multiplier. However, these calculations are undermined by Class Counsel's failure to account for their lack of success on the class's interaffiliate pricing claim. In cases where class counsel's efforts meet with only "partial or limited success," they are not entitled to collect attorneys' fees for all the billable hours and expenses incurred during the litigation. Hensley v. Eckerhart, 461 U.S. 424, 435-37, 103 S. Ct. 1933, 1940-41, 76 L. Ed. 2d 40 (1983); Thorne v. City of El Segundo, 802 F.2d 1131, 1141 (9th Cir.1986). Here, Plaintiffs sought and were denied more than $200 million on their interaffiliate pricing claim, compared to a recovery after trial of slightly more than $22 million on their other three claims. The Court must take this into consideration when awarding fees. The Court acknowledges that the claims in this case overlap to a large degree, making it difficult to determine how many hours Class Counsel spent on their losing claim. Nonetheless, it is possible to compute a reasonable estimate of these hours based on the number *299 and complexity of the claims and the damages sought for each claim. If the claims were of equal complexity and the damages sought for each claim were the same, computing an estimate would be a relatively easy task. Under those circumstances, it would be reasonable to assume that Class Counsel allocated their time equally to each of the four claims. If that assumption was accurate, it would be appropriate to compensate Class Counsel for 75 percent of their billable hours. Were the Court to award Class Counsel 25 percent of the common fund using this formula, the multiplier would be 2.4 ($19,180,803.07 ÷ (.75 × $10,692,067.25)). However, given that more than 90 percent of Plaintiffs' damage request was pursuant to their losing claim and that claim was far more complex than the others, it is very likely that Class Counsel allocated more than 25 percent of their time to that claim. The question then becomes: how much more? Based on the amount of damages Plaintiffs requested pursuant to their losing claim and its complexity, it is reasonable to assume that Class Counsel spent at least half of their time on that claim. If Class Counsel's compensation is based on these assumptions, the multiplier would be at least 3.6 ($19,180.803.07 ÷ (.5 × $10,692,067.25)), which is well within the acceptable range for fee awards in complicated class action litigation such as this. Based on the foregoing, the lodestar method confirms the reasonableness of a 25 percent benchmark award in this case. II. REIMBURSEMENT OF EXPENSES Class Counsel also requests $2,406,606.90 as reimbursement for litigation expenses. None of the class members have opposed this request. After reviewing the documentation Class Counsel has submitted, the Court finds Class Counsel's request for reimbursement of expenses to be reasonable. Their reimbursement request is supported by a detailed accounting and by declarations from independent counsel Jerome Braun and Bruce MacLeod. Therefore, the Court GRANTS Class Counsel's request for $2,406,606.90 in reimbursement of expenses. III. AWARD OF $100,000 TO THE NAMED CLASS REPRESENTATIVE Lastly, Class Counsel requests that the Court award Don Van Vranken, the named class representative, an incentive award of $100,000 for his efforts during this litigation. None of the class members have opposed this award. Whether to reward Mr. Van Vranken for his efforts is within the Court's discretion. See, e.g., In re Domestic Air Transp., 148 F.R.D. at 357-58 (awarding $142,500 to class representatives out of $50 million fund); In re Dun & Bradstreet, 130 F.R.D. at 373-74 (awarding $215,000 to several class representatives out of an $18 million fund). The criteria courts may consider in determining whether to make an incentive award include: 1) the risk to the class representative in commencing suit, both financial and otherwise; 2) the notoriety and personal difficulties encountered by the class representative; 3) the amount of time and effort spent by the class representative; 4) the duration of the litigation and; 5) the personal benefit (or lack thereof) enjoyed by the class representative as a result of the litigation. See Richard Greenfield, "Rewarding the Class Representative: An Idea Whose Time Has Come," 9 Class Action Reports 4 (1986); Enterprise Energy Corp. v. Columbia Gas Transmission Corp., 137 F.R.D. 240, 250 (S.D.Ohio 1991). Here, several of the above factors support Van Vranken's request for an incentive award. Van Vranken's participation lasted through many years of litigation. Furthermore, according to Class Counsel, Van Vranken's testimony at trial was key in rebutting ARCO's "good faith" defense. In exchange for his participation, Van Vranken will not receive great personal benefit. He owns a moderately sized truck stop and his claim makes up only a tiny fraction of the common fund. However, after reviewing the actual time that Van Vranken spent on the case, the *300 Court finds that a $100,000 award would be excessive. In his declaration, Van Vranken does not quantify how many hours he spent on the litigation or when he spent them. He merely states that he participated in 49 telephone conferences and five meetings with Class Counsel, attended three pre-trial hearings, had his deposition taken twice, and testified at trial. He further asserts that he made various unspecified out-of-pocket expenditures for gas, occasional meals, and wear and tear on his car during his travels from Fresno to San Francisco, San Jose, and Los Angeles. After evaluating the time Van Vranken committed to this case, the Court finds that an incentive award of $50,000 is just and reasonable under the circumstances. CONCLUSION For the foregoing reasons, the Court awards Class Counsel the following: 1) $19,180,803.07 in attorneys fees, plus any interest earned thereon since the date judgment was entered. 2) $2,406,606.90 in reimbursement of expenses. Class Counsel shall place these fees and expenses in a trust account separate from the rest of the settlement funds. Class Counsel may withdraw half of this money immediately, and the other half after the Court has determined that the claims process is completed. In addition, the Court awards Don Van Vranken $50,000 for his efforts during this litigation. Class Counsel shall disburse this award to Van Vranken immediately. IT IS SO ORDERED.

2023-08-23 14:16:40.845455+00

Smith

George Rose Smith, Justice. This is an action by seven former North Little Rock policemen to recover up to a maximum of 30 days of accumulated sick-leave pay that is assertedly due to each of them. The plaintiffs also seek to maintain the suit as a class action for the benefit of other former policemen. The city defends primarily on the ground that the original ordinance allowing the payment of accumulated sick leave upon the termination of employment was amended in 1976 to exclude employees with less than ten years of service. None of the plaintiffs meet that minimum requirement. After a hearing the trial judge ruled that the 1976 amendment did not apply to members of the fire and police departments; so the plaintiffs were entitled to recover. The city appeals from the ensuing money judgments for accumulated sick leave up to 30 days. The plaintiffs cross appeal from the court’s refusal to approve a class action. Our jurisdiction is based on Rule 29 (1) (c). We disagree with the trial judge’s interpretation of the city ordinances. The original ordinance was codified as Sections 2-206 and 2-207. Section 2-206 provided that sick leave would accrue monthly and could be accumulated for not more than a total of 30 days. Section 2-207 provided that a city employee would be paid all his accumulated sick leave upon retirement. In 1974 both sections were amended by Ordinance 4322. Section 1 of that ordinance amended 2-206 “to read as follows,” with the substituted language increasing the permissible accumulation to a maximum of 60 days, but excepting members of the fire and police departments from the effect of “this amendment.” Section 2 then amended 2-207 “to read as follows,” and provided that employees with less than 10 years of service would be paid accumulated sick leave to a maximum of 30 days at their retirement or resignation, but employees with 10 years of service or more would be paid up to their maximum accumulation of 60 days. In 1976 Ordinance 4710, relied on by the city, amended Section 2 of Ordinance 4322 to provide that employees with less than 10 years of service would not be entitled to the payment of any accrued sick leave upon termination of their employment. We cannot agree with the trial judge’s conclusion that the exemption of the fire and police departments contained in Section 1 of the 1974 ordinance also applied to Section 2 of that ordinance. Section 1 was directed only to 2-206 and referred to “this” amendment, not these amendments. Section 1 had no effect upon 2-207, which was simultaneously but separately amended by Section 2, with no similar exemption of the fire and police departments. Hence the city’s apparent intention was to permit firemen and policemen to accumulate up to 30 days of sick leave under the first two ordinances, payable upon retirement. But the 1976 amendment purported to withdraw the right to any payment of accumulated sick leave until the employee had served for at least ten years. If that amendment is retroactively valid, the city’s position must be sustained. The appellees argue that they had a vested contractual right to their accumulated sick leave because they “contributed” to the plan, not in money but by coming to work when they might have stayed away and charged their absence to sick leave. We do not find this argument persuasive. The ordinary meaning of the words “sick leave” contemplates an illness rather than an optional holiday with full pay. Alternatively the appellees argue that they had a vested contractual right to their accumulated sick leave, because it was held out to them as a fringe benefit at the time of their employment. There is a division of authority about the recognition of a vested right to the continuation of sick leave or similar benefits which arise from a statute or ordinance rather than from an express contract incorporating such benefits. The cases holding that there is no vested right include: Marsille v. City of Santa Ana, 64 Cal. App. 3d 764, 134 Cal. Rptr. 743 (1977) (sick leave); Brown v. City of Highland Park, 320 Mich. 108, 30 N.W. 2d 798 (1948) (pension); Halek v. City of St. Paul, 35 N.W. 2d 705 (Minn. 1949) (sick leave); Lickert v. City of Omaha, 12 N.W. 2d 644 (Neb. 1944) (pension); Dodge v. Board of Education, 302 U.S. 74 (1937), holding that there is a presumption that the law is not intended to create vested rights, but the question is essentially one of legislative intent. Other cases hold that the statute or ordinance becomes part of the contract of employment and creates a vested right. Yeazell v. Copins, 402 P. 2d 541 (Ariz. 1965) (pension); Vangilder v. City of Jackson, 492 S.W. 2d 15 (Mo. App. 1973) (sick leave); Harryman v. Rosenburg Rural Fire Protection Dist., 420 P. 2d 51 (Ore. 1966) (sick leave); City of Galveston v. Landrum, 533 S.W. 2d 394 (Tex. Civ. App. 1976) (sick leave); Mulholland v. City of Tacoma, 83 Wash. 2d 782, 522 P. 2d 1157 (1974) (pension). We think the better view is that an employee’s right to accumulated sick leave in a case such as this one continues to vest as long as a particular plan is in force, but the city may prospectively modify the plan if that course is found to be advisable. Hence, although we disagree with the trial court’s conclusion about the effect of Ordinance 4710, we remand the cause for a determination of the amount of accumulated sick leave, up to a maximum of 30 days, that had accrued to each claimant on the effective date of that ordinance and that was not thereafter diminished or exhausted. In the case of employees such as these, who did not ultimately complete 10 years of service, there could be no additional accumulation after Ordinance 4710 went into effect. As to the cross appeal, a class suit is permitted when, in addition to other requirements, the parties are numerous and it is impracticable to bring them all before the court within a reasonable time. ARCP, Rule 23 (a). Here the members of the class are all identified and total only seventeen, including the seven appellees. The appellees cite no authority permitting a class action for such a small group, and we doubt if such a case exists. Moore’s Federal Practice, § 23.05 [1] (1980); Wright and Miller, Federal Practice and Procedure: Civil, § 1762 (1972). In the present case there is no showing of impracticability. Reversed on direct appeal and remanded; affirmed on cross appeal. Purtle, J., dissents.

2023-08-23 14:16:40.849603+00

Purtle

John I. Purtle, Justice, concurring in part, dissenting in part. I dissent from the majority on that part of the opinion which refuses to allow the appellees to continue to accrue sick-leave time after December of 1976 when the city passed Ordinance 4710.1 agree with the interpretation by the majority up through their interpretation of Ordinance 4322 which was effective in January of 1974. When the appellees were hired by the city of North Little Rock, the provisions of Ordinance 4322 provided: The city employee with less than ten (10) years service shall be paid, at the time of his retirement or resignation from city employment, or upon the death of the employee, for all sick leave accumulated by him, to a maximum of thirty (30) days. ... Appellees undoubtedly considered the accumulation of sick pay as part of the remuneration for their services with the city of North Little Rock. Sick leave, vacation, hospitalization and life insurance are elements which strongly influence an individual in accepting or rejecting job offers. In my opinion, when the appellees were hired this ordinance became a part of their contract. The city had no right to take away benefits which were, in my opinion, already vested. It seems to me that the language above-quoted is clear and unambiguous and therefore we need not resort to the rules of statutory construction to determine the meaning thereof. Mears v. Arkansas State Hospital, 265 Ark. 844, 581 S.W. 2d 339 (1979). The rules of statutory construction, if required, apply to city ordinances as well as enactments of the General Assembly. Deloney v. Rucker, 227 Ark. 869, 302 S.W. 2d 287 (1957). We have held that a city may be bound by the terms of contracts entered into by it in the same manner as private corporations or citizens. Harrison v. Boone County, 238 Ark. 113, 378 S.W. 2d 665 (1964). The right to accumulate up to 30 days sick leave was a part of the ordinances of the city of North Little Rock when the appellees were hired. The majority recognize that the authorities are divided as to whether sick leave benefits are vested as a matter of contractual rights. Since we are ruling upon this particular issue for the first time, there is no reason why we should take the reactionary road and hold against those who have worked with the expectation that they would earn the benefits which had been promised them. The majority has been very fair in citing the authorities on both sides of this issue. However, I feel the case of Yeazell v. Copins, 402 P. 2d 541 (Ariz. 1965), furnishes the most logical reasoning of all cases reported. Yeazell stated that policemen had the right to rely on the terms of the legislative enactment as it existed at the time they started to work. Subsequent legislation could not arbitrarily be applied retroactively to impair the contract. The opinion stated that changes could be made only with the consent of the officers involved. It is true Yeazell dealt with pension rights and the present case deals with accumulated sick leave. However, I can see no difference in the logic between the two benefits. We have held in a closely related case that accrued rights may not be denied to those who have earned them. In the case of Jones v. Cheney, 253 Ark. 926, 489 S.W. 2d 785 (1973), we stated: The classes of contracts entered into voluntarily that are based on the assent of the parties expressly or impliedly given as opposed to those that are compulsory, are protected by the Constitutional provisions against impairing the obligation of a contract. In Anders v.Nicholson, 111 Fla. 849, 150 So. 639 (1933), it was held under a municipal ordinance providing for pensions to employees who should elect to participate in, and contribute to, the pension fund, that a public employee by acceptance of the terms and conditions of the enactment entered into a contractual relationship with the city, which entitled him to receive certain benefits, and his rights accruing under the statute could not be abrogated by any subsequent legislation. ... I think the sick-leave benefits were a part of the consideration paid to the employees and that the city had no right to deny the appellees these benefits after the contract between the parties was in full force and effect.

2013-10-30 06:35:54.315897+00

Holland

878 A.2d 451 (2005) STATE of Delaware, Employer Below, Appellant, v. Charles DALTON, Employee Below, Appellee. No. 55, 2005. Supreme Court of Delaware. Submitted: June 15, 2005. Decided: July 11, 2005. Dennis J. Menton and Timothy S. Martin, Tybout, Redfearn & Pell, Wilmington, DE, for appellant. Thomas J. Roman and Jonathan B. O'Neill, Kimmel, Carter, Roman & Peltz, Bear, DE, for appellee. *453 Before HOLLAND, BERGER and RIDGELY, Justices. *452 HOLLAND, Justice. This is an appeal from a final judgment entered by the Superior Court. The employer-appellant, the State of Delaware ("State"), appealed a decision of the Industrial Accident Board's ("IAB") finding that the employee-appellee, Charles J. Dalton, Jr., of the Delaware State Police, was injured during the course and scope of his employment and that the injury was, therefore, compensable under the Workers' Compensation Statute. The Superior Court affirmed the decision of the IAB. The State has raised three issues in this direct appeal. First, the State contends that the Superior Court erred by making independent findings of fact that were beyond the scope of the IAB's factual determinations. Second, the State argues that after the Superior Court allegedly made its own factual findings, it reached a conclusion that was contrary to the substantial weight of the evidence. Third, the State alleges that the IAB erred, as a matter of law, by failing to articulate the applicable legal standard upon which its decision was based. We have determined that the State's arguments are without merit. Accordingly, the judgment of the Superior Court is affirmed. Facts[1] Dalton works as a state trooper for the State of Delaware. In July 2003, Dalton's supervisor sent a message through the State Police e-mail system asking troopers to volunteer to play in a charity softball game against volunteers from the New Castle County Police Department. Dalton volunteered and was chosen to play in the game, which took place on August 30, 2003. During the game, Dalton severely broke his wrist. He was totally disabled from his police duties from August 30, 2003 until November 2003, and incurred medical expenses to treat the injury. The police charity softball game is an annual event organized by the Town of Middletown and played at Silver Lake Elementary School, which is owned and maintained by the State. Participation in the event by state troopers was approved seven years ago by high-ranking State Police personnel. The State Police provide uniforms for the state troopers who play in the game, and the officers provide the rest of their equipment. The game takes place on a weekend and involves only state troopers who are not on duty. Six State Police officers testified during the IAB hearing on August 8, 2004. All agreed that participation in charity events such as the softball game is part of the job of a state trooper. The officers further agreed that the State Police receive a benefit from participation, namely, that charity work presents a positive image of police officers to the community. They testified that it is vitally important that the public view state troopers positively, so that they will be willing to assist police efforts to prevent crime. In recognition of this benefit, the State Police maintain a credit system to govern trooper rank advancement, and significant credits are awarded for charitable work. The State does not contest the existence of the injury to Dalton or the bills associated with it. Instead, the State argues that the injury did not occur during the course and scope of Dalton's employment, and therefore is not compensable. The IAB disagreed, finding the fact that Dalton was asked to participate by his superior officer, *454 combined with the importance the State Police placed on charitable work, drew the softball game into the scope of Dalton's employment. The IAB's decision to award Dalton disability benefits was affirmed by the Superior Court. IAB's Decision Dalton's burden of proof was to establish that his injury arose out of the course and scope of his employment with the State.[2] Since Dalton was not injured on his employer's premises, he was required to establish that he was injured "in or about the employer's business where the employee's services require[d] the employee's presence as part of such service."[3] In granting Dalton's petition, the IAB stated that "based on the factual circumstances viewed in totality and giving liberal construction to the Workers' Compensation Act, the Board finds that [Dalton] has met his burden of proof in this matter." The IAB found that Dalton was "in or about the employer's business" when he was injured because: Dalton's "actions were taken in good faith to further his employer's interests"; Dalton's "duties as a state trooper, as reflected in the testimony of all witnesses, extended to representation at charity and community events"; Dalton's "participation shed a positive community light on the State Police and may have acted to deter crimes in the area and reflect well on the State Police's services"; the softball team was "comprised exclusively of fellow state troopers"; "participation in this event was sanctioned by State Police command and was believed to benefit the State Police and their image in the community"; and Dalton "never sought to gain personally from his participation as he did not file for a recognition of community service for his personnel file." Standard of Review The standard of review for an appeal of a decision from the IAB is well-established. In an appeal from the IAB, the function of both this Court and the Superior Court "is to determine only whether or not there was substantial evidence to support the findings of the Board. If there was, these findings must be affirmed."[4] This Court has noted that substantial evidence is more than a mere scintilla, but less than a preponderance of the evidence.[5] When reviewing appeals from the IAB, neither the Superior Court nor this Court is the trier of fact and neither tribunal has authority to weigh evidence, determine the credibility of witnesses or make independent factual findings.[6] Superior Court Made No Factual Findings The State contends that the Superior Court made three independent factual findings that were not originally made by the IAB and that those facts were incorrectly applied to the substantial evidence standard. Those alleged independent factual findings are: 1) "the State created a promotional system that `effectively' required attendance at charity events"; 2) "that `a trooper' would reasonably believe that he was acting on behalf of the State when he responded to a request from a *455 senior officer to `volunteer' for a charitable event"; and 3) "that `goodwill' police participation in charitable events was `institutionally' recognized and `actively' promoted by the State." This argument is without merit because the record reflects that the IAB did make these three contested factual findings. Those findings are set forth by the IAB in its Decision on Petition to Determine Compensation Due, under the section entitled "Findings of Fact and Conclusions of Law." Accordingly, all three of those factual findings were properly before the Superior Court for review on appeal. The IAB found that Dalton's duties as a trooper, "as reflected in the testimony of all witnesses, extended to representation at charity and community events." In the same section of its decision, the IAB made a factual finding that Dalton indeed "went about the State's business by his participation" in the softball charity game and that by "participating in the softball game, [Dalton] intended to further the interests of the State." The IAB accepted, as credible, testimony that Dalton's "participation shed a positive community light on the State Police and may have acted to deter crimes in the area and reflect well on the State Police's services." The IAB also found that the Delaware State Police sanctioned participation in the charity game. Conclusion Supported By Substantial Evidence The State next contends that the IAB's decision is not supported by substantial evidence. The determination as to whether a given activity is within a scope of employment is a conclusion of law based on a fact-specific analysis. In ascertaining whether Dalton's injury occurred during a non-sponsored recreational activity that was within the scope of his employment, the Superior Court considered the three factors set forth in Larson's treatise on Workers' Compensation Law: (1) it occurs on the premises during a lunch or recreation period as a regular incident of the employment; or (2) the employer, by expressly or impliedly requiring participation, or by making the activity part of the services of an employee, brings the activity within the orbit of the employment; or (3) the employer derives substantial direct benefit from the activity beyond the intangible value of improvement in employee health and morale that is common to all kinds of recreation and social life.[7] We hold that the Superior Court correctly decided to apply the non-sponsored recreational activity factors set forth in Larson's treatise because the softball game was not sponsored by the State Police. The purpose of applying the Larson factors is to determine whether a recreational activity that is not sponsored by an employer is, nevertheless, within the course and scope of employment.[8] The State argues that the first factor set forth in the Larson treatise is dispositive because the softball game did not take place at a State Police facility. In support of this argument, the State relies upon the Richmond[9] case from Oregon for the proposition that the location and timing of the activity is outcome determinative. However, the Richmond case is neither a binding precedent in this jurisdiction nor does it *456 remain good law, as it has been superseded by statute. Moreover, the Larson treatise expressly recognizes that a compensable injury may occur during a non-sponsored recreational activity that does not take place on the employer's premises. Most important, the express terms of the factors set forth in Larson's treatise for determining the compensability of a non-sponsored recreational activity are stated in the disjunctive. Consequently, only one of the factors must be satisfied to support a finding that an injury is compensable.[10] However, the broken wrist that Dalton sustained in the softball game comports with both the second and third factors of the non-sponsored recreational activity factors set forth in the Larson treatise. Since two of the Larson factors were supported by substantial evidence, the Superior Court had independent alternative factual bases for affirming the IAB's determinations that Dalton had suffered a compensable work-related injury. The Superior Court properly affirmed the IAB's determination that the State Police have brought charitable events such as this one into "the orbit of employment" for troopers, within the meaning of the second Larson factor, by soliciting volunteers through requests from superior officers, and by creating a promotion system that effectively requires attendance at charity events. With regard to the third Larson factor, benefit, the record supports the Superior Court's conclusion that there was substantial evidence to support the IAB's determination that the State derives a benefit from participation by state troopers in such events. IAB Articulated Applicable Legal Standard The State's third argument is that the IAB did not set forth the applicable legal standard upon which its decision was based. That argument is contradicted by the record. The IAB explicitly stated that it was evaluating Dalton's claim under the Workers' Compensation Act,[11] and that it resolved the claim under the applicable "totality of the circumstances" test.[12] The record reflects that the IAB supported its conclusion that Dalton had sustained a work-related injury with specific factual findings and stated that "[b]ased on the factual circumstances viewed in totality and giving liberal construction to the Workers' Compensation Act, the Board finds Claimant has met his burden of proof in this matter." The analysis in the IAB's decision supports the Superior Court's conclusion that the IAB was relying on the factors set forth in Larson's treatise for determining whether a non-sponsored recreational activity was with the course of employment. We agree. Conclusion The judgment of the Superior Court is affirmed. NOTES [1] These facts are taken from the Superior Court's decision. [2] See Histed v. E.I. DuPont de Nemours & Co., 621 A.2d 340, 343 (Del.1993). [3] Del.Code Ann. tit. 19, § 2301(15)a. [4] General Motors Corp. v. Freeman, 164 A.2d 686, 689 (Del.1960). [5] Olney v. Cooch, 425 A.2d 610, 614 (Del.1981). [6] Johnson v. Chrysler Corp., 213 A.2d 64, 66 (Del.1965). [7] 2 Arthur Larson and Lex Larson, Larson's Workers' Compensation Law, ch. 22 (LEXIS Publishing 2001) § 22.01. [8] Id. [9] Richmond v. State Accident Ins. Fund Corp., 58 Or.App. 354, 648 P.2d 370 (1982), superseded by statute as stated in Roberts v. SAIF, 196 Or.App. 414, 102 P.3d 752, 754 (2004). [10] 2 Arthur Larson and Lex Larson, Larson's Workers' Compensation Law, ch. 22 (LEXIS Publishing 2001) § 22.01. [11] Del.Code Ann. tit. 19, § 2304 (2005); Del.Code Ann. tit. 19, § 2301(15)a (2005). [12] See Histed v. E.I. DuPont de Nemours & Co., 621 A.2d 340, 345 (Del.1993).

2013-10-30 06:35:54.318452+00

Brody

901 F. Supp. 378 (1995) Susan CIRESOLI, individually and on behalf of her minor child, Joshua Ciresoli, Plaintiff, v. M.S.A.D. No. 22; Leo G. Martin, in his capacity as Commissioner of the Maine Dep't of Education; and Susan W. Davenport, in her capacity as Commissioner of the Maine Dep't of Mental Health and Mental Retardation, Defendants, v. John R. McKERNAN, in his capacity as Governor of the State of Maine; and Jane Sheehan, in her capacity as Commissioner of the Maine Dep't of Human Services,[1] Third-Party Defendants. Civ. No. 94-0011-B. United States District Court, D. Maine. September 6, 1995. *379 *380 *381 Judson Esty-Kendall, Pine Tree Legal Assistance, Inc., Bangor, Maine, for Plaintiff. Eric R. Herlan, Drummond, Woodsum, Plimpton & MacMahon, Portland, Maine, for Defendant M.S.A.D. # 22. Peter Stewart, Asst. Atty. Gen., Augusta, Maine, for Dept. Of Education. ORDER AND MEMORANDUM OF DECISION BRODY, District Judge. Susan Ciresoli brings this action on behalf of her emotionally disturbed son, Joshua. She contends that Defendants Maine School Administrative District Number 22 ("M.S.A.D. # 22" or "the District") and the Maine Department of Education failed to provide Joshua with an appropriate education as required by the Individuals with Disabilities Education Act, 20 U.S.C. §§ 1400-1491o (the "IDEA"), and state law. Ms. Ciresoli and the District also bring claims against the State and various state agencies under the IDEA, the Americans with Disabilities Act, 42 U.S.C. §§ 12101-12213 (the "ADA"), and the Rehabilitation Act, 29 U.S.C. §§ 701-797b. The Court divided the case into two tracts: an administrative tract for reviewing the Hearing Officer's decision; and a standard tract for addressing the remaining claims under the IDEA, the ADA, and the Rehabilitation Act. The case is ready for decision, the parties having agreed to have this case decided on briefs and a stipulated record. The Court will first decide the administrative tract issues under the IDEA and state law. I. The Administrative Tract The express goal of the IDEA, 20 U.S.C. §§ 1400-1491, is "to assure that all children with disabilities have available to them ... a free appropriate public education." 20 U.S.C. § 1400(c). The IDEA, formerly known as the Education of the Handicapped Act, "provides federal funds to assist state and local agencies in educating children with disabilities, but conditions such funding on compliance with certain goals and procedures." Ojai Unified Sch. Dist. v. Jackson, 4 F.3d 1467, 1469 (9th Cir.1993) (citing 20 U.S.C. § 1412 and Board of Educ. v. Rowley, 458 U.S. 176, 179-80, 102 S. Ct. 3034, 3037, 73 L. Ed. 2d 690 (1982)), cert. denied, ___ U.S. ___, 115 S. Ct. 90, 130 L. Ed. 2d 41 (1994). One of these procedural requirements is the annual development of individualized education programs (IEPs) for each student with a disability. 20 U.S.C. § 1401(a)(18)(D). A parent who disagrees with a school's proposed educational plan is entitled to an impartial due process hearing conducted by the State educational agency. 20 U.S.C. § 1415(b)(2). In addition, pursuant to 20 U.S.C. § 1415(e)(2), any party aggrieved by *382 the findings and decisions made during that hearing can bring a civil action in state or federal court with respect to the complaint presented at the hearing. Ms. Ciresoli pursues her appeal of the hearing officer's decision pursuant to § 1415(e)(2). A. Facts and Procedural Background The facts, according to the stipulated record, are as follows: Joshua Ciresoli was six-and-a-half years old when this action was filed and is now eight years old. He is a child of average to above-average cognitive abilities. He has, however, exhibited difficult and unpredictable assaultive behavior since a very early age and has been diagnosed as having, among other problems, Childhood Psychotic Disorder. The parties agree that Joshua's difficulties make him eligible for services under the IDEA. Joshua and his mother are residents of Hampden, Maine. Hampden is located within Maine School Administrative District Number 22 ("M.S.A.D. # 22" or "the District"). In the fall of 1992, Joshua began kindergarten at the McGraw School, which is located within M.S.A.D. # 22. Earlier caretakers expressed concern that Joshua's behavior would require a high level of intervention. In response, the District convened a pupil evaluation team to design an individualized education program (IEP) for Joshua, pursuant to the IDEA. Under that Program, Joshua was successfully mainstreamed in kindergarten with some special services including physical therapy, extra support from the teacher, and consultations with the special education teacher and the school psychologist. At the end of the 1992-93 academic year, Joshua appeared ready to be promoted to first grade during the 1993-94 academic year. During summer vacation, however, Joshua exhibited a marked increase in unpredictable aggressive behavior including assaulting other children and taking a kitchen knife to bed. This behavior caused Ms. Ciresoli to fear for her own safety as well as that of Joshua's younger sister. In August 1993, she placed Joshua in Acadia Hospital, a psychiatric hospital located in Bangor, Maine. Although Joshua's stay at Acadia was intended to be a short one, Joshua remained at Acadia for almost seven months. In September, Joshua began attending the academic program within Acadia. This program, which provided approximately two hours per day of academic training, was financed by the District. The District convened Joshua's pupil evaluation team in September 1993 to discuss Joshua's educational progress and his placement after discharge from Acadia. At that meeting, several members of the Acadia staff discussed Joshua's behavior at the hospital. They noted, in particular, Joshua's unpredictable assaultive actions and his repeated need for physical restraint. Joshua's treating psychiatrist recommended "[a] residential placement due to Joshua's potential for violence to others." (Ex. c at 19.) The District's Director of Special Education, Ruey Yehle, asserted that Joshua's need for a residential placement was for mental health reasons rather than educational reasons. (Id.) Although the team met again on October 13, 1993, they remained unable to come to a consensus on placement. In its October 13th IEP, the District proposed a nearby day program, known as the Old Town Regional Program, to be supplemented by: daily home-school coordination, individual counseling for one hour per week, social skills and group work for thirty minutes per week, a parent meeting for forty-five minutes per week, and psychological counseling twice a month for thirty minutes. Unhappy with the District's proposed placement, Ms. Ciresoli requested a "due process" hearing. According to witnesses at that hearing, held on November 30 and December 1, 1993, Joshua remained at Acadia where his behavior had deteriorated since the October 13th IEP. His discharge from Acadia was not imminent. The Acadia staff who testified were unanimous in recommending residential placement after discharge. The District's psychologist, however, testified that the day program recommended by the District would be appropriate for Joshua after his discharge from Acadia. The Hearing Officer found that Joshua's mental illness needs were different and segregable from his educational needs. She concluded that the District was not responsible for the cost of a residential placement *383 because Joshua was educable without such a placement. She further decided that the Old Town Regional Day Program could meet Joshua's educational needs with some cooperation from the hospital during the transition. Ms. Ciresoli disagrees and appeals the Hearing Officer's decision to this Court. The Court allowed the parties to supplement the record with evidence about Joshua's condition and progress since the due process hearing. On March 1, 1994, almost three months after the administrative decision, Ms. Ciresoli removed Joshua from Acadia, against medical advice, because of a dispute with hospital staff over the lack of an adequate discharge plan. Joshua never attended the Old Town Regional Program, however, because Ms. Ciresoli preferred that he attend a tutoring program at the McGraw School for first grade. The McGraw School program began primarily as one-to-one instruction within the special education program and gradually included a recreational component. Joshua's behavior and performance in school were generally good during this time. Also early in March, Ms. Ciresoli began to seek services from the Bureau of Children with Special Needs, an agency within the Maine Department of Mental Health and Mental Retardation, and from Community Health and Counseling, a private agency hired by the Bureau for the provision of mental health services. During the week of April 18, 1994, Community Health and Counseling began to provide a rehabilitation worker for ten hours per week. During spring vacation the next week, however, Joshua assaulted two peers and was admitted to the Jackson Brook Institute, another psychiatric hospital. Joshua remained at Jackson Brook until June 1994. During his institutionalization, Joshua received educational services for two hours per day through the Spurwink School, a private agency that provides academic services to Jackson Brook patients. The District paid for the services provided by Spurwink. Joshua's psychiatric team at Jackson Brook recommended that "Joshua receive 44 hours of home based support services in addition to the estimated 30 hours per week of school programming which he will be receiving" after his discharge from the hospital. (Ex. r at 4.) Ms. Ciresoli contacted a number of agencies in an attempt to provide these services to Joshua. Through Ms. Ciresoli's determined efforts, Joshua was receiving twenty-four hours per week of rehabilitation services; fifteen hours per week of recreational coaching; and some psychological counseling shortly after his discharge from Jackson Brook. In addition to these services, Joshua also participated in a one-on-one summer school program, designed by his pupil evaluation team, from 8:30 AM to 2:30 PM, five days a week. Joshua had a successful summer and his team recommended that, for the academic year 1994-95, he enter a full-day program at the McGraw School for second grade. Partially in response to a request by Ms. Ciresoli, this program included mainstream activities for 50-80% of the day. Joshua began second grade, as scheduled, in August. Despite the services he was receiving both in and out of school, Joshua's behavior began to deteriorate at the end of August, marked by threatening and assaultive behavior. After consulting with Joshua's psychiatrist, psychologist, and rehabilitation workers, Ms. Ciresoli decided to re-institutionalize Joshua at Jackson Brook in mid-September. While a patient, Joshua again attended the Spurwink School at the District's expense. In November, Joshua's treatment team at Jackson Brook noted that: "Within the hospital environment [Joshua's] behaviors appear stabilized[;] [h]owever, he continues to remain[] at serious risk for decompensation if these supports cannot somehow be duplicated in a less restrictive setting following discharge." (Ex. ff.) His team then recommended a therapeutic foster care setting or a residential treatment program. Joshua was again discharged from Jackson Brook and again returned to the McGraw School in early December 1994. (Supp. Stip.Rec. ¶¶ 1, 3.) During the spring, Joshua received approximately twenty hours of recreational therapy and ten to fourteen hours of rehabilitation services in addition to his approximately thirty hours of school programming each week. These services were *384 provided and financed primarily by the Department of Mental Health and Mental Retardation and its contractees. (Supp. Stip.Rec. ¶¶ 4-6.) During the summer, Joshua's school programming was increased to forty hours per week and his outside services were decreased by about ten hours per week. (Supp.Stip.Rec. ¶¶ 3, 6.) B. Standard of Review Plaintiff has brought this action under the IDEA,[2] specifically 20 U.S.C. § 1415(e)(2), as a party aggrieved by the findings and decisions of the state educational agency. In actions brought under § 1415(e)(2), "the court shall receive the records of the administrative proceedings, shall hear additional evidence at the request of a party, and, basing its decision on the preponderance of the evidence, shall grant such relief as the court determines is appropriate." 20 U.S.C. § 1415(e)(2). This is, however, "by no means an invitation to the courts to substitute their own notions of sound educational policy for those of the school authorities which they review." Board of Educ. v. Rowley, 458 U.S. 176, 206, 102 S. Ct. 3034, 3051, 73 L. Ed. 2d 690 (1982). Rather, courts are required to give the state administrative proceedings "due weight." Id. To accomplish this, district courts should apply "an intermediate standard of review ... — a standard which, because it is characterized by independence of judgment, requires a more critical appraisal of the agency determination than clear-error review entails, but which, nevertheless, falls well short of complete de novo review." Lenn v. Portland Sch. Comm., 998 F.2d 1083, 1086 (1st Cir.1993) (citations omitted). Although § 1415(e)(2) "contains no provision which specifically assigns the burden of proof to a particular party in the appeal of an agency decision ... [a]s a general principle ... in such appeals the burden of proof is on the party who seeks to overturn the findings and decision of the agency." Burlington v. Department of Educ. for Mass., 736 F.2d 773, 794 (1st Cir.1984) (citations omitted), aff'd, 471 U.S. 359, 105 S. Ct. 1996, 85 L. Ed. 2d 385 (1985). Accordingly, Plaintiff carries the burden of proof in this matter. Because the parties agree that the District complied with the procedural requirements of the IDEA, Plaintiff must show, by a preponderance of the evidence, that the individualized educational program provided to Joshua does not satisfy the IDEA. The IDEA requires school districts to provide disabled students with "a free appropriate public education which emphasizes special education and related services designed to meet their unique needs." 20 U.S.C. § 1400(c). "Implicit in the congressional purpose of providing `a free appropriate education' is the requirement that the education to which access is provided be sufficient to confer some educational benefit upon the handicapped child." Rowley, 458 U.S. at 200, 102 S. Ct. at 3048. At the same time, however, the IDEA does not require school districts to provide services that would enable disabled children to achieve their full potential commensurate with the opportunity provided other children. Id.; Abrahamson v. Hershman, 701 F.2d 223, 227 (1st Cir. 1983) (citations omitted). Rather, the program provided by the school need only be "reasonably calculated to enable the child to receive educational benefits." Rowley, 458 U.S. at 207, 102 S. Ct. at 3051. The IDEA also has mainstreaming criteria which require schools, "to the maximum extent appropriate," to educate disabled children "in the least restrictive environment with children who are not disabled." Hampton Sch. Dist. v. Dobrowolski, 976 F.2d 48, 50 (1st Cir.1992); see also 20 U.S.C. § 1412(5) and 34 C.F.R. § 300.550 (1994). The central question in this case, therefore, is whether the educational program provided to Joshua was reasonably calculated to enable him to receive some educational benefit in the least restrictive environment. C. Scope of Review As a general matter, an IEP is ripe for judicial review when the state educational *385 agency has issued a final decision reviewing that proposed educational plan. Pihl v. Massachusetts Dept. of Educ., 9 F.3d 184, 190 (1st Cir.1993). A hearing officer for the State Department of Education issued a final decision regarding the IEP prepared by the District for the 1993-94 academic year. The dispute between the parties at that hearing was whether the District's proposal to educate Joshua in the Old Town Regional Day Program, rather than a residential placement as requested by his mother, was appropriate under the IDEA. This case has been complicated, however, by the fact that Joshua's condition and the focus of the parties have changed significantly since the administrative decision. Although the District still defends its proposal to send Joshua to the Old Town program, it appears that the District would now prefer to keep Joshua at the McGraw School. Likewise, although Plaintiff still requests that the Court order the District "to locate and fund an appropriate residential placement," (Am.Compl. at 14), she would now prefer that the Court order the District to provide home-based support services, (Pl.'s Br. at 22). The District argues that the Court should not reach the question of home-based support services because it was not presented at the administrative hearing. (Dist.'s Reply at 2 (citing David D. v. Dartmouth Sch. Comm., 775 F.2d 411, 424 (1st Cir.1985), cert. denied, 475 U.S. 1140, 106 S. Ct. 1790, 90 L. Ed. 2d 336 (1986)); see also Pihl, 9 F.3d at 190 (in an IDEA case, failure to raise a claim at the administrative level bars the court from hearing that portion of the claim). Plaintiff responds, however, that such services were not seriously contemplated at the time of the hearing. (See Pl.'s Reply at 5.) The Court notes, first, that the scope of judicial review in IDEA cases is "broader than the usual review of administrative decisions," because "[i]n addition to the administrative record, a court `shall hear additional evidence at the request of a party' and `shall grant such relief as the court determines is appropriate.'" DeVries v. Spillane, 853 F.2d 264, 266 (4th Cir.1988) (quoting 20 U.S.C. § 1415(e)(2)). Courts may consider subsequent IEPs not yet appealed to a state agency as "additional evidence" useful in fashioning appropriate relief. Burlington, 736 F.2d at 794. Indeed, some courts have actually considered the merits of subsequent IEPs not yet appealed in conjunction with the merits of those IEPs that were appealed. See, e.g., DeVries, 853 F.2d at 266-67 (court reviewed both 1987-88 IEP and 1986-87 IEP even though only 1986-87 IEP was appealed to administrative agency), and Johnson v. Lancaster-Lebanon Intermediate Unit 13, 757 F. Supp. 606, 614 (E.D.Pa.1991) (court reviewed both 1990-91 IEP and 1989-90 IEP even though only 1989-90 IEP was appealed to administrative agency). Such an approach is appropriate "when the complaint remains the same though the IEPs change." DeVries, 853 F.2d at 267 (emphasis added) (parent's demand that child be educated in his neighborhood school had not changed even though school's proposals had changed); see also Johnson, 757 F.Supp. at 614 n. 6 (considered "the similarity of the 1990-91 IEP to the 1989-90 IEP"). In this case, however, Plaintiff's demands have changed. In fact, Plaintiff did not even contemplate the issue of home-based services at the time of the administrative hearing. Plaintiff could have properly raised this issue in an administrative appeal of Joshua's 1994-95 IEP. Such an appeal could then have been consolidated with the original appeal to this Court. Burlington, 736 F.2d at 794. She did not. Under these circumstances, the Court holds that Plaintiff did not properly exhaust her administrative remedies as to the issue of home-based services. The IDEA does not always require exhaustion, however. Pihl, 9 F.3d at 190 (citing, among others, Honig v. Doe, 484 U.S. 305, 311-12, 108 S. Ct. 592, 597-98, 98 L. Ed. 2d 686 (1988)). "Exhaustion may not be required where the pursuit of administrative remedies would be futile or inadequate; waste resources, and work severe or irreparable harm on the litigant; or when the issues raised involve purely legal questions." Pihl, 9 F.3d at 190. This case falls into none of these exceptions. There is nothing in the *386 record to suggest that seeking an administrative remedy would be futile or inadequate. Further, requiring administrative review would not cause either Plaintiff or her son to suffer severe or irreparable harm. Joshua is currently receiving almost all of the services that Plaintiff requests at no charge. Finally, administrative review in this case would not waste valuable resources — quite the contrary. Deciding whether Joshua needs home-based support services under the IDEA is necessarily a largely fact-driven question. Although the stipulated record supplied by the parties contains some discussion of this issue, neither party has had an opportunity for the presentation and cross-examination of expert witnesses on this area. Because Plaintiff has failed to exhaust her administrative remedies and no exception to the exhaustion doctrine applies, the Court holds that the issue of home-based services is not properly before the Court at this time. D. Review of Joshua's 1993-94 IEP The Court's review of the administrative decision will be limited, therefore, to deciding whether the 1993-94 IEP prepared by the District was reasonably calculated to enable Joshua to receive educational benefit. Ms. Ciresoli opposed the day program proposed by the District and preferred a residential placement.[3] Courts have "ample authority under the Act" to order a school district to pay for "a suitable residential program upon finding that such a placement [is] essential" for the disabled child to make "any educational progress." Abrahamson, 701 F.2d at 227 (emphasis in original); see also 34 C.F.R. § 300.302 (1994) ("If placement in a public or private residential program is necessary to provide special education and related services to a child with a disability, the program, including non-medical care and room and board, must be at no cost to the parents of the child."). On the other hand, "the Act does not authorize residential care merely to enhance an otherwise sufficient day program." Abrahamson, 701 F.2d at 227 (emphasis in original). "A handicapped child who would make educational progress in a day program would not be entitled to placement in a residential school merely because the latter would more nearly enable the child to reach his or her full potential." Id. Rather, a district is required "merely to ensure that the child be placed in a program that provides opportunity for some educational progress." Id. In fact, "[p]lacing a child in a residential program when that is unnecessary for enabling the child to make educational progress may also violate the Act's mainstreaming provisions." Id. at 227 n. 7. The central question, therefore, is whether the placement is essential in order for the disabled child to make educational progress. Id. at 227. This determination is necessarily fact and case specific. Burke County Bd. of Educ. v. Denton, 895 F.2d 973, 980 (4th Cir.1990). The parties do not dispute that, at the time of the hearing, Joshua required hospitalization for psychiatric difficulties. The parties agree that this placement served medical rather than educational needs. Just a few months prior to his hospitalization, however, Joshua had been successfully mainstreamed into a regular kindergarten program. In addition, the Old Town program had successfully educated other children who suffered from disabilities similar to Joshua's. The program had a very low student-teacher ratio and program staff were trained in non-violent crisis intervention. The events that followed the administrative decision also support the administrative findings. Although Joshua never matriculated at the Old Town program, the parties have stipulated that he received educational benefit from an even less restrictive placement. In fact, Plaintiff's request for residential placement is now made only secondarily to her request for home-based support services to supplement Joshua's day program. The Court recognizes that Joshua's behavior, particularly outside the structure of his school programming, is often unpredictable and sometimes dangerous. This, by itself, is not enough to compel a residential placement *387 under the IDEA, as long as the student is receiving an educational benefit from his placement. See. e.g., Hall v. Shawnee Mission Sch. Dist., 856 F. Supp. 1521, 1528-30 (D.Kan.1994) (residential placement not required for emotionally disturbed student whose behavior problems at home were severe but his academic progress at school was very good with only minor behavioral problems); Swift v. Rapides Parish Public Sch. Sys., 812 F. Supp. 666 (W.D.La.1993) (despite fact that majority of psychologists and psychiatrists who evaluated student recommended residential facility and fact that student was dangerous and uncontrollable at home, residential placement not required where student received meaningful educational benefit in day program), aff'd, 12 F.3d 209 (5th Cir.1993) (table, No. 93-04300). The result would likely be different if the Court found that Joshua's "behavior eventually reached a point at which he was uncontrollable both in and outside of school, rendering him uneducable without extensive psychological treatment." Manchester Sch. Dist. v. Charles M.F., Civ. No. 92-609-M, 1994 WL 485754, 1994 U.S. Dist. LEXIS 12919 (D.N.H. Aug. 31, 1994) (residential placement required under these circumstances). Fortunately, Joshua has not reached this point. The Court is satisfied in this case that, when the District prepared the 1993-94 IEP, it could have reasonably anticipated that Joshua would receive educational benefit from the proposed day program rather than a residential program. Accordingly, the administrative decision is affirmed and judgment should be entered in favor of the District and Leo Martin in his capacity as Commissioner of the Department of Education on Count One. II. The Standard Tract The cross-claims and third-party claims raised by the District against the State and various state agencies are basically claims for indemnification. Because the Court does not require the District to provide Joshua with additional services at this time, those claims are dismissed without prejudice. Plaintiff's claims under the ADA and the Rehabilitation Act, however, are not automatically dismissed. The IDEA was amended in 1986 to provide that "[n]othing in this chapter shall be construed to restrict or limit the rights, procedures, and remedies available under ... title V of the Rehabilitation Act of 1973, or other Federal statutes protecting the rights of children and youth with disabilities...." 20 U.S.C. § 1415(f). The IDEA does require, however, that "before the filing of a civil action under such laws seeking relief that is also available under [the IDEA], the [administrative] procedures under subsections (b)(2) and (c) of this section shall be exhausted to the same extent as would be required had the action been brought under [the IDEA]." 20 U.S.C. § 1415(f). The Court has already concluded that Plaintiff did not adequately exhaust her administrative remedies as to her claims for home-based services under the IDEA. In Counts Three, Four, and Five, she again seeks home-based services, this time under the ADA and the Rehabilitation Act. Because these claims request "relief that is also available under [the IDEA]," 20 U.S.C. § 1415(f), Plaintiff's failure to exhaust her administrative remedies is similarly fatal to these claims. See Christopher W. v. Portsmouth Sch. Comm., 877 F.2d 1089 (1st Cir. 1989) (dismissing claims under the Rehabilitation Act, and § 1983 for failure to exhaust administrative remedies under IDEA); and Association for Community Living v. Romer, 992 F.2d 1040 (10th Cir.1993) (dismissing claims under § 1983 against Governor and State Department of Education for failure to exhaust administrative remedies under IDEA). Accordingly, the Court orders that Counts Three, Four, and Five be dismissed.[4] In Count Two of her Amended Complaint, Plaintiff claims that the Department of Education also violated the IDEA by failing to provide for the development and implementation *388 of interagency agreements as required by 20 U.S.C. § 1413(a)(13). Although Plaintiff also did not exhaust her administrative remedies as to this claim, the Court is satisfied that exhaustion in this circumstance is not required. "Administrative remedies are generally inadequate or futile where plaintiffs allege structural or systemic failure and seek system[-]wide reforms." Romer, 992 F.2d at 1044 (citations omitted). Plaintiff's claim, that the Department of Education violated the IDEA by failing to implement interagency agreements, alleges a structural or systemic failure for which an administrative remedy would be inadequate. Accordingly, the Court will look to the merits of this claim. The IDEA expressly provides that: Any State meeting the eligibility requirements ... and desiring to participate in the program ... shall submit to the Secretary, through its State educational agency, a State plan ... [that] shall — (13) set forth policies and procedures for developing and implementing interagency agreements between the State educational agency and other appropriate State and local agencies to — (A) define the financial responsibility of each agency for providing children and youth with disabilities with free appropriate public education, and (B) resolve interagency disputes, including procedures under which local educational agencies may initiate proceedings under the agreement in order to secure reimbursement from other agencies or otherwise implement the provisions of the agreement[.] 20 U.S.C. § 1413(a)(13). According to the Stipulated Record, agencies in Maine cooperate to coordinate delivery of services to an individual child "primarily through discussions by representatives of ... agencies on an Interdepartmental Council." (Stip.Rec. ¶ 44.) This Interdepartmental Council convened a subcommittee to create a more formal system of coordination among those agencies. This subcommittee now consists of representatives from the Maine Departments of Education, Corrections, Human Services, and Mental Health and Mental Retardation, as well as the Office of Substance Abuse and "is expected to meet periodically to discuss and develop comprehensive case management plans for certain children who receive services from more than one of the member agencies." (Id.) Other than this arrangement, "there are no interagency agreements ... establishing procedures for resolving interagency disputes between [the various] agencies." (Id. ¶ 39.) Nor are there interagency agreements in place providing a mechanism through which an agency may "initiate proceedings to require other state agencies ... to provide services ... or secure reimbursement from those agencies for the cost of such services." (Id. ¶ 40.) Although the State conceded the above facts, its brief did not address Plaintiff's claim that it has not adequately "set forth policies and procedures for developing and implementing interagency agreements." 20 U.S.C. § 1413(a)(13). It appears, from the Stipulated Record, that the State did not comply with the requirements of § 1413(a)(13). Although the State has developed an Interdepartmental Council and an informal procedure to discuss case-management plans, it has not developed any formal procedures to resolve interagency disputes or to allow school districts to secure reimbursement from other agencies. Nor has the State pointed to any policies or procedures for developing and implementing such interagency agreements. The Court concludes, therefore, that the State Department of Education has not complied with 20 U.S.C. § 1413(a)(13). Accordingly, the Court orders the Department to establish policies and procedures for developing and implementing interagency agreements in compliance with § 1413(a)(13). III. Conclusion The Court orders that JUDGMENT on Count One of Plaintiff's Amended Complaint shall be entered for Defendants, M.S.A.D. # 22 and Leo Martin, in his capacity as Commissioner of the Maine Department of Education. The Court orders that JUDGMENT on Count Two of the Amended Complaint shall be entered for Plaintiff as against *389 Defendant Leo Martin, in his capacity as Commissioner of the Maine Department of Education. Counts Three, Four, and Five of the Amended Complaint are hereby DISMISSED. The District's Cross-Claims and Third-Party Claims are also DISMISSED. SO ORDERED. NOTES [1] Per a stipulation of dismissal, Jane Sheehan, Commissioner of the Maine Department of Human Services is no longer a party to this action. [2] Plaintiff also challenges the administrative decision based on state law. Maine's special education statutes and regulations largely mirror the IDEA. For that reason, the Court does not separately analyze the state law challenge to the IEP. [3] The Court notes that the question of residential placement is not moot because Ms. Ciresoli is still requesting such a placement, albeit second to her request for home-based services. [4] The Court also notes that Plaintiff is now receiving most of the services she has requested through various state agencies at no charge. Accordingly, to a very large extent, Plaintiff's claims in Counts Three, Four, and Five are moot.

2013-10-30 06:35:54.435401+00

Dominguez

901 F. Supp. 59 (1995) UNITED STATES of America, Plaintiff, v. Daniel Ortiz MEDINA, et al., Defendants. Crim. No. 95-042(DRD). United States District Court, D. Puerto Rico. October 16, 1995. Luis R. Rivera-Rodriguez, Rachel Brill, Hato Rey, PR, for Daniel J. Ortiz-Medina aka Flattop aka Jesus A. Ruiz-Adorno. Miriam R. Ramos-Grateroles, Bayamon, PR, for Ramon Batista-Olivo aka Junito Serpa. *60 Thomas R. Lincoln-San-Juan, San Juan, PR, Graham Albert Castillo-Pagan, Hato Rey, PR, for Angel Francisco Ruiz-Adorno aka Raton aka Pepe aka Francisco Ruiz-Adorno. Olga M. Shepard-de-Mari, Hato Rey, PR, for Edwin Sanchez-Cruz aka Chispa aka Chapulin. Benito I. Rodriguez-Masso, Hato Rey, PR, for Pedro Hornedo-Colon aka Tato aka Pedro Olnedo-Colon. Teodoro Mendez-Lebron, Santurce, PR, for Ramon Vega-Leonard aka Moncho. Jose R. Gaztambide-Aneses, Hato Rey, PR, for Juan Santiago-Collazo aka Tony. OPINION AND ORDER DOMINGUEZ, District Judge. Defendants, Ramón Batista Olivo and Ramón Vega Leonard, challenge the jurisdiction of this Court over various statutes, 18 U.S.C. § 924(c)(1) and (2); 18 U.S.C. § 922(g)(1) and 18 U.S.C. § 924(a)(2). Defendants aver that as was the case in United States v. López, ___ U.S. ___, 115 S. Ct. 1624, 131 L. Ed. 2d 626 (1995), there is no nexus to interstate commerce in the challenged statutes. The Court disagrees. The first challenged statute is 18 U.S.C. § 924(c)(1), a sentencing enhancement for persons who may have committed a crime of violence or drug trafficking crime with a firearm. 18 U.S.C. § 924(2) defines "drug trafficking crime" to include felonies under the Controlled Substances Act, 21 U.S.C. § 801 et seq.; The Controlled Substances Import and Export Act, 21 U.S.C. § 951 et seq., or the Maritime Drug Law Enforcement Act, 46 U.S.C.App. § 1901 et seq. The second challenged statute is 18 U.S.C. § 922(g)(1) which makes a crime that a person convicted of prior crime in any court punishable by imprisonment of one year to ship or transport in interstate commerce, or possesses in or affecting commerce firearms or munitions. The third challenged statute is 18 U.S.C. § 924(a)(2) which is a sentence enhancement for persons that may have violated section (a)(6), (d), (g), (h), (l), (j) or (o) of section 922 of the Act. In López, supra, the Supreme Court revisited the three categories of activities that Congress may regulate under the Commerce Clause. "First, Congress may regulate the use of the channels of interstate commerce", López, ___ U.S. at ___, 115 S.Ct. at 1629. "Second Congress is empowered to regulate and protect the instrumentalities of interstate commerce, even though the threat may come from only interstate activities", López, id. And, "lastly Congress' commerce authority includes the power to regulate those activities having a substantial relation to interstate commerce." López, id. Under this last category Congress can regulate activity that "substantially affects interstate commerce", López, id., ___ U.S. at ___, 115 S.Ct. at 1630. 18 U.S.C. § 922(g)(1) is a statute that requires evidence of shipping or transporting in interstate commerce of a weapon or possession in or affecting commerce by a person who has committed a crime punishable by imprisonment of one year. There is no doubt that this particular statute (18 U.S.C. § 922(g)(1)) falls in the last category since an element of shipping "in interstate or foreign commerce" of the firearm is required or possession of a firearm "in or affecting commerce" is required. These elements comply with the authorized category of "substantially affects interstate commerce" set forth in the case of U.S. v. López, supra. The Court deems premature at this time to rule if the accused possessed a firearm "in or affecting commerce" or the firearm being shipped "or in interstate commerce." The evidence provided at trial will determine compliance under these interstate elements. As to the sentencing enhancements under 18 U.S.C. § 924(c)(1) and (2), applicable to person committing a drug trafficking crime[1] with a weapon, there is no serious debate that Congress has authority to regulate drugs and narcotics under the Commerce Clause. The regulation of drugs has been traditionally held an activity that "substantially affects interstate commerce." Minor v. U.S., 396 U.S. 87, 98 n. 13, 90 S.Ct. *61 284, 289 n. 13, 24 L. Ed. 2d 283 (1969) ("a flat ban on certain [narcotic drug] sales ... is sustainable under "the commerce clause." Reina v. United States, 364 U.S. 507, 511, 81 S. Ct. 260, 263, 5 L. Ed. 2d 249 (1960) (Congress has "undoubtedly power to enact narcotics' laws."); United States v. Walsh, 331 U.S. 432, 434, 67 S. Ct. 1283, 1284, 91 L. Ed. 1585 (1947) ("the Federal Food, Drug, and Cosmetic Act [of 1938] rests upon the constitutional power resident in Congress to regulate Commerce."); Yee Hem v. United States, 268 U.S. 178, 183, 45 S. Ct. 470, 471, 69 L. Ed. 904 (1925) ("The authority of Congress to prohibit the importation of opium in any form ... to make its concealment with knowledge of its unlawful importation a criminal offense is not open to doubt."); McDermott v. Wisconsin, 228 U.S. 115, 128, 33 S. Ct. 431, 433, 57 L. Ed. 754 (1913) ("No longer open to question" that Congress has full and ample power to regulate food and drugs.) The Court further notes that Congress when enacting the Comprehensive Drug Abuse Prevention and Control Act of 1970 found drug trafficking, whether interstate or intrastate in character to substantially affect interstate commerce.[2] Further, Federal Appellate Courts have uniformly held that no interstate nexus is required in violations of possession, distribution and/or sale of controlled substances under the Comprehensive Drug Abuse Prevention Criminal Act of 1970, United States v. Montes-Zarate, 552 F.2d 1330, 1331 (9th Cir. 1977) cert. denied 435 U.S. 947, 98 S. Ct. 1532, 55 L. Ed. 2d 545 (1978); United States v. Atkinson, 513 F.2d 38, 39-40 (4th Cir.1975); United States v. López, 459 F.2d 949 (5th Cir.1972). See also White v. United States, 399 F.2d 813 (8th Cir.1968); United States v. Esposito, 492 F.2d 6 (7th Cir.1973) cert. denied 414 U.S. 1135, 94 S. Ct. 879, 38 L. Ed. 2d 760; United States v. Scales, 464 F.2d 371 (6th Cir.1972). Finally since there is no serious debate that Congress can regulate drug trafficking because said activity "affects interstate commerce", U.S. v. McDougherty, 920 F.2d 569 (9th Cir.1960) cert. denied 499 U.S. 911, 111 S. Ct. 1119, 113 L. Ed. 2d 227, the Court deems highly illogical to conclude that such trafficking somehow ceases to affect commerce when committed with the use of a firearm. The Ninth Circuit came to a similar analogous conclusion in the case of U.S. v. McDougherty, supra: "It would be highly illogical to believe that such trafficking somehow ceases to affect commerce when carried out within 1,000 feet of a school (citations omitted). There is no legal reason why Congress cannot choose to punish some behavior affecting commerce more harshly than other behavior based upon its detriment to society." McDougherty, supra p. 572. (Emphasis ours) The Court, therefore, concludes no nexus to interstate commerce is required for a drug trafficking violation since said nexus has been previously determined by Supreme *62 Court cases Minor v. U.S., (supra); Reina v. U.S., (supra); United States v. Walsh, (supra); Yee Hem v. U.S., (supra); McDermott v. Wisconsin, (supra), and by appellate Federal Courts; U.S. v. McDougherty, (supra). Further, the Comprehensive Drug Abuse Preventions and Control Act of 1970 specifically found that drug trafficking whether interstate or intrastate substantially affects interstate commerce. Hence, subsequent drug related Congressional enactments do not require specific interstate nexus. The Court therefore concludes that there is no impediment for Congress to punish more severely some behavior affecting interstate commerce than other behavior based on firearm usage because of its detriment to society. U.S. v. McDougherty, (supra) p. 572.[3] Defendants, Ramón Batista Olivo and Ramón Vega Leonard, challenge to this Court's jurisdiction based on lack of an interstate nexus of the discussed statutes IS DISMISSED. IT IS SO ORDERED. NOTES [1] The weapons' violations are alleged to have been committed in a drug related crimes. [2] In U.S. v. Raúal García-Salazar, 891 F. Supp. 568, 571, n. 4 (D. Kansas 1995), the Court made the following conclusions as to interstate commerce and the Comprehensive Drug Abuse Preventions and Control Act of 1970: Congress found in pertinent part: (2) The illegal importation, manufacture, distribution, and possession and improper use of controlled substances have a substantial and detrimental effect on the health and general welfare of the American people. (3) A major portion of the traffic in controlled substances flows through interstate and foreign commerce. Incidents of the traffic which are not an integral part of the interstate or foreign flow, such as manufacture, local distribution, and possession, nonetheless have a substantial and direct effect upon interstate commerce because — (A) after manufacture, many controlled substances are transported in interstate commerce, (B) controlled substances distributed locally usually have been transported in interstate commerce immediately before their distribution, and (C) controlled substances possessed commonly flow through interstate commerce immediately prior to such possession. (4) Local distribution and possession of controlled substances contribute to swelling the interstate traffic in such substances. (5) Controlled substances manufactured and distributed intrastate cannot be differentiated from controlled substances manufactured and distributed interstate ... (6) Federal control of the intrastate incidents of the traffic in controlled substances is essential to the effective control of the interstate incidents of such traffic. 21 U.S.C. § 801; see Comprehensive Drug Abuse Prevention and Control Act of 1970, Pub.L. No. 91-513, 1970 U.S.C.C.A.N. (84 Stat.) 4566, 4595-96. [3] The challenge to the jurisdiction of the Court of another enhancement statute, 18 U.S.C. § 924(a)(2), is subject to the same analysis as that made for 18 U.S.C. § 924(c)(1) in the sense that a firearm is used in relation to a drug traffick violation or any other violation that affects interstate commerce.

2013-10-30 06:35:54.464228+00

Cooper

619 S.W.2d 109 (1981) Mary Evelyn HIBNER, Plaintiff-Appellant, v. ST. PAUL MERCURY INSURANCE COMPANY and McKendree Manor, Inc., Defendants-Appellants. Supreme Court of Tennessee, at Nashville. July 27, 1981. *110 Bart Durham, Nashville, for plaintiff-appellant. William C. Moody and William A. Moody, Moody & Moody, Nashville, for defendants-appellants. OPINION COOPER, Justice. In this appeal of a worker's compensation action, the controlling issue is whether or not the employee's action is barred by the one year statute of limitations set forth in T.C.A. §§ 50-1003 and 50-1017. The chancellor concluded that the action was not barred and awarded the employee disability benefits, but denied her recovery of medical expenses on the ground that the expenses had been paid by "a third party source." Both the employee and the employer appealed, the employee seeking recovery of medical expenses and the employer taking issue with the trial judge's finding on the issue of the statute of limitations. The parties now agree that the employee is entitled to recover medical expenses incurred in treating her injury in the event her claim for benefits is not barred by the statute of limitations. Of course, if the employee's action is barred, the judgment in favor of the employee must be set aside and the case dismissed. The accident upon which Mrs. Hibner bases her claim occurred on April 27, 1977. Suit was filed on February 13, 1980, some two years and ten months after the accident. The employer insists the statute of limitations began to run on April 27, 1977, the date Mrs. Hibner injured her back. On the other hand, Mrs. Hibner insists that her disability did not manifest itself in any way until May, 1979, and that the statute of limitations did not begin to run until that date. The determination of the time the statute of limitations begins to run often is troublesome, not from the standpoint of what triggers the running of the statute but from a factual standpoint. It is now settled that the date the employee's disability manifests itself to a person of reasonable diligence, not the date of the accident, triggers the statute of limitations. Davidson & Graham Const. Co. v. McKee, 562 S.W.2d 426 (Tenn. 1978); Norton Co. v. Coffin, 553 S.W.2d 751 (Tenn. 1977); Union Carbide Corp., Food Prod. Div. v. Cannon, 523 *111 S.W.2d 360 (Tenn. 1975); Imperial Shirt Corporation v. Jenkins, 217 Tenn. 602, 399 S.W.2d 757 (1966); Griffitts v. Humphrey, 199 Tenn. 528, 288 S.W.2d 1 (1955). The facts in this case are not in material dispute. The record shows that Mrs. Hibner immediately notified her employer of the accident of April 27, 1977. She was examined by the "in-house" doctor, who advised self-treatment by heat packs. In May, 1977, Mrs. Hibner was seen on two occasions by Dr. Vincent R. Couden, an orthopedic specialist, who concluded that Mrs. Hibner's injury was "probably muscular in nature." He told Mrs. Hibner her problem was not serious and that she could continue to work but not to do "heavy duties" for a while. She followed his advice and worked regularly. In September, 1977, Mrs. Hibner's work assignment was changed from that of a nurse's aide to an assistant activities coordinator, charged with arranging activities for the patients. The new job was not as taxing physically as the old, but did require Mrs. Hibner to clean and vacuum the dining hall and patient's room whenever the patients celebrated special occasions. In February, 1978, Mrs. Hibner returned to Dr. Couden for treatment, complaining of intermittent back pain. Dr. Couden diagnosed her trouble as "recurrent back strain," treated her by the use of antiin-flammatory drugs, and instructed her to continue to work. She did so. Mrs. Hibner next sought medical treatment on April 27, 1979. At that time she complained of pain extending from her back into her hip and the calf of her leg. The examination by Dr. Couden revealed for the first time objective symptoms of nerve root involvement. His tentative diagnosis was confirmed by a myelogram examination, and Mrs. Hibner underwent surgery on May 18, 1979, for the removal of a ruptured disc. Dr. Couden expressed the opinion that Mrs. Hibner's disc problem and resulting disability were more likely than not the result of her injury in late April, 1977. In our opinion the above evidence supports a determination by the trial judge that Mrs. Hibner did not know, and had no reason to know, that she had sustained a compensable injury in the April, 1977, accident until she was so informed by her treating physician in April, 1979. Her injury was such that she lost no time from work. On the occasions she had noticeable back pain, she sought medical treatment and was advised that her condition was not serious and that she had no disability. She had no reason to doubt these diagnoses until late April, 1979, when the location of her pain became more extensive. It was then that her treating physician informed her that she had a herniated, or ruptured, disc in the lumbar area of her spine. There being no other basis to attribute to Mrs. Hibner the knowledge that she had sustained a compensable injury, the statute of limitations did not begin to run until April, 1979. The present action, being filed on February 20, 1980, then was in time and Mrs. Hibner is entitled to recover benefits afforded her under the Worker's Compensation Act. The employer has cited Travelers Insurance Co. v. Jackson, 206 Tenn. 272, 332 S.W.2d 674 (1960) and Taylor v. Clayton Mobile Homes, Inc., 516 S.W.2d 72 (Tenn. 1974), in support of its insistence that the present action is barred by the statute of limitations. The decisions in those cases are not inconsistent with our holding in the instant case. The same rule of law was applied in each case. The material distinction was one of fact. In each case cited by the employer, the trial judge found as a matter of fact that the employee knew or had reason to know that he had sustained a compensable injury in the on-the-job accident and this court found material evidence to support the findings of the trial judge. In the Jackson case, the employee was shown to have been continually under a partial physical disability from the time of his accident. In Taylor, the employee's testimony revealed the presence of continued and persistent pain in the cervical area from the date of the accident, plus hospitalization more than one year prior to filing *112 suit, for treatment of that condition without beneficial results. In the instant case the trial judge found — based on material evidence — that Mrs. Hibner did not know, nor had reason to know, that she had a compensable injury until the onset of symptoms of a disc injury in April, 1979. Under the applicable rule of law, it was at this time that the statute of limitations began running. The judgment of the trial court is modified to permit Mrs. Hibner to recover medical expenses in the amount of $2,293.25. As modified, the judgment is affirmed. Costs are adjudged against McKendree Manor, Inc., and its insurance carrier, St. Paul Mercury Insurance Company. The cause is remanded to the trial court for the enforcement of the judgment. HARBISON, C.J., and FONES, BROCK and DROWOTA, JJ., concur.

2013-10-30 06:35:54.471785+00

Walls

901 F. Supp. 183 (1995) Lloyd SIBERT, Plaintiff, v. John PHELAN, et al., Defendants. Civ. No. 94-566 (WHW). United States District Court, D. New Jersey. September 21, 1995. *184 William T. Connell, Dwyer Connell & Lisbona, Montclair, NJ, for Defendants. Richard M. Fried, Paterson, NJ, for Defendant John Phelan. James J. Frega, West Paterson, NJ, for Defendant Angel Perales. Lloyd Sibert, Secaucus, New Jersey, pro se. OPINION WALLS, District Judge. This matter is before the Court on motion of defendants, Detective John M. Phelan, Detective John M. Contini, Angel Perales and Hector Garcia, for leave to file an Amended Answer and for Summary Judgment. STATEMENT OF FACTS On November 9, 1992, plaintiff Lloyd Sibert was arrested and charged with unlawful possession of narcotics, unlawful possession of a weapon and resisting arrest. Plaintiff alleges that during the arrest, while fleeing from the arresting officers, the defendants, Detective John M. Phelan, Detective John M. Contini, Angel Perales and Hector Garcia, injured him. Specifically, plaintiff contends that the defendants hit him with an unmarked police car which rendered him unconscious, *185 and that defendant Perales struck the back of his legs with a flash light. Plaintiff further alleges that the defendants provided false statements in the police report, and that they threatened to break his legs if he said anything about the incident. The defendants maintain that plaintiff's injuries were sustained when he ran into a full 55 gallon garbage drum, and deny that they hit him with a car and that defendant Perales struck him with a flashlight. On October 26 and 27, 1993, plaintiff was tried in Passaic County Superior Court and convicted of illegally possessing narcotics and of illegally possessing a weapon. His conviction was affirmed by the New Jersey Superior Court, Appellate Division. At trial, plaintiff had sought to suppress evidence of the narcotics and the weapon obtained during his arrest as illegally obtained. The Court ruled that the evidence was admissible as the product of a search incident to a lawful arrest. Plaintiff filed the current action for injuries he sustained during his arrest on February 4, 1994 under 42 U.S.C. § 1983. On March 9, 1995, Magistrate Judge Pisano entered a discovery order compelling plaintiff to serve answers to interrogatories by April 15, 1995 and to appear for a deposition on April 17, 1995. During defendant's scheduled deposition of plaintiff, plaintiff discontinued the questioning prematurely and refused to answer any further questions. Also, plaintiff has not served answers to the defendants' interrogatories. Defendants now move for leave to amend their Answer and for Summary Judgment. DISCUSSION Defendants seek dismissal of plaintiff's suit on essentially two grounds. First, that the doctrines of claim and issue preclusion prevent this court from entertaining this action because the issues at stake either should have been, or were finally determined in plaintiff's criminal trial; and second, that plaintiff's failure to comply with the Court's Order compelling him to serve Answers to Interrogatories, as well as his failure to comply fully with defendants request to depose him require that this case be dismissed pursuant to Fed.R.Civ.P. 37(d). Because the Court holds that the essential issue in this case has already been litigated and grants defendants' motion for summary judgment, the Court need not address defendants' second argument for dismissal. Defendants did not include in their answer the defenses of claim or issue preclusion, and thus move to amend their complaint to include these defenses. Defendants move to dismiss on these grounds, presumably pursuant to Fed.R.Civ.P. 12(b), assuming that the motion to amend is granted, or alternatively move for summary judgment pursuant to Fed.R.Civ.P. 56. While technically a defendant should assert claim and issue preclusion as defenses in the Answer as a precursor to a motion to dismiss, Fed.R.Civ.P. 8(c), the Third Circuit does not follow this rule, and instead permits affirmative defenses to be raised for the first time in a motion to dismiss the complaint, Williams v. Murdoch, 330 F.2d 745 (3d Cir.1964) or in a motion for summary judgment. Hartmann v. Time, Inc., 166 F.2d 127, 131 (3d Cir.), cert. denied, 334 U.S. 838, 68 S. Ct. 1495, 92 L. Ed. 1763 (1947). Thus this Court need not decide whether to grant defendants' motion to amend their complaint since the merits of their motion to dismiss, or alternatively the motion for summary judgment, may be decided with the Answer in its current form. The defendants' motion will be analyzed by the Court as a motion for summary judgment because the Court has examined the affidavits submitted as well as other supporting documentation. A. Summary Judgment Standard Summary judgment may be granted only when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56; Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 2552, 91 L. Ed. 2d 265 (1986). An issue of material fact is `genuine' "if the evidence is such that a reasonable jury could return a verdict for the non-moving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 2510, 91 L. Ed. 2d 202 (1986). Moreover, preclusion arguments are appropriate for resolution on *186 motions for summary judgment. Rodziewicz v. Beyer, 809 F. Supp. 1164 (D.N.J.1992). B. Preclusion Claim and issue preclusion serve similar purposes; both prevent litigation over issues that should have been or were actually decided in a prior suit in order to foster "judicial economy, predictability and freedom from harassment" for litigants. Electro-Miniatures Corp. v. Wendon Co., 889 F.2d 41, 44 (3d Cir.1989). Courts must apply the preclusion law of the jurisdiction where the first judgment was entered. Watkins v. Resorts Int'l Hotel & Casino, Inc., 124 N.J. 398, 411, 591 A.2d 592, 598 (1991). Because the plaintiff's criminal trial occurred in Passaic County Superior Court, New Jersey, New Jersey law applies to the present inquiry. Furthermore, federal court's must accord preclusive effect to state court judgments. Migra v. Warren City School Dist. Bd. of Ed., 465 U.S. 75, 81, 104 S. Ct. 892, 79 L. Ed. 2d 56 (1984). 1. Claim Preclusion Claim preclusion, or res judicata, will bar a suit if (1) the judgment in the first action is valid, final and on the merits; (2) the parties in both actions are the same or are in privity with each other; and (3) the claims in the second action must arise from the same transaction or occurrence as the claims in the first one. Untracht v. West Jersey Health System, 803 F. Supp. 978, 982 (D.N.J.1992); Watkins, 124 N.J. at 412, 591 A.2d 592. In addition, res judicata bars not only claims that were brought in the first action, but also claims that should have been brought as well. Id. at 412-13, 591 A.2d 592. Defendants' motion for summary judgment on res judicata grounds is denied. Res judicata simply does not apply when the first action is criminal and the second action is civil. See, e.g., Hernandez v. City of Los Angeles, 624 F.2d 935, 937 (9th Cir.1980); Wright, Miller & Cooper, Federal Practice and Procedure: Jurisdiction § 4474. It is manifest that a defendant may not assert a civil counterclaim in the context of a criminal proceeding — therefore Mr. Sibert had no opportunity to raise his claim in the prior proceeding. 2. Issue Preclusion Defendants' also contend that the doctrine of issue preclusion, or collateral estoppel bars the present suit. Issue preclusion "proscribes relitigation when the identical issue already has been fully litigated," and will apply where "(1) the identical issue was decided in a prior adjudication; (2) there was a final judgment on the merits; (3) the party against whom the bar is asserted was a party or in privity with a party to the prior adjudication; and (4) the party against whom the bar is asserted had a full and fair opportunity to litigate the issue in question." Board of Trustees of Trucking Employees of North Jersey Welfare Fund, Inc. v. Centra, 983 F.2d 495, 505 (3d Cir.1992). In addition, the issue upon which preclusion is sought must have been "distinctly put in issue and directly determined adversely to the party against which estoppel is asserted." Wheeler v. Nieves, 762 F. Supp. 617 (D.N.J.1991) (quoting New Jersey-Philadelphia Presbytery of the Bible Presbyterian Church v. New Jersey State Board of Higher Education, 654 F.2d 868, 876 (3d Cir.1981)). Lastly, issue preclusion does apply "in cases in which a convicted defendant sues the government on a claim that is inconsistent with facts established by the conviction." Wright, Miller & Cooper, Federal Practice and Procedure: Jurisdiction § 4474; see, e.g., Willard v. U.S., 422 F.2d 810, 811-12 (5th Cir.), cert. denied, 398 U.S. 913, 90 S. Ct. 1714, 26 L. Ed. 2d 76 (1970). Defendants' issue preclusion claim is granted. While defendants do not identify with particularity which issue is allegedly precluded, it would seem that they are claiming that Mr. Sibert's version of the facts in the present suit were necessarily rejected in the prior criminal conviction. Indeed, "[i]n the case of a criminal conviction based on a jury verdict of guilty, issues which were essential to the verdict must be regarded as having been determined by the judgment." Wheeler, 762 F.Supp. at 626. First, the identical issue had been decided in the previous action. During the course of *187 the criminal trial, Mr. Sibert sought to suppress evidence of the drugs and the weapon seized during his arrest. By doing so he affirmatively put into issue the essential facts of the present inquiry — namely the conduct of the police at the time of his arrest. Moreover, the Judge, after hearing testimony from both sides, found the Police's version to be credible and therefore ruled that the evidence should be admitted. Def.Ex.B. p. 79. Thus, Mr. Sibert has already asserted his claims before a judge, who rejected them as completely without merit. Issue preclusion is especially appropriate in this case for the fundamental factual issue, which is a predicate to any theory of recovery possible, boils down to a battle of credibility — Mr. Sibert asserts that the police abused him whereas the police contend that Mr. Sibert's version of his arrest is false and inaccurate. Judge Hull in the criminal trial, after hearing the testimony of both sides, said: "if I were called upon to assess credibility and use a scale of one to ten in this case, the score is [Detective] Contini ten, Sibert zero." Def. Ex.B. p. 79. The Court is mindful that if the present case were to go to trial Mr. Sibert would have the opportunity to present his case before a jury, whereas the suppression motion in the criminal trial was before a judge. However, this has never been a bar to the assertion of issue preclusion. More relevant is that the standard of proof during the suppression hearing and during a trial of this case on the merits would be the same — namely preponderance of the evidence. Alternately, the factual issues in dispute herein are precluded from relitigation because during the trial itself, Detective Contini testified as to circumstances surrounding Mr. Sibert's arrest. However, Mr. Sibert chose to call no witnesses to challenge Detective Contini's account, nor did he testify on his own behalf. Exh. C, T.69 L. 3-17, T.71 L.13-25, T.72 L.1-2. The failure of a criminal defendant to refute facts pertinent to the prosecution's case or to establish facts relevant to an available defense, even if the defendant chooses not to take the stand at trial, will preclude relitigation of those facts in subsequent civil proceedings. See, e.g., Teitelbaum Furs, Inc. v. Dominion Ins. Co., 58 Cal. 2d 601, 25 Cal. Rptr. 559, 375 P.2d 439, cert. denied, 372 U.S. 966, 83 S. Ct. 1091, 10 L. Ed. 2d 130 (1962) ("[The Defendant's] error, if any, in trial strategy would no more defeat the plea of collateral estoppel than the failure of a litigant to introduce relevant available evidence in any other situation"). Thus the fact issue of what occurred during Mr. Sibert's arrest was heard and decided by a jury, who found Mr. Sibert guilty based upon the higher criminal standard of proof beyond a reasonable doubt. Mr. Sibert never challenged Det. Contini's version of the facts on appeal, and the Appellate Division affirmed. See State v. Sibert, No. A-3082-93T4, (App.Div., April 17, 1995). Secondly, there was a final judgment on the merits. Mr. Sibert appealed his conviction, and that conviction was affirmed. Moreover, a final judgment for purposes of issue preclusion exists because Mr. Sibert did not appeal on the grounds that the evidence seized from his person was impermissably admitted at trial (i.e. Judge Hull ruled incorrectly during the suppression hearing); Mr. Sibert has thus waived that argument and is bound by the trial court's ruling. Alternately, these issues were presented at trial and Mr. Sibert chose not to refute Detective Contini's version of the arrest. Again, the affirmance of the conviction by the Appellate Division is sufficient to constitute a final judgment on the merits on this issue. The third element is met since the party against whom preclusion is sought, here Mr. Sibert, was an actual party in the previous action. The fourth is also met because Mr. Sibert had a full and fair opportunity to present his claim. He raised the issues asserted herein by moving to suppress the evidence seized from his person during the criminal action. Also, he had an opportunity to challenge Detective Contini's testimony at trial but did not call any witnesses nor did he testify on his own behalf. In both instances he had a sufficient motive to prosecute his claim zealously "given the risk he faced of losing his freedom" if he were ultimately found guilty at trial. Wheeler v. Nieves, 762 F. Supp. 617, 626 (D.N.J.1991). There was also sufficient *188 incentive for him to raise these arguments on appeal, which he failed to do. Because the fundamental factual issue has already been fully and fairly decided during Mr. Sibert's criminal trial, there are no issues of material fact remaining to be tried and defendants' are entitled to judgment as a matter of law. CONCLUSION For the reasons stated in this Court's Opinion; it is on this 21st day of September, 1995; ORDERED that defendants' motion for summary judgment be and hereby is granted. SO ORDERED.

2023-08-23 14:16:53.086154+00

Berger

BERGER, Justice. In this appeal, we consider whether, with respect to automobile insurance policies, the implied covenant of good faith and fair dealing encompasses claims other than for “bad faith” in denying or delaying payment of benefits. Anne Dunlap, the insured, suffered catastrophic injuries in a car accident. She asked State Farm Fire and Casualty Company, her underinsured motorist (UIM) insurer, to agree that it would not deny coverage if she settled with a potential tortfeasor whose liability was questionable. State Farm refused, thereby causing Dunlap to litigate her claim against the tortfeasor (unsuccessfully) and lose more than $175,000. Dunlap sued State Farm, alleging that it acted in bad faith. The Superior Court dismissed her complaint, with prejudice. We agree that the complaint does not allege a bad faith claim for delay or denial of insurance, since it does not charge State Farm with failure to investigate, process, or pay a claim without reasonable justification. The complaint, however, does allege facts suggesting that State Farm breached the implied covenant of good faith and fair dealing by depriving Dunlap of a third party recovery without any justification and without any potential financial exposure. Accordingly, we remand with instructions to enter an order dismissing without prejudice, giving Dunlap the right to replead, if she can, in accordance with the principles discussed in this decision. Factual and Procedural Background On August 7, 1998, Anne Dunlap was a passenger in Mark Cardillo’s car when he made a left turn in front of a Delaware Transit Corporation (DART) bus. The bus collided with the car, striking the passenger door. Anne suffered severe and permanent injuries that left her partially paralyzed. She incurred hundreds of thousands of dollars in medical expenses. In August 2000, Anne and her parents filed suit against Cardillo, DART, and Monte Wood, the bus driver. The Dun-laps had a policy with State Farm that provided $1 million in UIM coverage. The policy covering Cardillo’s car had a single liability limit of $500,000, and DART had a single liability limit of $300,000. Cardillo’s insurer paid the Dunlaps and the other injured parties the limits of its coverage almost immediately in light of the seriousness of the injuries and its insured’s probable liability. DART contested liability, but nevertheless, following August 2001 negotiations, offered to settle with the Dunlaps for $175,000. The Dunlaps, worried about jeopardizing their UIM coverage, wrote to State Farm seeking assurance that if they settled for less than the DART policy limits, without exhausting “all bodily injury bonds and insurance policies available,” they would not be denied underinsurance benefits: In my opinion, the Cardillo vehicle is an “underinsured motor vehicle,” as defined [by Delaware law], regardless of whether any settlement with DART exhausts DART’s $300,000 limit. I would like to have State Farm’s agreement that the Dunlaps may settle with DART for less than $300,000 without prejudicing the Dunlaps’ UIM claim. Of course, I will not assert that the DART bus is *438an “underinsured motor vehicle” unless we exhaust the $800,000 coverage.1 The Dunlaps wrote similar letters the following month, noting that Anne was hemi-plegic and had already incurred more than $500,000 in medical expenses.2 In December 2001, State Farm refused to agree to the Dunlaps’ proposal. Citing the Dun-laps’ obligation to exhaust all applicable tortfeasor policies before pursuing a UIM claim, State Farm responded that it was “not aware [of] any authority in this state for the proposition that you’ve asked State Farm to accept.”3 The Dunlaps proceeded to trial against DART, Wood, and Cardillo. The jury found Cardillo solely liable and exonerated DART and Wood. Shortly thereafter, State Farm paid the Dunlaps the $1 million UIM coverage limit. The Dunlaps then filed suit against State Farm, asserting that State Farm had breached its policy in “bad faith” when it refused to consent to their request to settle with DART for less than the DART policy limits. The Dunlaps alleged that State Farm’s refusal forced them to trial against DART despite improbable liability and despite overwhelming damages unquestionably resulting from the accident. As a result, the Dun-laps lost the $175,000 DART had been willing to pay to avoid trial, and were forced to incur attorneys’ fees and other trial-related expenses. State Farm moved to dismiss the complaint for failure to state a claim. The trial judge granted its motion, holding: It was not [State Farm’s] responsibility to sanction the negotiations, nor was it a requirement that it administer advice or exercise influence with regard to [the Dunlaps’] decision to accept the settlement or to litigate. [The Dunlaps] have attempted to shift the onus of an unsuccessfully construed course of action, and/or trial strategy, onto [State Farm], whose statutory obligation had not yet been triggered at the time of settlement negotiations.4 The trial judge reasoned that the statutory exhaustion requirement, as well as the identical policy terms, provided a reasonable justification for State Farm’s conduct and that State Farm had neither unreasonably delayed nor refused payment of its UIM coverage limits. Therefore, the Dun-laps had not alleged a “bad faith” claim in their complaint.5 This is the Dunlaps’ appeal. Discussion The Court reviews judgments on a motion to dismiss de novo.6 In this context, we determine whether the trial judge erred as a matter of law in formulating or applying legal precepts.7 Dismissal *439is warranted only if “it appears with reasonable certainty” that the claims asserted would not entitle plaintiff to relief under any provable set of facts.8 But we need not “blindly accept as true all allegations, nor must [we] draw all inferences from them in [plaintiffs] favor unless they are reasonable inferences.”9 Before we consider the implied covenant of good faith and fair dealing, we address the two issues that controlled the trial court’s decision — the meaning of the statutory exhaustion requirement, and the elements of a so-called bad faith insurance claim. A. The Exhaustion Requirement This Court has considered the correct construction and application of Delaware’s uninsured/undei'insured motorist (UIM) statute, 18 Del. C. § 3902, many times.10 The statute provides, in relevant part: (b) Every insurer shall offer to the insured the option to purchase additional coverage for personal injury or death up to a limit of $100,000 per person and $300,000 per accident .... Such additional insurance shall include underin-sured bodily injury liability coverage. (1) Acceptance of such additional coverage shall operate to amend the policy’s uninsured coverage to pay for bodily injury damage that the insured ... [is] legally entitled to recover from the driver of an underinsured motor vehicle. (2) An underinsured motor vehicle is one for which there may be bodily injury liability coverage in effect, but the limits of bodily injury liability coverage under all bonds and insurance policies applicable at the time of the accident total less than the limits provided by the uninsured motorist coverage .... (3)The insurer shall not be obligated to make any payment under this coverage until after the limits of liability under all bodily injury bonds and insurance policies available to the insured at the time of the accident have been exhausted by payment of settlements or judgments.... The overriding purpose of § 3902 is to “fully compensate innocent drivers.”11 Thus, when construing ambiguous portions of the statute, this Court has adopted interpretations that maximize the accident victim’s opportunity to be fully compensated. Notwithstanding the goal of full compensation, this Court has limited the insured’s recovery in circumstances where the statutory language clearly mandated that result. Thus, for example, an insured may not stack policies to determine whether the tortfeasor’s vehicle meets the § 3902(b)(2) definition of an underinsured motor vehicle. The trial court applied settled rules of statutory construction and properly concluded that the exhaustion provision, § 3902(b)(3), is clear and unambiguous. The plain meaning of the provision is that UIM carriers are not obligated to pay their insureds until after the insureds ex*440haust all available liability insurance policies. Thus, State Farm was not obligated to pay the Dunlaps before the Dunlaps either received a policy limits settlement from DART or obtained a judgment after trial.12 B. Bad Faith Refusal to Pay In Tackett v. State Farm Fire & Cas. Ins. Co.,13 this Court held that a first-party claim against an insurer for bad faith denial or delay in claim payments sounds in contract and arises from the implied covenant of good faith and fair dealing.14 Tackett defined the elements of a bad faith insurance claim: Where an insurer fails to investigate or process a claim or delays payment in bad faith, it is in breach of the implied obligations of good faith and fair dealing underlying all contractual obligations .... A lack of good faith, or the presence of bad faith, is actionable where the insured can show that the insurer’s denial of benefits was “clearly without any, reasonable justification.”15 The Dunlaps’ complaint does not fit neatly within the above-described rubric, as it does not allege that State Farm failed to investigate or pay a claim. What the complaint does accuse State Farm of is a “bad faith” refusal to cooperate, which the trial court treated as a bad faith “refusal to pay” claim. It is in that context that we turn briefly to State Farm’s contentions. State Farm argues that its reliance on the “exhaustion” statute, even if misplaced, defeats a bad faith claim. State Farm points out that a bad faith claim requires a showing that its decision lacked any reasonable justification. Here, State Farm says, it relied on the plain language of a statute, which constituted “reasonable justification” as a matter of law. Moreover, and in addition, State Farm asked the Dunlaps to provide Delaware authority supporting their position, and the Dunlaps did not reply. Accordingly, State Farm concludes, there are no facts that could establish that it acted unreasonably. We agree that, under settled Delaware law, the Dunlaps’ complaint does not state a cause of action for a bad faith refusal to pay insurance claim because the complaint does not allege an unjustified failure or delay in the processing or payment of an insurance claim. The question is whether State Farm’s refusal to cooperate, under the facts of this case, could be actionable as a breach of the implied covenant of good faith and fair dealing on a different basis. We find, for the reasons next set forth, that it could be. C. The Insurer’s Implied Covenant of Good Faith and Fair Dealing The requirement that all parties to an insurance contract act in “good faith” toward one another spans at least three centuries of American legal thought.16 By *441the twentieth century, courts and commentators clarified the doctrine, steadily referring to the newly-coined “implied covenant of good faith and fair dealing.”17 Despite its evolution, the term “good faith” has no set meaning, serving only to “exclude a wide range of heterogeneous forms of bad faith.”18 The covenant is “best understood as a way of implying terms in the agreement,”19 whether employed to analyze unanticipated developments20 or to fill gaps in the contract’s provisions.21 Existing contract terms control, however, such that implied good faith cannot be used to circumvent the parties’ bargain,22 or to create a “free-floating duty.. .unattached to the underlying legal document.”23 Thus, one generally cannot base a claim for breach of the implied covenant on conduct authorized by the terms of the agreement.24 Recognized in many areas of the *442law,25 the implied covenant attaches to every contract,26 including contracts of insurance.27 Stated in its most general terms, the implied covenant requires “a party in a contractual relationship to refrain from arbitrary or unreasonable conduct which has the effect of preventing the other party to the contract from receiving the fruits” of the bargain.28 Thus, parties are liable for breaching the covenant when their conduct frustrates the “overarching purpose” of the contract by taking advantage of their position to control implementation of the agreement’s terms.29 This Court has recognized “the occasional necessity” of implying contract terms to ensure the parties’ “reasonable expectations” are fulfilled.30 This quasi-reformation, however, “should be [a] rare and fact-intensive” exercise, governed solely by “issues of compelling fairness.”31 Only when it is clear from the writing that the contracting parties “would have agreed to proscribe the act later complained of ... had they thought to negotiate with respect to that matter” may a party invoke the covenant’s protections.32 As noted earlier, the implied covenant of good faith and fair dealing doctrine applies to insurance contracts. But, in that context, the case law frequently (and unfortunately) equates a lack of good faith with the presence of bad faith,33 and the parameters of an action for “bad faith” refusal to pay insurance proceeds are well settled.34 Thus, in this case, State Farm’s refusal to cooperate with the Dunlaps did not subject it to liability for bad faith, because its conduct did not involve the failure or refusal to pay an insurance claim. Moreover, even if this were deemed to be a failure-to-pay case, State *443Farm reasonably relied on the exhaustion provision. The question thus becomes whether the scope of the duty arising out of the covenant of good faith and fair dealing is limited to the insurance company’s obligation to fairly and promptly process and pay its insured’s claims. The answer to that question is no. State Farm learned the answer to that question in a case decided in another jurisdiction. In Schwartz v. State Farm Fire and Casualty Company,35 two people were seriously injured by an uninsured motorist. Andrew Schwartz, one of the injured, had a primary policy with another insurance company, and a $2 million umbrella policy with State Farm. The excess policy “applied only when ... there is payment by your underlying coverage.”36 Elliot Wein-stein, the other injured party, was covered by Schwartz’s policies because he was a passenger in Schwartz’s car. Both men submitted demands for policy limits to the primary insurer and State Farm. Wein-stein obtained full payment from the primary insurer, and concluded his arbitration with State Farm before Schwartz. Without notifying Schwartz, State Farm paid Weinstein approximately $1.5 million of the $2 million in available excess coverage. A few months later, when Schwartz received full payment from the primary insurer, he notified State Farm and was paid the remaining $471,960. Schwartz sued State Farm, alleging that State Farm knew “to a reasonable degree of certainty” that the two claims would exceed all available policy limits but failed to take any steps to protect Schwartz’s claim.37 State Farm argued that it had no duty to Schwartz until such time as the primary insurance was exhausted, and that it complied with its duty to pay as soon as the exhaustion requirement was satisfied. The Schwartz court disagreed, holding that State Farm breached the implied covenant of good faith and fair dealing: We conclude that the duty applies to an excess insurer, just as it does to a primary insurer. We reject the notion that, simply because a condition precedent to a particular obligation — the obligation to pay — has not yet occurred, the insurer is relieved of the implied covenants that inhere in every contract.38 The court continued: There was no doubt that the Schwartzes’ claim would be covered by the State Farm policy once the primary insurer exhausted policy limits. As an excess insurer, State Farm, like any other insurer, was obliged under the implied covenant of good faith and fair dealing to do nothing to impair the Schwartzes’ right to the benefits of the agreement. Payment in full to its other insured, the Weinsteins, might well impair those rights if that payment prevented the Schwartzes from receiving a fair share of benefits under the policy. That is for jury determination at trial.39 Other jurisdictions, using similar reasoning, have found breaches of the implied covenant of good faith and fair dealing based on conduct other than a failure to process or pay claims promptly. For example, in Rawlings v. Apodaca, the Arizona Supreme Court noted that, “[t]he implied covenant is breached, whether the carrier pays the claim or not, when its conduct damages the very protection or security which the insured sought to gain *444by buying insurance.”40 In that case, the insurer withheld an investigative report that its insured needed to assert a claim against the tortfeasor, who was insured by the same carrier. See, also: Union Bankers Ins. Co. v. Shelton, 889 S.W.2d 278, 283 (Tex.1994) (holding that insurer breaches implied covenant of good faith and fair dealing when it cancels insured’s health policy without reasonable basis.) Delaware, likewise, recognizes that the covenant 'of good faith and fair dealing implied in all contracts comprehends duties other than the duty to promptly process and pay claims. Our courts have held that the covenant also requires an insurer to notify its insured of the policy’s limitations period if that time limit is shorter than the applicable State statute of limitations.41 Similarly, an insurer may not deny coverage based on an insured’s failure to give notice of a claim unless the insurer establishes that it was prejudiced by the lack of notice.42 In sum, the implied covenant of good faith “ ‘is the obligation to preserve the spirit of the bargain rather than the letter, the adherence to substance rather than form....’”43 It requires more than just literal compliance with the policy provisions and statutes. The implied covenant of good faith and fair dealing requires that the insurer act in a way that honors the insured’s reasonable expectations.44 D. State Farm’s Conduct as Breach of the Implied Covenant The exhaustion provision in State Farm’s policy, like the statute, expresses that UIM coverage is secondary, or excess, coverage that becomes payable after there is a determination that: (i) a third party was liable for the injuries sustained by the insured, (ii) the tortfeasor(s) vehicles were underinsured, and (iii) the insured has recovered on all available primary liability policies. Often the exhaustion requirement will protect the insurer from having to engage in expensive litigation to determine, for example, who is responsible for the accident or the extent of the insured’s damages. In such circumstances, it would be reasonable to expect the insurer to invoke the exhaustion provision, and by doing so the insurer would not face potential liability for breaching the implied covenant of good faith and fair dealing. The covenant does not, after all, require an insurer to risk financial exposure in order to assist the insured. Nonetheless, although “the obligation of good faith does not require the insurer to reheve the insured of all possible harm that may come from his choice of policy limits, it does obligate the insurer not to take advantage of the unequal positions in order to become a secondary source of injury to the insured.”45 Here, it was inferable, if not apparent, from the pleaded facts that State Farm faced no possible financial exposure or prejudice if it agreed to waive the exhaustion requirement to enable Dunlap to settle with DART for $125,000 below its policy limits. State Farm was informed, and easily could verify, that Anne was not at all responsible for the accident and that her severe, permanent injuries would far exceed the total *445of all available policy limits. Thus, whether the Dunlaps received nothing or the full $300,000 policy limits from DART, State Farm still would have had to pay the $1 million limit of its UIM policy. It thus appears arguable that by refusing to agree to the $175,000 DART settlement, State Farm was not advancing any interest of its own, and had become a secondary source of injury to the Dunlaps. Because the Dunlaps’ claim may implicate a breach of State Farm’s duty under the implied covenant of good faith and fair dealing, the dismissal of their complaint should be reversed and the case should be remanded to afford an Dunlaps the opportunity to plead a claim founded on the covenant. Just as an insurer may not rely on a notice provision to deny coverage except where it was prejudiced by the insured’s lack of notice,46 so, too, an insurer may not rely on an exhaustion provision absent a realistic risk of prejudice. In these circumstances, the Dunlaps may possibly have a claim that State Farm knew, or should have known, that the implied covenant of good faith and fair dealing required that it not arbitrarily prevent its own insured from obtaining the fullest possible recovery for her injuries where State Farm faced no realistic prejudice.47 Nothing in this Opinion should be read as a “pre-approval” of any claim for breach of the implied covenant of good faith and fair dealing. Whether or not the Dunlaps are able to plead a legally cognizable claim must be determined in light of the specific allegations of whatever amended complaint (if any) that they file. Conclusion Based on the foregoing, the judgment of the Superior Court is affirmed in part and reversed in part. This matter is remanded for further action in accordance with this opinion. Jurisdiction is not retained. . Letter from James J. Woods, Jr., Esq., to Maude I. Niedzielski (Sept. 18, 2001), citing 18 Del. C. § 3902(b)(2) (emphasis removed), Appellants' Appendix, A-000002. . See Letter from James J. Woods, Jr., Esq., to Maude I. Niedzielski (Oct. 22, 2001) (ending: "I sincerely hope that State Farm will 'take the high road’ and not obstruct the proposed DART-Dunlap settlements.”), Appellants’ Appendix, A-000003-4; Letter from James J. Woods, Jr., Esq., to Colin M. Shalk, Esq. (Nov. 13, 2001), Appellants’ Appendix, A-000005-6. . Letter from Colin M. Shalk, Esq., to James J. Woods Jr., Esq. (Dec. 18, 2001), Appellants’ Appendix, A-000008-9. . Dunlap v. State Farm Fire & Cas. Co., 2004 WL 1427001, at *6, 2004 Del.Super. LEXIS 188, at *24. . Id. at *8-9, 2004 Del.Super. LEXIS 188, at *32-33. . See, e.g., VLIW Tech. LLC v. Hewlett-Packard Co., 840 A.2d 606, 610 (Del.2003). . Gadow v. Parker, 865 A.2d 515, 518 (Del. 2005). . See, e.g., McMullin v. Beran, 765 A.2d 910, 916 (Del.2000). . White v. Panic, 783 A.2d 543, 549 (Del. 2001) (citation omitted). . See, e.g.: Deptula v. Horace Mann Ins.Co., 842 A.2d 1235 (Del.2004); Colonial Ins. Co. of Wisconsin v. Ayers, 772 A.2d 177 (Del. 2001); Nationwide Mut. Auto. Ins. v. Peebles, 688 A.2d 1374 (Del. 1997); Sutch v. State Farm Mut. Auto. Ins. Co., 672 A.2d 17 (Del. 1996); Hurst v. Nationwide Mut. Ins. Co., 652 A.2d 10 (Del.1995); Home Ins. Co. v. Maldonado, 515 A.2d 690 (Del.1986). .Deptula v. Horace Mann Ins. Co., 842 A.2d at 1237. .The Dunlaps point out that this construction requires insureds to "pursue claims of weak liability against third parties, thereby fostering marginal and costly litigation....” General Acc. Ins. Co. v. Wheeler, 221 Conn. 206, 603 A.2d 385, 388 (1992). The Connecticut Supreme Court, citing those concerns, construed a UIM statute like ours to mean that the insured must exhaust only one tort-feasor’s liability coverage before seeking UIM benefits. Ibid. Although we recognize this policy issue, it is not our function to construe a statute that is clear and unambiguous. If any changes to the UIM statute are deemed necessary, it is the General Assembly that must effect those changes. . 653 A.2d 254 (Del. 1995). . Id. at 264. . Id. at 264 (citing Casson v. Nationwide Ins. Co., 455 A.2d 361, 369 (Del.Super.1982)). . See, e.g., Goix v. Low, 1 Johns.Cas. 341, 352 (N.Y.1800) ("A rigorous attention to the *441purest rules of good faith is exacted from all the parties to a contract of insurance.”); Pine v. Vanuxem, 3 Yeates 30, 33 (Pa. 1800) ("Insurances are contracts of indemnity; they should be entered into and fulfilled with the purest good faith.”); Eichelberger v. Barnitz, 1 Yeates 307 (Pa.1793) ("In a policy of insurance, where the most pure good faith is required, it is settled, that the insured need not mention what the underwriter ought to know.”). Cf. Seton, Maitland & Co. v. Low, 1 Johns. Cas. 1, 6 (N.Y.1799) ("[T]he reason of the rule requiring due disclosure of all facts, within the knowledge of either party, is to prevent fraud and encourage good faith_”). . See, e.g., Blish v. Thompson Automatic Arms Corp., 64 A.2d 581 (Del.1948); Wood v. Lucy, Lady Duff-Gordon, 222 N.Y. 88, 118 N.E. 214 (1917); Heney v. Sutro & Co., 28 Cal.App. 698, 153 P. 972 (1915); Germania Ins. Co. v. Rudwig, 80 Ky. 223 (1882). See also Eric M. Holmes, A Contextual Study of Commercial Good Faith: Good Faith Disclosure in Contract Formation, 39 U. Pirr. L. Rev. 381 (1978) (tracing covenant’s Roman roots); J.F. O’Connor, Good Faith in International Law (1991) (same). . Robert S. Summers, "Good Faith” in General Contract Law and the Sales Provisions of the Uniform Commercial Code, 54 Va. L. Rev. 195, 201 (1968). . El. DuPont de Nemours & Co. v. Pressman, 679 A.2d 436, 443 (Del. 1996), citing E. Allan Farnsworth, Good Faith Performance and Commercial Reasonableness under the Uniform Commercial Code, 30 U. Chi. L. Rev. 666, 670 (1963). . Pressman, 679 A.2d at 443. . Glenfed Fin. Corp., Commercial Fin. Div. v. Penick Corp., 276 N.J.Super. 163, 647 A.2d 852, 858 (1994) (citations omitted) ("When the contract is silent, principles of good faith ... fill the gap."). . Rudbart v. North Jersey Dist. Water Supply Comm’n, 127 N.J. 344, 605 A.2d 681, 692 (1992), cert. denied, 506 U.S. 871, 113 S.Ct. 203, 121 L.Ed.2d 145. See also Hall v. Resolution Trust Corp., 958 F.2d 75, 79 (5th Cir. 1992) ("An agreement made by the parties and embodied in the contract itself cannot be varied by an implicit covenant of good faith and fair dealing.”), quoting Exxon Corp. v. Atlantic Richfield Co., 678 S.W.2d 944, 947 (Tex. 1984); Terry A. Lambert Plumbing Inc. v. Western Sec. Bank, 934 F.2d 976, 983 (8th Cir. 1991) ("Acting according to express terms of a contract is not a breach of good faith and fair dealing."); Kham & Nate’s Shoes No. 2, Inc. v. First Bank of Whiting, 908 F.2d 1351, 1357 (7th Cir. 1990) ("Any attempt to add an overlay of ‘just cause' ... to the exercise of contractual privileges [based on the UCC’s requirement of 'honesty in fact’] would reduce commercial certainty and breed costly litigation.”); Price v. Wells Fargo Bank, 213 Cal.App.3d 465, 479, 261 Cal.Rptr. 735 (1989) (holding the duty of good faith and fair dealing "does not impose any affirmative duty of moderation in the enforcement of legal rights.”). . Glenfed Fin. Corp., 647 A.2d at 858. . In re Prudential Ins. Co. of Am. Sales Practices Litig., 975 F.Supp. 584, 616 (D.N.J. 1996). See also Duquesne Light Co. v. Westinghouse Elec. Corp., 66 F.3d 604, 617 (3d Cir.1995) ("[C]ourts generally utilize the good faith duty as an interpretive tool to determine the parties’ justifiable expectations, and do *442not enforce an independent duty divorced from the specific clauses of the contract.”) (quotation marks omitted). . See, e.g., Desert Equities Inc. v. Morgan Stanley Leveraged Equity Fund II LP, 624 A.2d 1199, 1208 n. 16 (Del.1993) (limited partnerships); Merrill v. Crothall-American Inc., 606 A.2d 96, 101 (Del. 1992) (employment contracts); Simons v. Cogan, 542 A.2d 785, 787 (Del.Ch. 1987) (corporate-bond indenture); Gilbert v. El Paso Co., 490 A.2d 1050, 1054-55 (Del.Ch.1984) (tender offer); Jedwab v. MGM Grand Hotels Inc., 509 A.2d 584, 596 (Del.Ch. 1986) (preferred-stock preferences). . Merrill, 606 A.2d at 101; Blish v. Thompson Automatic Arms Corp., 64 A.2d 581, 597 (Del. 1948). . Pierce v. International Ins. Co., 671 A.2d 1361, 1366 (Del.1996); Corrado Bros. v. Twin City Fire Ins. Co., 562 A.2d 1188, 1192 (Del. 1989); Polito v. Continental Cas. Co., 689 F.2d 457, 463 (3rd Cir. 1982).. . Wilgus v. Salt Pond Inv. Co., 498 A.2d 151, 159 (Del.Ch. 1985), construing Restatement § 205. . Breakaway Solutions, Inc. v. Morgan Stanley & Co., 2004 WL 1949300, at *12, 2004 Del. Ch. LEXIS 125, at *49-50. . See, e.g., Pressman, 679 A.2d at 443; Cincinnati SMSA Ltd. Pshp. v. Cincinatti Bell Cellular Sys. Co., 708 A.2d 989, 992 (Del. 1998) ("Delaware Supreme Court jurisprudence is developing along the general approach that implying obligations based on the covenant ... is a cautious enterprise.”). . Cincinnati, 708 A.2d at 992-93; Wilmington Trust Co. v. Keith, 2002 WL 1748622 at *2, 2002 Del.Super. LEXIS 445 at *6 (echoing "cautious enterprise” language). . Katz v. Oak Industries, Inc., 508 A.2d 873, 880 (Del.Ch. 1986). . Tackett, 653 A.2d at 264. . "The law governing the insurer's liability for bad faith has evolved from an undefined, vague set of threats into a relatively mature body of settled rules and accepted goals.” Kenneth S. Abraham, The Natural History of the Insurer’s Liability for Bad Faith, 72 Tex. L. Rev. 1295, 1315 (1994). . 88 Cal.App.4th 1329, 106 Cal.Rptr.2d 523 (2001). . Id. at 526 (Internal citations omitted.). . Id. at 527. . Id. at 529. . Id. at 532. . 151 Ariz. 149, 726 P.2d 565, 573 (1986). . Woodward v. Farm Family Casualty Ins. Co., 796 A.2d 638, 648 (Del.2002). . State Farm Mut. Auto. Ins. Co. v. Johnson, 320 A.2d 345 (Del.1974). . Pierce v. Int’l. Ins. Co. of Illinois, 671 A.2d at 1366 (Quoting 3A Corbin on Contracts § 654A (1994))(emphasis added). . Ibid. . Rawlings v. Apodaca, 726 P.2d at 573. . State Farm Mut. Auto. Ins. Co. v. Johnson, 320 A.2d 345 (Del. 1974). . See, e.g.: Deese v. State Farm Mut. Auto. Ins. Co., 172 Ariz. 504, 838 P.2d 1265 (1992); Campbell v. State Farm Mut. Auto. Ins. Co., 840 P.2d 130 (Utah Ct.App.1992); State Farm Mut. Auto. Ins. Co. v. Shrader, 882 P.2d 813 (Wyo.1994); Zilisch v. State Farm Mut. Auto. Ins. Co., 196 Ariz. 234, 995 P.2d 276 (2000); Schwartz v. State Farm Fire & Cas. Co., supra.

2023-08-23 14:16:53.093515+00

Ridgely

RIDGELY, Justice, concurring in part, dissenting in part. I agree with and, therefore, concur in, the majority’s conclusion that the Superior Court correctly dismissed the Dunlaps’ bad faith claim against State Farm under Tackett v. State Farm, Fire & Cas. Ins. Co.48 The majority’s opinion, however, ultimately describes a cause of action for the breach of the implied covenant of good faith and fair dealing that is semantically different but not substantively different from a Tackett claim, reverses the dismissal to the extent it is “with prejudice,” and remands this case to allow the Dunlaps to amend their complaint. I disagree with the reversal and remand because the implied covenant does not come into play given the undisputed facts before us. This Court has held that “implying obligations based on the covenant of good faith and fair dealing is a cautious enterprise.”49 We have said that in deference to the principle that, absent grounds for reformation, courts should not rewrite contracts.50 The bottom line here is that the Dunlaps *446wanted UIM coverage even though DART still had primary insurance coverage. If State Farm agreed to this, the policy would be rewritten and changed from uninsured/underinsured motorist coverage to a policy for primary insurance coverage. Because State Farm had no obligation to change the scope of the coverage under the policy, it did not breach the implied covenant when it refused the Dunlaps’ request that it do so. In Tackett, we held that a first-party claim against an insurer for bad faith denial or delay in claim payments sounds in contract, rather than tort.51 We recognized that first-party insurance contracts, like any other contract, include an implied covenant of good faith and fair dealing.52 We held that the implied covenant of good faith and fair dealing is breached when “an insurer fails to investigate or process a claim or delays payment in bad faith....”53 We went on to state that “[a] lack of good faith, or the presence of bad faith, is actionable where the insured can show that the insurer’s denial of benefits was ‘clearly without any reasonable justification.’ ”54 The undisputed facts of this case show that State Farm was asked to consent to a settlement for less than the policy limits without prejudice to the Dunlaps’ UIM claim.55 The statute that provides for UIM insurance relieves State Farm of any obligation to pay “until after the limits of liability under all bodily injury bonds and insurance policies available to the insured at the time of the accident have been exhausted by payment of settlement or judgments.”56 In almost identical language, the Dunlaps’ insurance policy stipulates that UIM coverage cannot be exercised by the insured until the limits of “all bodily injury liability bonds or policies that apply have been used up by payments of judgments or settlements.”57 While the Dunlaps are not claiming that State Farm failed to investigate, process or delay payment on a claim, an analysis under Tackett of the alleged breach may be made on the premise that the Tackett list is merely representative and not exhaustive-.58 Thus, the Dunlaps have to show that State Farm’s refusal to agree to a settlement with DART for less than policy limits clearly lacked any reasonable justification. In this case, the Dunlaps own agreement with State Farm prevents them from doing so. State Farm was reasonably justified in refusing the Dunlaps’ request because the subject at issue was expressly covered by the contract. The DART policy had to be “used up” in order for the Dunlaps to have a UIM claim. Tackett addresses the implied covenant of good faith and fair dealing in the context of an insurance contract. The case does so with a focus upon whether there is a reasonable justification for the insurer’s position. Reasonable conduct is at the *447core of whether there has been a breach of the implied covenant of good faith and fair dealing. The implied covenant requires “ ‘a party in a contractual relationship to refrain from arbitrary or unreasonable conduct which has the effect of preventing the other party to the contract from receiving the fruits’ of the bargain.”59 Here, the bargain was for uninsured/underin-sured motorist coverage. The fruit of the bargain is payment under the terms of the UIM policy when no other insurance is available to the Dunlaps, not a settlement with DART. We have stressed that the implied covenant of good faith and fair dealing exists to protect the “parties’ reasonable expectations.” 60 Under the statute and insurance policy at issue here, there could be no reasonable expectation that State Farm would provide uninsured motorist coverage for a motorist that was still insured. To the contrary, the expectations of the parties were that unless DART’s policy was exhausted by settlement or judgment there could be no UIM claim. We should honor that bargained for expectation. The majority’s point that DART’s liability was “questionable” makes no difference. Disputes over liability are to be expected and a trial exists to resolve them. Because the undisputed nature of the Dunlaps request shows that the implied covenant of good faith and fair dealing does not come into play, it is my opinion that a remand to allow an amendment to the complaint is unwarranted. I respectfully dissent from the decision to reverse in part and remand. . 653 A.2d 254 (Del.1995). . Cincinnati SMSA Ltd. P’ship v. Cincinnati Bell Cellular Sys. Co., 708 A.2d 989, 992 (Del. 1998). . Gertrude L.Q. v. Stephen P.Q., 466 A.2d 1213, 1217 (Del. 1983). . Tackett, 653 A.2d at 265-66. . Id. at 264. . Id. . Id. (quoting Casson v. Nationwide Ins. Co., 455 A.2d 361, 369 (Del.Super.Ct.1982)). . The Dunlaps attached to their complaint and incorporated within it by reference their counsel’s and State Farm’s correspondence on their request. . Del. Code Ann. tit. 18, § 3902(b)(3) (2005) (emphasis added). . State Farm Car Policy, 9808.4, Section III — Uninsured Motor Vehicle Coverage (emphasis added). . "A complete catalogue of types of bad faith is impossible.” Restatement (Second) of Contracts § 205 comment d. (1981). . Majority Opinion at-(quoting Wilgus v. Salt Pond Inv. Co., 498 A.2d 151, 159 (Del.Ch. 1985)). . Cincinnati, 708 A.2d at 992.

2013-10-30 06:35:54.555455+00

Shea-Stonum

431 B.R. 718 (2010) In re CUMBERLAND MOLDED PRODUCTS, LLC, Debtor. Susan R. Limor, Trustee, Plaintiff-Appellee, v. First National Bank of Woodbury, Defendant-Appellant. No. 09-8049. United States Bankruptcy Appellate Panel of the Sixth Circuit. Argued: May 3, 2010. Decided and Filed: June 23, 2010. *720 ARGUED: Thomas F. Bloom, Law Office, Nashville, Tennessee, for Appellant. Kathryn A. Stephenson, Trauger & Tuke, Nashville, Tennessee, for Appellee. ON BRIEF: Thomas F. Bloom, Law Office, Nashville, Tennessee, James D. Lane, II, Hull, Ray, Rieder, Ewell, Lane & Ridner, Tullahoma, Tennessee, for Appellant. Kathryn A. Stephenson, Trauger & Tuke, Nashville, Tennessee, Susan R. Limor, Susan R. Limor, Attorney at Law, a Professional Corporation, Nashville, Tennessee, for Appellee. Before: BOSWELL, HARRIS, SHEA-STONUM, Bankruptcy Appellate Panel Judges. OPINION MARILYN SHEA-STONUM, Bankruptcy Judge. This is an appeal from the bankruptcy court's order granting summary judgment to Susan T. Limor (the "Trustee"), the chapter 7 trustee in the chapter 7 bankruptcy case of Cumberland Molded Products, LLC (the "Debtor"), on her adversary proceeding seeking to avoid the security interest of First National Bank of Woodbury (the "Bank") in the Debtor's checking account (the "Checking Account") and in proceeds of accounts receivable (the "Funds") deposited in the Checking Account. I. ISSUES ON APPEAL Did the Bank lose either its perfected security interest or right of setoff in either the Funds or Checking Account or proceeds thereof when it honored a check drawn by the Debtor and made payable to the Trustee after the Debtor's chapter 7 bankruptcy case was commenced? II. JURISDICTION AND STANDARD OF REVIEW The Panel has jurisdiction to hear appeals from "(1) final judgments, orders and decrees; ... and (3) with leave of court, from other interlocutory orders and decrees." 28 U.S.C. § 158(a). A party may bring an appeal as of right under 28 U.S.C. § 158(a)(1) from final judgments, orders and decrees of the bankruptcy court. A decision is considered final and appealable under 28 U.S.C. § 158(a)(1) if it "ends the litigation on the merits and leaves nothing for the court to do but execute the judgment." Midland Asphalt Corp. v. United States, 489 U.S. 794, 798, 109 S. Ct. 1494, 1497, 103 L. Ed. 2d 879 (1989). An order disposing of fewer than all claims in an adversary proceeding does not end the litigation on the merits and is not a final order. Settembre v. Fid. & Guar. Life Ins. Co., 552 F.3d 438, 441 (6th Cir.2009). The bankruptcy court in this case entered an order pursuant to Rule 54(b) finding that there was no just reason to delay determination of the issues on appeal here. Therefore, the order granting plaintiff's motion for summary judgment is final for the purposes of this appeal, and the Panel has jurisdiction. The bankruptcy court's findings of fact are reviewed under the clear-error standard, and its conclusions of law are reviewed de novo. Behlke v. Eisen (In re Behlke), 358 F.3d 429, 433 (6th Cir.2004). Following consideration of the record in its *721 entirety, if the trial court's view of the facts is plausible, the Panel may not reverse it even though, had it been sitting as the trier of fact, it would have weighed the evidence differently. "Where there are two permissible views of the evidence, the factfinder's choice between them cannot be clearly erroneous." Anderson v. City of Bessemer City, 470 U.S. 564, 573-74, 105 S. Ct. 1504, 84 L. Ed. 2d 518 (1985). The bankruptcy court's legal conclusions are reviewed de novo. Yoppolo v. MBNA America Bank, N.A. (In re Dilworth), 560 F.3d 562, 563 (6th Cir.2009); Stevenson v. J.C. Bradford & Company (In re Cannon), 277 F.3d 838, 849 (6th Cir.2002). De novo review means that the Panel should determine the law independently from the trial court's determination. See Razavi v. C.I.R., 74 F.3d 125, 127 (6th Cir.1996); Treinish v. Norwest Bank Minn., N.A. (In re Periandri), 266 B.R. 651, 653 (6th Cir. BAP 2001) (citations omitted). III. FACTS The Debtor filed a voluntary petition for relief under chapter 7 of the Bankruptcy Code on August 29, 2008 (the "Petition Date"). Prior to the Petition Date, the Debtor maintained the Checking Account at the Bank. In addition, the Bank lent money to the Debtor. In October 2007, the Debtor consolidated its loan obligations to the Bank into a single promissory note for $1 million. In connection with the consolidated loan, the Debtor executed security agreements granting the Bank a security interest in the "Collateral." Collateral was defined in the security agreements as "all equipment, machinery, inventory, tools, accounts receivable and all general intangibles of [Debtor] whether now owned or hereafter acquired, together with substitutes and replacements thereof, all accessions, and accessories added to or used in connection with such equipment." In addition, Collateral was defined to include all proceeds from the sale, destruction, loss or other disposition of any of the property described in the Collateral section. The Bank properly filed UCC-1 financing statements to perfect its security interest in the Collateral amenable to perfection through filing. It is undisputed that the Bank held this perfected security interest on the Petition Date. The Checking Account at the Bank was a regular commercial checking account with next day funds availability. Prior to the Petition Date, the Debtor deposited payments from its customers into the Checking Account. On its schedules, the Debtor listed the balance of the Checking Account as of the Petition Date as $455,655.66. The Trustee concedes that the monies deposited into the Checking Account were, with insignificant exceptions, proceeds of accounts receivable, though the precise sum of accounts receivable proceeds was not specified. The Debtor listed the Bank as a secured creditor on Schedule D. As of the Petition Date, the Debtor was not in default of its payment obligations to the Bank. After the Petition Date, the Trustee asked the Debtor to turn over to her the Funds in the Checking Account. Four days after the Petition Date, the Debtor delivered a check in the amount of $454,655.66 to the Trustee. The check was deposited into the Trustee's account and posted by the Bank on September 12, 2008. Subsequently, the Trustee asked the Bank to close the Checking Account and deliver any remaining funds in the Checking Account to the Trustee. The Bank complied. There is no dispute that the Bank was aware prior to the Petition Date that the Debtor was contemplating filing a voluntary petition for relief, and, in any event, *722 the Bank was aware prior to the posting of the check on September 12, 2008 that the Debtor had filed for bankruptcy. However, as of the Petition Date, the Debtor was current on its obligations to the Bank. The Bank took no immediate steps to freeze the Checking Account or setoff the Debtor's indebtedness to the Bank. Rather, in November 2008, the Bank filed a motion for relief from stay and abandonment seeking both authority to possess the Funds held by the Trustee and an order directing the Trustee to turn over all interest accrued on the Funds to the Bank. The Trustee filed a complaint against the Bank to determine the validity, priority, and extent of liens or interests that the Bank allegedly held in certain property of the estate. The Bank filed an answer and counterclaim against the Trustee again seeking relief from the automatic stay and turnover of property subject to the Bank's alleged security interest. Count I of the Trustee's amended complaint alleges that the Debtor did not grant the Bank a security interest in the Checking Account. Therefore, the Bank had no interest in the Funds in the Checking Account and the Funds are unencumbered property of the estate. Count II alleges that the Bank's security interest in the Checking Account is unperfected because the Bank failed to maintain control. Therefore, the Trustee asserts that, pursuant to § 544 of the Bankruptcy Code, the Bank's security interest in the Checking Account is void. Count III alleges that as a transferee of funds from a deposit account under UCC 9-332, the Trustee takes the Funds free of the Bank's security interest.[1] On May 29, 2009, the Trustee filed a motion for summary judgment seeking a determination that the Funds transferred postpetition to the Debtor's estate from the Checking Account at the Bank are property of the estate and not subject to a perfected security interest. Although the motion does not articulate the relief sought by reference to any particular count of the complaint, the Trustee's summary judgment motion seeks relief with respect to counts II and III of her Amended Complaint. On May 30, 2009, the Bank filed its own motion for summary judgment seeking judgment in its favor with respect to all four counts in the Trustee's Amended Complaint. The bankruptcy court entered a memorandum opinion on July 21, 2009 holding "that the Chapter 7 Trustee's motion for summary judgment should be granted. Specifically, the Court finds that the funds held by the Chapter 7 Trustee are property of the estate, free and clear of the defendant's unperfected security interest. It follows that the defendant's motion for summary judgment should be denied." The Bank timely filed a notice of appeal. IV. DISCUSSION Upon the filing of the voluntary petition for relief, the Funds and the Checking Account became property of the estate under 11 U.S.C. § 541. However, this property of the estate was subject to an undisputed perfected security interest as of the Petition Date. Claims and their respective priority are determined as of the petition date. See 11 U.S.C. §§ 502, 506 and 507. The Trustee concedes that the Bank had a perfected security interest in the Checking Account and the Funds as of the Petition Date. In a chapter 7 case, a primary duty of a trustee is to marshal assets for the benefit of creditors. See 11 U.S.C. § 704. She is vested with certain powers *723 to help her perform her duties. See, e.g., 11 U.S.C. §§ 544, 545, 547, 548 and 549. Those powers include the ability to avoid certain prepetition transfers and unauthorized postpetition transfers. However, the trustee's powers are measured as of the commencement of the bankruptcy case and only extend to property that was property of the estate at the time the case was filed. See Northern Acres, Inc. v. Hillman State Bank (In re Northern Acres, Inc.), 52 B.R. 641, 647 (Bank.E.D.Mich.1985) ("We must assume that the language `as of the commencement of the case' was included in the statute with a purpose in mind, and we should give effect to that purpose. Clearly, the phrase defines when the trustee's lien avoidance powers arise; the question is whether it also defines a particular moment in time at which the trustee's powers are to be measured. We think it does."). The extent to which a claim is properly secured in a chapter 7 case is determined as of the petition date. See Hubbard v. United States (In re Hubbard), 135 B.R. 430, 432 (Bankr.S.D.Fla. 1991) ("[I]n determining the extent to which a creditor is secured, this Court must look to the value of the collateral as of the date of the filing of the Chapter 7 petition in bankruptcy."); accord Perkins v. Gilbert (In re Perkins), 169 B.R. 455, 458 (Bankr.M.D.Ga.1994). See also Matter of Phillips Constr. Co., 579 F.2d 431 (7th Cir.1978) (in case under 1898 Act, Seventh Circuit held that since mechanics' lien was enforceable when petition for bankruptcy was filed, creditor was not required to take further action in state court to preserve its secured claim in bankruptcy); Toranto v. Dzikowski, 380 B.R. 96, 99 (S.D.Fla.2007) (creditor's judgment lien did not lapse as a result of non-renewal because it was frozen by the bankruptcy filing); Mostoller v. Citicapital Commercial Corp. (In re Stetson & Associates, Inc.), 330 B.R. 613, 623-24 & n. 11 (Bankr.E.D.Tenn.2005) (lapse of financing statements postpetition does not affect secured creditor's priority as against trustee). Cf. In re Morton, 866 F.2d 561, 563 (2d Cir.1989) (state requirement that creditor file for extension of judgment lien was tolled under 11 U.S.C. § 108(c), therefore Second Circuit did not reach creditor's argument that judgment lien remains valid because it was valid at time debtor filed her petition). If a judgment lien were to expire the day after the petition was filed, the claim would still be secured for purposes of § 506. Similarly, if a secured creditor were to turn over to a chapter 7 trustee property securing the creditor's claim, the secured nature of the claim would not be lost merely because the creditor no longer had possession of its collateral. Cf. Matter of Chaseley's Foods, Inc., 726 F.2d 303, 310 (7th Cir.1983) ("[O]nce the bankruptcy petition is filed the secured creditor should not be required to file a continuation statement to preserve the validity of its lien."). It is undisputed that on the Petition Date the Bank held a properly perfected secured claim. The Trustee attempts to avoid the Bank's properly perfected security interest pursuant to § 544. Section 544 grants trustees the rights and powers of a judicial lien creditor. However, a trustee's status as a hypothetical judgment lien holder "inures upon commencement of the case." See General Electric Credit Corp. v. Nardulli & Sons, Inc., 836 F.2d 184, 192 (3rd Cir.1988). Section 544(a)(1) is intended to protect general creditors of the debtor against "secret" liens. Id. It should not be construed to provide the trustee with an interest superior to that of creditors whose interests were perfected prior to the commencement of bankruptcy proceedings. Id. (citing Lockhart v. Garden City Bank & Trust Co., 116 F.2d 658 (2d Cir. 1940) (trustee's rights are determined at *724 the time of bankruptcy and liens valid at that time remain valid as against the trustee)); Isaacs v. Hobbs Tie & Timber Co., 282 U.S. 734, 738, 51 S. Ct. 270, 272, 75 L. Ed. 645 (1931) (recognizing that valid liens existing at the time of commencement of a bankruptcy proceeding are preserved). In this case, as between the Trustee, a judgment lien holder whose interest arose as of the Petition Date, and the Bank, holder of a security interest in the Checking Account and Funds which was properly perfected prior to the Petition Date, the Bank holds the superior interest. The Trustee may not avoid the Bank's security interest pursuant to § 544. In addition, the Trustee seeks to avoid the Bank's properly perfected security interest by arguing that UCC 9-332 allows the Trustee to take the Funds transferred to her postpetition free of the Bank's security interest. The Trustee's attempt to focus this matter as a priority dispute capable of resolution by reference to Tennessee's version of the Uniform Commercial Code is flawed for several reasons. First, as indicated previously, the allowance of a creditor's secured claim in Chapter 7 is determined as of the petition date. Second, the filing of a petition automatically creates an estate under § 541 in essentially all of the debtor's property "wherever located and by whomever held." Thus, at the time the Debtor delivered a check to the Trustee postpetition, the Funds in the Account were already property of the Debtor's estate. In this situation, a chapter 7 trustee is not a "transferee" as that term is used in Tennessee Code § 47-9-332 or UCC 9-332. This legal conclusion is supported by the official commentary in the UCC and the statutory role of a trustee under the Bankruptcy Code. For example, Official Comment 8 to UCC 9-315 recognizes that a secured party's right to proceeds is controlled by the Uniform Commercial Code, except to the extent the Bankruptcy Code provides otherwise. See also In re Music City RV, LLC., 304 S.W.3d 806 (Tenn.2010) (relying in part on the UCC official comments to interpret the Tennessee Code). In addition, Official Comment 1 to UCC 9-332 indicates that a change in ownership in the account is not a transfer, nor is the debtor itself a transferee. "Pursuant to § § 541 and 704(1) of the Code, the trustee stands in the debtor's shoes...." Jones v. Hyatt Legal Servs. (In re Dow), 132 B.R. 853, 861 (Bankr.S.D.Ohio 1991). Therefore, the Debtor's postpetition delivery of a check to the Trustee did nothing more than deliver to the Trustee property that was already property of the Debtor's estate. This reading of Tennessee Code § 47-9-332 is also consistent with the policy underlying respective provisions of the UCC and the Bankruptcy Code. For example, the expressed policy for permitting a transferee to take "money free of a security interest unless the transferee acts in collusion with the debtor" is "to ensure that security interests in deposit accounts do not impair the free flow of funds" and to "minimize[] the likelihood that a secured party will enjoy a claim to whatever the transferee purchases with the funds." Tenn.Code Ann. § 47-9-332 (UCC 9-332) cmt. 3. Unlike most parties receiving a check from a debtor, a chapter 7 trustee gives no consideration when property of the debtor's estate is turned over to her. Nor does a trustee purchase anything in exchange or take action in reliance on the turnover. Rather, a chapter 7 trustee may only pay claims from property of the estate after court approval and pursuant to the priorities specified under the Bankruptcy Code. Furthermore, the policy of encouraging the voluntary turnover to the trustee of property of the estate would suffer if secured creditors knew they risked losing their secured claims simply *725 by turning over collateral without ironclad written assurances from the trustee, if not court orders, specifying that they were not forfeiting their rights to allowed secured claims under §§ 502 and 506. Indeed, a contrary ruling would lead to a distrust of trustees, a reluctance to turnover property voluntarily, and a system that appears to reward trustees who succeed in duping inattentive secured creditors. In short, from a policy standpoint, there is no reason why a claim's allowance and secured status in bankruptcy should not await determination under the claims process established under the Bankruptcy Code, as opposed to having a secured claim be deemed waived simply by the postpetition turnover to the trustee of property of the debtor's estate. In addition to lien avoidance under § 544, which is not applicable in this case for the reasons set forth above, a trustee can also seek the turnover of property of the estate in the hands of third parties. See 11 U.S.C. §§ 542 and 543. Section 542(a) of the Bankruptcy Code provides "an entity, other than a custodian, in possession, custody, or control, during the case, of property that the trustee may use, sell, or lease under section 363 of this title, or that the debtor may exempt under section 522 of this title, shall deliver to the trustee, and account for, such property or the value of such property, unless such property is of inconsequential value or benefit to the estate." Section 542(b) provides "an entity that owes a debt that is property of the estate and that is matured, payable on demand, or payable on order, shall pay such debt to, or on the order of, the trustee, except to the extent that such debt may be offset under section 553 of this title against a claim against the debtor." While compliance with a turnover request or the release to the trustee by a creditor holding a secured claim may result in a waiver of the ability to setoff pursuant to § 553 or § 542(b), it is not a waiver of the underlying claim nor an avoidance of the underlying security interest. See In re Archer, 34 B.R. 28, 31 (Bankr.N.D.Tex.1983) ("There is nothing in § 506, nor elsewhere in the Code, that indicates that continued possession is required to maintain the secured claim."); accord U.S. v. Whiting Pools, Inc., 462 U.S. 198, 211-12, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983) ("When property seized prior to the filing of a petition is drawn into the Chapter 11 reorganization estate, the Service's tax lien is not dissolved; nor is its status as a secured creditor destroyed."); In re Reliance Acceptance Group, Inc., No. 98-288, Adv. No. A-98-310, 2000 WL 33712305 at *3 (Bankr.D.Del.2000) (noting that cases finding waiver as the result of the failure to assert setoff before surrendering possession are factually distinct from cases where the creditor transfers money at the behest of the bankruptcy trustee). The Bank had a perfected security interest as of the Petition Date and, therefore, a valid secured claim. Contrary to the Trustee's argument, the Bank did not lose or waive its secured claim when it honored the postpetition check made payable to the Trustee. While Citizens Bank of Maryland v. Strumpf, 516 U.S. 16, 116 S. Ct. 286, 133 L. Ed. 2d 258 (1995), permits a bank to temporarily freeze an account without violation of the automatic stay, nothing in Strumpf mandates that a bank must freeze a debtor's account or forfeit the secured nature of its claim. In addition, the Trustee did not seek turnover of the Funds pursuant to § 542. Since she did not employ procedures that framed a contest of the rights of the estate versus the rights of the Bank, the Trustee took the Funds subject to the perfected and unavoided security interests in existence on the Petition Date. *726 The Bank might have done more to protect its secured claim and avoid costly litigation with the Trustee. Nevertheless, the Bank did not lose its secured claim for purposes of §§ 502 and 506 simply by allowing the Debtor to turnover the Funds to the Trustee postpetition. Since the bankruptcy court ruled incorrectly that the Bank lost its secured claim by the postpetition turnover to the Trustee of property of the Debtor's estate, the matter must be remanded to resolve the claims at issue in the Trustee's amended complaint and the Bank's counterclaim. V. CONCLUSION For the reasons set forth above, the Panel reverses the decision of the bankruptcy court granting the Trustee summary judgment and its finding that the funds held by the Chapter 7 Trustee are free and clear of the defendant's security interest and remands for further proceedings consistent with this decision. NOTES [1] The trustee's complaint had a fourth count which sought to avoid the underlying obligation under § 548; however, that count is not at issue in this appeal.

2013-10-30 06:35:54.735108+00

Dowd

619 S.W.2d 804 (1981) STATE of Missouri, Plaintiff-Respondent, v. Horise O'TOOLE, Defendant-Appellant. No. 41710. Missouri Court of Appeals, Eastern District, Division One. June 9, 1981. Motion for Rehearing and/or Transfer Denied July 10, 1981. Application to Transfer Denied September 8, 1981. *805 J. Justin Meehan, St. Louis, for defendant-appellant. John Ashcroft, Atty. Gen., Paul Robert Otto, Jan Bond, Asst. Attys. Gen., Jefferson City, George A. Peach, III, Circuit Atty., St. Louis, for plaintiff-respondent. Motion for Rehearing and/or Transfer to Supreme Court Denied July 10, 1981. DOWD, Judge. Defendant-appellant, Horise O'Toole, was charged with first degree (felony) murder and convicted by a jury of second degree murder for the killing of Vernice Weary. He was also charged and convicted of first degree robbery and two counts of kidnapping. Defendant was sentenced to a term of thirty years imprisonment for the murder conviction and ten years sentences for each of the other three convictions, with each of the ten year sentences to run concurrently with each other and with the thirty year sentence. *806 Vernice Weary had lived with her two teenage sons, Larry and Michael, in the first floor of a home located in the City of St. Louis. In the early morning hours of July 30, 1977, while all three members of the family were home, Larry and Michael were awakened by the sound of gunshots. Shortly thereafter, two men carrying guns entered the boys' bedroom. One of the men was Earl Wilkerson, who the boys had known for several months. Wilkerson had been in the home on prior occasions. The other man was wearing a nylon stocking over his face while in the home. This man later removed the stocking, however, and both Larry and Michael subsequently identified defendant as the man who accompanied Wilkerson on this morning. The men ordered Larry and Michael to get dressed. Wilkerson left the room briefly and returned with Vernice Weary's purse. Defendant told Michael to get all the money and the car keys from the purse. Michael gave him the $30.00 that was inside the purse, but the car keys were not there. Wilkerson again left the room and returned shortly thereafter with the keys. Michael was then told to unlock the door to a third bedroom where a television and stereo component were kept. Initially defendant told the boys to bring the television and stereo, but the men decided against doing so. They concluded that it would not look right taking those items outside at that time of the morning. The men then placed the boys in Vernice Weary's automobile and drove to Illinois. During the trip defendant threw some shells from a gun in his possession out the car window. Defendant also made sure to remove all personal identification in the boys' possession. The ride ended in East St. Louis, Illinois, where the defendant asked Wilkerson, "Do you want to do one of these with me?" Wilkerson then took Michael to a nearby railroad boxcar. Once inside, Wilkerson fired three shots, one of which struck Michael in the shoulder. Meanwhile, defendant made Larry run up a hill and lie down. Defendant fired five shots at Larry and the boy was wounded in the leg. The City of St. Louis police were subsequently notified and went to the Weary residence. The found Vernice Weary's body in a bedroom of the home. An autopsy revealed that Ms. Weary had been shot three times. Michael and Larry later identified a photograph of defendant as the man who accompanied Wilkerson. Defendant was eventually located in Tacoma, Washington and returned to St. Louis. While in custody defendant told police officers that he had shot the boy but not the lady. At trial defendant presented alibi testimony of his girlfriend that they had left St. Louis on July 28, 1977 and driven to Tacoma, Washington. Defendant's first contention in this appeal is a challenge to the sufficiency of the first count of the indictment upon which he was tried. Count I of the indictment read, in part, as follows: "That HORISE O'TOOLE also known as HORACE O'TOOLE, ACTING WITH EARL WILKERSON, at the City of St. Louis aforesaid, on the 30th day of July, 1977, did unlawfully, feloniously and willfully kill VERNICE WEARY, while the said HORISE O'TOOLE also known as HORACE O'TOOLE, acting with EARL WILKERSON, was engaged in the perpetration of a robbery, and did thereby shoot the said VERNICE WEARY, inflicting a mortal wound upon the said VERNICE WEARY, from which said mortal wound VERNICE WEARY, did die on July 30, 1977; contrary to Sections 565.002, 565.008, Revised Statutes of Missouri, in such case made and provided and against the peace and dignity of the State." Defendant argues that the indictment is fatally defective because it (1) erroneously contained the elements of first degree (felony) murder and an element of capital murder, (2) was duplicitous in that it purported to charge defendant with two separate crimes in one count and (3) referred to a non-existent statutory section. We note initially that defendant did not challenge the sufficiency of the indictment before or during trial, nor in his motion *807 for a new trial. However, an allegation that an information or indictment failed to charge a crime is jurisdictional and may be raised for the first time on appeal. State v. Tierney, 584 S.W.2d 618, 621 (Mo. App.1979); State v. Johnson, 548 S.W.2d 245, 248 (Mo.App.1977). The indictment did contain all the elements of first degree (felony) murder plus one element of capital murder—"willfully."[1] Defendant argues that because of the inclusion of "willfully" the indictment failed to adequately notify him whether he was charged with capital murder or first degree (felony) murder. The failure of an indictment or information to precisely track the statutory language does not necessarily render it insufficient. In determining the sufficiency of an indictment the test is whether or not it states the essential elements of the offense charged so that the defendant is adequately informed of the charge against him and the final disposition of the charge will constitute a bar to further prosecution for the same offense. State v. Downs, 593 S.W.2d 535, 540 (Mo. 1980). Count I of the indictment charged defendant with (1) the unlawful killing (2) of a human being (3) committed in the perpetration (4) of a robbery. Thus, Count I of the indictment clearly stated the elements of first degree (felony) murder. The inclusion of "willfully" did not render the indictment insufficient. A charge of capital murder would require allegations of acting knowingly, premeditatedly and deliberately. We hold that the indictment adequately informed defendant that he was charged with first degree (felony) murder and constituted a bar to further prosecution for that offense. Furthermore, there was no demonstration that defendant was prejudiced by the use of the language complained of. Rule 24.11 (1977).[2] Defendant argues that the inclusion of "willfully" in Count I rendered the indictment void for duplicity. We have already determined that the indictment sufficiently alleged the crime of first degree (felony) murder. The indictment clearly did not charge two or more distinct offenses in Count I and defendant's duplicity argument is without merit. Defendant also argues that the indictment was defective because it listed a non-existent statute. Rule 24.01(a) (now Rule 23.01(b)) required an indictment to state the section of the Revised Statutes of Missouri proscribing the conduct charged and the section fixing the penalty or punishment. The indictment in this case referred to Section 565.002, which was a non-existent statute.[3] It also referred to Section 565.008, which was the correct punishment section. The indictment sufficiently informed defendant of the offense charged and constituted a bar to further prosecution for that offense. Defendant has not shown any prejudice from the listing of the non-existent statutory section. Under these circumstances the failure to list the correct statute proscribing the conduct charged does not invalidate the conviction. State v. Harris, 598 S.W.2d 200, 202 (Mo.App.1980); State v. Umfleet, 587 S.W.2d 612, 616-617 (Mo.App.1979); State v. Tierney, 584 S.W.2d 618, 622 (Mo.App.1979). Defendant next contends the trial court erred in submitting to the jury the offense of second degree murder on Count I of the indictment and in entering judgment *808 against defendant for that offense. Count I of the indictment charged defendant with first degree (felony) murder. Defendant now argues that the trial court was without jurisdiction to submit second degree murder because that offense is not a lesser included offense of first degree (felony) murder. A similar factual situation was presented in the companion case of State v. Wilkerson, 616 S.W.2d 829 (Mo. banc, 1981). In wilkerson, the submission to the jury of second degree murder was upheld, even though the information charged the defendant with first degree (felony) murder and did not contain a separate count on second degree murder. This determination was based on the provisions of former Section 556.220 RSMo 1969 (applicable in Wilkerson and in the instant case). Section 556.220 RSMo 1969 provides as follows: Upon indictment for any offense consisting of different degrees, as prescribed by this law, the jury may find the accused not guilty of the offense charged in the indictment, and may find him guilty of any degree of such offense inferior to that charged in the indictment, or of an attempt to commit such offense, or any degree thereof; and any person found guilty of murder in the second degree, or of any degree of manslaughter, shall be punished according to the verdict of the jury, although the evidence in the case shows him to be guilty of a higher degree of homicide. (Emphasis added). The Court in Wilkerson noted that the legislature has recognized a difference between an offense being a lesser offense of the offense charged because it is specifically denominated as such and an offense being a lesser offense because it is necessarily included in the offense charged.[4] In the present case the jury found defendant guilty of second degree murder under a charge of first degree (felony) murder. Pursuant to Wilkerson, the jury found defendant guilty of a degree of murder "inferior to that charged in the indictment."[5] Thus, the trial court did not err in submitting second degree murder to the jury under the charge of first degree (felony) murder or in entering judgment against defendant for the offense of second degree murder. The third contention raised by defendant is that the trial court erred in entering judgment on the first degree robbery charge on two reasons: (1) charging the defendant with felony murder and robbery violated the federal constitutional prohibition against double jeopardy and (2) the finding of guilt for second degree murder together with the implicit acquittal of felony murder necessarily acquitted defendant of the underlying felony of robbery. These issues have been raised for the first time on this appeal. Although these issues were not properly preserved for review we consider them below. Defendant was charged with the offenses of first degree (felony) murder and robbery. He was convicted of second degree murder and robbery. Defendant could not be convicted and punished for both felony murder and the underlying felony of robbery. State v. Morgan, 612 S.W.2d 1 (Mo. banc 1981); State v. Olds, 603 S.W.2d 501, 510 (Mo. banc 1980).[6] But in the present case defendant was not convicted of felony murder. Defendant's argument—that since a conviction for both first degree (felony) murder and the underlying felony cannot stand, the submission to the jury of both offenses subjected him to double jeopardy *809 in violation of federal constitutional guarantees—was rejected in State v. Thompson, 610 S.W.2d 629 (Mo. 1981). In Thompson the court concluded that submission to the jury of the charges of felony murder and robbery did not violate the constitutional protections guaranteed by the Fifth Amendment. Id. at 634. Since second degree murder (the homicide of which defendant was convicted) and robbery are not the same offense, State v. Charles, 612 S.W.2d 778, 781 (Mo. banc 1981), the Fifth Amendment does not require dismissal of the robbery conviction. Defendant also argues the verdict of guilty for second degree murder together with the implicit acquittal of felony murder meant the jury must have found defendant had unlawfully killed Vernice Weary but had not committed the robbery. We disagree. While the finding of second degree murder and robbery did render the verdict inconsistent—such inconsistency on separate counts of an indictment does not require reversal. In State v. Thompson, supra, the court stated: When a defendant is tried on a multiple count charge involving crimes with different elements, there is no requirement that the jury's verdict be logically consistent. The jury may acquit on one charge and convict on the other. State v. Amerson, 518 S.W.2d 29, 32-33 [4, 5] (Mo. 1975); State v. Voyles, 561 S.W.2d 697, 699 [3] (Mo.App. 1978). There is no reason to speculate on the reasoning which led to the verdict in this case. It is sufficient that the evidence have supported the finding of guilt which the jury made, without regard for its verdict of acquittal. 610 S.W.2d at 637.[7] In State v. McCall, 602 S.W.2d 702 (Mo. App. 1980), the defendant was charged, among other things, with felony murder and robbery. He was convicted of manslaughter and robbery. This court held that the inconsistency in the jury's verdict on the two counts was not fatal. Id. at 708. The jury's failure to find defendant guilty of felony murder, even though it found him responsible for the killing of Vernice Weary, does not preclude a finding of guilt on the underlying felony of robbery. An inconsistent verdict among the varied charges of a multiple count indictment does not require reversal, provided there is sufficient evidence to support the jury's finding of guilt. Viewing the evidence in the light most favorable to the state, there was sufficient substantial evidence from which the jury could have found defendant guilty of second degree murder and first degree robbery. Accordingly, the trial court did not err in entering judgment against defendant on the first degree robbery charge. Defendant's final contention is that the trial court erred in overruling his motion to suppress and in permitting two police officers to testify over objection concerning certain statements made by defendant while in custody because (1) defendant was not informed of his constitutional rights prior to making the statement (2) the confession was made involuntarily and (3) the trial court failed to make a finding that the state met its burden of establishing by a preponderance of the evidence that the confession was voluntarily made. The only witness who testified at the hearing on the motion to suppress was police officer Joseph Burgoon. He indicated that when defendant was returned to St. Louis on October 13, 1977, he was given Miranda warnings and declined to make a statement. Approximately one month later Burgoon received word that defendant wanted to talk with him. Someone from *810 the City of St. Louis Jail called the homicide office from the City Jail. It was never established who made this call. After receiving the message Burgoon and his partner went to see defendant at the City Jail. Burgoon testified that he did not initiate the meeting and did not want to go over and talk to defendant. The officers met defendant in a room at the jail. Officer Burgoon testified that upon entering the room defendant said, "Off the record." Burgoon responded by asking, "What do you want to talk about?" Defendant then said he had shot the boy that night but not the lady, and that he wanted to talk to the Circuit Attorney's Office. Defendant indicated that he had heard that Wilkerson, his partner on the morning of July 30, 1977, was trying to blame defendant for the murder of Vernice Weary. Burgoon told defendant that he would see what he could do. Burgoon testified that this was the extent of their conversation. Burgoon said he never agreed to talk off the record and he did not question defendant at all. Miranda warnings were not given at any time during this meeting. Defendant first argues that his statement should be suppressed because the police officers failed to advise him of his Miranda rights as enunciated in Miranda v. Arizona, 384 U.S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694 (1966). In order for the procedural safeguards outlined in Miranda to apply an individual must be both in custody and interrogated. State v. Battles, 607 S.W.2d 723, 728 (Mo.App.1980); State v. Darris, 587 S.W.2d 89, 91 (Mo.App.1979). It is clear that defendant was in custody and the issue, therefore, is whether he was interrogated by the officers. As the Supreme Court noted in Miranda: Confessions remain a proper element in law enforcement. Any statement given freely and voluntarily without any compelling influences is, of course, admissible in evidence. The fundamental import of the privilege while an individual is in custody is not whether he is allowed to talk to the police without the benefit of warnings and counsel, but whether he can be interrogated.... Volunteered statements of any kind are not barred by the Fifth Amendment and their admissibility is not affected by our holding today. 384 U.S. at 478, 86 S.Ct. at 1630. In Rhode Island v. Innis, 446 U.S. 291, 100 S. Ct. 1682, 64 L. Ed. 2d 297 (1980) the Supreme Court reexamined the meaning of "interrogation" under Miranda. In defining "interrogation" the Court stated the following: We conclude that the Miranda safeguards come into play whenever a person in custody is subjected to either express questioning or its functional equivalent. That is to say, the term "interrogation" under Miranda refers not only to express questioning, but also to any words or actions on the part of the police (other than those normally attendant to arrest and custody) that the police should know are reasonably likely to elicit an incriminating response from the suspect. The latter portion of this definition focuses primarily upon the perceptions of the suspect, rather than the intent of the police. This focus reflects the fact that the Miranda safeguards were designed to vest a suspect in custody with an added measure of protection against coercive police practices, without regard to objective proof of the underlying intent of the police. A practice that the police should know is reasonably likely to evoke an incriminating response from a suspect thus amounts to interrogation. But, since the police surely cannot be held accountable for the unforeseeable results of their words or actions, the definition of interrogation can extend only to words or actions on the part of police officers that they should have known were reasonably likely to elicit an incriminating response. (Emphasis in original) 446 U.S. at 300-302, 100 S.Ct. at 1689. Our review of the record as a whole indicates that no interrogation under Innis occurred. The uncontradicted testimony showed that the police who heard the statement in issue did not initiate the meeting with defendant. As soon as the police entered the room defendant opened the conversation by stating "Off the record" and *811 the police officer responded with the general remark, "What do you want to talk about?" The incriminating statement was made immediately thereafter. Officer Burgoon's question was in response to defendant's initial statement and cannot be deemed the equivalent of express questioning within a custodial setting. Nor can we say that the officers should have known that immediately following their remark defendant would make an incriminating statement. The officers had not sought the meeting with defendant and could not know what he wanted to discuss. Defendant's statement was volunteered and not the product of interrogation. Thus, there was no violation of defendant's rights under Miranda. In addition, the record does not indicate that the police officers sought to deliberately elicit incriminating information from defendant in violation of his Sixth Amendment right to counsel. See Rhode Island v. Innis, 446 U.S. 291, 300, n. 4, 100 S. Ct. 1682, 1689, n. 4, 64 L. Ed. 2d 297 (1980); State v. Holt, 592 S.W.2d 759, 770 (Mo. banc 1980). Defendant also argues that his incriminating statement was not made voluntarily, and that the findings of the trial court were deficient because the trial court failed to find that the state established by a preponderance of the evidence that the confession was voluntary. When a defendant has challenged the admissibility of a statement or confession made while he was in police custody, the burden is on the state to prove that the statement was voluntarily made. State v. Higgins, 592 S.W.2d 151, 158 (Mo. banc 1979). For a statement to be admissible, the state must prove by a preponderance of the evidence that it was voluntary. State v. Hughes, 596 S.W.2d 723, 726 (Mo. banc 1980). In overruling defendant's motion to suppress, the trial court stated "the evidence to me indicates that there was no coercion regarding this alleged statement made by the Defendant and that the Defendant initiated the contact with the detective [Burgoon] ... and therefore said statement was a voluntary act on the part of the Defendant and the statement should not be suppressed." Implicit in these findings, along with the trial court's admission of the statement in evidence, was a finding that the state established by a preponderance of the evidence that the statement was voluntary. There was no error in the trial court's findings regarding this statement. See State v. Royal, 610 S.W.2d 946, 948-949 (Mo. banc 1981). It is also apparent from a review of the record that the finding of a voluntary statement is supported by substantial evidence. There is no evidence of mental or physical coercion, nor that defendant's statement was extracted by promises or by offers of leniency. Defendant's statement was not compelled within the meaning of the Fifth Amendment to the United States Constitution. The trial court's denial of the motion to suppress and admission of the statement in evidence were not error. Judgment affirmed. STEPHAN, P. J., and STEWART, J., concur. NOTES [1] Section 565.001, RSMo Supp.1977 defined capital murder as follows: "Any person who unlawfully, willfully, knowingly, deliberately, and with premeditation kills or causes the killing of another human being is guilty of the offense of capital murder." Section 565.003, RSMo Supp.1977 defined first degree (felony) murder as follows: "Any person who unlawfully kills another human being without a premeditated intent to cause the death of a particular individual is guilty of the offense of first degree murder if the killing was committed in the perpetration of or in the attempt to perpetrate arson, rape, robbery, burglary, or kidnapping." [2] Rule 24.11, as revised, is now Rule 23.11. [3] The correct statutory section was 565.003. There was no statutory section numbered 565.002 in the Missouri Revised Statutes. [4] See Section 556.230 RSMo 1969. [5] The court in Wilkerson also noted that if the case had arisen after January 1, 1979, it would be governed by Section 556.046 RSMo 1978. The court noted that this statutory provision is a legislative determination that an offense can be a lesser offense of another offense so that a charge of the greater will support a conviction of the lesser, even though the lesser offense is not necessarily included in the greater. [6] The prohibition against punishment for both felony murder and the underlying felony is not premised upon the double jeopardy clause, but rather upon legislative control of multiple punishment. State v. Thompson, 610 S.W.2d 629, 634 (Mo. 1981). [7] In Thompson, the defendant was charged with felony murder, armed robbery and armed criminal action. He was found not guilty of murder and guilty of robbery and armed criminal action. He argued that the verdict was inconsistent and improper because his only defense was alibi and by being found not guilty of murder the jury must have accepted his alibi and could not have found him guilty of other offenses occurring at the same time and place. The court in Thompson upheld the robbery conviction, even though the jury's verdict was not logically consistent.

2013-10-30 06:35:54.770128+00

Doyle

619 S.W.2d 293 (1981) Charles Davis BEAGO, Sr., et al., Appellants, v. Patricia M. CERES, et al., Appellees. No. 17871. Court of Civil Appeals of Texas, Houston (1st Dist.). July 2, 1981. *294 Lawrence C. Hoff, Jr., Houston, for appellants. Groom, Miglicco, Gibson, Bussell & Stewart, Thea M. Fabio, Houston, for appellees. DOYLE, Justice. This appeal results from a judgment granting the appellee the right to partition certain real property, a right arising from a property settlement in a divorce action. These are the undisputed facts as stated in appellees' brief concerning the subject property: Appellees, Plaintiffs below, are PATRICIA M. CERES (formerly Mrs. Charles Davis Beago, Sr.), her daughters, HELEN CHRISTINE (formerly Helen Christine Beago) and CYNTHIA DEAN SIMPSON (formerly Cynthia Dean Beago). Appellants, Defendants below, are CHARLES DAVIS BEAGO, SR. and CHARLES DAVIS BEAGO, JR. CHARLES DAVIS BEAGO, SR. answered and defended the lawsuit. CHARLES DAVIS BEAGO, JR. defaulted at trial. The subject property was acquired during the marriage of Patricia M. Ceres and Charles Beago, Sr., the principal parties, and was held jointly by them. On October 14, 1957, the principal parties were divorced. The decree of divorce incorporated into it a separation agreement which provided, in pertinent part: "PATRICIA BEAGO and CHARLES DAVIS BEAGO are to have title to their home at 1534 Wakefield St., Houston, Harris County, Texas, of the fair and reasonable value of $9,500.00. Mr. Beago to assume the outstanding balance and make payments of $70.00 a month. Mr. Beago is to maintain said premises and it will be rented with the proceeds to go to Mr. Beago. In the event of sale, the proceeds are to be split one third to Mr. Beago, one third to Mrs. Beago and one third to the children of said marriage." Since the divorce, the house has been managed and rented by Mr. Beago, Sr. The monetary benefits derived from the rental were retained by Mr. Beago, Sr. alone. The mortgage was paid off in the late 1960's or early 1970's and the children have long passed the age of majority. Mr. Beago alone has claimed the depreciation on the house on his tax return. Appellee testified that the parties intended to sell the house when the children reached majority age, but, when requested by Appellees, Appellant refused to sell the property. Consequently, this suit for partition by sale was filed. Trial was before a jury. The sole issue presented to the jury for determination was the reasonableness of the time span of Charles Beago's possession of the property following the divorce. The jury's answer to the one special issue submitted was that a reasonable time had passed for appellant to possess and arrange for a sale of the subject property. Appellants filed a motion for new trial which was overruled. On appeal appellants present two points of error and appellee brings one counterpoint. Appellants' two points of error, which we shall discuss jointly, complain of the insufficiency of the evidence to support the submission by the court and the finding by the jury "that a reasonable time for the defendant to possess and arrange for a sale of the subject property has passed." It is uncontroverted that appellant and appellee were joint owners of the subject property. It is the statutory law of Texas that the right of a joint owner to partition property is absolute. Tex.Rev.Civ. Stat.Ann. art. 6082; Spires v. Hoover, 466 S.W.2d 344 (Tex.Civ.App. El Paso 1971, writ ref'd n.r.e.). This proposition of law is not disputed by either party. Appellant argues that although the right of a joint owner to partition is absolute, this right can be waived or contracted away. He contends that appellee contracted away her right to partition by that portion of the separation agreement quoted in *295 the facts set out above. We have reviewed the record and find no evidence that appellee contracted away her right to partition. On the contrary there is evidence that appellee and appellant discussed delaying the sale of the home because "it would be of more value when the kids went to college, to sell it then." The record shows that no partition suit was filed until two of the children were in college. It is a well established legal principle that after a determination that property is not susceptible to partition in kind, there must be a partition by sale. Tex.R.Civ.P. 770. The house involved in the case before us is not susceptible. Although the absolute right to partition by the joint owners is statutory, the courts will not interfere with contracts between the joint owners not to partition. Here we have no written agreement by appellee to waive partition, nor can such agreement be implied since there is no evidence that a partition of the property would destroy the estate as appellant contends. Warner v. Winn, 191 S.W.2d 747 (Tex.Civ. App. San Antonio 1946, writ ref'd n.r.e.). Appellant also contends that the duration of the separation agreement is perpetual. He states that the date when the jointly held property would be sold was not specifically expressed. Appellant points out that since the length of time was not specified, this contract was permanent and cites Foster v. Wright, 217 S.W. 1090 (Tex. Civ.App. Fort Worth 1919, no writ) as supporting this contention. The Foster case can be distinguished from the case at bar. It held that a contract which is not limited in duration by its express terms or its intrinsic nature will be permanent. The separation agreement in this case contemplates a sale of property and provides for distribution of proceeds in such event. The subject contract by its intrinsic nature clearly shows that it was of limited duration. Where the duration of a contract is not expressly prescribed, a reasonable time will be inferred. Dauray v. Gaylord, 402 S.W.2d 948 (Tex.Civ.App. Dallas 1966, writ ref'd n.r.e.); Houston County v. Landauer & Associates, 424 S.W.2d 458 (Tex.Civ.App. Tyler 1968, writ ref'd n.r.e.). Where a contract does not fix a time for performance, what constitutes a reasonable time will depend on the circumstances of each case. In the case before us appellee attempted to partition the property after all the children were grown and 23 years after the separation agreement was incorporated into the divorce decree. The evidence adduced was sufficient to sustain the jury's findings that a reasonable time had passed. Appellant's points of error are overruled. Appellee, in her counterpoint, argues that appellant has taken this appeal for reasons of delay and urges this court to assess a penalty pursuant to Tex.R.Civ.P. 435 and 438. Rule 438 gives the this court the authority to make such an assessment based on a finding that the appeal is groundless, frivolous and for delay, only, and results in injury to appellee. Blume v. Saucier, 507 S.W.2d 827 (Tex.Civ.App. Houston [14th Dist.] 1974, writ ref'd n.r.e.). Before the imposition of a penalty, the record must clearly show that at the time the appeal was filed, the appellant had no reasonable ground to believe the judgment would be reversed. Select Insurance Co. v. Patton, 506 S.W.2d 677 (Tex.Civ.App. Amarillo 1974, writ ref'd n.r.e.). Appellee testified without contradiction that she and appellant orally agreed to later sell the house to help the children with their education. Although the mortgage balance and community judgments had long been paid, appellant continued to collect the rentals on the house and enjoy a tax savings through depreciation. Except for maintenance, taxes and insurance, all the income was clear and used exclusively by appellant. Appellant stands to gain financially by delaying a final court determination on his appeal. From the entire record before us and based upon the evidence, applicable law and points raised in appellant's brief, we find that appellant had no reasonable expectation that the trial court judgment would be reversed at the time he perfected his appeal *296 and that such appeal was groundless, frivolous and brought only for delay and caused injury to appellee. Appellee's counterpoint is sustained. This court is authorized to require the appellant to pay 10% on the amount in dispute as damages, plus interest and costs of suit, when there has been a finding that an appeal or writ of error has been taken for delay and there was no sufficient cause for taking such appeal. Rule 438, T.R.C.P. There is testimony in the record that the value of the house at the time of trial was at least $40,000. Under the property settlement agreement, appellee would be entitled to one third of the net proceeds from the sale ordered by the partition judgment. The judgment of the trial court is affirmed with penalty assessed against appellant in the sum of $1,000. All costs herein incurred are assessed against appellant. EVANS and WARREN, JJ., also sitting.

2013-10-30 06:35:54.830311+00

Per Curiam

619 S.W.2d 628 (1981) Floyd D. WILLIAMS, Petitioner, v. STATE of Arkansas, Respondent. No. CR 76-93. Supreme Court of Arkansas. July 6, 1981. Floyd D. Williams, pro se. Steve Clark, Atty. Gen., Little Rock, for respondent. PER CURIAM. Petitioner was convicted by a jury of capital felony murder and sentenced to life imprisonment without parole. We affirmed, Williams v. State, 260 Ark. 457, 541 S.W.2d 300 (1976). In 1976, petitioner filed a petition for postconviction relief pursuant to Arkansas Criminal Procedure Rule 37 which was denied. He was allowed to file a second Rule 37 petition in 1979 because his original petition presented only conclusory allegations. This petition was also denied. Petitioner now seeks a transcript at public expense. The motion for transcript is denied. Since a motion for transcript is a petition for postconviction relief, petitioner's motion must be considered as his third attempt to obtain relief pursuant to Rule 37. Criminal Procedure Rule 37.2(b) provides: "All grounds for relief available to a prisoner under this rule must be raised in *629 his original or amended petition. Any ground not so raised or any ground finally adjudicated or intelligently and understandingly waived in the proceedings which resulted in the conviction or sentence or in any other proceedings that the prisoner may have taken to secure relief from his conviction or sentence may not be the basis for a subsequent petition." In the past, in cases where allegations of the original petition were conclusory, subsequent Rule 37 petitions have been allowed and decided on their merits. When an original petition presented grounds for relief with supporting facts, however, any subsequent petition was dismissed in accordance with Criminal Procedure Rule 37.2(b). Since this practice may have resulted in inconsistency in the treatment of subsequent petitions, this Court will no longer consider any subsequent petitions unless the original petition was specifically denied without prejudice. (See per curiam this date.) In the case at bar, petitioner has had ample opportunity to pursue his postconviction remedies under Rule 37 and this Court will not consider a third petition. Petition dismissed. ADKISSON, C. J., not participating.

2023-08-23 14:17:09.142196+00

Reynolds

REYNOLDS, Judge. Mrs. Nancy Bishop, appellant (plaintiff below), was awarded $1,801 damages in an action instituted against adjoining property owners, William and Patricia Rueff. This is an appeal and cross-appeal from the judgment. The Rueffs had constructed a backyard patio and enclosed it with a 7-foot high “wooden slab” fence. One section of the fence was erected upon the parties’ common boundary which was in near proximity to the side of the Bishop home. As a result of this improvement, appellant alleged damages resulting in changes from the water-flow across her property, as well as from the interference with her use and enjoyment of the property, and, additionally, she had sought injunctive relief to bring the fence into compliance with cited restrictive covenant. A Mr. George Imorde initially owned a sizeable tract of property, and from a portion of the tract he established four lots, one of which he sold to Mrs. Bishop in June of 1957, and her deed contained the following restriction: As a further consideration for this conveyance, it is hereby agreed that the property herein conveyed shall be subject to the following restrictions: No. 4 — No solid board fence shall be erected on the property. Fencing, if any, shall be of rail, picket or shrub. Fences, other than shrub, shall not exceed four feet in height. It is further agreed that the restrictions hereinabove set out shall apply to and affect all the remaining property of the parties of the first part as was conveyed to George H. Imorde by deed of record in Deed Book 2672, Page 566, in the aforesaid Clerk’s office. *720Subsequent to this transaction, and before June 17, 1959, three additional lots were sold by Mr. Imorde, and with only one of those deeds (Lot 251 sold on July 3,1957) containing notice of these restrictions. On March 29, 1962, Mr. Imorde disposed of a larger tract constituting the remainder of this property to developers David H. Wilson and Bobby J. Welsh. A subdivision containing eleven lots, being known as Trough Springs, was then developed with separate restrictions, none of which mentioned, nor did the deeds refer to, or notice, the restrictions contained in Mrs. Bishop’s deed. On June 1, 1973, appellees became owners of a Trough Springs Subdivision lot which abutted the Bishop property. Appellees were unaware of the restrictions until their backyard construction was substantially complete. This area had been graded, as well as elevated, which allowed water to flow/stand upon appellant’s property. In its instructions to the jury, the court ruled that the restrictions serving as the basis for appellant’s claim for injunctive relief were inapplicable. The court reasoned that in the absence of notice in the direct chain of title, appellees were not charged with duty of notice. By the instructions, the jury was permitted to find a maximum of $2,200 for future cost of remedy, and a maximum of $450 for past costs of remedy if it determined that the appel-lees’ improvements caused/diverted drainage water to interfere with appellant’s right to the use and enjoyment of her property. Additionally, and in the event the jury determined that the fence constituted a nuisance in that it interfered with appellant’s enjoyment and comfort of her property, the jury was instructed to fairly and reasonably compensate her for the resulting discomfort, not to exceed $10,000. The jury awarded damages in the sum of $901 for the interference with appellant’s right to the use and enjoyment of her property as a result of the diverted drainage water; awarded her $100 for damages sustained by trespass in the construction of the fence; and $800 for the discomfort suffered by her as provided under an instruction on “nuisance”. After the close of the case, the parties filed objections to the court’s instructions. The record contains no objections made prior to this time. Appellant argues that the deed restrictions ran with the land and were therefore binding on any subsequent purchasers of remaining portions of the original tract, and that the court’s instructions were contrary to law and erroneous. On cross-appeal it is asserted that the court erred in not directing a verdict in their favor at the close of all evidence regarding the claims for water damage and nuisance. Generally, the grantee is charged with notice of an encumbrance upon property created by an instrument which is of record, notwithstanding the fact that it may exist only collaterally in the chain of title. Harp v. Parker, 278 Ky. 78, 128 S.W.2d 211 (1939). The trial court determined that the restrictive covenant from the Bishop deed had no application to the lot subsequently acquired by appellees. The criteria for determining whether a covenant runs with the land or is merely personal between the grantor and the grantee include the intent of the parties, whether the covenant must affect or concern the land with which it runs, and whether privity of estate exists between the party claiming the benefit and the party who rests under the burden. 21 C.J.S. Covenants § 54. While the Bishops’ deed was not in appellees’ chain of title, we are aware of no rule that a restrictive covenant of this nature must meet such requirement. We believe that appellees were on constructive notice as to the restriction limiting fences, and there is some evidence of actual notice. The “chain of title” argument seems to have been disposed of by Harp v. Parker, supra. We believe the governing principle involved is stated in McLean v. Thurman, Ky., 273 S.W.2d 825, 829 (1954). Where the owners of two or more lots situated near one another convey one of the lots with express restrictions applying thereto in favor of the land retained by the grantor, the *721servitude becomes mutual, and during the period of restraint the owner of the lots retained may do nothing that is forbidden to the owner of the lot sold. The restriction is enforceable against the grantor, or subsequent purchaser, with notice, actual or constructive. Also, see Anderson v. Henslee, 226 Ky. 465, 11 S.W.2d 154 (1928). The deed of conveyance between Imorde and appellant contains words indicating that the parties intended for the restrictive covenants to run with Imorde’s remaining lands and thus be binding on subsequent purchasers. After the Bishop sale, Imorde sold three additional residential lots. One of the deeds contained the restriction. We hold that the trial court erred by denying injunctive relief. Regarding the argument on cross-appeal that a verdict should have been directed for appellees at the close of evidence on the claim for water damage and nuisance, we find ample evidence to support a jury finding that appellees’ acts created or substantially contributed to the conditions adversely affecting appellant’s property. Appel-lees were not entitled to a directed verdict. The balance of the appeal/cross-appeal alleged error for various reasons in the court’s instructions to the jury. At the conclusion of evidence, the court conferred with counsel concerning instructions to be given. Only the counsel for appellant tendered instructions, and counsel for neither party filed objections before the court instructed the jury. Even though the parties were permitted to file objections to the instructions after the close of the case, only those errors properly preserved under CR 51 § 3 may be reviewed on appeal. Kentucky Border Coal Company, Inc. v. Mullins, Ky., 504 S.W.2d 696 (1974). Therefore, we do not undertake to review the instruction errors alleged on cross-appeal and address only the positions presented in instructions offered by appellant. In the court’s discussion with counsel regarding the instructions, and in light of the court’s holding that the deed restrictions did not apply, it was agreed that the improvements upon appellee’s land were permanent in nature. Appellant argues that the second instruction regarding interference with appellant’s right to the use and enjoyment of her property, as a result of the diverted drainage water, should have utilized, as a measure of damages, the damage to its use, or diminution in market value, during the continuance of the nuisance or injury up to the time of trial. Temporary damages were defined in Texaco, Inc. v. Melton, Ky., 463 S.W.2d 301 (1971), to be that which does not prevent the damaged property from being substantially restored to its previous condition at a reasonable cost. The record establishes, as was ably recognized by the trial court, that temporary damages resulted from an improvement of a permanent nature. Although admittedly an elusive concept, the customary measure of damages or injuries of a temporary character is an amount which will reasonably compensate the injured parties for the diminution in the value of the use and occupancy of the property. City of Danville v. Smallwood, Ky., 347 S.W.2d 516 (1961); Price v. Dickson, Ky., 317 S.W.2d 156 (1958). The court properly instructed the jury that the proper measure of damages was the cost to remedy the conditions interfering with appellant’s use and enjoyment of her property as a result of the diverted drainage water. The record is without competent evidence to support any measure of damages based upon diminution in market value of the property as a result of the drainage. The court’s third instruction provided for damages sustained by trespass not to exceed the sum of $900. Counsel for appellant conceded that the facts supported only nominal damages for trespass and is precluded from arguing on appeal that any limitation was erroneous. Finally, appellant contends that the record did not support a $10,000 limit in the instructions on the nuisance award. However, an examination of the complaint and amended complaint reflects a demand for *722general damages in the amount of only $10,000. The instruction was not in error. The judgment of the trial court is reversed in part, and appellant is entitled to the enforcement of the restrictive covenant which provides: No solid board fence shall be erected on the property. Fencing, if any, shall be of rail, picket or shrub. Fences, other than shrub, shall not exceed four feet in height. The judgment of the trial court, in all other respects, is affirmed. HOWARD, J., concurs.

2023-08-23 14:17:09.146607+00

Howerton

HOWERTON, Judge, concurring. I would like to affirm Judge Eckert in all respects, but I must concur in the result reached by this Court. Perhaps our Supreme Court will see fit to bring the law regarding reciprocal negative easements and/or covenants running with the land into the late Twentieth Century. This ease disturbs me, because we are giving effect to land restrictions which are not within a chain of title, nor are they contained in an instrument which should necessarily be checked to insure a clear title. Three Kentucky cases which have dealt with the problem and which have helped establish the law are Anderson v. Henslee, 226 Ky. 465, 11 S.W.2d 154 (1928); Harp v. Parker, 278 Ky. 78, 128 S.W.2d 211 (1939); and McLean v. Thurman, Ky., 273 S.W.2d 825 (1954). Each of the cases, if limited to its facts, could be distinguished from the case at bar, but the language of the opinions expresses the law in such a way that such restrictions are enforceable, if reasonable. Constructive notice was considered to be given, because the restrictions were recorded in a deed from a common grantor, although the deed was outside the chain of title of the party to be bound by the restrictions. In Anderson, supra, the deed to Henslee contained no restriction against erecting an apartment building, but the deed to Hen-slee ⅛ grantor did make that conveyance “subject to existing restrictions against the land conveyed.” Anderson, 226 Ky., at 468, 11 S.W.2d 154. There were only a few deeds to be checked from the common grantor, and the phrase would have alerted Henslee to investigate what restrictions the deed referred to. Harp, supra, is clearly distinguishable. The deed containing the restrictions was listed as an exception or off-conveyance in the source of title in Harp’s grantor’s deed. It was necessary to check the deed with the restrictions in order to know the description of the land that had been conveyed from the common grantor to determine what land remained to be conveyed by the new deed. There was evidence of actual notice of the restrictions in McLean, supra, although the source of the information was an improperly-recorded contract. The contract was in the chain of title. The case was not decided on that point, however. It was decided on the basis of the constructive notice afforded by the restrictions contained in a collateral deed outside the chain of title. The McLean court concluded that the “chain of title” argument was settled in Harp, supra. McLean, supra, at 829. Generally, the law is that reciprocal negative easements, which are enforceable against a grantor, are also enforceable against a subsequent purchaser of the common grantor’s restricted remaining property, if the purchaser has notice, actual or constructive. I find no fault with that general principle, but the problem comes in what constitutes constructive notice of such off-shoot restrictions. In attempting to “settle” the chain of title argument in Harp, the court adopted a passage from 2 Tiffany on Real Property, (2d Ed.) p. 2188. The passage concludes: And if, in conveying lot A the grantor enters into a restrictive agreement as to the improvement of lot B, retained by him, a subsequent purchaser of lot B would ordinarily be charged with notice of the agreement, by reason of its record as a part of the conveyance of lot A. Harp v. Parker, 278 Ky. 78, at 82, 128 S.W.2d 211. *723Lot A is a conveyance from a common grantor with lot B, but the deed to lot A is outside the chain of title for lot B. The restrictive agreement is not in any conveyance to the common grantor. It appears to me that the question of what is reasonable should not only apply to the nature of the restriction, but also to the manner of recording and what should constitute constructive notice. None of the three cited cases reach unreasonable results on the basis of their facts. However, to blindly apply Tiffany’s principle in today’s world is absurd. We are no longer dealing with a few conveyances or the examples of “blackacre” and “whiteacre.” Today, we may find a subdivision of 1,000 acres divided into 2,000 lots. If the owner of the subdivision agreed with the buyer of the twenty-fifth lot to have a reciprocal negative easement against fences on the remainder of his land, is every lot sold thereafter to be bound solely from the restriction written in the twenty-fifth deed? If so, it means that the buyer of lot number 2,000 would have to examine all 1,999 preceding deeds. Buyers and lenders already have legitimate complaints regarding costs of title examinations, but we have heard nothing compared to what we will hear, if such useless and unreasonable burdens are mandated. It would be far more reasonable to require the buyer of lot A or 25 to require the grantor to record a separate instrument putting the restrictions squarely on the common grantor and in all chains of title from him. If the buyer of lot A or 25 desires to have the restrictions run with the land, he could require that the necessary instrument be prepared and recorded. There will be times when a proper title examination will reveal restrictions which are nevertheless outside the chain of title. Examples of these situations would be similar to Anderson, Harp, and McLean, supra. Actual knowledge may come from any source, but constructive notice should not be applied to any situation where reciprocal negative restrictions are recorded only outside the chain of title.

2013-10-30 06:35:55.154471+00

Shadur

901 F. Supp. 1387 (1995) Edith M. VIERO, etc., Plaintiff, v. Diane BUFANO, et al., Defendants. No. 95 C 2281. United States District Court, N.D. Illinois, Eastern Division. October 13, 1995. As Corrected December 28, 1995. *1388 *1389 *1390 *1391 Leo T. McGonigal, Chicago, IL, for Plaintiff. Sandra Castillo, Assistant Attorney General, State of Ill., for Defendants. MEMORANDUM OPINION AND ORDER SHADUR, Senior District Judge. Edith Viero ("Viero"), as Special Administrator of the Estate of her son John Rosario, Jr. ("Rosario"), has sued Illinois Juvenile Court Probation Officer Diane Bufano ("Bufano") and four employees of the Illinois Department of Corrections ("Department") — Marcia Little ("Little"), Victor Brooks ("Brooks"), Mr. Carter ("Carter") and Mr. Porter ("Porter") — under 42 U.S.C. § 1983 ("Section 1983"). Viero's Complaint alleges that Rosario's constitutional rights were violated while he was an inmate at the St. Charles Illinois Youth Correctional Facility ("St. Charles"), resulting in his death by suicide. Bufano and Little have moved for dismissal of the Complaint under Fed.R.Civ.P. ("Rule") 12(b)(6),[1] claiming: 1. Viero states no claim under Section 1983 because she has not adequately alleged that Bufano and Little violated the Eighth Amendment.[2] 2. Bufano and Little are entitled to qualified immunity. 3. This action should be dismissed as an official capacity suit. 4. Bufano is entitled to absolute immunity under the doctrine of "quasi-judicial" immunity. 5. Viero has failed to state a claim under Illinois state law. For the reasons stated in this memorandum opinion and order, this Court denies Bufano and Little's motion in its entirety, and Viero is granted leave to amend the Complaint to clarify the fact that she is suing defendants in their individual rather than their official capacities. Facts On December 17, 1992 14-year-old Rosario was confined for mental treatment and evaluation at Hartgrove Hospital ("Hartgrove") in Chicago, Illinois, initially diagnosed as suffering from major depression. Hartgrove's records reflect that Rosario "expressed suicidal ideation during psychological and social work evaluations" there and also that he and his grandmother "related an incident in which he planned to take his own life by stabbing himself."[3] Sometime in January *1392 1993 Rosario was discharged from Hartgrove with a "guarded" prognosis, a prescription for 10 milligrams of ritalin three times a day and a diagnosis of attention deficit hyperactivity disorder, severe psychosocial stresses and poor adaptive functioning. Upon his discharge from Hartgrove, Rosario was placed in Department's custody and was taken to St. Charles. At the time of Rosario's intake Viero advised Little (an employee of Department located at St. Charles) of Rosario's mental history, medication needs and suicidal thoughts. Viero also told Bufano (Rosario's probation officer) of Rosario's mental history, diagnosis and condition and provided Bufano with his prescription medication. Despite those warnings both Bufano and Little acted with a "total indifference to [Rosario's] safety":[4] 1. "Bufano failed to take steps to assure [Rosario] received his medication, and to assure that [Rosario's] mental health history, diagnosis and suicidal ideation were adequately communicated to the Illinois Department of Corrections." 2. "Little failed to assure that [Rosario] received his medication, and to assure that he received adequate counseling and observation in view of his mental history and diagnosis." On March 2, 1993, while still in custody at St. Charles, Rosario committed suicide by hanging himself. That was a direct and proximate result of Bufano's and Little's failures. Section 1983 Claim Section 1983 actions require a two-tiered showing: (1) "the conduct complained of was committed by a person acting under color of state law" and (2) "this conduct deprived a person of rights, privileges, or immunities secured by the Constitution or laws of the United States" (Parratt v. Taylor, 451 U.S. 527, 535, 101 S. Ct. 1908, 1913, 68 L. Ed. 2d 420 (1981)). Here Bufano and Little do not take issue with the allegation that each was acting under color of state law. What they do challenge is Viero's ability to establish any constitutional violation. For that purpose it is well to take a brief look at just which constitutional provisions are at issue. Although Complaint ¶ 11 speaks of the Fourth and Fourteenth Amendments, both sides' memoranda emphasize Eighth Amendment jurisprudence. And to the extent that those constitutional provisions may arguably implicate different standards, this Court cannot sort matters out in the present posture of the case. It is of course conventional wisdom that the Fourth Amendment protects arrestees, that the Fourteenth Amendment as such protects pretrial detainees and that the Eighth Amendment protects convicted prisoners. But the Complaint does not cabin Rosario within one of those categories, so it does not answer the question of which Amendment to apply. Fortunately the Complaint's substantive allegations provide a way out of that dilemma. Because a pretrial detainee's due process rights are at least as great as a convicted prisoner's Eighth Amendment rights (Hall v. Ryan, 957 F.2d 402, 405 (7th Cir.1992)) and because Rosario was clearly one or the other, the question of Rosario's specific status — and a more specific determination of that status' accompanying rights — need not now be addressed if Viero's claim can meet the higher Eighth Amendment burden. Any "prison official's `deliberate indifference' to a substantial risk of serious harm to an inmate" (Farmer v. Brennan, ___ U.S. ___, ___, 114 S. Ct. 1970, 1974, 128 L. Ed. 2d 811 (1994)) — including his or her indifference to the inmate's "serious medical needs" (Estelle v. Gamble, 429 U.S. 97, 104, 97 S. Ct. 285, 291, 50 L. Ed. 2d 251 (1976)) or the substantial risk of the inmate's suicide[5]*1393 — violates the Eighth Amendment's prohibition of cruel and unusual punishment. To survive the present motion to dismiss, then, Viero must sufficiently allege (1) that Rosario presented a substantial risk of suicide or at least a serious medical need and (2) Bufano and Little were deliberately indifferent to that substantial risk or serious need. Suicide Risk As a special application of the already-stated Eighth Amendment principles, prison officials may not display deliberate indifference to a "strong likelihood" that an inmate will attempt suicide (Torraco, 923 F.2d at 235-36; Edwards v. Gilbert, 867 F.2d 1271, 1274-76 (11th Cir.1989)). As a measure of risk, State Bank of St. Charles v. Camic, 712 F.2d 1140, 1146 (7th Cir.1983) has contrasted "strong likelihood" with a "mere possibility." Deciding whether an inmate presents a substantial enough risk of suicide to qualify as a "strong likelihood" (rather than a "mere possibility" or some other lesser degree of risk) involves a case-by-case fact-specific determination (see Bell, 937 F.2d at 1343-44, citing cases and discussing facts that tend to establish an increased risk of suicide — such as prior psychological counseling, unusual behavior, prior suicide attempts, or expressions of suicidal tendencies). At this threshold pleading stage, however, the question is only whether it appears beyond doubt that Viero can prove no set of facts that would show Rosario presented a substantial risk of suicide. As already stated, Rosario was a 14-year-old with a history of severe psychological and psychosocial problems. Just a few months before his death he was confined for mental treatment and given a prescription for ritalin. And he had expressed his suicidal tendencies on at least two occasions. From those allegations it cannot be said that Viero will undoubtedly be unable to establish that Rosario presented a substantial suicide risk. That is enough to require denial of the Bufano-Little motion. Serious Medical Need Even if the Complaint had not sufficiently alleged the existence of a substantial suicide risk, it would still survive the current motion, for nearly two decades ago Estelle, 429 U.S. at 104, 97 S.Ct. at 291 established that prison officials violate the Eighth Amendment when they are deliberately indifferent to an inmate's "serious medical needs." Although Estelle originally used the phrase in the context of physical health needs, it has since been applied to mental health needs as well (Wellman v. Faulkner, 715 F.2d 269, 272 (7th Cir.1983)). To qualify for Eighth Amendment protection, a physical or mental health need must meet a threshold level of severity. For a brief discussion of the line between serious and non-serious medical needs, see this Court's opinion in Leslie v. Doyle, 868 F. Supp. 1039, 1045-46 (N.D.Ill.1994). As Partee v. Lane, 528 F. Supp. 1254, 1260 (N.D.Ill.1991) has put it: That a medical need is "serious," for the purpose of a section 1983 action, can be established either by showing that a physician has diagnosed it as mandating treatment or by demonstrating that the condition was so obvious that even a lay person would recognize the necessity of a doctor's attention. In this instance the Complaint alleges that Rosario was diagnosed as suffering from several psychological disorders, he had recently been released from confinement for mental treatment and he was given a prescription for the drug ritalin. While the determination whether a physical or mental health need is serious may often involve some hair-splitting, Viero's allegations certainly suffice to survive a motion to dismiss. Deliberate Indifference That leads to the second half of the Estelle-Farmer formulation: the need to allege sufficiently that Bufano and Little displayed deliberate indifference to Rosario's *1394 plight (Popham v. City of Talladega, 908 F.2d 1561, 1563-64 (11th Cir.1990) (per curiam)). Farmer, ___ U.S. at ___-___, 114 S.Ct. at 1978-80 defined that Eighth Amendment standard (dealt with there in the context of prison officials' duty to protect against inmate-on-inmate violence) to be the equivalent of the criminal law's recklessness concept. Thus deliberate indifference goes beyond mere negligence and requires a showing of conscious disregard of a known risk or condition. It contains both a subjective inquiry — did the official know[6] of the risk or condition (id. at ___, 114 S.Ct. at 1979)? — and an objective inquiry — did the official take reasonable steps in response (id. at ___- ___, 114 S.Ct. at 1982-83)? Thus to be held liable Bufano and Little must have known of Rosario's serious medical needs or substantial suicide risk (or both) and must have acted in conscious disregard of that need or risk (or both) by failing to take adequate measures in response.[7] Again the Complaint's allegations are sufficient to meet the Farmer standard of deliberate indifference. Viero alleges that she personally advised both Bufano and Little of Rosario's mental history and medication needs and also advised Little that Rosario had suicidal thoughts. That ascribes knowledge of Rosario's psychological problems and suicidal tendencies directly to Little and at least inferentially to Bufano.[8] Viero also alleges that Bufano and Little did not take adequate measures in response. Both failed to assure that Rosario received his medication, Bufano did not communicate mental health information to Department and Little did not see to it that Rosario received adequate counseling and observation. Those allegations — especially in light of the fact that on a Rule 12(b)(6) motion all reasonable inferences are to be drawn in Viero's favor — are enough to preserve the Section 1983 claim against dismissal.[9] Qualified Immunity Bufano and Little also seek dismissal on qualified immunity grounds. That defense turns on the "objective legal reasonableness" of their actions (Hall, 957 F.2d at 404). And actions are considered objectively unreasonable if the allegedly-violated right is "clearly established in a sufficiently particularized sense at the time of the actions at issue" (id.). In other words, "[t]he contours of the right must be sufficiently clear that a reasonable official would understand that what he is doing violates that right" (Anderson v. Creighton, 483 U.S. 635, 640, 107 S. Ct. 3034, 3039, 97 L. Ed. 2d 523 (1987)). Here the "actions at issue" occurred between January and March 1993, when the law was already clear (as the earlier discussion *1395 shows) that prison officials violate the Eighth Amendment when they are deliberately indifferent to a strong likelihood that an inmate will commit suicide or to an inmate's serious medical needs relating to physical or mental health. While Bufano and Little admit in their motion and accompanying memoranda that this general principle was clearly established they argue that — in the context of the specific factual situation facing them — its contours were not sufficiently particularized to put a reasonable person on notice that their actions amounted to a violation. But that position distorts the teaching of Anderson and its progeny. It is the essential equivalent of urging that the decided cases were white-horse cases while this is a black-horse case — a distinction without a difference. Here the Complaint sufficiently alleges (1) that Bufano and Little knew enough about Rosario's serious mental health needs and his substantial suicide risk to require them to respond and (2) that they nevertheless acted in conscious disregard of — in Eighth Amendment parlance, they were deliberately indifferent to — Rosario's serious medical needs and substantial suicide risk. That is enough to strip them of any putative qualified immunity because, as Hamilton v. Endell, 981 F.2d 1062, 1066 (9th Cir.1992) put it: A finding of deliberate indifference necessarily precludes a finding of qualified immunity; prison officials who deliberately ignore the serious medical needs of the inmates cannot claim that it was not apparent to a reasonable person that such actions violated the law. Bufano and Little are not entitled to qualified immunity at this stage of the litigation. Official Capacity Bufano and Little also ask for dismissal because the Complaint purportedly seeks damages against them in their official capacities, a claim barred by the Eleventh Amendment. In support they invoke the bright-line rule announced in Kolar v. County of Sangamon, 756 F.2d 564, 568-69 (7th Cir.1985) that where a plaintiff does not specify that state-actor defendants are being sued individually, it will be presumed that they are being sued in their official capacities. While that bright-line approach provides a useful means for weeding out claims that impermissibly seek to tap the state treasury, it is most often a trap for plaintiffs' counsel who really want to target individually named defendants but are unaware of the Kolar doctrine. After all, plaintiffs must perforce identify defendants as public officeholders to establish that they are state actors in order to bring Section 1983 into play at all. Thus Kolar, if applied blindly and rigorously,[10] may cause a Section 1983 complaint to carry its own inadvertent death warrant. This Court of course honors and applies Kolar, but in the present situation — where P.Mem. 5-6 says that this action (filed originally in the Circuit Court of Cook County under state, rather than federal, pleading rules) was intended as an individual action — the appropriate course is to let the Complaint stand on condition that Viero's counsel file an amendment to confirm that in writing. Bufano and Quasi-Judicial Immunity As quoted earlier, Complaint ¶ 11(a) alleges that Bufano "failed to take adequate steps to assure [Rosario] received his medication, and to assure that [Rosario's] mental health history, diagnosis and suicidal ideation were adequately communicated to the Illinois Department of Corrections." Juvenile Court probation officer Bufano claims that because she obtained information about Rosario in the course of performing a social investigation for purposes of a judicial dispositional hearing, she is entitled to absolute immunity because she was performing a function "intimately associated with the judicial phase of the criminal process." For that proposition *1396 she points to Spaulding v. Nielsen, 599 F.2d 728, 729 (5th Cir.1979) (per curiam). Although absolute immunity is generally not available to probation officers, our Court of Appeals (like the Fifth Circuit in Spaulding) recognizes a "quasi-judicial" immunity for "[n]on-judicial officials whose official duties have an integral relationship with the judicial process" (Henry v. Farmer City State Bank, 808 F.2d 1228, 1238 (7th Cir. 1986)). But the burden of establishing entitlement to absolute immunity rests on its proponent (Antoine v. Byers & Anderson, Inc., ___ U.S. ___, ___ 8 n. 4, 113 S. Ct. 2167, 2169 & n. 4, 124 L. Ed. 2d 391 (1993); Walrath v. United States, 35 F.3d 277, 281 (7th Cir.1994)), and Bufano does not come even close to meeting that burden. It is difficult to see how Bufano's failure to assure that Rosario received his medication and her failure adequately to communicate information as to Rosario's mental health has anything to do with the judicial process.[11] Merely because she was also preparing a report for use at a dispositional hearing, she is not shielded from the responsibility of conveying to Department the critical information that she had about Rosario's mental and physical health.[12] State Law Claim Bufano and Little also argue, citing Dezort v. Village of Hinsdale, 35 Ill. App. 3d 703, 711, 342 N.E.2d 468, 474 (2d Dist.1976), that to state a claim under Illinois law the Complaint must allege that Rosario was "incapable of exercising ordinary care for his own protection." Dezort imposes no such requirement.[13] Even apart from the fact that Illinois pleading rules do not apply in this federal court although Illinois substantive law provides the rules of decision (Hanna v. Plumer, 380 U.S. 460, 85 S. Ct. 1136, 14 L. Ed. 2d 8 (1965)), Bufano and Little are wrong under Illinois law as well. They also support their motion to dismiss by making a cryptic argument about contributory negligence as a bar to recovery. This Court need not address the validity of that contention, for by definition no such potential affirmative defense taints the validity of a complaint. Conclusion As stated at the outset of this opinion, the Bufano-Little motion to dismiss is denied on all grounds. Viero is granted leave to amend the Complaint on or before October 23, 1995 to confirm that this is an individual-capacity lawsuit. In the meantime (and understanding that such a nominal amendment, involving only the prayer for relief, is in the works), Bufano and Little are ordered to answer the existing Complaint on or before that same October 23 date. This action is set for a status hearing at 9 a.m. November 8, 1995. NOTES [1] Familiar Rule 12(b)(6) principles require this Court to accept as true the Complaint's well-pleaded factual allegations, together with all reasonable inferences in Viero's favor (Bowman v. City of Franklin, 980 F.2d 1104, 1107 (7th Cir. 1992)). Dismissal is appropriate only if it appears beyond doubt that Viero can prove no set of facts consistent with the Complaint's allegations that would entitle her to relief (Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S. Ct. 2229, 2232-33, 81 L. Ed. 2d 59 (1984)). Hence the ensuing Facts section credits Viero's allegations in their entirety. [2] As always, this opinion adheres to the conventional and convenient (though technically imprecise) practice of referring to the underlying Bill of Rights provision (which of course imposes limitations only on the federal government) rather than to the Fourteenth Amendment (which applies to state actors and has been construed to embody such Bill of Rights guaranties). [3] Although Hartgrove's records were neither included nor incorporated by reference in the Complaint, they were adverted to in Viero's response to the motion to dismiss. Although it is somewhat problematic to consider them at this stage (see Car Carriers, Inc. v. Ford Motor Co., 745 F.2d 1101, 1107 (7th Cir.1984)), Viero's absolute right to amend the Complaint under Rule 15(a) makes it eminently sensible to credit her assertions now rather than later (see also Early v. Bankers Life and Casualty Co., 959 F.2d 75, 79 (7th Cir.1992)). In any case, those records are not at all needed to support the Complaint's sufficiency. [4] Because only Bufano and Little have joined in the current motion to dismiss, this opinion does not address the specific claims made against Brooks, Carter and Porter. [5] Although the Supreme Court has not expressly recognized a prisoner's right to be protected from self-inflicted harm, several Courts of Appeals have extended the Supreme Court's Eighth Amendment analysis to prisoner suicide cases (see, e.g., Torraco v. Maloney, 923 F.2d 231, 235 (1st Cir.1991); Bell v. Stigers, 937 F.2d 1340, 1342-43 (8th Cir. 1991); and cases cited in each). [6] Farmer, id. at ___, 114 S.Ct. at 1981 (citation omitted) elaborated on the "knowledge" ingredient: Whether a prison official had the requisite knowledge of a substantial risk is a question of fact subject to demonstration in the usual ways, including inference from circumstantial evidence, and a factfinder may conclude that a prison official knew of a substantial risk from the very fact that the risk was obvious. [7] One recurring problem that has muddied the waters of prisoner suicide case law has been the tendency of courts to merge their analysis of the inmate's suicide risk or medical need with their consideration of the prison official's "deliberate indifference" (see, e.g., Bell, 937 F.2d at 1342-43). Those inquiries should be kept separate to the extent possible, for they involve fundamentally different methods of analysis and are designed to serve different purposes. [8] It will also be recalled that Hartgrove's records reflect that Rosario expressed his suicidal thoughts on at least a couple of occasions. P.Mem. 1 does not make it clear whether copies of those records accompanied Rosario to St. Charles. If they did, their relevance to the deliberate indifference issue is obvious. If not, a rational factfinder might view Bufano's and Little's failure to obtain them as further evidence of their deliberate indifference in light of what Viero had already told them. [9] Complaint ¶ 11 alleges that Bufano and Little acted "with a total indifference to [Rosario's] safety." That suffices in the federal courts' notice pleading regime. Although the Bufano-Little motion frequently takes issue with the Complaint's "failure to allege facts," that is simply wrong. Because that misconception is encountered all too often among practitioners, this Court has particularly welcomed the recent strong reminder from our Court of Appeals that under the Rules no plaintiff is required to plead facts rather than conclusions, so long as those conclusions provide defendant with at least minimal notice of the claim (Jackson v. Marion County, 66 F.3d 151 (7th Cir.1995)). [10] In other cases this Court has encountered defense motions based on Kolar even where the complaint's prayer for relief asks for punitive damages — a sure tipoff that the suit must be an individual-capacity and not an official-capacity action (City of Newport v. Fact Concerts, Inc., 453 U.S. 247, 101 S. Ct. 2748, 69 L. Ed. 2d 616 (1981)). Needless to say, such motions both deserve and get short shrift. [11] That contrasts sharply with the judicially-linked situation in Spaulding. [12] Although neither side has addressed this issue, Illinois law does itself appear to impose a duty on Bufano to compile information and communicate it to Department. 705 ILCS 405/6-1(2)(f) requires a Probation Department "[t]o maintain an adequate system of case records" and make such reports to "authorized persons," and id. 405/6-1(2)(g) requires such a department "[t]o perform such other services as may be appropriate to effectuate the purpose" of the Juvenile Court Act of 1987. [13] That quoted language did not refer to a jailer's duty of care for his or her prisoner, but had to do instead with the defense of contributory negligence by reason of voluntary intoxication, an issue that has nothing to do with the disposition of this motion. Earlier Dezort had defined the duty of care owed to a prisoner (including that stemming from a risk of suicide) without imposing any such pleading requirement.

2013-10-30 06:35:55.178151+00

Per Curiam

704 A.2d 1187 (1997) In re Howard D. MOORE, Respondent. A Member of the Bar of the District of Columbia Court of Appeals. No. 97-BG-612. District of Columbia Court of Appeals. Submitted October 1, 1997. Decided November 6, 1997. Before FARRELL, KING, and RUIZ, Associate Judges. PER CURIAM: The Board of Professional Responsibility ("the Board") has recommended that Howard D. Moore be disbarred. Bar Counsel has informed the court that it takes no exception to the Board's report and recommendation; respondent has filed neither an exception nor a brief. We adopt the Board's recommendation. Charges against respondent stem from his misappropriation of funds entrusted to him by a client, his repeated invasion of his client escrow account to pay general business and other expenses, and his failure to cooperate with the subsequent investigation by Bar Counsel. Moore was charged with violations of Rules 1.15, 5.3, 8.4(b), 8.4(c), 8.4(d) of the District of Columbia Rules of Professional Conduct, D.C. Bar R.App. A, as well as Rule XI § 2(b)(3) of the District of Columbia Bar Rules. After an evidentiary hearing, a hearing committee found that the evidence was sufficient to sustain all of the charges except for the one filed pursuant to Rule 8.4(b). Both the hearing committee and the Board have recommended dismissal of that charge. For the reasons stated in the report and recommendation of the Board dated April 22, 1997 (a copy of which is attached as an appendix to this opinion), we conclude that respondent violated D.C. Rules of Professional Conduct 1.15, 5.3, 8.4(c), and 8.4(d) and D.C. Bar R. XI § 2(b)(3), and that the misappropriation was not the result of mere negligence. We have held that "in virtually all cases of misappropriation, disbarment will be the only appropriate sanction unless it appears that the misconduct resulted from nothing more than simple negligence." In re Addams, 579 A.2d 190, 191 (D.C.1990) (en banc). Accordingly, it is hereby ORDERED that respondent, Howard D. Moore, shall be disbarred from the practice of law in the District of Columbia, effective thirty days from the date of this opinion. We call respondent's attention to D.C. Bar R. XI § 14(g), requiring the filing of an affidavit containing certain information, and to D.C. Bar R. XI § 16(c), setting forth the consequences of a failure to file the affidavit within the time prescribed by section 14(g). *1188 DISTRICT OF COLUMBIA COURT OF APPEALS BOARD ON PROFESSIONAL RESPONSIBILITY In the Matter of: HOWARD D. MOORE, Respondent. Bar Docket No. 419-95. REPORT AND RECOMMENDATION OF THE BOARD ON PROFESSIONAL RESPONSIBILITY Respondent was charged with a number of violations of the Rules of Professional Conduct, all arising from his handling of funds he received on behalf of a client in settlement of a personal injury action. Bar Counsel charged that Respondent was guilty of commingling and misappropriation, in violation of Rule 1.15, failure to supervise staff, in violation of Rule 5.3, illegal conduct that reflects adversely on a lawyer's honesty or fitness, in violation of Rule 8.4(b), fraudulent conduct, in violation of Rule 8.4(c), conduct seriously interfering with the administration of justice, in violation of rule 8.4(d), and failure to respond to a Board order, in violation of D.C.App. R. XI, § 2(b)(3). Because the Hearing Committee found, by clear and convincing evidence, that Respondent was guilty of misappropriation and that the misappropriation was not the result of mere negligence, it recommended that Respondent be disbarred. Neither Respondent nor Bar Counsel has excepted to the Hearing Committee's report. We agree with the reasoning and the recommendation of the Hearing Committee.[1] The facts that establish commingling and misappropriation were drawn by the Hearing Committee from numerous documents demonstrating the amount of money in Respondent's trust fund at different times relevant to this inquiry and demonstrating the amounts owed to third parties. The facts are set out in detail in the Hearing Committee report. Briefly, the facts are as follows: Respondent was retained in May, 1992, to represent D.C. Police Officer Carmichael Humble in connection with a personal injury claim. In that same month, Respondent executed an assignment and authorization form in favor of Dr. Franklin Garmon, a physician who had agreed to provide medical treatment to Officer Carmichael [Humble]. Officer Carmichael [Humble] obtained treatment from Dr. Garmon from May, 1992 through May, 1994. By June, 1994, Dr. Garmon had provided Respondent with invoices for medical services provided to Officer Humble in the amount of $16,043.85. On or about November 14, 1994, Respondent received an insurance carrier's check for $80,000 in full settlement of Officer Humble's personal injury claims. On November 30, 1994, Officer Humble executed the carrier's form release and endorsed the settlement check for deposit. On the same day, Respondent deposited the settlement check into his "trust account". Immediately prior to the deposit of the $80,000 settlement check, the balance in the trust account was $14,813.21. Included in the account were funds belonging to Respondent's mother-in-law, Mrs. Dorothy Thorne. Between November 30, 1994 and April 24, 1995, a number of checks, totaling $4,976.98, were written on the trust account to pay for Mrs. Thorne's care and for expenses related to her death. Tr. 96-98, 118-121, 123-124; Hearing Committee Appendix. During the period of time relevant to this inquiry, Respondent's wife managed the law office, including all bookkeeping functions for trust and commercial checking accounts. Mrs. Moore had signature authority over those accounts and it is her name that appears on many of the checks drawn on the trust account. Respondent acknowledged, however, that he supervised his wife's management of the trust account and authorized *1189 all banking transactions conducted by Mrs. Moore. Tr. 85. Respondent did not provide a written settlement sheet to Officer Humble, detailing proposed disbursements, until February 14, 1995. By that time, the funds in the trust account had dropped below $80,000. On January 19, 1995, Respondent caused a check to be written on the trust account, payable to himself, in the amount of $2,000.00. A notation on the check indicated "transfer". As a result of that check, the trust account balance dropped to $78,892.40.[2] Again, on January 27, 1995, Respondent caused a check written on the trust account to be presented for payment. Again, the check was payable to himself, in the amount of $1,000.00, and also bore the notation "transfer."[3] As a result of that check, the balance in the trust account dropped to $77,892.40. By the time Respondent provided Officer Humble with a settlement sheet, the balance in the trust account was $73, 125.20. According to the settlement sheet, Officer Humble was due $20,969. The settlement sheet also indicated that Respondent was due $26,600.00, but that he was reducing his fees by $3,500.00. BX 9. The District of Columbia government had agreed to reduce its lien for leave-related benefits by the same amount. According to the settlement sheet, therefore, Respondent was owed $23,100 out of the settlement proceeds, $23,102.85 were needed to pay outstanding medical expenses, including Dr. Garmon's bill, which, according to the settlement sheet, amounted to $20,337.85,[4] and $12,827.84 were needed to pay the D.C. government for non-medical expenses. Officer Humble approved the settlement figures. Respondent gave Officer Humble a check drawn on the trust account for $20,969. Shortly after that, Officer Humble testified, Respondent advised him that all of the other creditors had been paid. Tr. 22, 45. Respondent did not write a check to himself for the amount he was due from the settlement proceeds. Instead, Respondent simply wrote checks on the trust account. Some of the checks were made out to Respondent and apparently were deposited into Respondent's operating account. Tr. 133-34. Between November 30, 1994 and October 31, 1995, the total amount of the checks made out to Respondent was $46,220.00. Other checks were made out to various service providers, including health services, the funeral home, the Washington Post, and the Clerk of the D.C. Superior Court.[5] On February 16, 1995, after removing the $20,969.31 delivered to the client, the balance in the trust account was $52,155.89. The amount needed to pay the medical providers and the D.C. government, according to the settlement sheet, was $35,930.69. As of May 19, 1995, after numerous checks were written to Respondent and to other persons and entities, none of which had anything to do with Officer Humble, the balance in the trust account fell to $33,609.96. No *1190 other persons with claims against the settlement had been paid as of that date. At no time between that date and the date of the hearing, May 24, 1996, was the trust account balance sufficient to cover the remaining claims against the settlement proceeds. On August 25, 1995, a check was drawn on the trust account, payable to the D.C. Treasurer, in the amount of $12,827.84. The check bore the notation "fbo Humble" and was in apparent satisfaction of the claims of the D.C. government against the settlement proceeds. After payment of that check, the balance in the trust account was $12,363.15, insufficient to pay Dr. Garmon's outstanding medical bills. As of the date of the hearing, Dr. Garmon had not been paid. Respondent's Conduct during Bar Counsel's Investigation On August 10, 1995, Dr. Garmon complained to Bar Counsel that Respondent had failed to notify him of the settlement and had failed to pay him out of the settlement proceeds. BX 46. Bar Counsel advised Respondent of the complaint and requested his response. Respondent did not reply. After repeated letters, personally served on Respondent, Bar Counsel sought and received an order from this Board directing Respondent to provide Bar Counsel with substantive responses to Bar Counsel's inquiries. BX 48-49. Respondent failed to comply with the Board's order. Respondent's Explanation for his Conduct Respondent did not file an answer to Bar Counsel's petition. He did appear at the hearing and was ordered by the Hearing Committee to respond to an outstanding subpoena and to answer the Complaint. Respondent submitted a letter, BX 60, that the Hearing Committee found did not comply squarely with the terms of its order. HC Rep. at 13. Respondent offered no other documents or written submissions. He was called as a witness by Bar Counsel, but declined to provide additional testimony in his own defense. As the Hearing Committee noted, Respondent admitted virtually all of the facts supporting the violations, but offered no coherent explanation for his conduct. HC Rep. at 6. In the letter to the Committee filed just prior to the hearing, Respondent mentioned ongoing negotiations regarding reductions in the third party claims and his expectation of a wire transfer into the account. Under the caption "Confusion, Error and Neglect", Respondent wrote that "[i]t was my intention at all relevant times to maintain the appropriate balance of funds in my trust account." BX 60 at 4. At the hearing, Respondent testified that his mishandling of the funds in the trust account was attributable to "confusion." When asked directly why, even as of the date of the hearing, Dr. Garmon had not been paid, Respondent testified that: Well, I should have paid that bill—I wish I had paid that bill when I first got started with this. Basically, I'm liable for these funds and I intend to pay it within a few days. I can just tell you that there was some confusion in my accounts, which at this point I still do not know how everything that happened here happened. But there was nothing intentional on my part to deprive this man of his income. I think I have made some mistakes here. I think I was negligent about some things I should have paid attention to that I didn't. I don't think I accounted for the funds that were in my account properly. But basically I had—all of these time periods we had the funds to pay him. Tr. 130-131.[6] Respondent testified vaguely to several sources of "confusion", including his expectation of a wire transfer in August, 1995, that never came, his mother-in-law's illness and death, to a period in which he was ill himself and to an office arrangement that made it difficult for him to get his bank statements. Tr. 95-96, 104. He insisted that although he *1191 drafted checks on the trust account without keeping a ledger reflecting the funds in the account and without reviewing the bank statements, "if I had a check issued it was because I at least believed there was proper funds in the account." Tr. 105. In urging the Committee against a sanction of disbarment, Respondent admitted making mistakes, but "would not categorize what I did as willful or reckless, ... I think that I was simply—not simply but in many instances in this regard, I was careless, and I neglected to take care of matters that I should have taken care of." Tr. 160. Respondent admitted that, at least by August or September, 1995, he was aware that the trust account contained insufficient funds to pay Dr. Garmon. Tr. 139-40. He had no real explanation for his failure to restore the money to the trust account, other than that "there were just a lot of things that I intended to do that I didn't do." Tr. 139-141. Violations I. Rule 1.15 A. Misappropriation of Trust Funds The Hearing Committee found that Respondent was guilty of several acts constituting misappropriation of trust funds. We agree. Misappropriation is "any unauthorized use by an attorney of ... funds entrusted to him or her, whether or not temporary or for personal gain or benefit." In re Choroszej, 624 A.2d 434, 436 (D.C.1992). Violation of the rule is complete "when the balance in [the trust] account falls below the amount due the client." In re Micheel, 610 A.2d 231, 233 (D.C.1992); accord, In re Pels, 653 A.2d 388, 394 (D.C.1995). An act of misappropriation was complete on January 19, 1995, when the trust account balance fell to $78,892.40. At that time, Respondent was not entitled to draw fees upon Officer Humble's settlement proceeds, because he had not yet provided his client with a list of proposed disbursements and received his client's approval.[7] The offense of misappropriation is a per se offense requiring no proof that Respondent intended to use his client's funds for unauthorized purposes. In re Choroszej, 624 A.2d at 436 (D.C.1992); In re Evans, 578 A.2d 1141, 1142 (D.C.1990). Respondent's mental state is relevant to the appropriate sanction for his misconduct. In re Addams, 579 A.2d 190, 191 (D.C.1990) (en banc) ("in virtually all cases of misappropriation, disbarment will be the only appropriate sanction unless it appears that the misconduct resulted from nothing more than simple negligence"). Accord In re Pierson, 690 A.2d 941, 948 (D.C. 1997); In re Clarke, 684 A.2d 1276, 1280 (D.C.1996); In re Morrell, 684 A.2d 361, 373 (D.C.1996); In re Pels, 653 A.2d at 389; In re Micheel, 610 A.2d at 237 (D.C.1992). Bar Counsel urged that the evidence in this case establishes as least reckless misappropriation. The Committee found that "Respondent acted with knowledge that this invasion of trust proceeds was wrongful. We can draw no other conclusion from the delay in accounting for receipt of funds, the failure to cooperate with Bar Counsel's investigation, and Respondent's failure to produce any records to support his use of the trust proceeds." HC Rep. at 8. Because it is clear that Respondent's conduct was at least reckless, we find it unnecessary to decide whether the evidence also establishes that Respondent had actual knowledge, as of January, 1995, that the trust account had insufficient funds to cover the amount that he was obligated to hold in trust for Officer Humble. There is no doubt that the misappropriation is attributable to more than "mere negligence." As of May 19, 1995, when the balance in the trust account fell below the sum that should have been held in trust to pay the client's creditors, Respondent was guilty of an additional act of misappropriation. As the Committee found, that misappropriation was ongoing at least through the date of the hearing, May 24, 1996. Again, Bar Counsel urged a finding of at least reckless misappropriation and the Committee found that "Respondent acted with knowledge that his use of the trust founds was wrongful. No other *1192 conclusion can follow from Respondent's repeated use of Trust proceeds to pay his personal creditors rather than applying trust proceeds as entrusted." HC Rep. at 9. Again, we find it unnecessary to determine whether Respondent's misconduct was attributable to gross recklessness or to actual knowledge that the balance in the trust account was insufficient to cover the outstanding claims against the settlement proceeds. Respondent admitted that by August or September 1995, he was aware that there were insufficient funds in the trust account to pay Dr. Garmon. Tr. 139-40. He did not restore the funds to his trust account then and had not done so by the time of the hearing. Tr. 140-42. Prior to August, 1995, Respondent appears to have been operating without any sense of obligation to maintain records or to keep his own funds and debts separate from those of his clients. We agree with Bar Counsel and the Hearing Committee that the facts of this case are so egregious that the misappropriation cannot have been the result of mere negligence. The Committee noted that Respondent, by his own admission engaged in two other acts of misappropriation of trust account funds. The two checks written to the D.C. Superior Court were used to cover Superior Court filing fees for clients who had no funds in the trust account. Tr. 121-123. Respondent testified that the use of trust account funds to pay those filing fees was inadvertent. Id. The Committee found that Respondent was grossly negligent in permitting those unauthorized uses of other people's entrusted money. HC Rep. at 9. B. Commingling Commingling occurs when an attorney fails to hold entrusted funds in a special account, separate from his own funds. In re Hessler, 549 A.2d 700 (D.C.1988). As of February 14, 1995, Respondent was entitled to $21,500 as a fee for his representation of Officer Humble. By leaving the money in the trust account and using the trust account as if it were his personal checking account, Respondent was guilty of commingling. C. Failure Promptly to Deliver to Client and Third Parties Funds They Were Entitled to Receive Rule 1.15(b) provides that: Upon receiving funds or other property in which a client or third person has an interest, a lawyer shall promptly notify the client or third person. Except as stated in this rule or otherwise permitted by law or by agreement with the client, a lawyer shall promptly deliver to the client or third person any funds or other property that the client or third person is entitled to receive and, upon request by the client or third person, shall promptly render a full accounting regarding such property, subject to Rule 1.6. There is no doubt that Respondent violated this rule. In May, 1992, Respondent executed an assignment and authorization to pay Dr. Garmon for the medical treatment provided Officer Humble from the settlement proceeds. In November, 1994, Respondent received $80,000 in settlement funds for Officer Humble's case. In February, 1995, Officer Humble authorized the disbursal of the settlement funds in accordance with the settlement sheet provided by Respondent. That settlement sheet indicated that Dr. Garmon was entitled to receive $20,337.85. Respondent negotiated a reduction of the bill to $16,837.85, to which Dr. Garmon agreed. Tr. 57; BX 11. Respondent testified that he believed that someone on his staff negotiated a further reduction, to $12,500. Tr. 94. As of the date of the hearing, Dr. Garmon had received no payment for his treatment of Officer Humble. Tr. 94, 143. II. Rule 5.3: Failure to Supervise Nonlawyer Assistant Rule 5.3 provides in relevant part: (b) A lawyer having direct supervisory authority over the nonlawyer shall make reasonable efforts to ensure that the person's conduct is compatible with the professional obligations of the lawyer; and (c) A lawyer shall be responsible for conduct of such a person that would be a violation of the Rules of Professional Conduct if engaged in by a lawyer if: (2) The lawyer has direct supervisory authority over that person, or is a partner *1193 in the law firm in which the person is employed, and knows of the conduct at a time when its consequences can be avoided or mitigated but fails to take reasonable remedial action. Janice Moore, Respondent's wife and office manager was an authorized signatory on the trust and operating accounts. Tr. 82; BX 16. She drafted a number of the checks drawn on the trust account that are the bases for the misappropriation violations in this case. At the hearing, Respondent acknowledged that he authorized all banking transactions conducted by Mrs. Moore. Tr. 85. He is therefore responsible for the actions of Mrs. Moore that resulted in the commingling of his funds with client and third-party funds in his operating account, the misappropriation of those funds by withdrawals from the operating account to pay his business and personal expenses and the failure to pay Dr. Garmon and Officer Humble's other third-party medical care providers promptly. III. Rule 8.4(b) Criminal Conduct The Hearing Committee made no findings regarding Bar Counsel's charge that Respondent's conduct constituted criminal conduct within the meaning of Rule 8.4(b) and recommended that the charge be dismissed. HC Rep. at 13. The Hearing Committee apparently was of the view that, in light of the other violations it found, it was unnecessary to make a finding on this charge. We have emphasized several times recently that it is incumbent on the Hearing Committee to make findings regarding all of the charges brought by Bar Counsel, even if in the Committee's view, the charge is surplusage. See, e.g., In re Bernstein, D.N. 292-94 (BPR Oct. 2, 1996). If the charge is based on the same conduct on which other charges are based, that fact can be taken into consideration in determining the appropriate sanction. Respondent may be guilty of the offense of committing a criminal act that reflects adversely on the honesty, trustworthiness or fitness of a lawyer even if he has not been prosecuted for his crime. In re Gil, 656 A.2d 303 (D.C.1995). Bar Counsel has charged that Respondent's unauthorized use of funds entrusted by his client to pay his client's medical bills amounts to theft. The offense of theft, however, requires that the person wrongfully use the property of another "with intent ... [t]o deprive the other of a right to the property or a benefit of the property; or... [t]o appropriate the property to his or her own use or to the use of a third person" under D.C.Code § 22-3811(b)(1982). While Respondent's conduct undoubtedly was grossly reckless, perhaps, as the Hearing Committee concluded, rising to the level of actual knowledge that the funds were being used improperly, we do not find on this record clear and convincing evidence that Respondent intended to deprive either his client or third party creditors of their property or to appropriate their property to his own use.[8] IV. Rule 8.4(c): Conduct involving Dishonesty, Fraud, Deceit and/or Misrepresentation Under Rule 8.4(c), the term "dishonesty" includes "conduct evincing `a lack of honesty, probity or integrity in principle; [a] lack of fairness and straightforwardness.'" In re Shorter, 570 A.2d 760, 767-68 (D.C.1990). Conduct that "may not be legally characterized as an act of fraud, deceit or misrepresentation may still evince dishonesty." Id. Respondent's statement to his client that all medical providers had been paid was a knowing misrepresentation. We agree with Bar Counsel and the Hearing Committee that Respondent violated this rule. V. Rule 8.4(d) and Rule XI, § 2(b)(3) Respondent's failure to cooperate with Bar Counsel's investigation, despite personal service of letters, a motion to compel and an order from this Board directing him to respond to Bar Counsel's request for information is conduct that seriously interferes with the administration of justice, in violation of Rule 8.4(d) and D.C.App. R. XI, § 2(b)(3). Sanction There can be no appropriate sanction for Respondent's numerous acts of misappropriation, commingling and other serious disciplinary *1194 violations other than disbarment. In re Addams, 579 A.2d at 191; In re Gilchrist, 488 A.2d 1354, 1358 (D.C.1985); accord In re Morrell, 684 A.2d at 372. BOARD ON PROFESSIONAL RESPONSIBILITY By:________________________ Elizabeth G. Taylor Dated: April __, 1997 All members concur in this Report and Recommendation except Ms. Ossolinski, who is recused, and Ms. Brannan and Mr. Howard, who did not participate. NOTES [1] With the exception of the charge that Respondent was guilty of illegal conduct, as to which the Committee made no finding, the Hearing Committee also found that Bar Counsel had proven the other violations charged. We agree with the Hearing Committee on these conclusions as well, although we remind the Committee that it should make findings as to all of the charges brought by Bar Counsel, unless Bar Counsel decides not to pursue them. Based on our review of the record, we do not find clear and convincing evidence that Respondent is guilty of illegal conduct. [2] Respondent did not produce a ledger or other record of the activity in his trust and commercial accounts. He offered no explanation for his handling of the funds that should have been held in trust for his client and his client's creditors other than that he lost track of how much money was in the accounts. As a result, the Hearing Committee had to reconstruct what happened to the money by reviewing bank statements and canceled checks from Respondent's trust and commercial checking accounts. Attached as an appendix to the Hearing Committee report is a chart showing all of the activity in the trust account between November 23, 1994 and October 31, 1995, with the balance in the account after each transaction. [The appendix is not attached to this opinion.] That chart makes it unmistakably clear that Respondent was using the trust account as an operating account, drawing funds out of the trust account as needed to pay bills or to transfer money to Respondent's other commercial account. [3] It appears that the checks written to Respondent from the trust account were deposited into his operating account and used to pay personal and/or business expenses. See BX 20, 36; Tr. 133-34. [4] The settlement sheet overstated the amount due to Dr. Garmon by $4,294.00, apparently because of Respondent's confusion over Dr. Garmon's submission of two separate invoices. If that amount was not needed to pay medical providers, however, it should have been delivered to the client. In either case, it was not money Respondent was entitled to spend. As did the Hearing Committee, we have included the $4,294.00 as funds that were needed for "other claims" against the settlement. [5] Respondent acknowledged that the checks to the Superior Court were filing fees for clients who had no funds deposited in the trust account. Tr. 121-23. [6] The records of Respondent's trust and operating accounts established that, at least during the period between May 19, 1995 and October 31, 1995, Respondent did not have the funds in either of these accounts to pay the outstanding claims against the settlement proceeds. BX 24-29, 40-46; Tr. 134-137. The Hearing Committee also found that the documentary record demonstrated that Respondent was heavily burdened with consumer debt, was making minimum payments on several cards and was paying some accounts through collection agencies. Hearing Committee Report at 10 n. 6. [7] In the event of a fee contest, Respondent would have been obligated to hold the disputed fee in trust. Rule 1.15(c). [8] We interpret the Committee's failure to make a finding on this charge and its recommendation that it be dismissed as at least an indication that the Committee was not convinced that the conduct here rose to the level of a criminal offense.

2013-10-30 06:35:55.220954+00

Wathen

704 A.2d 872 (1998) 1998 ME 16 IRVING OIL CORPORATION v. MAINE AVIATION CORPORATION and The Estate of Joseph Caruso. Supreme Judicial Court of Maine. Argued October 9, 1997. Decided January 21, 1998. *873 Fred W. Bopp, III (orally), Perkins, Thompson, Hinckley & Keddy, P.A., Portland, for plaintiff. John P. McVeigh (orally), Preti, Flaherty, Beliveau & Pachios, L.L.C., Portland, for defendants. Before WATHEN, C.J., and ROBERTS, CLIFFORD, and RUDMAN, JJ. WATHEN, Chief Justice. [¶ 1] Defendants Maine Aviation Corporation (MAC) and the Estate of Joseph Caruso (the Carusos) appeal from a judgment of the District Court (Cumberland, Calkins, J.) concluding that they were tenants at will of plaintiff Irving Oil Corporation (Irving) with respect to a leased parcel of land located at the Portland International Jetport. The Superior Court affirmed that part of the District Court's judgment that evicted the Carusos but vacated the order evicting MAC on the basis of improper notice of termination. On appeal, defendants contend that the Superior Court improperly denied them a trial by jury; that the District Court erred in ordering eviction and in rejecting their promissory estoppel and third party beneficiary claims; and, that the Superior Court erred in ordering them to pay rent into an escrow account pending resolution of this appeal. Finding no error in the underlying judgment of eviction, we affirm the Superior Court judgment in part and vacate in part. [¶ 2] The relevant facts may be briefly summarized as follows: In 1976, MAC entered into a twenty year ground lease with the City of Portland for a parcel of land located at the Portland International Jetport. The written lease, executed on behalf of MAC by corporate President Joseph Caruso, permitted MAC to build an airplane hangar on the leased land provided title was not transferred to any other entity. The lease provided that "[a]ny attempts to transfer title to said hangar, building, and improvements shall cause title ... to pass" to the City. The lease, however, expressly permitted MAC to transfer title to the hangar to either Joseph Caruso or Thomas J. Caruso, who were then directors and stockholders of MAC, provided their interest remained subordinate to the interest of the City. Thereafter, Joseph Caruso and Thomas Caruso formed a partnership, the Caruso Company, and built a hangar. [¶ 3] Although the hangar was built by the Carusos on MAC's leased land, there is no evidence of any agreement between them and MAC for the use of the land under the hangar. Once constructed, however, MAC rented space in the hangar and paid the Carusos $1500 per month as rental.[1] In 1990, MAC filed a petition for protection in bankruptcy pursuant to Chapter 11. As part of a plan for corporate reorganization, MAC transferred its rights under the City's ground lease to Jet Services Portland, Inc. (JSPI), another corporation owned by the Carusos. MAC, however, continued to occupy the hangar, allegedly pursuant to its rental agreement with the Carusos. In 1994, JSPI filed a petition for protection in bankruptcy pursuant to Chapter 11. The trustee in bankruptcy eventually sold JSPI's interest in the ground lease along with other assets to plaintiff Irving. [¶ 4] In November 1995, Irving sent a letter to the personal representative of the Estate of Joseph Caruso, giving "formal notice that the hangar must be removed no later than December 31, 1995." Irving sent invoices for ground lease rent to MAC for *874 the months of October, November, and December of 1995 and January and February of 1996. The hangar remained in place, no rent was paid on the ground lease, and in February of 1996, Irving filed this forcible entry and detainer action against both defendants in the District Court. The court entered a judgment evicting both defendants. Defendants appealed to the Superior Court and requested a jury trial. The Superior Court (Bradford, J.) denied their motion for a jury trial, and affirmed the District Court's judgment with respect to the Carusos but vacated it with respect to MAC. The court concluded that Irving had failed to provide the requisite notice of termination to MAC pursuant to 14 M.R.S.A. § 6002 (1980 & Supp.1997). Defendants now appeal from the judgment of the Superior Court. I. [¶ 5] The procedural rule applicable to actions for forcible entry and detainer allows for a jury trial in the Superior Court on issues "triable of right." M.R. Civ. P. 80D(f)(2). The Superior Court denied defendants' request pursuant to M.R. Civ. P. 80D(f)(5) because of their failure to demonstrate a genuine issue of material fact. On the record before it, the court did not err in concluding that there were no material facts in dispute and that nothing beyond a review of the legal consequence of the facts presented to the District Court was required. Before this Court, defendants challenge the constitutionality of M.R. Civ. P. 80D. Because they failed to preserve the issue in the Superior Court, we will not review it on appeal even though it is one of constitutional dimension. See Cyr v. Cyr, 432 A.2d 793, 797 (Me.1981); Morris v. Resolution Trust Corp., 622 A.2d 708, 714 (Me.1993) (when a party seeks to raise an issue for the first time on appeal for the purpose of attacking judgment from which it appeals, the party is held to have waived the issue for appellate review because the party failed to submit it for decision at the trial level). II. [¶ 6] With regard to the orders of eviction, we review the judgment of the District Court directly for errors of law, Homstead Enterprises v. Johnson Products, Inc., 540 A.2d 471, 472 (Me.1988), or clearly erroneous factual findings. Casco Northern Bank v. JBI Associates, Ltd., 667 A.2d 856, 859 (Me.1995). Initially, defendants contend that factual inaccuracies in the District Court judgment require that it be vacated. Because the findings in question have no effect on the underlying result, the factual errors, if any, are harmless. See L. Ray Packing v. Commercial Union Ins. Co., 469 A.2d 832, 834 (Me.1983); Bakal v. Weare, 583 A.2d 1028, 1030 (Me.1990) (we will uphold a decision on appeal even though the lower court's decision was erroneous because there exists another valid rationale to support the judgment). [¶ 7] Defendants argue that they were subtenants under the original ground lease and accordingly that they are now subtenants of Irving. They contend that they are entitled, without paying rent, to keep the hangar on the leased land until the ground lease, or any extension thereof, is terminated. At a minimum, they contend that their tenancy is at will and that the District Court erred in evicting them because Irving failed to proceed in compliance with 14 M.R.S.A. § 6002. Because of the absence of any written sublease between MAC and defendants, they can claim no estate greater than a tenancy at will. 33 M.R.S.A. § 152 (1988). A tenancy at will, however, cannot be conveyed or assigned; it does not pass with the alienation of the underlying estate. Esty v. Baker, 50 Me. 325, 334 (1862). When title to property occupied by a tenant at will is passed by deed or lease, the tenancy is terminated, Rancourt v. Nichols, 31 A.2d 410, 139 Me. 339 (Me.1943) and the tenant becomes a tenant at sufferance. A tenant at sufferance is an interest which arises "when one comes into possession by lawful title otherwise than by act of law, but retains such possession longer that he has any right." Cunningham v. Holton, 55 Me. 33, 37 (1869). [¶ 8] Based on the record before the District Court, it is undisputed that the Carusos never entered into a written lease agreement with MAC, JSPI, any trustee in *875 bankruptcy, or Irving. The District Court correctly concluded that once the rights in the ground lease were sold to Irving, defendants became tenants at sufferance.[2] There is no notice requirement for a party who is a disseisor. See Reed v. Reed, 48 Me. 388 (1861) (a tenant at sufferance is not entitled to notice to quit). Irving's request for forcible entry and detainer was properly granted. III. [¶ 9] During the pendency of these proceedings, Irving filed a motion for a writ of possession to issue. The Superior Court held an evidentiary hearing and conditionally denied Irving's motion for a writ of immediate possession. In return, however, the court ordered defendants to pay $3,000 rent per month, pending appeal, together with "the sum of $7900 representing arrearage from the date of the judgment in the District Court." Payments were to be deposited into an escrow account pursuant to 14 M.R.S.A. § 6008 (1980 & Supp.1996).[3] Although defendants maintain that the court improperly calculated the fair rental value of the premises, we review only for clear error. See M.R. Civ. P. 52(a); Casco Northern Bank v. JBI Associates, Ltd., 667 A.2d 856, 859 (Me.1995). Without specific findings of fact, we must assume that the court found for the prevailing party on all factual issues necessary to reach its decision. See Glidden v. Belden, 684 A.2d 1306, 1316 (Me.1996). The court's order to pay the fair rental value in escrow was not clearly erroneous. The entry is: Judgment of the Superior Court vacated in part. Remanded with instructions to affirm the judgment of the District Court and remand for issuance of a writ of possession. NOTES [1] An unsigned copy of a lease of the hangar building running from the partnership to MAC is included in the record. It is fair to assume that income tax considerations may have influenced the ownership structure that the parties attempted to achieve. [2] Defendants argue that Irving's unproductive demands for rent during the first few months of its ownership, serve to create a new tenancy at will. Irving responds with the contention that the invoices were only sent as a temporary accommodation to defendants while bids for the use of the land were being solicited. Because there is no transcript of the evidence in the District Court, we assume that the court found all of the necessary historical facts to sustain its conclusion that defendants remain tenants at sufferance. See Herrick v. Town of Mechanic Falls, 673 A.2d 1348 (Me.1996). Similarly, defendants' promissory estoppel and third party beneficiary claims are unsupported by the record and must be affirmed on the basis of assumed findings. [3] The statute provides that the "Superior Court may stay an issuance of a writ of possession pending in the disposition of the appeal" from the District Court's judgment. "The Superior Court shall condition the granting and continuation of the stay on the defendant's payment of the current rent for the premises to the plaintiff or, if there is a dispute about the rent, into an escrow account." 14 M.R.S.A. § 6008(2) (1980 & Supp. 1996).

2013-10-30 06:35:55.260672+00

Odom

491 S.W.2d 883 (1973) Ronald Louis JONES, Appellant, v. The STATE of Texas, Appellee. No. 46420. Court of Criminal Appeals of Texas. February 7, 1973. Rehearing Denied April 11, 1973. *884 Malcolm Dade, Dallas, for appellant. Henry Wade, Dist. Atty., Mike G. McCollum, Asst. Dist. Atty., Dallas, and Jim D. Vollers, State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION ODOM, Judge. The appellant entered a plea of guilty before a jury to the offense of rape. His punishment was assessed at life. Three grounds of error are alleged on appeal, the first being a contention that a proper and adequate admonishment was not given. Such contention is overruled. The record shows that appellant was fully, adequately and properly admonished pursuant to Article 26.13, Vernon's Ann.C.C.P. The admonishment covers approximately two and a half pages of the record and shows that the appellant fully understood the consequences of his plea and that it was voluntarily given. Next, appellant contends that reversible error was committed by the trial court in admonishing him as to the consequences of his plea before the empaneled jury. The record shows that no objection was addressed to this procedure and no reversible error was committed by such. However, better practice would have been for the trial judge to have retired the jury and admonished appellant in their absence. Compare, Crawford v. State, Tex.Cr.App., 466 S.W.2d 319. Finally, appellant contends that the court, on its own motion, should have withdrawn the plea of guilty and substituted a plea of not guilty. This contention is based on appellant's testimony that he did not participate in the rape. A brief summary of the testimony will be stated. The record shows that the prosecutrix and her boy friend were parked in an automobile near North Lake, a recreational area in the northern part of Dallas County, during the early morning hours of May 2, 1969. The appellant and Harold Eugene Hill[1] approached the automobile, held a gun on the couple, and ordered them to get out of the automobile. The prosecutrix was robbed of the money in her purse and her boy friend was robbed, beaten and put into the trunk of the automobile by appellant and Hill. The prosecutrix was then beaten, ordered back into the automobile, and raped by appellant and Hill, after *885 which they tied her up, took the car keys and left. Appellant, testifying in his own behalf, stated that although he was present at the time of the rape he did not commit the offense himself. Rather, he stated that Hill and a Ronnie Smith were the two assailants who were involved in the rape of the prosecutrix, and that he was merely an onlooker. He stated that he did participate in the removal of the dome light of the automobile. The court charged the jury on the law of principals. We conclude that the evidence is sufficient to support the verdict and no error was committed by the trial court's failure to withdraw appellant's plea of guilty on its own motion. Finding no reversible error, the judgment is affirmed. NOTES [1] See Hill v. State, Tex.Cr.App., 487 S.W.2d 64.

2013-10-30 06:35:55.273941+00

152 N.J. 361 (1998) 704 A.2d 1297 SHALOM ALMOG AND IRIT ALMOG v. ISRAEL TRAVEL ADVISORY SERVICE, INC., ETC., ET AL. AND BEN AMI GELLER AND ISRAEL RODRIGUE, ET AL. The Supreme Court of New Jersey. January 21, 1998. ORDER This matter having been duly considered and the Court having determined that certification was improvidently granted; It is ORDERED that the within appeal be and hereby is dismissed.

2023-08-23 14:17:32.503424+00

Rickhoff

JOHN R. RICKHOFF, Special Judge. This is an appeal from an order and judgment entered by the Circuit Court of Jefferson County denying appellant’s motion to vacate judgment and sentence under S.Ct. Rule 27.26, V.A.M.R. Upon this appeal, appellant urges that the trial court erred in not sustaining his motion to set aside his conviction because he was denied effective assistance of counsel in violation of his rights under the Sixth and Fourteenth Amendments to the United States Constitution. He bases this conclusion upon his contention that his appointed attorney failed to become conversant with pertinent statutes which were applicable to the determination of his competency to stand trial. The appellant was charged with assault with intent to kill, and the court appointed an attorney, William Bernhardt, to defend him. Mr. Bernhardt filed a motion for psychiatric examination on behalf of appellant, and thereafter the appellant was examined at the Fulton State Hospital to determine his competency to stand trial and also to determine his mental fitness at the time of the offense charged. In January, Mr. Bernhardt, at the suggestion of appellant, requested permission to withdraw from the case, which request was denied. A report of the psychiatric examination was filed January 16, 1970. Section 552.-020, V.A.M.S., provides that within five days after the filing of the report, both the accused and the State shall, upon written request, be entitled to an order granting them an examination of the accused by a physician of their own choosing and at their own expense. The statute further provides that if the opinion in the report is not contested, the court can make a determination on the basis of the report filed or may hold a hearing on its own motion. No written request was made, and on February 2, 1970, the appellant in person, Mr. Bernhardt, and the prosecuting attorney appeared in open court, where the prosecuting attorney asked that the report be accepted as evidence and that the court find appellant had mental fitness to proceed. Mr. Bernhardt argued that the report was prepared upon an incomplete picture of the defendant, that the report was prepared without the knowledge that the defendant had tried to commit suicide while in jail, that the five-day period was not adequate because defendant did not want a court appointed attorney to represent him, and that the procedure under which the report was made violated appellant’s rights under the Fourteenth Amendment to the United States Constitution. The court then found that under § 552.-020 appellant had no mental disease or defect excluding his fitness to proceed with the trial. During the same proceedings, Mr. Bernhardt was given permission to withdraw as appellant’s attorney. Shortly after Mr. Bernhardt withdrew, Mr. Clinton Almond entered his appearance on behalf of appellant and represent*277ed him in the trial of the case, as a result of which the appellant was found guilty. Thereafter, Mr. Almond filed a motion for new trial on behalf of appellant, arguing that the evidence was insufficient for a finding of guilty, that the verdict was against the weight of the evidence, that evidence used to establish prior incarceration was based on hearsay and was inadmissible, and that physical evidence was improperly admitted without proper foundation. The motion was overruled and on April 30, 1970, appellant appeared before the court for sentencing, at which time appellant stated on the record that he did not wish to appeal the sentence. At the hearing held on the Rule 27.26 motion, Mr. Bernhardt testified that he asked for a mental examination of appellant because it looked to him like it was the appellant’s only hope. He testified that he knew the State had a confession and statements of witnesses, and he could not see any other way out than to ask for a mental examination. Mr. Bernhardt also testified that he had been unaware of the five-day limitation in the statute. The appellant testified that nobody told him that a report from the Fulton State Hospital had been filed with the court and nobody discussed with him the question of whether or not there would be another mental examination, nor did Mr. Bernhardt tell him that he could file exception to the report made and have an examination by a doctor of his own choosing. Appellant also testified that in the two years prior to the night of the occurrence out of which the charge arose, he had not sought medical attention for any mental problem and that since he had been in the county jail and state penitentiary he had not sought medical attention either. Appellant here makes no contention that he was not competent to stand trial, nor that counsel who represented him in the trial of the case and in the motion for new trial, and who did not raise the issue of whether appellant was competent to stand trial, failed to render appellant effective assistance. Rather, appellant’s position seems to rest solely upon the theory that because the failure of Mr. Bernhardt to request a hearing proceeded from lack of knowledge rather than from a judgment not to request a hearing made with knowledge of the time limit on the right to request an examination, the appellant was denied effective assistance of counsel. Thus, appellant’s complaint with counsel’s handling of the case appears to stem, not from what counsel did, but rather from the reasons for counsel’s action. Appellant’s reliance for his motion on the reason for failure to request a further examination, rather than the fact of such failure, is borne out by lack of any contention that the failure of Mr. Almond to raise the issue of appellant’s competency to stand trial denied him effective assistance of counsel. In a concurring opinion in an en Banc decision of this court in McQueen v. State, 475 S.W.2d 111 (1971), Chief Justice Finch observes that the accepted test in cases where ineffectiveness of counsel is urged as ground for a new trial, is stated in terms of whether counsel’s actions, or lack thereof, have made the trial a farce or mockery of justice. Garton v. State, 454 S.W.2d 522 (Mo.1970); Holbert v. State, 439 S.W.2d 507 (Mo.1969). But he further observes that in most instances the courts, after stating the test in the above terms, have sought actually to ascertain whether there has been such failure on the part of the attorney that defendant has not had a fair trial. The determination of this issue in turn depends upon whether the defendant was prejudiced as a result of ineffective assistance of counsel. A defendant is not entitled to a new trial merely upon the proposition that counsel should have handled the case differently than he did. The need to affirmatively demonstrate prejudice in seeking to make a case for ineffective assistance of counsel is also recognized by federal courts. In United *278States ex rel. Green v. Rundle, 434 F.2d 1112 (3d Cir. 1970), an applicant for a writ of habeas corpus argued that the failure of his trial counsel to locate employment records to corroborate the applicant’s alibi defense denied the applicant effective assistance of counsel. The Third Circuit Court of Appeals held that the District Court should rehear the case to determine the prejudicial effect of the absence of those records, and that the burden was upon the applicant to show that his defense was prejudiced by that absence. We do not find Mr. Bernhardt’s • representation of appellant to be so deficient that it denied appellant the basic right to assistance of counsel. More must be shown to establish that conclusion than mere mistakes on the part of counsel, and in any event there must be an affirmative demonstration of prejudice resulting from an omission of counsel to make a case of ineffective assistance of counsel. As we have stated, appellant, in his argument here, relies solely upon Mr. Bernhardt’s lack of knowledge of the statutory provisions. The trial court, upon hearing of this motion, made no finding that appellant may have been suffering from a mental incapacity; appellant himself makes no such contention; and Mr. Almond, appellant’s second attorney with whom appellant finds no fault, made no such contention at any stage of the proceeding. The trial court was presented with no evidence and this court has been presented with no argument that appellant was in fact incompetent to stand trial. In view of these facts we are unable to find any basis for disagreeing with the finding of the court below that the appellant was not denied a fair trial by the inaction of his counsel. Judgment affirmed. HOLMAN, P. J., concurs. SEILER, J., concurs in result in separate concurring opinion filed. BARDGETT, J., not sitting.

2023-08-23 14:17:32.508139+00

Seiler

SEILER, Judge (concurring in result). At the February 2, 1970 appearance in circuit court, where the court ruled defendant competent to proceed in the criminal trial, original appointed counsel candidly stated, “Judge, my heart’s not in it” and “I haven’t taken too much care to prepare the case.”1 With this limited interest on part of counsel, it is not surprising important possibilities were overlooked or that defendant was seeking to change counsel. In my opinion, counsel’s self-characterization of his representation is not inaccurate, and I do not see how this kind of representation can be held to be the effective assistance of counsel which we guarantee every defendant. Certainly it is below the standard we expect of lawyers generally. However, under McQueen v. State, 475 S.W.2d 211 (Mo. banc 1971) I see no alternative to concurring in result. The net result of cases such as this is that the defendant, the courts, and the lawyers, as well as the public, come out on the short end: (1) the defendant, instead of getting effective assistance of counsel at the outset of his case, is relegated to an inquiry made long after the event as to whether effective assistance of counsel originally would have helped him and (2) the courts, lawyers, and public must take time to hold a hearing and determine what could have been developed for defendant had counsel given the case proper attention in the beginning. We would save time for all, as well as enhance respect for law, by insisting on effective assistance of counsel from the start, rather than somewhere down the line. . February 2,1970 also was the date the ease had been set for trial.

2013-10-30 06:35:55.334651+00

Conaboy

901 F. Supp. 906 (1995) GOULD INC., Plaintiff, v. A & M BATTERY AND TIRE SERVICE, et al., Defendants. No. 3 CV-91-1714. United States District Court, M.D. Pennsylvania. September 14, 1995. *907 Dennis R. Suplee, Diana S. Donaldson, Susan G. Caughlan, Schnader, Harrison, Segal & Lewis, Philadelphia, PA, Barry S. Neuman, Schnader, Harrison, Segal & Lewis, Washington, DC, Jacob P. Hart, Schnader, Harrison, Segal & Lewis, Philadelphia, PA, Mark A. Lockett, Philadelphia, PA, John M. Armstrong, James H. Rodman, Schnader Harrison Segal & Lewis, Philadelphia, PA, for Gould, Inc. James A. Humphreys, III, Michael W. Davis, Barley Snyder Senft & Cohen, Lancaster, PA, for Micro Group. Philip T. Medico, Jr., Forty Fort, PA, Donald B. Mitchell, Jr., Laurel A. Bedig, Arent, Fox, Kintner, Plotkin & Kahn, Washington, DC, for Marjol Site PRP Group. MEMORANDUM AND ORDER CONABOY, District Judge. Presently before the Court is a Motion for Partial Summary Judgment filed on behalf of two of the defense groups in the above-captioned action. The motioning defense groups are the Marjol Site PRP Group and the Rosenn Jenkins Joint Defense Group.[1] In its motion, the moving defense groups ask this Court to disallow Plaintiff Gould from bringing a cost recovery action under § 107 of the Comprehensive Environmental Response Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9607 (hereinafter "§ 107"). The moving Defendants contend that, as a matter of law under the facts set forth in Gould's own Amended Complaint, Gould's only action is one for contribution *908 under 42 U.S.C. § 9613 (hereinafter "§ 113"). Plaintiff Gould, by way of its Third Amended Complaint, has brought an action against the Defendants under both Section 107 and Section 113 of CERCLA. Under its § 107 count, Gould asserts that liability should be joint and several against all of the various Defendants. Moving Defendants aver that Gould's only action is limited to a § 113 contribution action and therefore pursuant to § 113's provisions, liability among the Defendants will be several, not joint and several. Furthermore, Defendants contend that if the various Defendants can only be severally liable, then the so called "orphan share"[2] must be borne by Plaintiff Gould. Finally, Defendants state that if this action is styled as a § 113 contribution action Plaintiff Gould's claim for past cost is time barred by the three-year statute of limitations under 42 U.S.C. § 9613(g)(3) (hereinafter § 113(g)(3)). As noted above, Plaintiff Gould has asserted a cause of action under both Section 107 and Section 113 of CERCLA. The statute of limitations for a § 107 cost recovery action is contained in § 113(g)(2) of CERCLA (42 U.S.C. § 9613(g)(2)), while the statute of limitations for a § 113 contribution action is found in § 113(g)(3) of CERCLA (42 U.S.C. § 9613(g)(3)). For the reasons which follow, this Court holds that Plaintiff Gould's action is in the nature of a § 113 contribution action. As such, Defendants can only be severally liable for their proportionate share of the harm caused at the Marjol site. Furthermore, since liability under a § 113 contribution action is several, Defendants are not responsible to Gould for the "orphan shares". The Court takes notice of Gould's argument that it would be inequitable to hold Gould solely accountable for the "orphan shares". However, this argument is misplaced based in part on Gould's own waste-in-list. This list clearly shows how much each Defendant contributed to the harm and the resultant liability accorded to each Defendant. Since liability under a section 113 contribution action is several, Defendants are only liable for their share of the harm caused. The waste-in-list provides an accurate method for this Court to determine each Defendant's share of responsibility. Contrary to Gould's argument, it would be inequitable for us to hold Defendants liable for any harm related to the "orphan shares" when this harm was clearly caused by entities other than Defendants. Finally, we agree with the Defendants that § 113(g)(3) is the applicable statute of limitations governing a contribution action. However, Defendants argument that Gould is time barred is incorrect. As will be discussed, § 113(g)(3) requires one of four triggering events to occur in order to start the running of the three-year limitation period. Gould's consent order with the Environmental Protection Agency (EPA) is in no way equivalent to one of the four triggering events of § 113(g)(3) and therefore, Gould's action is not time barred. STATEMENT OF FACTS In December 1991, Plaintiff Gould initiated this action by filing a complaint against various Defendants seeking recovery pursuant to the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9601, et seq., for costs incurred and to be incurred to cleanup contamination at the "Marjol Site" located in the Borough of Throop, Lackawanna County, Pennsylvania. Marjol Battery & Equipment Company operated a battery-breaking operation in Throop, Pennsylvania from 1963 until May 1980 when Gould acquired the stock of the company. Gould operated the battery-breaking operations until April 1981 when it shut down its battery-breaking operations. In September, 1982, the Pennsylvania Department of Environmental Resources ("DER") advised Gould that no remediation would be necessary and no enforcement actions would be taken at the site unless battery-breaking operations resumed. However, *909 the EPA began investigating the Marjol Site in 1987 and after performing preliminary tests, concluded that there may be "an imminent and substantial endangerment to the public health, welfare or the environment." In April, 1988, the EPA and Gould entered into a Consent Agreement and Order pursuant to § 106(a) of CERCLA, 42 U.S.C. § 9606(a), to conduct site stabilization activities concerning lead and other hazardous substances at the Marjol Site and other residential properties. In May, 1990, Gould entered into a second consent order, this one with both the EPA and DER. This order was based on the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. § 6928(h). Pursuant to this second consent order, Gould agreed to perform a RCRA Facility Investigation and Corrective Measure Study ("CMS") at the Marjol Site. EPA is currently evaluating Gould's CMS, and will ultimately select a final remedy for the Marjol Site. Gould initiated the above-captioned matter as a cost recovery action pursuant to § 107(a)(4)(B) of CERCLA and, in the alternative, a contribution action pursuant to § 113(f) of CERCLA. On June 8, 1995, this Court entered Case Management Order No. 5 ("CMO No. 5"). The parties were directed to address the question of whether Gould can bring a § 107 cost recovery action or whether Gould is limited to a § 113 contribution action. The determination of which section(s) Gould can proceed under also affect the issue of who is responsible for the "orphan shares" and the corresponding statute of limitations for section 107 and section 113. The parties have adhered to "CMO No. 5" and the issue concerning whether the action is a § 107 cost recovery action or a § 113 contribution action is now ripe for adjudication. DISCUSSION Nature of Action Defendants' motion for partial summary judgment is brought pursuant to Federal Rule of Civil Procedure 56(c). A party is entitled to summary judgment where: the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. Fed.R.Civ.P. 56(c); see Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 2552, 91 L. Ed. 2d 265 (1986). The issue addressed in Defendants' motion is purely one of law. Gould has asserted a cost recovery action under § 107 of CERCLA or in the alternative a contribution action under § 113 of CERCLA. The issue before this Court is whether Gould can maintain both actions or are they limited to bringing a § 113 contribution action. CERCLA Section 107(a) of CERCLA imposes liability on four classes of potentially responsible parties ("PRPs"): (1) the owner and operator of the facility; (2) any person who owned or operated the facility at the time of disposal of any hazardous substance; (3) any person who by contract, agreement, or otherwise arranged for disposal or treatment of hazardous substances owned or possessed by that person; and (4) any person who accepted any hazardous substances for the transport to disposal or treatment sites selected by that person. 42 U.S.C. § 9607(a)(1)-(4). Section 113(f)(1) of CERCLA states, "[A]ny person may seek contribution from any other person who is liable or potentially liable under section 9607(a) of this title, during or following any civil action under section 9606 of this title or under section 9607(a) of this title...." In resolving contribution claims, the court may allocate response costs among liable parties using such equitable factors as the court determines are appropriate. Plaintiff Gould has asserted in its Complaint that it has a private right of action under § 107 for "cost recovery" that is distinct from its claim for "contribution" under § 113. However, this Court favors the view that CERCLA § 113 was enacted to confirm that responsible parties who resolve their liability to the government for a cleanup may bring an action against other allegedly responsible *910 parties for contribution. The § 106 consent agreement in April, 1988, between Plaintiff Gould and the EPA is a primary example of a responsible party, in this case Plaintiff Gould, resolving their liability to the government for the cleanup of a contaminated site. We find that Gould's action to recover its equitable share of its response costs is a section 113 contribution action. This finding is in accord with the various circuits that have addressed this issue. Plaintiff Gould has taken the position that the Third Circuit allows a private responsible party to bring a cost recovery action under § 107 where that party has remediated a site. However, the Third Circuit cases cited by Gould are inapplicable to the present action and do not stand for the proposition that private responsible parties can bring a § 107 cost recovery action. Third Circuit Decisions The issue presently before this Court has not been directly ruled upon by the Third Circuit and as such, we are not bound by precedent. The Third Circuit has implicitly accepted the position of the various circuits that a cost recovery claim by a private PRP is a claim for contribution under § 113 of CERCLA. In Smith Land & Improvement Corp. v. Celotex Corp., 851 F.2d 86 (3rd Cir.1988), cert. denied, 488 U.S. 1029, 109 S. Ct. 837, 102 L. Ed. 2d 969 (1989), a case originally brought in this Court, the EPA informed the site owner that unless it remediated the site, EPA would perform the work and seek recovery of its costs. The owner of the site settled with EPA and incurred costs cleaning the site. The owner then brought an action against the prior owner of the site under § 107 to recover those costs. While not directly holding the action to be a § 113 contribution action, the Third Circuit held, among other things, that in the context of a private CERCLA claim, the three defenses listed in § 107(b) are not exclusive and that a defendant may also raise equitable defenses. 851 F.2d at 89. Thus, the Third Circuit all but recognized that a cost recovery claim by a private PRP is a claim for contribution under § 113 of CERCLA because a § 107(a) cost recovery action has only the limited defenses specified in § 107(b). The Third Circuit's interpretation of allowing equitable defenses, thus classifying a cost recovery claim by a private PRP as a § 113 contribution claim, has been adopted by Transtech Industries, Inc. v. A & Z Septic Clean, 798 F. Supp. 1079 (D.N.J.1992), appeal dismissed, 5 F.3d 51 (3rd Cir.1993), cert. denied, ___ U.S. ___, 114 S. Ct. 2692, 129 L. Ed. 2d 823 (1994). In Transtech, a case that closely resembles the factual underpinnings before us, the EPA filed an action against the owners and operators of the Site, which was designed to force those responsible for the Site's situation to engage in cleanup operations. Plaintiffs in Transtech argued that the statutory scheme, § 107 and § 113, divides causes of action between privately initiated cleanups and cleanups initiated under threat by the EPA. Under plaintiffs' theory, claims of the former type constituted claims for response costs under § 107, while claims of the latter type were contribution claims under § 113(f)(1). The plaintiffs then contended that since they voluntarily began their cleanup operation, theirs was a cost recovery action under § 107. Id. at 1085. The Transtech opinion further stated that Congress enacted section 113(f)(1), to provide for fairness in situations where one party was bearing the cost of a major hazardous waste site simply because the EPA targeted it first. Id. at 1086. The court in Transtech also rejected plaintiffs' argument that the action was a § 107 cost recovery action because plaintiffs acted voluntarily in cleaning up the site. The court noted that plaintiffs actions were clearly the result of government threats. Likewise, in the present action, Plaintiff Gould acted in response to EPA directives, highlighted by Gould's and the EPA's signing of the April, 1988, Consent Order. Thus, it appears evident that when a party, who agrees to cleanup a site pursuant to a settlement agreement, sues another liable party, it is a claim for contribution and it must be distinguished from cases in which a plaintiff incurred expenses on its own initiative. *911 In Witco Corp. v. Beekhuis, 38 F.3d 682 (3rd Cir.1994), the Third Circuit again implicitly held that a cost recovery claim by a private responsible party is a claim for contribution. The Third Circuit began its opinion by noting that the case before it was an action for contribution. 38 F.3d at 684. Like the present matter, Witco was a suit brought by a site owner, who had signed a consent agreement with EPA, against other PRPs. The court several times cited the contribution action statute of limitations in § 113(g)(3), always indicating that the action was properly one in contribution under § 113. Plaintiff Gould's reliance on Hatco Corp. v. W.R. Grace & Co., 59 F.3d 400 (3rd Cir. 1995), is misplaced. Gould asserts that Hatco stands for the proposition that a § 107 cause of action is available to a private responsible party when they remediate a site. However, Hatco centered around § 9607(e) which deals with indemnification, hold harmless, etc., agreements, conveyances; or subrogation rights. Hatco simply does not illicit a holding that a § 107 cost recovery action is available to a private responsible party. Even if we were to determine that Hatco addressed the § 107 issue, which it does not, we are of the opinion that the position adopted in Transtech (holding that when a party who agreed to cleanup pursuant to a settlement agreement sues a liable party, it is a claim for contribution and it must be distinguished from cases in which a plaintiff incurred expenses on its own initiative) is the proper approach when dealing with private responsible parties. Plaintiff Gould also places reliance on the United States Supreme Court's decision in Key Tronic Corp. v. United States, ___ U.S. ___, 114 S. Ct. 1960, 128 L. Ed. 2d 797 (1994), for its position that a § 107 cost recovery action could be brought by a responsible party. Plaintiff Gould believes because the Supreme Court never suggested only innocent parties could bring a § 107 action, that the Key Tronic opinion grants an implied cause of action for a responsible party to bring a § 107 action. Nonetheless, it appears clear to this Court that Key Tronic focused on whether or not attorney's fees are a necessary cost of response within a § 107 action. In addressing the issue of recovering attorney's fees as response cost, Justice Stevens stated, "although § 107 unquestionably provides a cause of action for private parties to seek recovery of cleanup costs, that cause of action is not explicitly set out in the text of the statute. To conclude that a provision that only impliedly authorizes suit nonetheless provides for attorney's fees with the clarity required by Alyeska [Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 95 S. Ct. 1612, 44 L. Ed. 2d 141 (1975)] would be unusual if not unprecedented." Key Tronic at ___, 114 S.Ct. at 1967. Key Tronic's opinion focused on what types of fees may or may not be recoverable as part of § 107 response costs. Because the Supreme Court suggested that an implied cause of action under § 107 exists for private parties, (the Court never addressed the issue of whether or not only innocent parties could bring a § 107 action), Gould argues that Key Tronic allows them to bring a § 107 cost recovery action. However, Key Tronic did not answer the question of whether a responsible party could bring a § 107 action. As numerous courts of appeals, including the Third Circuit, have addressed this very issue, we are unpersuaded by Gould's position that they can assert a § 107 cost recovery action. The overwhelming belief is that when both parties are PRPs the action will sound in contribution. Plaintiff Gould also places reliance on the recent decision in Bethlehem Iron Works, Inc. v. Lewis Industries, Inc., 891 F. Supp. 221 (E.D.Pa.1995). In that case, the plaintiff was a responsible party that had incurred response costs in remediating a hazardous site under CERCLA. The plaintiff was allowed to bring a § 107 cost recovery action. That opinion reasoned that "permitting plaintiffs to raise their § 107 claims comports with CERCLA's goal of encouraging parties to initiate cleanup operations promptly and voluntarily." Bethlehem at 225. This Court is of the opinion that the Bethlehem court allowed a § 107 action by focusing on CERCLA's goals of having responsible *912 parties initiate cleanup actions voluntarily and promptly. Once again, in the instant action, Plaintiff Gould did not voluntarily initiate cleanup of the Marjol Site. Gould's cleanup operations were the direct result of the EPA Consent Order of April, 1988. Thus, we reiterate our support for the holding in Transtech Industries v. A & Z Septic Clean, 798 F. Supp. 1079 (D.N.J.1992), appeal dismissed, 5 F.3d 51 (3rd Cir.1993), cert. denied, ___ U.S. ___, 114 S. Ct. 2692, 129 L. Ed. 2d 823 (1994), that when a party agrees to cleanup a site pursuant to a settlement agreement, and sues another liable party, it is a claim for contribution and must be distinguished from cases in which a plaintiff incurred expenses upon its own initiative. OTHER CIRCUITS While the Third Circuit has only implicitly found that a cost recovery claim by a private party is a § 113 contribution action, other circuits have explicitly found that in private party CERCLA actions, one responsible party's claim against another responsible party is a contribution claim subject to the provisions of § 113. In United States v. Colorado & Eastern R.R., 50 F.3d 1530 (10th Cir.1995), a PRP brought a cross-claim against another PRP under § 107 and the targeted PRP argued that the claim should be treated as a "contribution" claim. The court found that the claimant was a PRP and "therefore, any claim that would apportion costs between [the] parties is the quintessential claim for contribution." Id. at 1536, citing Restatement (Second) of Torts at 888A (1979), and Amoco Oil v. Borden, Inc., 889 F.2d 664, 672 (5th Cir.1989). The Tenth Circuit further reasoned that to allow one PRP to recover costs from another PRP under the strict liability scheme of § 107 would eviscerate § 113. Id. at 1536. In United Technologies Corp. v. Browning-Ferris Industries, Inc., 33 F.3d 96 (1st Cir.1994), cert. denied, ___ U.S. ___, 115 S. Ct. 1176, 130 L. Ed. 2d 1128 (1995), the First Circuit found that the plaintiff's action was one for "contribution" and not for cost recovery under § 107. The court determined that the plaintiff was also a liable party and concluded that its claim "must be classified as an action for contribution." Id. at 101. Additionally, the Seventh Circuit in Akzo Coatings v. Aigner Corp., 30 F.3d 761 (7th Cir.1994), found that a liable party seeking recovery of costs it had incurred in cleanups, has only a claim for "contribution" despite the fact that § 107 permits "any person" to seek recovery. The court determined that Akzo had no cause of action under § 107 because: Akzo has experienced no injury of the kind that would typically give rise to a direct claim under Section 107(a) — it is not, for example, a landowner forced to clean up hazardous materials that a third party spilled onto its property or that migrated there from adjacent lands. Instead, Akzo itself is a party liable ... and the gist of Akzo's claim is that the costs it has incurred should be apportioned equitably amongst itself and the others responsible.... That is a quintessential claim for contribution. Id. at 764. In Amoco Oil Co. v. Borden, Inc., 889 F.2d 664 (5th Cir.1989), the Fifth Circuit held that any action among PRPs is for contribution. In Amoco, a PRP sued to recover response costs it had incurred and would incur under a cleanup. The court held it first must determine if the defendant is a liable person under § 107(a). The "court then must ascertain, under CERCLA's contribution provision, each responsible party's equitable share of the cleanup costs." Id. at 668. "When one liable party sues another to recover its equitable share of the response costs, the action is one for contribution ..." Id. at 672. We find no credence in Gould's argument that the Amoco case is an example of courts using a two-step process to determine each party's response costs. The fact that the Amoco court went to § 107(a) first was merely to determine if a party was liable, for it is § 107(a) that determines whether or not a party is liable. Gould favors an approach whereby a PRP can bring a § 107 action to recover its response cost and then have the other liable parties bring a § 113 contribution counterclaim to allocate liability. Amoco looked to § 107(a) only to determine if a *913 party may be liable. It was not a situation where the two-step process was initiated. Because both parties, like here, were PRPs, the claim to reapportion costs between the parties was found to be a contribution claim. Most recently, Control Data Corp. v. S.C.S.C. Corp., 53 F.3d 930 (8th Cir.1995), joined the growing list of appeals courts that ruled that private party CERCLA litigation brought by a liable party to recover costs is an action governed by the contribution provisions of § 113. Based on the numerous circuit holdings as well as the implicit findings in the Third Circuit, when a private responsible party sues another responsible party to reapportion costs, that action will be a "contribution" action pursuant to § 113. The cases relied upon by Plaintiff Gould are either misplaced or distinguishable. In a factual situation, like the present action, where a responsible party initiates a site cleanup pursuant to governmental pressure, and then sues another responsible party to allocate the costs, the action falls under the provisions of § 113. We agree that a private cause of action may exist under § 107, as is implied by Key Tronic Corp. v. United States, ___ U.S. ___, 114 S. Ct. 1960, 128 L. Ed. 2d 797 (1994). However, the issue of whether the action is available for a non-innocent party was never addressed by the Supreme Court. As such, we have proceeded along the same avenue taken by the United States Court of Appeals for the 1st, 5th, 7th, 8th and 10th Circuits, as well as the implicit findings of the Third Circuit in Smith Land & Improvement Corp. v. Celotex Corp., 851 F.2d 86 (3rd Cir.1988), cert. denied, 488 U.S. 1029, 109 S. Ct. 837, 102 L. Ed. 2d 969 (1989); and Witco Corp. v. Beekhuis, 38 F.3d 682 (3rd Cir.1994). Plaintiff Gould may not bring a § 107 cost recovery action and is instead limited to bringing a § 113 contribution action. Partial Summary Judgment is therefore granted to the moving Defendants on the nature of the claim issue. "ORPHAN SHARES" After finding in favor of the moving Defendants on their motion for partial summary judgment with respect to Plaintiff Gould being limited to asserting a § 113 cause of action, we turn our attention to the issue concerning the so-called "orphan shares" that were deposited at the Marjol-Site. Since liability under a § 113 action is several, not joint and several, each party is only responsible for their proportionate share of the harm caused at the Marjol-Site. The Defendants are not responsible to Gould for the "orphan shares" in question. The contribution provision of § 113 states in part, "In resolving contribution claims, the court may allocate response costs among the liable parties under such equitable factors as the court determines are appropriate." 42 U.S.C. § 9613(f)(1). In allocating response costs, this Court can think of no greater equitable factor than Plaintiff Gould's own waste-in-list. This list establishes the exact amount of harm caused by every Defendant, after the deduction of Plaintiff's share and the "orphans shares". As liability in a § 113 contribution action is several, the Defendants are responsible for their respective contributions to the harm at the Marjol-Site. It appears to this Court that it would be most inequitable to hold Defendants liable for any of the "orphan shares" when Gould's waste-in-list specifically indicates the exact amount each Defendant contributed to the harm. Therefore, Defendants motion for partial summary judgment is granted with respect to each Defendant being responsible for its own contribution to the harm. Plaintiff Gould cannot collect any part of the "orphan shares" from the Defendants. STATUTE OF LIMITATIONS Turning to the issue concerning the applicable statute of limitations for a contribution action, the parties are clearly in disagreement as to which statute applies. The parties cite two different sections of CERCLA as being the applicable statute of limitations section. The court in United Technologies Corp. v. Browning-Ferris Industries, 33 F.3d 96, 99 (1st Cir.1994), cert. denied, ___ U.S. ___, 115 S. Ct. 1176, 130 L. Ed. 2d 1128 (1995), stated that the statutory language of § 113(g)(2) and § 113(g)(3) suggests that cost recovery and contribution actions are distinct and do not overlap. This reasoning becomes vital when examining the respective positions of *914 the parties. We believe both sides are somewhat incorrect in their briefs on this issue. Plaintiff Gould is in error in asserting that § 113(g)(2) is the appropriate statute of limitations section and likewise, Defendants are incorrect in asserting that under § 113(g)(3) Plaintiff is time barred by the three year statute of limitations from bringing this action. Plaintiff Gould is of the opinion that they can bring a cost recovery action under § 107 of CERCLA. 42 U.S.C. § 9607. This section is controlled by the statute of limitations in § 113(g)(2) which reads as follows: (2) Actions for recovery of costs An initial action for recovery of the costs referred to in section 107 of this title must be commenced — (A) for a removal action, within 3 years after completion of the removal action, except that such recovery action must be brought within 6 years after a determination to grant a waiver under section 9604(c)(1)(C) of this title for continued response action; and (B) for a remedial action, within 6 years after initiation of physical on-site construction of the remedial action, except that, if the remedial action is initiated within 3 years after the completion of the removal action, costs incurred in the removal action may be recovered in the cost recovery action brought under this subparagraph. As discussed at length earlier, the case law both in this Circuit and several others requires that Plaintiff Gould may bring this action pursuant to a § 113 contribution action but they cannot bring the action pursuant to a § 107 cost recovery action. Thus, since contribution actions and cost recovery actions are separate and distinct, Plaintiff Gould's assertion that § 113(g)(2) is the applicable statute of limitations is incorrect, since that section relates to cost recovery actions under § 107, while the instant case is a contribution action under § 113. The Defendants in this matter are of the belief that the applicable statute of limitations is contained in § 113(g)(3). This statute reads as follows: (3) Contribution No action for contribution for any response costs or damages may be commenced more than 3 years after — (A) the date of judgment in any action under this chapter for recovery of such costs or damages, or (B) the date of an administrative order under section 9622(g) of this title (relating to de minimis settlements) or 9622(h) of this title (relating to cost recovery settlements) or entry of a judicially approved settlement with respect to such costs or damages. Defendants are correct in their assertion that § 113(g)(3) is the applicable statute of limitations, however, their interpretation of the statute is somewhat flawed. Defendants state that under § 113(g)(3), the statute of limitations is three years from the date that the plaintiff enters a consent agreement with the United States to clean the site. See United Technologies Corp. v. Browning-Ferris Industries, Inc., 33 F.3d 96 (1st Cir.1994). Defendants contend that Gould's past-cost claim is time barred under § 113(g)(3) since Gould signed a Section 106 consent order with EPA in April, 1988, but did not file the present action until December, 1991, that is, more than three (3) years after the signing of the consent order. Plaintiff Gould argues that none of the four (4) triggering events contained in § 113(g)(3) have occurred and therefore they are not time barred by that section. The four events that trigger the running of the statute of limitations are as follows: (1) the entry of a judgment; (2) a section 9622(g) de minimis settlement; (3) a section 9622(h) cost recovery settlement; and (4) a judicially approved settlement Plaintiff Gould is correct in its assertion that none of the four triggering events have occurred and thus, Gould's claim is not time barred by § 113(g)(3). Gould entered into a consent agreement with EPA to cease its battery operations at the Marjol-Site. The consent agreement is in no way equivalent *915 to any of the four necessary triggering events that would run the three year limitation period contained in § 113(g)(3). The clear language of § 113(g)(3) states that "no action for contribution for any response costs or damages may be commenced more than 3 years after — (any of the four triggering events)." As none of the so called triggering events have occurred, Gould's claim, which is one for contribution, is timely brought. Gould's entering into a section 106 consent order with the EPA in April, 1988, is not one of the four triggers for running the statute of limitations. Accordingly, Defendants motion for partial summary judgment with respect to Gould's action being time barred by the statute of limitations in § 113(g)(3) is denied. CONCLUSION For the reasons indicated above, the moving Defendants' motion for partial summary judgment is granted in part and denied in part. Defendants' motion is granted with respect to the nature of the claim. Plaintiff Gould may not bring a § 107 cost recovery action, but may only assert a § 113 contribution action. In regards to liability, Defendants' motion is granted and liability will be several only. Furthermore, the motion also grants partial summary judgment to Defendants in holding that they are not responsible to Gould for the "orphan shares". Finally, the Defendants' motion for partial summary judgment is denied with respect to the statute of limitations argument. The applicable statute of limitations is contained in § 113(g)(3) and does not bar Plaintiff Gould from bringing this action. An appropriate Order is attached. ORDER AND NOW, THIS 14th DAY OF SEPTEMBER, 1995, IT IS HEREBY ORDERED THAT: 1. Defendants' Motion for Partial Summary Judgment (Doc. No. 796) is GRANTED IN PART and DENIED IN PART. 2. Defendants' motion is GRANTED in disallowing Plaintiff Gould from asserting a § 107 cost recovery action and limiting Gould's action to a § 113 contribution action. 3. Defendants' motion is GRANTED whereby each Defendant is only severally liable for their respective share of the harm caused at the Marjol-Site. 4. Defendants' motion asserting that they are not responsible to Plaintiff Gould for the "orphan shares" is GRANTED. 5. Defendants motion relating to the statute of limitations is DENIED. Plaintiff Gould is not time barred from bringing a § 113 contribution action. 6. This opinion disposes of document numbers 792 and 796 respectively. 7. The Clerk of Court is directed to mark the docket sheet accordingly. NOTES [1] The Micro Defense Group has joined in the motion and corresponding memorandum of law filed by the PRP Group and the Rosenn Jenkins Joint Defense Group. The Micro Defense Group's Motion and Brief in Support are found in Docket Number 792 and Docket Number 793 respectively. [2] The term "orphan shares" as used throughout our opinion, refers to the percentage of the harm at the former Marjol Site that was caused by parties other than Plaintiff Gould or any of the numerous Defendants

2013-10-30 06:35:55.352228+00

Dally

491 S.W.2d 936 (1973) Charles Manuel WRIGHT, Appellant, v. The STATE of Texas, Appellee. No. 45824. Court of Criminal Appeals of Texas. March 21, 1973. Rehearing Denied April 11, 1973. *937 Howard B. Law, Dallas, for appellant. Henry Wade, Dist. Atty., and W. T. Westmoreland, Jr., Asst. Dist. Atty., Dallas, Jim D. Vollers, State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION DALLY, Commissioner. The conviction is for robbery by firearms, the punishment 149 years imprisonment. The evidence shows the appellant robbed J. O. Simpson by the use of a pistol. The sufficiency of that evidence to sustain the conviction is not challenged. The appellant first complains that the state was erroneously permitted to test the knowledge of a witness who testified that the appellant's general reputation for being a peaceable, law-abiding citizen was good by asking "have you heard" questions concerning the offense for which he was being tried and acts alleged to have occurred subsequent thereto. The appellant designates the following portion of the record as supporting his claim of error. Question by the prosecutor: "I failed to ask you this, but had you heard that Charles Manuel Wright was arrested on September 27, 1967—" Defendant's attorney: "Your Honor, I object to this and to any insinuation of the record after the alleged offense, we don't think that is material to this case and is prejudicial." The Court: "I overrule the objection." Defendant's attorney: "Note our exception." Prosecutor: "For the offense of armed robbery and murder which occurred on August 6th, 1967, had you heard that?" Witness: "Had I heard that? No, I just heard that he got picked up for investigation of armed robbery." As soon as the witness had left the witness stand the appellant's counsel placed the prosecutor on the witness stand and showed that the murder to which prosecutor was referring in the above question occurred August 28, 1967, subsequent to the commission of the alleged offense for which he was being tried and prior to the time of his arrest on September 27, 1967.[1] *938 The appellant's objection in the trial court concerned only the asking of "have you heard" questions about acts subsequent to the offense for which he was on trial. Although the rule was different prior to the effective date of Article 37.07, Vernon's Ann.C.C.P., that article now permits either the state or the defendant during the hearing at the punishment phase of the trial to introduce evidence concerning the appellant's general reputation for being a peaceable, law-abiding citizen up until the time of trial. Therefore, the appellant's objection to the prosecutor's asking "have you heard" questions concerning matters occurring after the time of the alleged offense is without merit. See Broadway v. State, 418 S.W.2d 679 (Tex. Cr.App.1967); Ballew v. State, 452 S.W.2d 460 (Tex.Cr.App.1970) and Frison v. State, 473 S.W.2d 479 (Tex.Cr.App.1971). For the first time on appeal appellant additionally asserts that "... it is not proper for the State to show or attempt to show that the reputation of the defendant is bad because of the charge for which he is being tried." It is still improper to permit a witness to testify that a defendant's general reputation for being a peaceable law-abiding citizen is bad based upon the offense for which he is being tried. Stephens v. State, 128 Tex. Crim. 531, 80 S.W.2d 980 (1935); Broadway v. State, supra (concurring opinion); Wilson v. State, 434 S.W.2d 873 (Tex.Cr.App.1968) and Frison v. State, supra. It is also improper to test the knowledge of a witness who has testified to the good reputation of a defendant for being a peaceable, law-abiding citizen by asking "have you heard" questions concerning the alleged offense for which he is being tried. In this case the asking of the question and the answer given do not show reversible error. In the first place no objection was made on this ground at the time of trial. In addition, from the record in this case it is not entirely clear that the armed robber referred to by the prosecutor in his question was the same robbery for which he was then on trial, even though the robbery referred to in the question was committed on the same day alleged in the indictment in the case for which he was being tried. See Frison v. State, supra. Further, the answer of the witness does not reflect what effect the robbery offense referred to in the question had upon the appellant's reputation. What was said in King v. State, 133 Tex. Crim. 496, 113 S.W.2d 181 (1938) under similar circumstances is equally applicable here. That is: "The state was venturing on dangerous ground in the particulars mentioned, but it appears that the witness did not advise whether what he had heard had been good or bad, and we think the bill fails to reflect error which would call for a reversal." See also Boone v. State, 149 Tex. Crim. 476, 196 S.W.2d 638 (1945);[2] Frison v. State, supra, and Grizzell v. State, 164 Tex. Crim. 362, 298 S.W.2d 816 (1956). The appellant next contends that it was error to prevent him from placing before the jury evidence that he had been incarcerated for eighteen months prior to trial. He argues that such evidence was admissible to explain his lack of witnesses on the issue of alibi. The record does not show that he was deprived of any alibi witnesses. At a hearing out of presence of the jury the appellant named only one witness whose testimony he desired and who was not available as a witness. Later *939 the witness named did in fact testify. No error is shown. The appellant also urges that it was error for the court to refuse to strike testimony given by him in answer to one of his own counsel's questions on direct examination which he says was non-responsive. His counsel inquired: "Okay, were you employed after you left school? Did you have a job?" The appellant answered: "I went to reform school." We perceive no error in the court's refusal to strike this answer. The appellant's last ground of error urges that the court erred in limiting his cross-examination of the witness Mrs. J. O. Simpson concerning the identification of photographs introduced after her initial testimony. Although there were a number of eye witnesses to this robbery which occurred at a restaurant where a number of patrons were present, only two witnesses observed the appellant before he placed a mask over his face. Both of these witnesses testified and were unequivocal in their identification of the appellant. Both witnesses were cross-examined at length and without limitation. Later the defense placed into evidence two photographs. One was a photograph of the appellant (Defense Exhibit No. 2) and the other was a photograph of the appellant's brother. (Defense Exhibit No. 3). The next day appellant's counsel recalled the two witnesses for further cross-examination. Mrs. Simpson was called to the stand and counsel were informed that she was suffering from a severe migraine headache and were admonished by the court not to repeat what had already been covered in earlier testimony. After the photograph, Defense Exhibit No. 3, was exhibited to Mrs. Simpson and inquiry was made as to whether that was a picture she had identified at her place of business as being the appellant, Mrs. Simpson said she didn't know. The court commented that he didn't believe the witness was in condition to testify. Defense counsel said: "Okay, we have no further questions," and the witness was excused. The other witness, Mrs. Marlow, was recalled to the witness stand and fully cross-examined by defense counsel. After she had been excused, defense counsel orally requested a continuance because of his inability to cross-examine Mrs. Simpson "about her identification of the picture in question." A defendant is entitled to a fair opportunity to cross-examine a State's witness. Such cross-examination must be done with due regard to rules of evidence and within the sound discretion of the trial court. Under this record we are unable to find that the appellant was deprived of his right to cross-examine Mrs. Simpson. She was excused and another witness testified before complaint was made. Further, the appellant has not demonstrated in the record either at the time of trial or on his motion for new trial an abuse of discretion in the trial court's refusing to grant the requested continuance for the purpose of further cross-examination. The judgment is affirmed. Opinion approved by the Court. NOTES [1] Appellant's counsel also showed the prosecutor knew appellant had been no-billed by the grand jury for the murder. This would not constitute bad faith in that the witness was only asked if she had heard appellant was arrested for the murder, which he had been, and not asked if she had heard he committed or was tried for that offense. It was not shown that the robbery referred to by the prosecutor was the one for which he was on trial. [2] The "have you heard" questions in Boone v. State, supra, may not have been properly framed. For a good discussion of that matter see Brown v. State, Tex.Cr. App., 477 S.W.2d 617 (1972) and Webber v. State, Tex.Cr.App., 472 S.W.2d 136 (1971).

2013-10-30 06:35:55.362272+00

Lederberg

704 A.2d 740 (1997) Patricia CALLAGHAN v. RHODE ISLAND OCCUPATIONAL INFORMATION COORDINATING COMMITTEE/INDUSTRY EDUCATIONAL COUNCIL OF LABOR, et al. Nos. 96-536-MP, 96-537-MP. Supreme Court of Rhode Island. December 11, 1997. *741 Bernard W. Boyer, Providence, for Plaintiff. Howard L. Feldman, Providence, Alan J. Cooke, Joseph C. Tanski, Boston, MA, for Defendant. Before WEISBERGER, C.J., and LEDERBERG, BOURCIER, FLANDERS and GOLDBERG, JJ. OPINION LEDERBERG, Justice. These consolidated cases came before the Supreme Court on petitions for certiorari in respect to a final decree of the Appellate Division of the Workers' Compensation Court (Appellate Division). Employee Patricia Callaghan (Callaghan) sought review of the Appellate Division's reversal of one of two cost-of-living adjustments (COLAs) granted to her by a trial judge of the Workers' Compensation Court. The Rhode Island Insurers' Insolvency Fund (fund) sought review of the Appellate Division's imposition of a 20 percent penalty fee for the fund's failure to pay the remaining COLA in a timely manner and of an award of attorney's fees to Callaghan. For the reasons set forth below, we deny and dismiss both petitions. The facts insofar as pertinent to these petitions follow. Facts and Procedural History Callaghan suffered a work-related injury on June 1, 1990, while employed by the Rhode Island Occupational Information Coordinating Committee/Industry Educational Council of Labor (council). At the time of the injury, the council's insurer was American Universal Insurance Company (American Universal). A memorandum of agreement dated September 21, 1990, provided for the payment of weekly workers' compensation benefits to Callaghan as of June 2, 1990, for total incapacity due to carpal tunnel syndrome. American Universal was declared insolvent by the Rhode Island Superior Court on January 8, 1991, at which time the fund became obligated to pay covered claims that existed prior to the determination of the insurer's insolvency. G.L.1956 § 27-34-8(a)(1). On March 5, 1993, Callaghan filed with the Workers' Compensation Court (WCC) a petition for review of the memorandum of agreement, seeking a COLA effective May 1992. Callaghan had not received a COLA since she began receiving workers' compensation benefits in 1990. Following a pretrial conference, a WCC trial judge issued a pretrial order on March 26, 1993, granting Callaghan's petition and awarding two COLAs, retroactive to June 2, 1991, and June 2, 1992—the dates corresponding to the anniversary of her total incapacity. The pretrial order denied penalties and interest on the COLAs. On March 31, 1993, Callaghan filed a claim for a trial to the WCC, pursuant to G.L.1956 § 28-35-20(d). Although Callaghan waived any rights to the payment of interest on the COLAs, she contended that, pursuant to statute, she was entitled to 20 percent of the amount of the awarded COLAs as a penalty for late payment of the COLAs. In February 1995, Callaghan was once again awarded COLA increases retroactive to June 2, 1991, and June 2, 1992, and was once again denied the 20 percent penalty. On February 14, 1995, Callaghan filed a claim of appeal to the WCC Appellate Division in which she averred that the WCC trial *742 judge had erred, inter alia, both by misinterpreting applicable statutes, and thereby denying the 20 percent penalty assessment, and in denying interest payments on the COLAs. Neither party appealed the grant of the two COLAs. On September 27, 1996, the Appellate Division entered a final decree that ordered the fund to pay the 20 percent penalty for its failure to pay Callaghan a COLA in a timely fashion and to pay Callaghan's attorney's fees for both the WCC trial and the appeal, but it denied Callaghan's request for interest on the COLAs. In addition, the Appellate Division reversed the trial court's granting of two COLAs, finding that under the Workers' Compensation Act, Callaghan was entitled to only one COLA as of May 10, 1992. Pursuant to § 28-35-29, the fund filed a petition for certiorari on October 17, 1996 (No. 96-536-M.P.), asserting that the Appellate Division lacked jurisdiction to interpret or to apply the Rhode Island Insurers' Insolvency Fund Act and that the award of the 20 percent penalty and attorney's fees constituted legal error. Callaghan also filed a petition for certiorari on the same day (No. 96-537-M.P.), contending that the Appellate Division was without jurisdiction to deny one of the COLAs awarded by the WCC trial judge. On October 28, 1996, a stay of the final decree of the Appellate Division was granted by the duty judge, and on November 21, 1996, certiorari was granted in respect to both petitions, the matters were consolidated for briefing and oral argument, and the stay was continued until further order of this Court. Standard of Review It is well settled that this Court does not engage in weighing evidence on certiorari but, rather, reviews the record to determine "whether legally competent evidence supports the findings of the tribunal whose decision is under review." Simpson v. Dytex Chemical Co., 667 A.2d 1229, 1231 (R.I.1995) (citing, inter alia, Ryan v. Zoning Board of Review of New Shoreham, 656 A.2d 612, 615 (R.I.1995)). Moreover, if such evidence exists, the findings of the tribunal, in this case the Appellate Division, are binding upon this Court, absent fraud. Forte v. Fernando Originals, Ltd., 667 A.2d 780, 782 (R.I.1995) (citing Falvey v. Women and Infants Hospital, 584 A.2d 417, 419 (R.I.1991)). Appellate Division's Jurisdiction to Reverse Trial Court Award We address first the single claim raised in Callaghan's petition, namely, that because none of the parties appealed the award of the two COLAs, the Appellate Division erred in eliminating one of the COLAs awarded by the WCC. Specifically, Callaghan claimed that the Appellate Division "was without any jurisdiction to deny a `COLA' granted by the Trial Judge when there was no appeal by the [council or the fund] nor, obviously, any reason of [sic] appeal."[1] It is axiomatic that issues not properly brought before appellate tribunals are deemed to have been waived by the parties. Simpson, 667 A.2d at 1231; Hydro-Manufacturing, Inc. v. Kayser-Roth Corp., 640 A.2d 950, 959 (R.I.1994). But an appellate court is not required to overlook a fact, such as an arithmetical error, that, once perceived, is controlling in respect to the issue before the tribunal. In George W. Smith & Son, Inc. v. Cimini, 692 A.2d 340 (R.I.1997) (mem.), for example, this Court recalculated sua sponte the statutory interest on indebtedness to which the plaintiff was entitled after recognizing that the Superior Court justice had committed an arithmetical error in his calculation of the interest. And in reviewing a case decided by the former Workmen's Compensation Commission, this Court acknowledged the principle that the MI commission "lacked jurisdiction" to consider an appeal in any respect save that propounded by the parties, but held that the full commission was not barred from amending a decree to include the essential finding of the claimant's average weekly wage, which finding had been omitted when the case was heard at the single commissioner stage. *743 Corrado v. Brown University, 98 R.I. 256, 260-62, 201 A.2d 29, 31-32 (1964). The Workers' Compensation Act delineates the authority of the Appellate Division, providing in pertinent part that "[a]ny person aggrieved by the entry of a decree by a [Workers' Compensation Court] judge may appeal to the appellate division * * *. [An] appellate panel [of the court] shall forthwith review the decree upon the record of the case and shall file a decision pursuant to the law and the fair preponderance of the evidence * * *. Upon consideration of the appeal, the appellate panel shall affirm, reverse, or modify the decree appealed from, and may itself take such further proceedings as just * * *." (Emphases added.) G.L.1956 § 28-35-28(a). Of particular importance in the case before us is the fact that the Appellate Division's express authority to affirm, to reverse, to modify the decree appealed from, and to "itself take such further proceedings as just" was introduced into § 28-35-28 in 1990, by P.L.1990, ch. 332, art. I, § 5. In the case before us, the Appellate Division determined that the WCC trial judge had erred as a matter of law in awarding two COLA increases, effective June 2, 1991, and June 2, 1992, to Callaghan, who was found to be totally incapacitated as of June 2, 1990. The award of COLAs is governed by G.L.1956 § 28-33-17(f)(1), which provides that "[w]here any employee's incapacity is total and has extended beyond fifty-two (52) weeks, regardless of the date of injury, payments made to all such totally incapacitated employees shall be increased as of May 10, 1991, and annually on the tenth (10th) of May thereafter so long as the employee remains totally incapacitated." (Emphases added.) Applying the statute, the Appellate Division reasoned that "the employee really has a two-part burden in cases seeking a cost of living adjustment. The employee must demonstrate A) that they are totally disabled as of May 10, and B) that this total incapacity has extended beyond fifty-two (52) weeks. A review of the stipulation entered by the parties here reveals that [Callaghan] first satisfied both of these conditions on May 10, 1992, and would therefore be entitled to a COLA only as of that date." The parties stipulated that Callaghan was rendered totally incapacitated on June 2, 1990. Consequently, on May 10, 1991, Callaghan had not been totally incapacitated for a period beyond fifty-two weeks, and therefore, she was not eligible for a COLA award at that time. The next date of eligibility under the statute was May 10, 1992, the date in fact that Callaghan herself cited in her initial 1993 petition to the WCC, in which she requested "that the respondent be ordered to pay cost of living increase effective May, 1992." (Emphasis added.) Under the delineation of powers set forth in § 28-35-28, see ante, the Appellate Division, in considering an appeal, is granted express authority to "modify the decree appealed from" and to "take such further proceedings as [are] just." We are led to conclude, therefore, that the Appellate Division did not err in issuing a decree that was consonant with a plain and ordinary reading of the statute governing COLA awards. See Accent Store Design, Inc. v. Marathon House, Inc., 674 A.2d 1223, 1226 (R.I.1996) ("[W]hen the language of a statute is clear and unambiguous, this Court must interpret the statute literally and must give the words of the statute their plain and ordinary meanings."). Moreover, we have affirmed the judgment of the Appellate Division in similar cases. For example, in Forte, 667 A.2d at 782-83, this Court affirmed the Appellate Division's modification of a trial judge's computation of an employee's weekly earnings in circumstances in which the trial court was clearly in error in not complying with the statutory method for computing wages. Here, because legally competent evidence existed to support the Appellate Division's determination that Callaghan was entitled to one COLA only, we conclude that the Appellate Division did not err in modifying the WCC decree to ensure its compliance with § 28-33-17(f)(1). *744 Appellate Division's Imposition of 20 Percent Penalty and Attorney's Fees We turn next to the claims of the fund, which petitioned this Court to review the Appellate Division's order that the fund pay Callaghan's attorney's fees as well as a fee equal to 20 percent of the approved COLA. Central to our analysis of the fund's claim in this regard is § 28-33-17(f)(5),[2] which provides that computations for COLA payments to totally incapacitated individuals "shall be made by the director of labor and promulgated to insurers and employers making payments required by this section. Increases shall be paid by insurers and employers without further order of the court. If payment payable under this section is not paid within fourteen (14) days after the employer or insurer has been notified or it becomes due, whichever is later, there shall be added to the unpaid payment an amount equal to twenty percent (20%) thereof, which shall be paid at the same time as, but in addition to the payment." The fund contested the orders of the Appellate Division on several grounds, and we address each claim separately. Statutory Authority. The fund argued that "[t]he Workers' Compensation Act contains no provision which allows the workers' compensation court to exercise jurisdiction to interpret or apply the Rhode Island Insurer's Insolvency Fund Act or impose penalties upon the Fund in contravention of the [Insolvency Fund] Act." With this contention we must disagree. We begin by pointing out the WCC's express authority pursuant to G.L.1956 § 28-30-1(a), which provides that "[t]here shall be established in the state of Rhode Island a workers' compensation court * * * having such jurisdiction as may be necessary to carry out its duties under the provisions of the Workers' Compensation Act * * * except those provisions of the act which establish violations of the act as crimes, offenses, or misdemeanors." (Emphasis added.) In interpreting this statutory framework of the WCC, this Court has stated: "It is our opinion that in the enactment of § 28-30-1 the legislature was conferring full and general jurisdiction in connection with all matters relating to workmen's compensation on the commission which the statute creates. * * * To hold that the legislature, in transferring jurisdiction of workmen's compensation cases from the superior court, intended that the commission it created for that purpose would establish a forum not fully effective is repugnant to reason and wholly untenable." Segrella v. Workmen's Compensation Commission, 91 R.I. 282, 287, 162 A.2d 810, 813 (1960). In the instant case, the Appellate Division found that Callaghan was entitled by law to a COLA award. Having determined that payment of the COLA had not been rendered in a timely fashion, the Appellate Division was then confronted with the task of assessing the obligation of the fund to pay the statutorily imposed penalty for failure to make prompt payment. Integral to this determination was an interpretation and application of the Rhode Island Insurers' Insolvency Fund Act. The fund's constrained view of the jurisdiction of the WCC repudiates our pronouncement in Segrella and contravenes the well-settled principle that the Workers' Compensation Act is to be liberally construed to effectuate its purpose. See, e.g., Mendes v. ITT Royal Electric, 648 A.2d 1358, 1360 (R.I. 1994) (per curiam); DeNardo v. Fairmount Foundries Cranston, Inc., 121 R.I. 440, 452, 399 A.2d 1229, 1236 (1979) (Kelleher, J., concurring) ("[T]he [Workers' Compensation] Act's provisions must be given a liberal construction with an eye to effectuating their evident humanitarian purpose."). Because a determination of the fund's obligation with respect to the COLA penalty is essential to the outcome of the case, we are of the opinion that the WCC, pursuant to § 28-30-1, may interpret and apply the Rhode Island *745 Insurers' Insolvency Act to the extent necessary to determine the fund's obligations under the Workers' Compensation Act. Attorney's Fees and 20 Percent Penalty: Sanction or Obligation, Punitive or Remedial? The fund also argued that it should not have to pay the 20 percent penalty and the award of attorney's fees. It asserted that these sums do not fall within the definition of "covered claim" under the Rhode Island Insurers' Insolvency Fund Act "because [they] did not arise out of and [were] not within the coverage of the Council's insurance policy with American." In arguing that it was not obligated to pay these amounts, the fund further contended that the 20 percent penalty constituted punitive or exemplary damages that the statute expressly exempts the fund from paying. We disagree. With respect to the fund's first objection, we note that we have previously rejected similar arguments. For example, in Jerry's Supermarkets, Inc. v. Rhode Island Insurers' Insolvency Fund, 692 A.2d 697, 698 (R.I. 1997), this Court rebuffed the fund when it contended that "pre- and postjudgment interest arise from statute, not from the policy's coverage, and hence do not fall within the act's definition of covered claims." Turning to the second contention, we note that the definition of a "covered claim" under the Rhode Island Insurers' Insolvency Fund Act states that "[c]overed claim' means an unpaid claim, including one for unearned premiums, submitted by a claimant, which arises out of and is within the coverage and subject to the applicable limits of an insurance policy to which this chapter applies issued by an insurer, if the insurer becomes an insolvent insurer on or after July 1, 1988." G.L.1956 § 27-34-5(8). Section 27-34-5(8)(ii) goes on to explain that the term "covered claim" "shall not include any amount: (A) Awarded as punitive or exemplary damages." In determining that the fund was obligated to pay the 20 percent penalty for its failure to pay Callaghan's COLA in time, the Appellate Division reasoned: "The facts reveal that [Callaghan] was seeking payment of a May 1992, cost of living increase. As of January 8, 1991, American was declared insolvent and the Insolvency Fund became responsible to pay all `covered claims' existing prior to the declaration of insolvency. Pursuant to this responsibility, the Insolvency Fund was subsequently required to pay [Callaghan her] workers' compensation benefits and cost of living increases pursuant to the Workers' Compensation Act. The penalty was incurred because the Insolvency Fund failed to meet its own responsibilities to pay the cost of living increase in May of 1992." In our view, the Appellate Division correctly concluded that the 20 percent penalty was not, as the fund had contended, a punitive or an exemplary award prohibited by § 27-34-5(8), and pointed out that a party seeking punitive damages is required to produce "evidence of such willfulness, recklessness or wickedness, on the part of the party at fault, as amount[s] to criminality, that * * * ought to be punished." Allen v. Simmons, 533 A.2d 541, 543 (R.I.1987) (quoting Morin v. Aetna Casualty and Surety Co., 478 A.2d 964, 967 (R.I.1984)). Moreover, whereas the question of whether punitive damages are appropriate in a given case is a question of law to be decided by the court, Morin, 478 A.2d at 967, once a court determines that such damages may appropriately be awarded, "such an award is discretionary with the finder of fact." Id. Such is not the situation before us. Here, in contrast, § 28-33-17(f)(5) provides a nondiscretionary, prescribed penalty for delinquent payment and requires no showing of misconduct. As we have explained in construing G.L.1956 § 28-35-43, which provides a 20 percent penalty for failure to pay workers' compensation benefits following an order or a decree of the WCC, "by enacting penalties for delinquent payments, the Legislature intended to encourage prompt payment [of awards]." Matias v. Davol, Inc., 457 A.2d 1063, 1064 (R.I. 1983). There, as here, the penalty is remedial, not punitive. With respect to the issue of the award of attorney's fees, we point out that § 28-35-32, *746 provides that in proceedings under the Workers' Compensation Act, "costs shall be awarded, including counsel fees * * * to employees who successfully prosecute * * petitions to amend a * * * memorandum of agreement." Because we affirm that the 20 percent penalty was a "covered claim" that the fund was obligated to pay, the award of attorney's fees was properly ordered by the Appellate Division. Fund as Insurer. The fund also maintained that because it "is not an insurance company[,] * * * has not contracted with any employer to pay compensation[,] * * * [and] issues no policies and collects no premiums," it is not an insurer and therefore cannot be penalized under § 28-33-17(f). Callaghan, in contrast, argued that the Fund "stands in the shoes of the insurer" and, as such, is obligated to the extent that the insolvent insurer would have been obligated. The fund conceded in its brief to this Court that the Workers' Compensation Act "does not define the term `insurer.'" We decline to adopt the fund's limited characterization of its role, and we concur with Callaghan that the fund stands in the shoes of the insolvent insurer, and thereby assumes the insurer's obligations. We reach this conclusion as a consequence of the Legislature's directive that "[t]he Fund shall: * * * (2) Be deemed the insurer to the extent of its obligation on the covered claims and to such extent shall have all rights, duties and obligations of the insolvent insurer as if the insurer had not become insolvent." Section 27-34-8(a). A plain reading of the statute, combined with our holding that the 20 percent penalty and attorney's fees constitute "covered claims" in the instant case, see ante, suffice to support the conclusion that the fund stands as an insurer subject to § 28-33-17(f). Our reasoning in Jerry's Supermarkets, Inc. v. Rhode Island Insurers' Insolvency Fund, 692 A.2d 697 (R.I.1997), also lends support to our rejection of the fund's position on this issue. The insurer appealed an adverse judgment of liability, and when it later was decreed insolvent, the fund took over the appeal. After this Court affirmed the Superior Court judgment against the insurer, Jerry's Supermarkets, Inc. v. Rumford Property and Liability Insurance Co., 586 A.2d 539 (R.I.1991), the fund paid the judgment, and the plaintiff then filed a complaint in the Superior Court seeking interest on the judgment. Following the granting of the fund's motion for summary judgment, the plaintiff, relying in part on the language of § 27-34-8(a)(2), appealed to this Court. We held, in reasoning that is equally applicable to the case before us, that "the purposes of the [Rhode Island Insurers' Insolvency Fund A]ct will best be effectuated by ensuring that the insolvency fund discharges its obligations in a timely fashion. * * * [Although the fund] should not be held accountable for delays attributable to the insurer * * * [it] is obligated to pay statutory interest on the judgment against Rumford for the period beginning with the fund's assumption of Rumford's appeal of the Superior Court's judgment until * * * the date the fund paid the * " judgment. At the time the fund took over the appeal, the claim had been reduced to judgment and thus became a covered claim. At that point, the fund stood in the shoes of the insolvent insurer." (Emphases added.) Jerry's Supermarkets, Inc., 692 A.2d at 698. There, as here, the pre-existence of a covered claim rendered the fund the equivalent of the insurer. At the time American Universal was decreed insolvent, it was obligated to provide adequate worker's compensation to Callaghan. The fund, by statute, then stepped in and assumed American Universal's extant covered claims, inclusive of the obligation to pay COLAs for injured employees covered at the time of the insolvency and the concomitant obligation to pay a penalty in the event that a COLA was not timely paid. Therefore, the fund stood in the place of an insurer in respect to its obligations to Callaghan under § 28-33-17(f). Fund Immunity. Last, the fund claimed immunity from liability for the 20 percent penalty and award of attorney's fees. Specifically, the fund contended that G.L. 1956 § 27-34-16, the so-called immunity clause, "is obviously intended to limit the *747 Fund's exposure for liabilities arising out of the Fund's acts or failures to act," and that the statute "bars recovery of late payment penalties and attorney's fees." Section 27-34-16, provides that "[t]here shall be no liability on the part of, and no cause of action of any nature shall arise against, any member insurer, the fund, or its agents or employees, the board of directors, or the commissioner or his or her representative for any action taken or not taken by them in the performance of their powers and duties under this chapter." The term "liability," however, "is a broad legal term * * * [that] has been referred to as of the most comprehensive significance, including almost every character of hazard or responsibility, absolute, contingent, or likely." Black's Law Dictionary 914 (6th ed.1990). To construe § 27-34-16 so as to abrogate the fund's obligation to pay the penalty for a late COLA payment or its duty to pay attorney's fees before the WCC would contravene the legislative purpose behind the Rhode Island Insurers' Insolvency Fund Act, namely, "to provide a mechanism for the payment of covered claims under certain insurance policies to avoid excessive delay in payment and to avoid financial loss to claimants or policyholders because of the insolvency of an insurer * * *." Section 27-34-2. Certainly, with respect to the penalty for late COLA payments and the payment of applicable attorney's fees, the immunity provision is violative of the fund's and the WCC's statutory purposes, and is therefore inapplicable to those assessments. In conclusion, therefore, in light of the foregoing analysis, we deny and dismiss both petitions for certiorari, quash the writs improvidently issued, vacate the stay previously imposed, and affirm the final decree of the Appellate Division, to which the papers in this case may be returned with our decision endorsed thereon. NOTES [1] Callaghan did not seek review of the Appellate Division's denial of interest payments on the COLAs. [2] This provision was formerly codified at G.L. 1956 § 28-33-17(f)(4), as amended by P.L.1992, ch. 31, § 5, and was redesignated at § 28-33-17(f)(5) pursuant to P.L.I995, ch. 323, § 1.

2013-10-30 06:35:55.378764+00

Ellis

901 F. Supp. 208 (1995) Julia WILLIAMS et al., Plaintiffs, v. The 5300 COLUMBIA PIKE CORP. et al., Defendants. Civ. A. No. 95-225-A. United States District Court, Eastern District of Virginia, Alexandria Division. October 23, 1995. *209 Julian Karpoff, Karpoff, Title & Mitnick, Arlington, Virginia, for plaintiffs. Thomas C. Mugavero, Montedonico, Hamilton & Altman, P.C., Washington, DC, for defendants. MEMORANDUM OPINION ELLIS, District Judge. In this suit stating both federal and state causes of action, plaintiffs challenge a conversion plan by which a cooperatively owned apartment building was converted to a condominium form of ownership. The matter is presently before the Court on (1) defendant's motion to exclude plaintiffs' expert witness and, (2) defendant's motion for summary judgment. For the reasons that follow, the motion for summary judgment is granted and the remaining claims against the defendants are dismissed. The motion to exclude plaintiffs' expert witnesses is therefore denied as moot. I The facts of this case have been recited at length in an earlier opinion and will not be repeated here in any detail. See Williams v. The 5300 Columbia Pike Corp., 891 F. Supp. 1169 (E.D.Va.1995). It is enough to note *210 here that plaintiffs were residents and shareholders in a cooperative apartment building and complain that they were treated unfairly when the board of directors of the corporation decided to convert the apartment building to a condominium form of ownership. Plaintiffs contend that the increase in value resulting from the conversion was enjoyed only by those residents who were able to participate in the conversion. Plaintiffs were not in this group; they were unable to participate in the conversion because they could not obtain the necessary financing to purchase their units. This suit followed, in which plaintiffs alleged violations of the Sherman Act, 15 U.S.C. §§ 1-2, and the Fair Housing Act, 42 U.S.C. §§ 3601-3631, as well as breach of contract and fiduciary duties under state corporate law.[1] At the threshold stage of the litigation, defendants moved to dismiss all claims. The Court granted the motion to dismiss for failure to state a claim as to the antitrust allegations. The Fair Housing Act claim was allowed to proceed because, after performing a statistical analysis of the racial make-up of those residents who participated in the conversion, the Court concluded that plaintiffs had made out a prima facie case of racial discrimination. The Court also concluded that plaintiffs had stated breach of contract and fiduciary duty claims that merited factual development. After discovery, defendants brought a motion for summary judgment as to the remaining claims. The Court granted the motion with respect to the Fair Housing Act claim, concluding that defendants had shown a legitimate, non-discriminatory business purpose for their actions, which purpose plaintiffs had not shown to be pretextual. See Williams v. The 5300 Columbia Pike Corp., Civ. Action No. 95-225-A (Order, September 15, 1995). More precisely, plaintiffs failed to show that any triable issue of fact existed with respect to the existence of a non-pretextual business purpose for the condominium conversion plan at issue. Summary judgment was also granted as to the breach of fiduciary duty claim with respect to plaintiff Williams because she was found to have voted in favor of the conversion plan and was therefore estopped to challenge its fairness. The motion as to the breach of fiduciary duty claim as to the Mouzon plaintiffs was taken under advisement and the parties were directed to file additional briefs. The parties have done so, and this final remaining issue is now ripe for disposition. II The gravamen of plaintiff's complaint is that the shares of those who chose not to or were unable to participate in the conversion were re-purchased by the defendant corporation for an amount equal to the apartment units' value appraised as cooperative units rather than their value appraised as condominium units, a higher amount. The first issue presented is who bears the burden of proof as to the fairness or unfairness of the purchase price for non-participating shares. Delaware law provides that in general the plaintiff bears the burden and must overcome the "business judgment" rule, a rule that mandates substantial judicial deference to the decisions of a board of directors. See Baron v. Pressed Metals of America, Inc., 35 Del. Ch. 325, 117 A.2d 357, 361 (1955), aff'd, 35 Del. Ch. 581, 123 A.2d 848 (1956). But the burden shifts to the defendant directors where the plaintiff establishes that there is a conflict of interest between the directors and the shareholders. More specifically, a conflict of interest between the directors and the shareholders serves to shift to the defendant directors the burden of establishing the "intrinsic fairness" of the transaction, including the fairness of the price. See Weinberger v. UOP, Inc., 457 A.2d 701, 703 (Del.1983); Alcott v. Hyman, 42 Del. Ch. 233, 208 A.2d 501, 506-07 (1965). Plaintiffs here seek to shift the burden to these defendants by arguing that the defendant directors here had a personal interest in the conversion. Plaintiffs contend that because the directors stood to gain personally by the conversion plan, the transaction should be deemed to be an interested one and the burden should therefore shift to *211 the defendants to prove the intrinsic fairness of the price. Because the transaction sub judice differs substantially from those typically at issue in the reported cases, it is important to examine what is meant by an "interested" transaction. The business judgment rule is only available when the directors neither appear on both sides of a transaction nor expect to derive any personal financial benefit from it in the sense of self-dealing, as opposed to a benefit which devolves upon the corporation or all stockholders generally. Aronson v. Lewis, 473 A.2d 805, 812 (Del. 1984).[2] Plaintiffs point to the first phrase of this definition and argue that because the directors were also shareholders of the new corporation, they appear on both sides of the transaction, thereby making it an "interested" transaction. Yet, the phrase "on both sides of a transaction" usually refers to the merger context in which the directors of the target corporation are directors or shareholders of the acquiring corporation.[3] In that case, the directors interests are potentially in conflict with those of the shareholders of the target corporation. In the case at bar, however, the directors were on both sides only in the sense that they would serve on the board of the re-organized corporation after conversion; they did not hold an interest in a separate company. More importantly, the directors' interests did not diverge from those of the shareholders, all of whom, including the plaintiff, expected to become shareholders in the new corporation. The mere fact that the directors of the old corporation were intended to become directors of the new corporation does not mean that they appeared on both sides of the transaction for purposes of shifting the burden of proof under Delaware law. The second phrase of the definition applied here confirms this conclusion. The Aronson court stated that the business judgment rule does not apply when the directors "expect to derive any personal financial benefit from [the transaction] in the sense of self-dealing, as opposed to a benefit which devolves upon the corporation or all stockholders generally." Id. (emphasis added). The Aronson court also made clear that the expectation of self-benefit alone did not call a transaction into doubt; only when the benefit would not fall on all shareholders generally would the deal be suspect. Again, the touchstone is the presence of a conflict of interest between the directors and the corporate shareholders. Shareholders are allowed, indeed expected, to act in their own self-interest. The problem arises when directors act to benefit themselves at the expense of other stockholders. In this event, because the transaction is infected with self-interest, the burden would shift to the director defendants. But this did not occur here; the defendant directors here did not act to benefit themselves at the expense of other shareholders. Instead, the directors' interests were aligned with the shareholders' interests and in designing and consummating the condominium conversion the directors acted to benefit all stockholders, including themselves, in the same way. Even so, plaintiffs argue the directors' interests did diverge once some shareholders became unable to participate in the conversion. At that point, plaintiffs contend, the directors had an incentive to re-purchase the non-participating units as cheaply as possible. Plaintiffs also contend that the board knew that some shareholders would be unable to participate. To be sure, the record reflects that the directors were aware of the possibility that some unidentified shareholders would not qualify for financing and therefore would be unable to take advantage of the conversion opportunity. But this knowledge of a possibility is insufficient to establish that the directors acted fraudulently or that their interests were in conflict with any of the shareholders for the purpose of shifting *212 the burden of proof. The conversion plan was offered to all shareholders equally with the hope that all would participate. Delaware courts recognize that "in some circumstances Delaware law permits shareholders (as distinguished from shares) to be treated unequally." Grover v. Simmons (In re Sea-Land Corp. Shareholders Litig.), 642 A.2d 792, 799 n. 10 (Del.Ch.), aff'd without published opinion, 633 A.2d 371 (Del.1993). It is uncontroverted that defendants "had no control over the shareholders' dealings with potential lenders." Williams, 891 F.Supp. at 1183 n. 28 (citing Sea-Land, 642 A.2d at 803 ("To be chargeable with having violated a fiduciary duty involving equal treatment precepts, the board must at the very least have approved the transaction creating the disparity.")). Thus, because the defendant directors' interests in the conversion did not conflict with the interests of the other shareholders, and because any difference in the shareholders' ability to participate in the conversion was the result of decisions by lending institutions over whom the defendants had no control, the transaction at issue cannot be said to be an interested one.[4] The burden of proof therefore remains with the plaintiffs to establish that the coop-appraised value violated the business judgment rule. This they cannot do. Under the business judgment rule, "director liability is predicated upon concepts of gross negligence." Aronson, 473 A.2d at 812.[5] Specifically, "[i]n the area of valuation, wide discretion is allowed to directors, and as long as they appear to act in good faith, with honest motives, and for honest ends, the exercise of their discretion will not be interfered with by the courts." Kaplan v. Goldsamt, 380 A.2d 556, 568 (Del.Ch.1977). The choice of the coop-appraised value as the price at which to re-purchase the non-participating shares appears eminently sensible. What the plaintiffs had, after all, was a unit in a cooperative. Plaintiffs' attempt to obtain the condominium value of the unit is illogical because it is uncontroverted that plaintiffs never had a condominium. The primary reason the unit's value was higher as a condominium rather than as a cooperative was that the resident owned the unit in fee simple, requiring the owner to carry a greater debt load, the precise reason that plaintiffs were unable to purchase their unit. In sum, plaintiffs were paid for exactly what they had at the time of repurchase, namely, shares in a cooperatively owned apartment building.[6] For these reasons, the defendants' motion for summary judgment is granted and the remaining claims against the defendants are dismissed, and the motion to exclude plaintiffs' expert witnesses is therefore denied as moot. An appropriate order will issue. NOTES [1] The breach of contract claim is essentially identical to the breach of fiduciary duty claim, as it is based on the notion that shareholders' rights are contractual in nature. [2] See also Jedwab v. MGM Grand Hotels, Inc., 509 A.2d 584, 595 (Del.Ch.1986) ("Self-dealing occurs when the parent ... causes the subsidiary to act in such a way that the parent receives something from the subsidiary to the exclusion of, and detriment to, the minority stockholders of the subsidiary."). [3] See, e.g., Cinerama, Inc. v. Technicolor, Inc., 663 A.2d 1134 (Del.Ch.1994); Weinberger, 457 A.2d 701; Alcott, 42 Del. Ch. 233, 208 A.2d 501; Sterling v. Mayflower Hotel Corp., 33 Del. Ch. 293, 93 A.2d 107 (1952). [4] Indeed, it is important to note that the defendant directors are no more than residents and shareholders in the corporation themselves. They in no way stood to gain from the conversion in any manner different from that of their fellow shareholders. [5] See, e.g., Sinclair Oil Corp. v. Levien, 280 A.2d 717, 722 (Del.1971) ("fraud or gross overreaching"); Getty Oil Co. v. Skelly Oil Co., 267 A.2d 883, 887 (Del.1970) ("gross and palpable overreaching"); Warshaw v. Calhoun, 43 Del. Ch. 148, 221 A.2d 487, 492-93 (1966) ("bad faith ... or a gross abuse of discretion"). [6] To ascertain the cooperative-value of the unit, the defendants obtained a professional appraisal. Plaintiffs do not challenge that appraisal.

2013-10-30 06:35:55.384798+00

Dally

491 S.W.2d 170 (1973) Jessle Walter HORN, Appellant, v. The STATE of Texas, Appellee. No. 45962. Court of Criminal Appeals of Texas. March 7, 1973. *171 James P. Finstrom, Dallas, for appellant. Henry Wade, Dist. Atty., Jerome L. Croston, Asst. Dist. Atty., Dallas, Jim D. Vollers, State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION DALLY, Commissioner. The appellant was convicted for knowingly, intentionally and with lascivious intent exposing his private parts to a female person under sixteen years of age; the punishment five years imprisonment. The sufficiency of the evidence is not challenged. The appellant's first two grounds of error complain that the admission into evidence of a prior conviction for another offense of the same nature was error because "a proper predicate had not been laid connecting that offense to appellant," and because it was too remote. At the guilt-innocence stage of the trial, under cross-examination, the appellant was asked without objection and admitted he was the same person who had been convicted in Cause No. 3038 in Criminal District Court of Dallas County on the first day of August, 1956, for the offense of "indecent exposure" and received a one year jail sentence. Later an objection was made that the conviction was too remote and that a proper predicate had not been laid, when the State offered a certified copy of a judgment and sentence showing that Jessie Walter Horne had been convicted on the first day of August, 1956, in Cause No. 3038-H in Criminal District Court No. — of Dallas County, for the offense of knowingly and intentionally, and with lascivious intent exposing his private parts to a female child under the age of sixteen years and was sentenced to one year imprisonment in the county jail. The appellant's acknowledgment of the conviction and his admission of the salient details which coincide with the judgment and sentence introduced into evidence was sufficient predicate for the admission of the judgment and sentence over the objection that it had not been shown he was the person convicted of the prior offense. The difference in the spelling of the name Horn is not significant, as the names Horne and Horn are idem sonans. See Schnellbacher v. State, 384 S.W.2d 137 (Tex.Cr.App.1964). There was no objection that the prior conviction was too remote when the appellant was questioned about and admitted to the prior conviction earlier in the trial. It became a part of the evidence at that time.[1] See Brem v. State, 432 S.W.2d 916 (Tex.Cr.App.1968); Gonzalez v. State, 168 Tex. Crim. 49, 323 S.W.2d 55 (1959) and Watson v. State, 162 Tex. Crim. 156, *172 282 S.W.2d 715 (Tex.Cr.App.1955). His later objection was not timely. The appellant complains of the prosecutor's closing argument in three separate grounds of error. The first complaint concerns the argument: "You know, when officer Bordelon said he was arresting him, he went up there and the man asked him what he was arresting him for and he said `indecent exposure.' Did he ever tell officer Bordelon that he was urinating there? What would be the besttime for somebody to tell a man, right when it happens, or some six or seven months later when he is at his trial before the trial jurors?" The appellant objected to such argument on the grounds that "it would be a comment on the defendant's failure to testify, if, at the time in fact he did not say anything about it." The appellant had voluntarily testified in his own behalf that he had been taking some medicine which caused him to urinate frequently and that he had not intentionally exposed himself, but that he had been urinating in an empty milk carton while he was in the phone booth. Officer Bordelon had arrested the appellant while he was still in the same telephone booth where the little girl had seen him. The officer, without objection, testified that the appellant had not told him at the time of the arrest that he had been urinating in the phone booth. We do not construe the prosecutor's argument to be that the appellant was guilty because he was silent or failed to make a denial when the officer told him that he was accused of indecent exposure. See Hawk v. State, 482 S.W.2d 183 (Tex.Cr. App.1972). We construe the prosecutor's argument to be that the appellant's testimony was of recent fabrication, and in the context made, we perceive no error. The next ground of error complains that the prosecutor's argument concerning an extraneous offense, which had been admitted into evidence, suggested to the jurors that they could consider that evidence generally rather than for the limited purpose of showing a lascivious intent, as they had been instructed by the court's charge. The prosecutor argued: "I think the State is permitted, in a case like this, to bring extraneous offenses in and this is about the little girl, V______ A______. And I'm glad we could bring this to you because it really gives this jury an idea of what type of man sits over here. Do you think she knows the difference between a man urinating and a man shaking himself at her?" After the appellant's objection and the ruling of the court, the prosecutor stated: "The Judge has instructed you you can use this offense against V______ A______ only to show his lascivious intent, his lascivious intent. In other words, was he out there just urinating, or was he out there exposing himself to a girl under the age of sixteen? I think it's reasonable, he was standing in the front door of this old house, she said he wasn't urinating. If he's got such a bad kidney problem, why didn't he just turn around and urinate inside. It's ridiculous." This ground of error is without merit. In the other instance, the prosecutor argued "and there's one thing in a case like this that really points to the truthfulness of these little girls, and that is the fact that on each instance after this thing happened, what we call in legal terms `the first outcry,' both of these little girls went immediately and told someone, they didn't wait a week or a month, immediately the first person they saw, they told—" The appellant's objection was that "I object to the argument, he goes to both of these little girls and we are trying one case and that is a girl named P____ P____ and this other case I object to him in argument associating these two cases together." The complaining witness in the indictment was P____ P____. After the appellant *173 had testified that the act was not intentionally done, and that he was in fact urinating in the phone booth, the State offered in rebuttal the testimony of another girl that the appellant had committed the same act before her on a separate occasion. Consideration of the extraneous offense was limited by a jury instruction. In view of the facts of the case, the jury instruction and the context of the argument, we find no error. The appellant's remaining ground of error urging that the word "intent" in the court's charge was not qualified by the word "lascivious" is without merit, as the term "lascivious" was defined elsewhere in the charge. The refusal to grant the requested charge was not error. Webster v. State, 455 S.W.2d 264 (Tex.Cr.App.1970) and Owens v. State, 450 S.W.2d 324 (Tex. Cr.App.1969). The judgment is affirmed. Opinion approved by the Court. NOTES [1] The appellant also admitted under cross-examination, without any objection being made, that he had been convicted in the Dallas Municipal Courts for the offense of "indecent exposure" in 1963, 1967 and 1969, and had been convicted for the offense of misdemeanor theft in 1959. Thereafter, the state voluntarily withdrew the evidence of the convictions in Municipal Court. The reason for the voluntary withdrawal of this evidence was not fully developed and it cannot be determined whether the court may have been authorized to consider this evidence to show that the appellant had not reformed nor been rehabilitated. The former convictions in question may well have been admissible for purposes of impeachment over a proper and timely objection. e. g., Bustillos v. State, 464 S.W.2d 118 (Tex. Cr.App.1971); Penix v. State, 488 S.W.2d 86 (Tex.Cr.App.1972).

2013-10-30 06:35:55.440254+00

Hollander

704 A.2d 448 (1997) 119 Md. App. 78 Gregory M. PAPILLO v. POCKETS, INC. et al. No. 230, Sept. Term, 1997. Court of Special Appeals of Maryland. November 5, 1997. Shelton H. Skolnick (Skolnick & Leishman, P.C., on the brief), Derwood, for Appellant. *449 Clyde H. Sorrell, Bethesda (Albert E. Crandall, Gaithersburg, on the brief), for Appellees. Argued before CATHELL and HOLLANDER, JJ., and ROBERT SWEENEY, Judge (retired), Specially Assigned. HOLLANDER, Judge. Gregory M. Papillo, appellant, and Albert E. Crandall, appellee, have been engaged in a protracted dispute concerning two close corporations in which each party owned a fifty percent interest. In 1993, after appellant sought dissolution of both corporations, appellee elected to avoid dissolution by purchasing appellant's stock, pursuant to Md. Code (1975, 1993 Repl.Vol.), § 4-603 of the Corporations and Associations Article ("C.A."). Several years later, the trial court essentially determined that appellee's election was revocable at will. Thereafter, appellant noted his appeal and presents two questions for our review, which we have rephrased: I. Is the statutory election to avoid dissolution of a close corporation, exercised pursuant to § 4-603 of the Corporations and Associations Article, revocable at will? II. Did the trial court err or abuse its discretion in permitting appellee to revoke in 1996 the election to purchase appellant's stock that he exercised in 1993? As we shall answer the first question in the negative, we must remand the matter for further proceedings. Factual Background The salient facts are substantially undisputed. In 1992, appellant and appellee each invested approximately $50,000.00 to form and operate a billiards parlor business through two close corporations, Pockets, Inc. ("Pockets") and Pima, Inc. ("Pima"). Pockets operated the billiards parlor, and Pima owned the equipment, which it leased to Pockets. The parties were the sole stockholders of the corporations, with each party owning fifty percent of the stock of each corporation. In early 1993, for reasons not relevant here, the relationship between the parties grew acrimonious. As a result, on July 2, 1993, appellant filed a complaint in the Circuit Court for Montgomery County to dissolve both corporations. Faced with involuntary dissolution, appellee intervened and elected to exercise his statutory right to purchase appellant's stock, pursuant to C.A. § 4-603. The court (Miller, J.) issued an order on November 16, 1993, permitting appellee to stay dissolution proceedings so long as appellee timely posted a $60,000.00 bond. In order to satisfy the statutory requirement to purchase the stock at its fair market value as of the time of filing of the petition for dissolution, appellee sought an appraisal of appellant's stock. By order of April 28, 1994, the court appointed three appraisers. In an order filed September 28, 1994, the court (Ruben, J.), determined that, at the relevant time, and based on the appraisers' reports, the value of appellant's stock in the two corporations was $16,291.00. After appellee paid $16,291.00 to appellant, the bond was released, pursuant to an order of court stating it was to be released "regardless of the pendency of any appeal." Subsequently, appellant noted his appeal to this Court, in order to challenge the amount of the valuation. In a per curiam opinion, we affirmed in part and reversed in part, and remanded the case to the trial court to "conduct a hearing at which each party may present testimonial or tangible evidence in support of or in opposition to the appraisers' report." Papillo v. Pockets Inc., No. 416, Sept. Term 1995, slip op. at 11, 107 Md.App. 748 (filed December 8, 1995). On remand, the trial court conducted an evidentiary hearing as to valuation. Thereafter, it rejected all of the appraisers' reports, and stated that it considered that the parties were back to "square one." By order filed August 2, 1996, the court (Donohue, J.) ordered new appraisals "subject to Motions of the parties regarding election to purchase the stock." Before appointment of the new appraisers, however, appellee sought to revoke his election to purchase appellant's stock and moved to proceed with dissolution. He claimed that, as a result of the delay *450 caused by the lengthy proceedings, he lacked the financial resources to consummate the election to purchase. On November 27, 1996, the court conducted a hearing concerning appellee's motion. In an opinion and order filed December 4, 1996, the court (McGuckian, J.) granted appellee's motion to proceed with dissolution, stating: The Court finds that there is nothing in [C.A. § 4-603] which would preclude a stockholder from withdrawing his petition to avoid dissolution at any time. It would be contrary to the clear purpose of Section 4-603 to preclude such a move by a stockholder since such action would cause the corporation to be at a standstill, which is clearly what this section is meant to avoid. The section does not contemplate personal judgments against a stockholder for failing to complete a petition under this section. The right of the plaintiff to recover any funds that may have unwarrantedly gone to the benefit of the defendant during the pendency of this litigation can be handled through the provisions for dissolution set forth in Title 3 of [the Corporations and Associations] Article. (Emphasis added). It is this ruling that is at issue here. Discussion A. Appellant contends that an election to purchase stock pursuant to C.A. § 4-603 is irrevocable. The statutory provision is silent, however, as to the ability to revoke an election. Section 4-603 provides, in pertinent part: (a) Stockholder's right to avoid dissolution.—Any one or more stockholders who desire to continue the business of a close corporation may avoid the dissolution of the corporation ... by electing to purchase the stock owned by the petitioner at a price equal to its fair value. (b) Court to determine fair value of stock. (1)—If a stockholder who makes the election is unable to reach an agreement with the petitioner as to the fair value of the stock, then, if the electing stockholder gives bond or other security sufficient to assure payment to the petitioner of the fair value of the stock, the court shall stay the proceeding and determine the fair value of the stock. It is immediately apparent that the statute does not speak to whether, or under what circumstances, an electing stockholder may change his or her mind and revoke an election to purchase the petitioner's stock. Given that "[t]he statute is silent on the question... it is into this breach that the Court must step with a reasonable interpretation." D & Y, Inc. v. Winston, 320 Md. 534, 539, 578 A.2d 1177 (1990) (construing Md.Code (1974, 1988 Repl.Vol.), § 10-102(f) of the Real Property Article). As we have not discovered any Maryland case construing the provision in issue, we begin with a brief review of the guiding principles of statutory construction. The interpretation of a statute presents a question of law. Hider v. Department of Labor, Licensing and Regulation, 115 Md.App. 258, 273, (1997), rev'd on other grounds, ___ Md. ___, ___ A.2d ___, 1998 WL 107991, No. 63 Sept. Term 1997 (filed March 13, 1998); Mayor of Ocean City v. Purnell-Jarvis, Ltd., 86 Md.App. 390, 413, 586 A.2d 816 (1991). The seminal rule of statutory construction requires that we determine and effect the intent of the Legislature. Oaks v. Connors, 339 Md. 24, 35, 660 A.2d 423 (1995); Mayor of Baltimore v. Cassidy, 338 Md. 88, 93, 656 A.2d 757 (1995); Privette v. State, 320 Md. 738, 744, 580 A.2d 188 (1990). To accomplish this task, we ordinarily look to the language in the statute itself. Allied Vending Inc. v. City of Bowie, 332 Md. 279, 306, 631 A.2d 77 (1993); State v. Patrick A, 312 Md. 482, 487, 540 A.2d 810 (1988); Jones v. State, 311 Md. 398, 405, 535 A.2d 471 (1988). "[T]he Court considers the language of an enactment and gives that language its natural and ordinary meaning." Montgomery County v. Buckman, 333 Md. 516, 523, 636 A.2d 448 (1994). As the Court said in Harris v. State, 331 Md. 137, 626 A.2d 946 (1993), "Giving the words their ordinary and common meaning `in light of the full context in which they appear, and in light of external manifestations of intent or general purpose available through other evidence,' *451 normally will result in the discovery of the Legislature's intent." Id. at 146, 626 A.2d 946 (citations omitted). Moreover, "we seek to avoid constructions that are illogical, unreasonable, or inconsistent with common sense." Frost v. State, 336 Md. 125, 137, 647 A.2d 106 (1994); see also Fraternal Order of Police, Montgomery County Lodge No. 35 v. Mehrling, 343 Md. 155, 174, 680 A.2d 1052 (1996); Condon v. State, 332 Md. 481, 492, 632 A.2d 753 (1993). We also consider the statute's purpose, Blaine v. Blaine, 336 Md. 49, 69, 646 A.2d 413 (1994); Kaczorowski v. Mayor of Baltimore, 309 Md. 505, 513, 525 A.2d 628 (1987), and the context in which it was adopted. C.S. v. Prince George's County Dept. of Soc. Servs., 343 Md. 14, 24, 680 A.2d 470 (1996); Condon, 332 Md. at 491, 632 A.2d 753; Motor Vehicle Admin. v. Mohler, 318 Md. 219, 225, 567 A.2d 929 (1990); Brzowski v. Maryland Home Improvement Comm'n, 114 Md.App. 615, 627, 691 A.2d 699, cert. denied, 346 Md. 238, 695 A.2d 1227 (1997). Thus, we do not read a statutory provision in isolation. Instead, we consider the purpose, goal, or context of the statute as a whole. Prince George's County v. Vieira, 340 Md. 651, 658, 667 A.2d 898 (1995); Board of Trustees v. Hughes, 340 Md. 1, 7, 664 A.2d 1250 (1995); Frost, 336 Md. at 138, 647 A.2d 106. Often, it is necessary for us to examine the development of the statute to discern the Legislature's intent. C.S., 343 Md. at 24, 680 A.2d 470; Condon, 332 Md. at 492, 632 A.2d 753; Mohler, 318 Md. at 225, 567 A.2d 929. The legislative history concerning C.A. § 4-603 is useful here. The close corporation statute was enacted in 1967. 1967 Md. Laws, Ch. 649 § 14; see Md.Code (1957, 1967 Repl.Vol., 1967 Cum. Supp.), Art. 23 §§ 100-111 (now codified, as amended, at C.A. §§ 4-101 to 4-603).[1] It was adopted substantially as proposed in the Final Report of the Commission on Revision of the Corporation Laws of Maryland (the "Report"), dated December 15, 1966. Of particular interest here, as to the ability to avoid dissolution by purchasing a petitioner's stock, the Report stated: [F]or all judicial dissolutions of close corporations stockholders other than the party moving for dissolution may, in appropriate cases and subject to the discretion of the court, avoid dissolution by purchasing the shares of the petitioner at a fair appraised value, except where there is a contrary stockholders' agreement with respect to a dissolution proceeding. . . Id. at 75 (emphasis added). Moreover, the official comment to the then-newly enacted statute included the precise language that we just quoted from the Report. See Md.Code (1957, 1967 Repl.Vol., 1967 Cum.Supp.), Art. 23 § 100 cmt. A member of the Commission on Revision of the Corporation Laws of Maryland subsequently described the purpose of the buyout provision in a law review article. Although he did not address the issue presented here, the author explained: It results in a fair accommodation of the conflicting interests involved, on the one hand the desire to continue a profitable enterprise, and on the other, a desire to secure reasonable value for one's ownership interest. *452 * * * * Stockholders asserting their right to bar dissolution by the purchase of the stock of a stockholder petitioning for dissolution are required to give bond or sufficient security to insure their ability to pay a reasonable price for the stock. This serves both as a protection to the stockholder seeking dissolution and as a deterrent to harassing or delaying tactics. There is a danger that stockholders who in fact wish to continue to operate the business might permit dissolution and liquidation of the company in order to buy the assets at a lower figure than it would be necessary for them to pay if they elected to purchase the stock of the shareholder seeking dissolution. Since this would circumvent the statute's purpose of providing the stockholder a reasonable alternative when transfer of his stock is barred, it is to be hoped that the courts will not approve liquidation sales to other stockholders over the objection of the liquidating stockholder when such sales make it possible for the remaining stockholders to continue the business. William G. Hall, The New Maryland Close Corporation Law, 27 Md. L. Rev. 341, 362 (1967) (emphasis added). Although the close corporation statute was recodified in 1975, no substantive changes were enacted with respect to the statutory election provision. See Md.Code (1975), CA. § 4-603 (Revisor's Note); see also Allers v. Tittsworth, 269 Md. 677, 683, 309 A.2d 476 (1973) ("The practice of considering revision commission reports in searching for legislative intent is too well established to be open to question."); Abington Ctr. Assocs. v. Baltimore County, 115 Md.App. 580, 599, 694 A.2d 165 (1997) (noting that revisor's construction is relevant with regard to determination of legislative intent). Thus, Maryland's statute has remained essentially unchanged since its enactment thirty years ago; it is completely silent with respect to the right to revoke. Considering the purpose of C.A. § 4-603, however, we are of the view that the Maryland Legislature did not intend to bar revocation altogether. Neither can we discern any intention by the Legislature to permit unfettered revocation of an election to purchase a petitioner's stock. Although we have not found any reported Maryland case that addresses the precise question presented here, numerous other states with buy-back statutes have considered the matter.[2] In our survey of the law of other states, it is apparent that many have statutory buyout provisions that expressly disfavor revocability. Nevertheless, these statutes continue to reserve for the court some degree of discretion. See, e.g., Ala. Code § 10-2B-14.34(a) (Michie 1994) ("An election pursuant to this section shall be irrevocable unless the court determines that it is equitable to set aside or modify the election." (emphasis added)); Conn. Gen. Stat. § 33-900(a) (1997) (same); Fla. Stat. Ann. § 607.1436(1) (West Supp. 1997) (same); Miss.Code Ann. § 79-4-14.34(a) (1996) (same); N.H.Rev. Stat. Ann. § 293-A:14.34 (Supp.1994) (same); Utah Code Ann. § 16-10a-1434(1) (1995) (same); see also, e.g., N.Y. Bus. Corp. Law § 1118(a) (McKinney Supp. 1996) ("An election pursuant to this section shall be irrevocable unless the court, in its discretion, for just and equitable considerations, determines that such election be revocable." (emphasis added)). Like Maryland, other states have buy-back provisions that omit any reference to the ability to revoke. Yet judicial construction of these statutes has made plain that the trial courts are deemed to have discretion with respect to revocation of an election to purchase a petitioner's stock. See, e.g., Mo. Ann. Stat. § 351.860.3 (West 1991) ("After the purchase order is entered, any party may petition the court to modify the terms of the purchase and the court may do so if it finds that changes in the financial or legal ability of the corporation or other purchaser to complete the purchase justify a modification."); Mont. Code. Ann. § 35-9-503(3) (1995) (same); Wyo. Stat. Ann. § 17-17-142(c) (Michie 1997) (same). *453 We are especially guided by the view of the court in Bogosian v. Woloohojian, 749 F. Supp. 396, 401 (D.R.I.1990). It considered the issue of the ability to revoke an election when the applicable buy-back statute was silent. The court declined to implement a bright line rule, opting instead to consider the equities of the particular case. See also Brodsky v. Seaboard Realty Co., 206 Cal. App. 2d 504, 24 Cal. Rptr. 61, 69 (1962) (holding, under then-existing version of buyout statute, that the ability to revoke an election to purchase petitioner's shares was within the discretion of the trial court); cf. Rey v. Pan Am. Cash & Carry Corp., 152 A.D.2d 246, 548 N.Y.S.2d 524, 527, 529 (1989) (holding that it would be unreasonable to prevent revocation because stock would be rendered worthless by intervening fire that destroyed the corporate premises, but indicating in dicta that under prior version of statute, which was silent on the ability to revoke, it was possible that electing stockholder could freely revoke election to purchase); see generally 16A Timothy P. Bjur & James Solheim, Fletcher Cyclopedia of the Law of Private Corporations § 8043, at 100 & n. 5 (Perm. ed. 1995) ("Whether an election to buy-out a dissident shareholder is revocable depends on the jurisdiction." (citing Bogosian and Rey)). In Bogosian, the court reviewed Rhode Island's buyout statute, which closely resembles Maryland's precursor to C.A. § 4-603. Rejecting unilateral revocation, at will, the Bogosian court reasoned: A strong and probably successful argument can be mounted that the Rhode Island General Assembly did not authorize revocation at will of the election to purchase plaintiff's stock. The purpose of the statute, to bring peace to the troubled waters soiled by stockholder dissent, would result in a fragile peace if the corporation could simply withdraw its election on a whim. This construction of the statute [allowing unfettered right to revoke] would provide [the electing stockholder] a potent weapon to temporarily silence an opposing stockholder, since during the interregnum between the filing of an election and its later withdrawal, the opposing stockholder is effectively denied all rights qua stockholder. . . [F]ollowing the purported withdrawal of the election, [the electing stockholder] must acknowledge that the plaintiff's rights as a stockholder are revived, without any real remedy, however, for the denial of [the plaintiff's] rights as a stockholder while the [electing stockholder] persisted in its election. It should not be expected that the General Assembly... intended to vest such capricious power in [an electing stockholder] or that it intended to deny an opposing shareholder her rights so completely and without a remedy. Of course, the statute must be construed to avoid such an absurd result. Bogosian, 749 F.Supp. at 399. The court also distinguished Rey, by noting the "remarkable" differences between the Rhode Island statute and an earlier version of the New York statute: New York Business Corporation Law § 1118 did not provide for a bond to be posted after election. More importantly, neither ... [did it] provide[ ] for immediate termination of the non-electing stockholder's rights, or for payment of interest after the election. The Rhode Island statute, however, does contain these provisions. Bogosian, 749 F.Supp. at 399. C.A. § 4-603 contains provisions similar to the Rhode Island statute and is equally distinguishable from Rey. As we see it, interpreting Maryland's statute to permit the unbridled, unilateral right to revoke a buyout election would, in some circumstances, thwart the Legislature's goal of protecting minority stockholders of close corporations. On the other hand, if we were to construe the statute to bar revocation, regardless of the circumstances, that, too, would lead to unreasonable and inequitable results. See, e.g., Rey, 548 N.Y.S.2d at 529 ("Under the circumstances, it would be unreasonable to expect [the electing stockholder] to purchase [the petitioning stockholder's] shares at their prepetition value, when the stock has been rendered worthless because of an unfortunate and unanticipated event."). *454 We observe that those states providing a statutory right to purchase a petitioner's stock in order to avoid dissolution have found a common thread with regard to the right to revoke the election: judicial discretion. In some states, as we noted, judicial discretion is expressly authorized in the text of the statute. In the two states that have directly addressed the issue in the face of legislative silence, the courts have concluded that the statutes permit judicial discretion. Our analysis of C.A. § 4-603 leads us to the ineluctable conclusion that the Maryland Legislature intended no less. Accordingly, we hold that the revocation of an election to purchase a petitioner's stock, pursuant to C.A. § 4-603, is subject to the sound discretion of the trial court. In this case, the trial court essentially determined that appellee was unilaterally entitled to revoke his election at will. Although this may be a case for which revocation is warranted, we conclude that the court erred in deciding, as a matter of law, that an electing stockholder is freely entitled to revoke an election to purchase a petitioner's stock, regardless of the circumstances. In light of our determination, we shall vacate the circuit court's order and remand this matter to the trial court to determine whether, under the circumstances attendant here, revocation is justified. In exercising its discretion, the trial court should consider that at least one purpose of the statutory scheme is to provide the petitioning stockholder with "reasonable value for one's ownership interest." Hall, supra, at 362. The trial court should also consider the following factors, among others: (1) whether there will be "remarkable differences... between fair value [of appellant's stock] at the time of election and liquidating value," Bogosian, 749 F.Supp. at 400; (2) whether any decline in the value of the corporation or its assets is due to any "unanticipated event," Rey, 548 N.Y.S.2d at 529; (3) whether appellant "has been excluded from participating in the corporation as a shareholder" between the time of election and revocation, Bogosian, 749 F.Supp. at 400; (4) whether, subsequent to releasing the bond, the parties engaged in any "harassing or delaying tactics," Hall, supra, at 362; and (5) other equitable considerations. If the court determines that revocation is not appropriate, then it should proceed to resolve the issue regarding valuation.[3] B. For the benefit of the court on remand, we shall briefly consider some of the parties' remaining contentions. Appellant argues that it would be inequitable to permit appellee to change his mind and withdraw his election, thereby forcing appellant to accept dissolution. He contends that he was excluded from the business for thirty-four months—the period from the date that appellee posted the bond for appellant's shares to the date the trial court granted appellee's motion to proceed with dissolution. Moreover, in the interim, he claims that the business has become worthless. Appellant asserts: When [appellant] commenced this litigation in July 1993, Pockets, Inc. was an operating business.... By December 26, 1996, Pockets was no longer an operating business and it owed the landlord $96,027.18 for unpaid rent, CAM [sic] and taxes for the premises that it had occupied. . . On or about January 15, 1997, Pima's pool tables were sold for $6000.00. Thus, it appears that the assets of Pockets and Pima are insufficient to pay any money to [appellant], since the amount owed to the landlord exceeds the total assets of Pockets and Pima. When the court rejected appellant's arguments, it did not appear to consider how appellant would be able to recover the fair value of his stock at the time he filed for *455 dissolution, given that appellee is apparently unable to pay and the corporation is now valueless. Yet we read C.A. § 4-603 as providing the court with discretion to "secure reasonable value" for appellant's ownership interests, Hall, supra, at 362, and "[i]t is clear that there are remarkable differences to be expected between fair value at the time of election and liquidating value." Bogosian, 749 F.Supp. at 400. On remand, the court should consider, inter alia, the length and reasons for the delay, and the reasons for the decline, if any, in the value of Pima and Pockets. At oral argument, appellee contended, in part, that revocation was properly permitted because, after he gave appellant $16,291.00 for his stock, as required by the trial court's order of September 28, 1994, appellant did not turn over his shares to appellee. Appellee thus asserts that, as a result of appellant's failure to do so, appellant was never divested of his authority to exercise his rights as a stockholder. Therefore, appellee claims that he should not be penalized, because it was appellant who slept on his rights as a stockholder. Appellee's argument is without merit. Section 4-603(d)(2) expressly states that the petitioner for dissolution "[c]eases to have any other rights with respect to the stock, except the right to receive payment of its fair value." Nowhere in the present version of the statute does it say that the petitioner's rights continue until the stock is physically transferred to the electing stockholder. We recognize that the trial court was troubled because the bond had been released prior to appellee's revocation. Indeed, appellee argued to this Court that, because the bond had been released, he should not be required to post another bond, especially when he cannot afford to do so. We point out, however, that the statute does not speak only of posting a bond. It includes "other security sufficient to assure payment to the petitioner." C.A. § 4-603(b)(1). As the trial judge has the power to require the posting of a bond or other security, we see no reason why the $16,291.00 now in appellant's possession could not constitute such "other security." ORDER VACATED. CASE REMANDED TO THE CIRCUIT COURT FOR MONTGOMERY COUNTY FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. COSTS TO BE PAID BY APPELLEE CRANDALL. NOTES [1] The original version of the buy-back provision did not address the right to revoke. It stated, in pertinent part: Avoidance of dissolution by purchase of petitioner's stock.—Any one or more stockholders desiring to continue the business of a close corporation may avoid the dissolution of the corporation or the appointment of a receiver under this section or under § 79A of this article by electing to purchase the shares of stock owned by the petitioner at a price equal to their fair value. If stockholders' making such election are unable to reach an agreement with the petitioner as to the fair value of his shares, the court shall, upon the stockholders' giving bond or other security sufficient to assure to the petitioner payment of the value of his shares, stay the proceeding and proceed to determine the value of the shares, in accordance with the procedure set forth in § 73(f) of this article, as of the close of business on the day on which the petition for dissolution was filed. * * * Upon full payment of the purchase price, under the terms and conditions specified by the court, or at such other time as may be ordered by the court, the petitioner shall transfer the shares of stock to the purchasing stockholder. Md. Code (1957, 1967 Repl. Vol., 1967 Cum. Supp.) Art. 23 § 109(c) (codified as amended at C.A. § 4-603). [2] To our surprise, in their briefs submitted to this Court, neither party cited a single case for any purpose. [3] We recognize that the court may determine that revocation is warranted. On the other hand, if it decides against revocation, it must then decide whether the fair market value of appellant's stock exceeded the original appraisal of $16,291.00. We note that appellant has already been paid that sum. The parties have not raised, and therefore we do not consider, whether appellant's acceptance of the $16,291.00 constitutes a wavier of his right to pursue a greater recovery from appellee for appellant's stock.

2013-10-30 06:35:55.442392+00

Douglas

491 S.W.2d 920 (1973) L. J. HARRISON, Appellant, v. The STATE of Texas, Appellee. No. 45976. Court of Criminal Appeals of Texas. March 21, 1973. R. B. Cousins, Dallas for appellant. Henry Wade, Dist. Atty., Harry J. Schulz, Jr., Asst. Dist. Atty., Dallas, Jim D. Vollers, State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION DOUGLAS, Judge. This is an appeal from a conviction for the offense of robbery. The court assessed punishment at twenty-five years. The sufficiency of the evidence is challenged. The record reflects that on September 20, 1970, at approximately 8:00 a. m., Mrs. W. C. Perry, an employee on duty at a 7-11 Store in the Oak Cliff section of Dallas, was robbed. Mrs. Perry testified that appellant entered the store and demanded all the money in the cash drawer and in her billfold. She also testified that appellant took the money and drove away and that she was able to copy down the license number of the vehicle used by appellant as he left. Subsequently, appellant's vehicle was stopped by Officer Bateman of the Dallas police department. Some $214 in cash was found in appellant's pickup truck. This was approximately the amount taken in the robbery. The appellant testified that he had gone to the 7-11 Store to get three money orders totalling $173 to use in making various payments. He claimed that he had placed *921 the money on the counter and gave Mrs. Perry a ten dollar bill to pay for an orange drink and cigarettes, after which she gave him change for only one dollar and that he then reached in the open cash drawer and took money for his change. He also testified that he picked up money that he had placed on the counter for money orders. The appellant complains that "the Court erred in allowing cross examination of appellant as to oral statements made or not made following his arrest." He also complains of prosecutorial misconduct. During cross-examination, Mr. Stauffer, the prosecutor, asked the appellant about statements made after he had been stopped and handcuffed by the officers. Objections to questions asked which called for answers after he was under arrest were sustained. The prosecutor again asked about his statements to the officers. He replied that he did not say anything and then said he told them that he did not rob Mrs. Perry. He was then asked, "It's down here in front of the jury, did you ever give an explanation for all of them?" An objection was sustained, but a motion for mistrial was overruled. Previous to this the prosecutor asked the appellant if he had told or complained to anyone about the conspiracy that he was talking about. An objection, "Your Honor, that's the same thing about a statement after arrest," was sustained, but the court overruled a request for the jury to disregard "the statement made by the prosecuting attorney." Then the prosecutor asked if he protested "when these officers had arrested you, and took your gun from you and your money, did you protest in any way to them about this fact that you were a victim of this woman and that's how the money came to be in your truck? Did you ever tell them, Officer Bateman, or Officer Reardon or any people?" Here the court stated: "Sustained after the arrest. Before the arrest, overruled, you may answer." The answers that followed concerned silence of the appellant after he was under arrest. Generally, statements which do not comply with the provisions of Article 38.22, Vernon's Ann.C.C.P., requiring a warning by the person to whom the statement is made are not admissible. See Butler v. State, Tex.Cr.App., 493 S.W.2d 190 (1973); Garner v. State, Tex.Cr.App., 464 S.W.2d 111; Leach v. State, Tex.Cr.App., 428 S.W.2d 817, and McIntosh v. State, 85 Tex. Crim. 417, 213 S.W. 659. The State contends that these statements were admissible for impeachment purposes under Harris v. New York, 401 U.S. 222, 91 S. Ct. 643, 28 L. Ed. 2d 1, and Small v. State, Tex.Cr.App., 466 S.W.2d 281. The contention was presented and this Court held that statements made while one was in custody were not admissible because they were not taken in compliance with Article 38.22, supra. Butler v. State, supra. In addition to the above, the record contains several instances where the prosecutor, contrary to the court's instructions, asked improper questions of the appellant. On one occasion, the judge threatened to hold the prosecutor in contempt of court. It was error to permit the questions and answers concerning the statements or lack of statements by the appellant after he was under arrest. It was also error for the prosecutor to get before the jury statements by the appellant and his failure to protest his innocence after he was under arrest even though some of the objections to his questions were sustained. See McIntosh v. State, supra. Even after the repeated admonishments of the trial court, the appellant did not receive a fair trial. The quotation from Shawhan v. Commonwealth of Kentucky, Ky., 318 S.W.2d 541, 544, cited by Judge *922 Woodley in Brown v. State, 168 Tex. Cr.R. 67, 323 S.W.2d 954, is applicable. It is as follows: "`a litigant is entitled to at least one tolerably fair trial' regardless of the nature of his offense, * * * and to this end we have made our ruling." The judgment is reversed and the cause remanded.

2013-10-30 06:35:55.444032+00

Norton

901 F. Supp. 1047 (1995) D. Cecil LUCAS, Plaintiff, v. Captain Dwain GUYTON, individually as Correctional Officer at Broad River Correctional Institution; Richard L. Harvey, individually as Correctional Officer at Broad River Correctional Institution; and Lester A. Hubbard, individually as Correctional Officer at Broad River Correctional Institution, Defendants. Civ. A. No. 3:93-2469-18. United States District Court, D. South Carolina, Columbia Division. September 25, 1995. *1048 *1049 J. Christopher Mills, Columbia, SC, for plaintiff. David L. Morrison, Columbia, SC, for defendant. ORDER NORTON, District Judge. I. INTRODUCTION Cecil Lucas does not deserve much sympathy. His attorney knew this when he decided *1050 to represent him and the Defendants knew that when they were notified of his claim. Cecil Lucas broke into the home of an elderly couple late at night, killed them both and burglarized their home. His attorney knew when this he filed his Complaint, as did the Defendants when they filed their Answer. Cecil Lucas was convicted of these crimes, was sentenced to death and has lived on death row since 1983. His attorney knew this as he prepared his case for trial and the Defendants knew this as they planned their litigation strategy. Most of Cecil Lucas' witnesses had been convicted of murder and were also awaiting the ultimate punishment meted out by society. His attorney knew that when he took their depositions to be read at trial and the Defendants knew that when they prepared their witnesses to testify live at trial. Cecil Lucas admitted to being drunk at the time of the incident and to possibly spitting on the Defendants. His lawyer knew that before the trial of this case, as did the Defendants. Cecil Lucas could prove no out of pocket damages; he had no medical bills; he had no lost wages; he had no permanent injuries. His lawyer knew this as he attempted to settle his case and the Defendants knew this when they refused to negotiate Cecil Lucas' claims. Cecil Lucas' jury was comprised of four white jurors and four black jurors; Cecil Lucas is white and each Defendant is black. At trial, there was testimony that Lucas used highly offensive racial slurs towards the Defendants. His lawyer knew this at the trial of the case as did the Defendants. Cecil Lucas did not have much left in this world; he had the minimal possessions that he was allowed to keep on death row; he had some ability to communicate with the outside world and he retained some of his constitutional rights, having lost his right to liberty and possibly his right to life.[1] One right Cecil Lucas retained on death row was his right under the Eighth Amendment of the Constitution to be free from cruel and unusual punishment — that is what this case is all about. For Cecil Lucas to be a successful in his claim against the Defendants, both parties agree that the jury had to find that on December 21, 1992, the Defendants maliciously and sadistically inflicted bodily harm on Cecil Lucas. His attorney knew that as he argued his case to the jury. The Defendants' attorney knew that as he argued their case to the jury. Cecil Lucas does not deserve much sympathy, but a jury of eight men and women from different areas of South Carolina listened to the evidence presented to them and found for Cecil Lucas in the amount of ten cents. Cecil Lucas may not deserve much sympathy, but the jury found that he did not deserve what happened to him on December 21, 1992. II. BACKGROUND This matter is now before the court on Plaintiff's Motion for Attorney's Fees and Costs Pursuant to 42 U.S.C. § 1988. As noted above, this was an extremely unusual case. Plaintiff's petition for attorney's fees and costs comes as a result of Plaintiff, a death row inmate, being a prevailing party in a section 1983 suit against three correctional officers. In his Complaint, Plaintiff alleged that on December 21, 1992, the three correctional officer Defendants — Captain Dwain Guyton, Richard L. Harvey, and Lester A. Hubbard — violated his Eighth Amendment right against cruel and unusual punishment by sadistically and maliciously beating him. The Complaint asserted two Eighth Amendment causes of action: (1) a cause of action for a violation of his rights by Defendants at the initial stages of an altercation with the officers as they took him from his individual cell to an isolation cell, and (2) a cause of action against Defendants alleging that they beat him further once he was placed in the isolation cell. During the four day trial, the jury was informed that Plaintiff had an extensive history of fighting correctional officers in addition to a long history of self inflicted injury, including several attempts at suicide. The incident at issue occurred on December 21, 1992 after a Christmas pizza party for the death row inmates. Plaintiff, after using a telephone, got into an argument with Officer Harvey and threatened Harvey with a serving spoon. As a result of this threatening *1051 action, correctional officers escorted Plaintiff back to his cell and then came to take him to an isolation cell. Plaintiff refused to submit to the officers when they came to take him to the isolation cell and started fighting with them. Plaintiff admitted that he was intoxicated at the time, having imbibed a significant amount of homemade Christmas cheer called "buck." Plaintiff also admitted that he was wrong to initially resist the officers' efforts to take him to the isolation cell, but claimed that once he was subdued with handcuffs and leg irons, Defendants maliciously and sadistically beat him. Photos and a video taken after the incident showed significant black and blue facial bruising and swelling. Plaintiff alleged that these injuries were the result of Defendants' dropping Plaintiff face first onto the cement floor while he was handcuffed, forcefully ramming his face into prison bars, and striking Plaintiff in the face. At trial, Defendants admitted to having to use force to subdue Plaintiff, but claimed to have used only such force as was necessary to subdue a drunken, violent, resisting, profane, belligerent prisoner. Defendants steadfastly maintained that almost all of Plaintiff's bruising was self inflicted and not the result of any intentional acts on their part. It was Defendants' position that Plaintiff's facial injuries occurred when Plaintiff tripped and fell on his face when he was let go by correctional officers who were trying to avoid Plaintiff's spitting in their faces. Regardless of the origin of Plaintiff's injuries, the evidence revealed Plaintiff's eyes were swollen completely shut and his face was badly bruised. After four days of trial, in which Plaintiff and Defendants each testified and Plaintiff presented deposition testimony of numerous other death row inmates,[2] the jury found for Plaintiff on the first cause of action against all three Defendants and awarded nominal damages in the amount of ten cents. On the second cause of action, the court directed a verdict for Defendants Harvey and Hubbard and the jury found in favor of Defendant Guyton. Subsequent to trial, Plaintiff's counsel applied for fees and costs pursuant to 42 U.S.C. § 1988. With Plaintiff's petition for fees, he has submitted an affidavit that includes a detailed itemized list of fees totaling $29,516.50 and costs amounting to $1,856.17. III. ANALYSIS A. Attorney's Fees in Nominal Damages Cases Under 42 U.S.C. § 1988, a prevailing party is entitled to a reasonable attorney's fee in a § 1983 action. The landmark case discussing awards of attorney's fees for a plaintiff who receives only nominal damages in a civil rights action is Farrar v. Hobby, 506 U.S. 103, 113 S. Ct. 566, 121 L. Ed. 2d 494 (1992). In Farrar, the Court held that a plaintiff who is awarded nominal damages is considered a prevailing party for the purposes of the statute. Id. at ___, 113 S.Ct. at 573. Although the Court in Farrar found such plaintiffs to be prevailing parties under the statute and that they are not precluded from an award of attorney's fees, the "technical" nature of a nominal damages award must be considered when a court decides whether to award attorney's fees. Id. at ___, 113 S.Ct. at 574. The Court stated: In a civil rights suit for damages, however, the awarding of nominal damages also highlights the plaintiff's failure to prove actual, compensable injury.... When a plaintiff recovers only nominal damages because of his failure to prove an essential element of his claim for monetary relief, the only reasonable fee is usually no fee at all. Id. at ___, 113 S.Ct. at 575 (citing Carey v. Piphus, 435 U.S. 247, 254-57, 264, 98 S. Ct. 1042, 1047-52, 55 L. Ed. 2d 252 (1978)) (emphasis added). The Court emphasized: "Indeed `the most critical factor' in determining the reasonableness of a fee award `is the degree of the success obtained.'" Id. at ___, 113 S.Ct. at 574 (quoting Hensley v. Eckerhart, 461 U.S. 424, 436, 103 S. Ct. 1933, 1941, 76 L. Ed. 2d 40 (1983)); see Carroll v. Wolpoff & Abramson, 53 F.3d 626, 630 (4th Cir.1995) (addressing the award of attorney's *1052 fees under the Fair Debt Collection Practices Act). In her concurring opinion in Farrar, Justice O'Connor examined the congressional intent behind the statute and recognized the statute's discretionary nature, but concluded that Congress did not enact the statute to reward a "technical or de minimis victory," a "pyrrhic" victory, or "chimerical accomplishments." Id. at ___, 113 S.Ct. at 577 (O'Connor, J. concurring). She further stated: "That is not to say that all nominal damages awards are de minimis. Nominal relief does not necessarily a nominal victory make." Id. at ___, 113 S.Ct. at 578. Finally, she identified the following three factors that a court should consider in determining if plaintiff's award of nominal damages is merely a de minimis victory: "first, the difference between the judgment recovered and the recovery sought; second, the significance of the legal issue on which the plaintiff prevailed; and third, the public purpose served by the litigation." Cartwright v. Stamper, 7 F.3d 106, 109 (7th Cir.1993) (citing Farrar, 506 U.S. at ___, 113 S.Ct. at 578-79). It is this court's opinion that the jury's award of nominal damages in the amount of ten cents, which may appear on its face to be a de minimis victory, was in reality a significant accomplishment under the very unique circumstances of this case. It is hard to imagine a more repugnant or unsympathetic client to put before a jury. See Wilcox v. City of Reno, 42 F.3d 550, 557 (9th Cir. 1994) (awarding attorney's fees under § 1988 and recognizing the unsympathetic nature of the plaintiff, who was a convicted felon, drunk at the time of the alleged excessive police force incident and who had just broken a beer bottle on a woman's face). Although the jury was not told the specific circumstances of the double murder that Cecil Lucas committed in 1983, the jury was aware that Plaintiff was on death row and could reasonably conclude that those on death row are usually there for a good reason. The evidence before the jury also demonstrated that Plaintiff had a history of self inflicted injury and had the unfortunate habit of fighting with correctional officers. The day of the incident, Plaintiff admitted to being drunk, swinging the first punch, possibly having spit at Officer Harvey, and violently resisting the officers' efforts to take him to the isolation cell. All of Plaintiff's corroborating witnesses, whose testimony was read by deposition, were death row inmates — not the type of people that are usually seen to be overly credible. The mere fact that the jury was able to look past these highly prejudicial and negative factors and render a verdict for Plaintiff, was far from a de minimis or pyrrhic victory. Instead, Plaintiff's verdict was a vindication of an important constitutional right and merits compensation for his attorney. The overall success that Plaintiff obtained "goes well beyond" the ten cent verdict. See Wilcox,. 42 F.3d at 557. Although the Court in Farrar denied attorney's fees to the prevailing party of a nominal damages verdict, Farrar is distinguishable on several important respects. For example, the litigation in Farrar was costly and prolonged — lasting over ten years and finally being resolved at the U.S. Supreme Court after two decisions by the circuit court of appeals. 506 U.S. at ___, 113 S.Ct. at 575 (O'Connor, J. concurring). This case was tried less than two years after it was filed and the detailed list of expenses submitted by Plaintiff's counsel demonstrate to this court that counsel expended a very reasonable amount of time on the case.[3]Contra Fair Housing Council v. Landow, 999 F.2d 92, 97 (4th Cir.1993) (denying award of attorney's fees when counsel submitted *1053 "woefully inadequate time records" and the amount requested shocked the conscience of the court). Additionally, an analysis of the three factors enumerated by Justice O'Connor helps to draw distinctions between Farrar and other cases in which the fee issue has been addressed in the context of a nominal damage verdict.[4] The first factor is the difference between the judgment recovered and the recovery sought. Farrar, 506 U.S. at ___, 113 S.Ct. at 578 (O'Connor, J. concurring). This court believes that the first factor weighs in favor of an award of fees. In Farrar, the plaintiff requested seventeen million dollars from six defendants and ultimately prevailed against only one for the sum of one dollar. 506 U.S. at ___, 113 S.Ct. at 575. In this case, Plaintiff sued three Defendants for two claims of excessive force. Although Plaintiff was unsuccessful in proving the second excessive force cause of action against Defendants, he did prevail in the first excessive force cause of action against all three Defendants. Even though the jury only awarded Plaintiff ten cents, this court does not believe that the monetary amount alone should be determinative of the degree of success — especially in light of the fact that Plaintiff's trial strategy did not include a high demand for monetary damages. The fact that Plaintiff prevailed in any way in this action demonstrates an impressive effort by counsel of overcoming many significant adverse factors. Counsel recognized throughout the trial that, due to the unique nature of this case, it was primarily about the vindication of the constitutional rights of a death row inmate. Although Plaintiff's counsel in closing argument asked the jury to consider compensatory and punitive damages, he frankly recognized the difficulty of such a request considering Plaintiff's death row status. In fact, counsel even stated in closing that the case was not about "ringing the bell" and getting "big money," but was instead about the violation of important constitutional rights and that a nominal damage verdict in Plaintiff's favor would send a message to the Defendant correctional officers that "it wasn't business as usual" on death row. Counsel for Plaintiff did not argue a dollar amount before the jury nor is one included in the Complaint. Further, Plaintiff's counsel specifically requested and presented to the court the nominal damage jury charge. In other cases in which attorney's fees have been denied under Farrar due to a nominal damage verdict, the courts have focused on the fact that such a verdict, encompassing little monetary relief, is indeed a failure when the injured party specifically sets out to recover large sums of money. For example, in Cramblit v. Fikse, 33 F.3d 633 (6th Cir.1994), the Sixth Circuit affirmed the lower court's denial of attorney's fees in a § 1983 case in which the plaintiff received only nominal damages because the court found that plaintiff's "primary goal in the underlying § 1983 action was to obtain monetary damages." Id. at 635. In fact, in the closing argument and rebuttal, plaintiff's counsel in Cramblit specifically demanded "full and fair compensation" and "full and fair punitive damages" and emphatically stated "this is not a nominal damages case...." Id. at 635; see also Romberg v. Nichols, 48 F.3d 453, 455 (9th Cir.1995) (denying attorney's fees in § 1983 case in which plaintiff sought sixteen million dollars in punitive and compensatory damages from eight defendants, but received only nominal damages); Cartwright v. Stamper, 7 F.3d 106, 109 (7th Cir.1993) (denying attorney's fees in § 1983 case in which plaintiff received nominal damages, but sought "substantial compensatory and punitive damages"); Haywood v. Koehler, 885 F. Supp. 624, 629 (S.D.N.Y.1995) (denying attorney's fees when plaintiff sought *1054 ten million dollars from two defendants, but received a nominal damage verdict against only one defendant); Briggs v. Marshall, 881 F. Supp. 414, 419 (S.D.Ind.1995) (denying attorney's fees in § 1983 case in which plaintiff recovered nominal damages, but sought specific, large monetary amounts from the individual defendants). But see Clark v. Sims, 894 F. Supp. 868, 873, n. 17, (1995) (awarding attorney's fees and recognizing "that this was not a case in which the plaintiffs placed unreasonable emphasis upon pursuing a huge award of damages.") Additionally, this was not a case in which counsel set out to recover a large monetary verdict and then made a last minute pitch in closing argument for nominal damages. See e.g., Romberg, 48 F.3d at 455 (denying attorney's fees when plaintiff initially requested two million dollars in punitive and compensatory damages from each of eight defendants, but made last minute pitch for nominal damages in closing argument). Recovering large sums of money was not the theme nor the trial strategy of this case. Plaintiff's Complaint simply requested compensatory or nominal damages "in an appropriate amount." Cmplt. ¶ 16. Additionally, Plaintiff's answer to the standard interrogatory, which requested he "describe said injuries and damages in detail and list the elements of damages for which you contend you are entitled to recover and the measure by which you contend the same should be computed," simply described Plaintiff's physical injuries, but did not list any monetary amount. Pl.'s Answer Interrogs. ¶ 5. Therefore, this court finds that the jury's favorable nominal damage verdict[5], demonstrating that the jury found that Defendants maliciously and sadistically violated Plaintiff's constitutional rights, was exactly the relief Plaintiff sought.[6]See Farrar, 506 U.S. at ___, 113 S.Ct. at 578 (O'Connor, J. concurring) ("[A]n award of nominal damages can represent a victory in the sense of vindicating rights even though no actual damages are proved."). O'Connor's second factor weighs strongly in favor of an award of attorney's fees. The second factor looks to the significance of the legal issue on which plaintiff prevailed. Farrar, 506 U.S. at ___, 113 S.Ct. at 578 (O'Connor, J. concurring). In Jones v. Lockhart, 29 F.3d 422 (8th Cir.1994), a similar prisoner case involving a violation of the Eighth Amendment, the Eighth Circuit granted an award of attorney's fees in spite of a nominal damage award.[7] The court recognized the significance of the constitutional right to be free from cruel and unusual punishment and stated: "[W]e find the vindication of the constitutional right to be free from cruel and unusual punishment is a significant legal issue in contrast to the injury to the business interest alleged in Farrar." Id. at 424 (citing Farrar, 506 U.S. at ___, 113 S.Ct. at 570). This court agrees with the Eighth Circuit that the constitutional right — *1055 of all persons regardless of their individual circumstances — to be free from cruel and punishment is one of the premises upon which this great nation was founded and that right continues to distinguish this nation today. This is a fundamental protection that the Constitution guarantees all persons — even those on death row. Finally, considering Justice O'Connor's third criteria, this court strongly believes that this civil rights litigation served an important public purpose. The purpose for awarding attorney's fees under 42 U.S.C. § 1988 is to provide an incentive for competent and skilled attorneys to take on unpopular cases and indigent clients thereby acting as a "private attorney general." Farrar, 506 U.S. at ___, 113 S.Ct. at 578 (O'Connor, J. concurring) ("[I]t is a tool that ensures the vindication of important rights, even when large sums of money are not at stake, by making attorney's fees available under a private attorney general theory."); see City of Riverside v. Rivera, 477 U.S. 561, 578, 106 S. Ct. 2686, 2696, 91 L. Ed. 2d 466 (1986) (citing Kerr v. Quinn, 692 F.2d 875, 877 (2d Cir.1982)); Newman v. Piggie Park Enters., 390 U.S. 400, 402, 88 S. Ct. 964, 966, 19 L. Ed. 2d 1263 (1968). As the Court stated in Newman, when a plaintiff brings a civil rights claim, "he does so not only for himself but also as a `private attorney general,' vindicating a policy that Congress considered of the highest priority." Newman, 390 U.S. at 402, 88 S. Ct. at 966. Although the verdict in this case might not have a far reaching effect beyond the walls of South Carolina's death row or its prisons, this court believes that the verdict will have a significant effect within those walls. But see Haywood, 885 F.Supp. at 629 (denying attorney's fees under the O'Connor analysis because the plaintiff sought ten million dollars in damages, prevailed against only one defendant for nominal damages and the court found that, although the excessive force claim was significant, "the illegality of the use of excessive force on inmates is already clearly established"[8]). Although Defendants disagree, this court believes that the probable catalytic effect of the judgment against the Defendants can be considered in analyzing this third criteria and can have an impact on the amount of the fee award. Such analysis is directly contemplated by Justice O'Connor in Farrar. See 506 U.S. at ___, 113 S.Ct. at 578-79 (recognizing the district court did not identify the "type of lawless conduct that might be prevented." (emphasis added)). Additionally, such analysis would appear to be consistent with current Fourth Circuit law. In S-1 & S-2 v. State Bd. of Educ., 21 F.3d 49 (4th Cir.) (en banc) (per curiam), cert. denied, ___ U.S. ___, 115 S. Ct. 205, 130 L. Ed. 2d 135 (1994), the Fourth Circuit reversed its earlier decision and rejected the catalyst theory as a grounds for determining whether a party is a "prevailing party" for the purposes of section 1988. Id. at 51 (citing Farrar, 506 U.S. at ___, 113 S.Ct. at 573-74). Although the application of the third O'Connor factor involves somewhat of a secondary application of the catalyst theory, this court recognizes that under the clear mandates of Farrar and S-1 & S-2, Plaintiff has already established prevailing party status by the "virtue of having obtained an enforceable judgment." Id. at 51. To the extent that a subsequent Fourth Circuit case has appeared to infer that the catalyst theory cannot be considered in calculating the amount of the fee award,[9] this court finds such a position was not intended by Farrar nor was it the holding of S-1 & S-2. Instead, this court agrees entirely with the analysis and rationale of the Maryland District Court in the Clark v. Sims case on remand, 894 F. Supp. 868, 87-872 & n. 15 (1995), in which that court recognized that *1056 the consideration and application of a catalyst theory approach in determining the amount of the fee is distinguishable from application of the catalyst theory in determining prevailing party status. On remand, the Maryland District Court stated: Although, the Clark Panel suggests that S-1 & S-2 stands for a total elimination of catalyst theory per se, it appears that S-1 & S-2 addresses only the more limited issue of how to establish prevailing party status.... It is the opinion of this Court, that once a party has been otherwise found to be a prevailing party, catalyst theory remains available for consideration as a factor in arriving at the actual amount of the fee award, if any. This secondary application of catalyst theory was not specifically prohibited by either S-1 & S-2 or Farrar. Id. at 871 (citing Kilgour v. City of Pasadena, 53 F.3d 1007, 1011 n. 4 (9th Cir.1995) (adopting the catalyst theory for purposes of determining prevailing party status, which the Fourth Circuit has expressly rejected, but also acknowledging its application as a "factor in determining the extent of success.")). Therefore, this court believes a consideration of the verdict's overall effect in determining the fee award amount is not only consistent with Farrar, but also supportive of the rationale behind awarding attorney's fees in civil rights cases in which the plaintiff's attorney serves as a private attorney general. Therefore, in this case, an award of a fee is supported by Farrar and the O'Connor test. Further, because this court finds the victory to be far from de minimis or pyrrhic, the court believes a fee greater than a low fee is appropriate. B. Amount of Attorney's Fees Having decided that this is a rare case in which fees should be awarded and that a fee award greater than a low fee is appropriate, this court's discretion in determining the reasonableness of the fee amount is strictly guided by the twelve factors enumerated in Johnson v. Georgia Highway Express, 488 F.2d 714 (5th Cir.1974). Trimper v. City of Norfolk, 58 F.3d 68, 73 (4th Cir. 1995). Those factors are as follows: (1) the time and labor required to litigate the suit; (2) the novelty and difficulty of the questions presented by the lawsuit; (3) the skill required properly to perform the legal service; (4) the preclusion of other employment opportunities for the attorney due to the attorney's acceptance of the case; (5) the customary fee for such services; (6) whether the fee is fixed or contingent; (7) time limitations imposed by the client or the circumstances; (8) the amount in controversy involved and the results obtained; (9) the experience, reputation, and ability of the attorney; (10) the "undesirability" of the case; (11) the nature and length of the attorney's professional relationship with the client; and (12) awards in similar cases. Id. at 73 (citing Daly v. Hill, 790 F.2d 1071, 1075 n. 2 (4th Cir.1986)). A district court must consider the Johnson factors in determining the reasonable hourly rate and the reasonable number of hours that are then multiplied to calculate the lodestar figure, which will usually reflect a reasonable fee. Daly, 790 F.2d at 1078; E.E.O.C. v. Service News Co., 898 F.2d 958, 965 (4th Cir.1990). "Johnson expressly contemplates that these factors be used both in calculating the hourly rate and the reasonable number of hours expended on a case." Trimper, 58 F.3d at 76. 1. Reasonable Hourly Rate Plaintiff's case was handled by one attorney with very minor assistance over its pendency by two other attorneys within his firm. J. Christopher Mills, Plaintiff's counsel, billed 177.35 hours, whereas the two other attorneys billed a combined total of only one hour and an additional attorney, apparently not associated with counsel's firm, billed $200.00 for preparation and research assistance of the fee memorandum. The hourly fee for both in court and out of court time requested by Mr. Mills is $140.00. W. Gaston Fairey, a senior partner at counsel's law firm, billed .4 of an hour at the rate of $225.00 per hour. Rochelle Romosca, a junior associate at the firm, billed .6 of an hour *1057 at a rate of $100.00 per hour.[10] Based on the discussion of the applicable Johnson factors below, this court finds that the $140.00 hourly fee is reasonable for Mr. Mills and Mr. Fairey and that an hourly fee of $100.00 is reasonable for Ms. Romosca. Although Mr. Fairey is an experienced attorney, this court lowers his fee to be the same as Mr. Mills. This court finds that relevant to determining the appropriate hourly rate are Johnson factors two, three, four, five, eight, nine, ten and eleven.[11] a. Novelty and difficulty of the questions presented — This court finds that although the law involved in this case was no more or less difficult than most civil rights cases, the circumstances associated with the case made it a very difficult case to prepare for, try and win. As previously mentioned, Plaintiff and all his witnesses were death row inmates. Although Plaintiff was present in court, all of his witnesses testified by way of deposition. The question presented to the jury was whether they would believe Plaintiff's testimony and deposition testimony of his fellow death row inmates who maintained that the correctional officers had beaten him in violation of his constitutional rights or the live testimony of Defendants and their fellow correctional officers who contended that they had used only the amount of force necessary to subdue Plaintiff. b. The skill required to perform the legal service — This case required an above average degree of skill to successfully try. Due to Plaintiff's unfavorable character and the circumstances involved in the incident, it is this court's opinion that this case required a seasoned trial attorney with an in depth knowledge of civil rights law who demonstrated a very positive demeanor before a jury. Success in the courtroom also required an above average degree of pre-trial preparation and development of trial strategy. The affidavit presented by Mr. Mills supports the court's evaluation of his experience and skill level. c. The preclusion of other employment opportunities — This court finds that Mr. Mills has a successful private practice that primarily involves civil rights litigation. Due to the acceptance of this case, which Mr. Mills realized from the outset had little chance of monetary recovery, this court is convinced that the hours spent on this case precluded Mr. Mills from working on other current files and entertaining additional case work. d. The customary fee for such services — The court finds that the $140.00 hourly fee requested by Plaintiff's counsel to be within the range of customary fees for such services in the Columbia, South Carolina area. Although Mr. Mills produced no affidavits to the court with respect to the fee charged by other civil rights practitioners in the area,[12] this court is familiar with the market rate for that area and recognizes that the $140 per hour is the fee that Mr. Mills and other attorneys of his experience normally charge and successfully collect from their clients. Sheppard v. Riverview Nursing Ctr., Inc., 870 F. Supp. 1369, 1377 (D.Md.1994) ("The Court also has discretion to make factual findings based on personal knowledge of prevailing rates in the relevant market.") (citing Rum Creek Coal Sales, Inc. v. Caperton, 31 F.3d 169, 179 (4th Cir.1994)). *1058 e. The amount in controversy involved and the results obtained — Although the amount in controversy was not significant in this case, the degree of success was very significant. A death row inmate prevailed on a cruel and unusual punishment claim against three correctional officers all of whom testified and directly disputed his version of the events. Additionally, although Plaintiff was not successful in an additional cause of action against these officers, the two causes of action developed from a continuing incident involving a common core of facts and identical legal theories. Normally, claims are treated as related if they are "part and parcel of a series of events between the plaintiff and defendants, occurring within a relatively short time span in one particular setting." Burston v. Virginia, 595 F. Supp. 644, 650 (E.D.Va.1984). In this case, the court will not attempt to reduce the fees to recognize the loss on the second cause of action because these two claims were directly related and resulted from a series of events that occurred over a very short time span. Instead, the court focuses on the relative significance of the overall relief Plaintiff obtained. Stacy, 845 F.Supp. at 1140-41 (citing Hensley, 461 U.S. at 435, 103 S. Ct. at 1940 and Abshire v. Walls, 830 F.2d 1277, 1282-83 (4th Cir.1987)). f. The experience, reputation and ability of the attorney — This court finds that Mr. Mill's experience in civil rights litigation, his reputation as a fine trial attorney and his courtroom demeanor and skill, as demonstrated by his client's verdict in this case, are surely worthy of a fee on the upper spectrum of the market rate. g. The undesirability of the case — As has been previously mentioned, this court finds it difficult to imagine a more undesirable case. Plaintiff is a convicted double murderer who admitted to starting the incident, while drunk on death row, that ultimately resulted in his injury. He had a history of self abuse and fighting with and spitting on correctional officers. Three correctional officer Defendants, and other correctional officers called as witnesses, directly disputed his claims. From the outset of the case, because of the great disparity in the apparent credibility of the witnesses on each side, the prospect of any recovery or favorable verdict would appear to have been very remote. Additionally, adequate preparation for the case involved numerous trips to death row along with deposing many of South Carolina's most notorious and brutal killers. h. The nature and length of the attorney's professional relationship with the client — Mr. Mills representation of Plaintiff commenced on April 14, 1993 and lasted until the end of the trial in June of 1995. The court recognizes that the nature of the attorney client relationship in this case made it more difficult to prepare than would be so in the average litigation in which the client is not locked away in a high security prison facility. Therefore, considering these Johnson factors, this court finds that the hourly rate of $140.00, requested by Mr. Mills, is indeed reasonable under the specific facts of this case. 2. Reasonable Number of Hours Having determined the reasonable hourly rate, this court again relies on the Johnson factors to determine the reasonable number of hours. Trimper, 58 F.3d at 76. In so doing, this court pays close attention to the detailed bill submitted by Plaintiff's counsel recognizing that [c]ounsel for a party statutorily entitled to recover attorney's fees must exercise "billing judgment" and exclude from a fee request hours that are excessive, redundant, or otherwise unnecessary. "Hours that are not properly billed to one's client also are not properly billed to one's adversary pursuant to statutory authority." Sheppard, 870 F.Supp. at 1376 (quoting Hensley, 461 U.S. at 434, 103 S. Ct. at 1940); Daly, 790 F.2d at 1079. The court finds Johnson factors one, two, three, seven, eight, nine, eleven and twelve relevant to the analysis of the reasonable number of hours billed. a. The time and labor required. After reviewing the bill submitted by counsel, this court finds most of the hours charged by Plaintiff's attorney and staff are very reasonable expenditures of time. Additionally, it *1059 appears to this court that counsel has very wisely and efficiently budgeted his time and made sound economical use of his staff. However, this court makes one minor reduction as follows: 1. J. Christopher Mills — Mr. Mills claims 177.35 hours. This court finds a reasonable amount of hours is 171.85 reflecting a 5.5 hour reduction for the following reason. On June 8, 1995, the bill reflected 7.3 hours for nine phone calls.[13] This court finds that amount of time to be excessive and unreasonable. Therefore, the charge for that day is reduced to reflect a total of 1.8 hours, (.2 for each phone call), which is more consistent with his billing practices for other phone calls. Of the hours billed by Mr. Mills, only 12.6 hours (7.3%) were billed for preparation of the petition for attorney's fees and the court finds that amount of time to be reasonable. See Service News, 898 F.2d at 966 (finding the expenditure of over 20% of the claimed time on fee preparation to be unreasonable in a case in which the attorney billed a total of 13.25 hours). Finally, this court is aware that this was a case in which Defendants refused to participate in settlement negotiations which necessitated the case to be settled before a jury. (Letter from Defendants' counsel to the court of 9/16/94, at 1). 2. W. Gaston Fairey — Mr. Fairey's claims totaling .4 hour of an hour are adequately documented and reasonable for the services rendered in the bill. 3. Rochelle Lyn Romosca — Ms. Romosca's claim for .6 of an hour is adequately documented and reasonable for the services described in the bill. 4. Tammie Maria Pope — The bill includes 63.05 hours for services rendered by counsel's paralegal, Ms. Pope. The hours billed by Ms. Pope are sufficiently documented and very reasonable for the services she rendered. More than half of her billable hours, 44.3 hours (70%), were billed during the four day trial period. This court observed Ms. Pope to be a diligent and very able paralegal who assisted in many respects during the trial including reading the depositions of Plaintiff's death row witnesses, taking notes throughout the proceeding and, on numerous occasions, conferring with counsel during his presentation of the case. Additionally, Ms. Pope was found to be a knowledgeable and reliable point of contact during the pendency of the case when Mr. Mills was unavailable. Therefore, this court finds 63.05 hours to be the reasonable amount of hours billed by Ms. Pope. 5. Law clerks and project assistants — The bill includes a total of 12.55 hours for various services provided by law clerks and project assistants. The court has reviewed the services rendered by these personnel and finds those services to be adequately documented and the hours to be reasonable for the services provided. b. Novelty and difficulty of questions — This court has reviewed the itemized bill and notes that there is no time billed for research prior to the trial. Although the questions of law were not difficult, this court notes that Mr. Mills experience in civil rights litigation contributed to a lack of billing for basic research. c. The skill required to properly perform the legal services — The court finds that the hours expended to be reasonable for an attorney with the skill of Mr. Mills. d. Time limitations imposed by the client or the circumstances — Other than the court's numerous scheduling orders, this court is not aware of any time limitation that had an effect in this case. However, this court notes that this case, with its obvious logistic and security problems, was tried within two years of the Complaint being filed. e. The amount in controversy and the results obtained — This court finds that the hours billed, with the minor adjustments above, are very reasonable for the results obtained. Mr. Mills prevailed at trial for a *1060 total of 171.85 hours of work including 45.6 hours billed during the intensive four day trial period. f. The experience, reputation, and ability of the attorney — This court finds that the number of hours billed by Mr. Mills and his staff to be very reasonable in light of his experience level compared to an attorney with comparable experience. g. The nature and length of the attorney's professional relationship with the client — Mr. Mills' representation of Plaintiff commenced on April 13, 1993 and lasted through June 15, 1995. Over the nearly two year period counsel's awarded billable hours total only 171.85 hours — a little over the time reflected in four average work weeks. h. Awards in similar cases — This court finds the amount of hours billed for a case of this magnitude to be reasonable in light of hours billed in comparable civil rights litigation. 3. The Lodestar Figure The above analysis of Plaintiff's motion for attorney's fees and supporting documentation yields the following totals as appropriate compensation in this case: Mills 171.85 hrs. @ $140/hr. = 24,059.00 Fairey .40 hrs. @ $140/hr. = 56.00 Romosca .60 hrs. @ $100/hr. = 60.00 Pope 63.05 hrs. @ $65/hr. = 4098.25 Misc. staff 12.55 hrs. @ $35/hr. = 439.25 ___________ TOTAL FEES = $ 28,712.50 C. Amount of Recoverable Costs In addition to the above fees, Plaintiff's Motion includes a request for reimbursement for costs amounting to $1,856.17. Plaintiff is entitled to recover those costs that are reasonable and normally passed to a client. Daly, 790 F.2d at 1082-84. Plaintiff has included the appropriate receipts verifying costs for filing fees, depositions, meals, and service of process charges. Other costs include copying and fax charges and mileage charges. This court finds these costs to be reasonably incurred in the preparation of the case and are therefore recoverable from Defendants. However, the itemized costs also include a bill for $200.00 for attorney services rendered in research and assistance in preparing the memorandum in support of attorney's fees. To the extent that this court finds that cost to be duplicative of the 12.6 hours already billed by Mr. Mills for fee preparation and research, that $200.00 cost is disallowed. Therefore, this court awards $1,656.17 in costs to Plaintiff. IV. CONCLUSION Although this court is aware that the usual fee in a nominal damages case is no fee at all, this was far from a usual case nor was the nominal damage verdict unimportant. As the court has attempted to describe throughout this Order, this was a case in which any lay person or attorney would have believed had no chance of a favorable verdict from the outset. As a result of Plaintiff's favorable verdict, this court finds the award of fees and costs is justified under both Farrar and Johnson. Cecil Lucas does not deserve much sympathy. He may well deserve the sentence imposed by the jury in 1983, but in spite of that sentence, he convinced a jury in 1995 that he was maliciously and sadistically treated by Defendants on December 21, 1992. Cecil Lucas does not have much, but he still has some constitutional rights. These rights were vindicated by the jury's verdict on June 15, 1995. It is therefore, ORDERED that Plaintiff's Motion for Attorney Fees and Costs Pursuant to 42 U.S.C. § 1988 is hereby GRANTED. Defendants are hereby ordered to pay Plaintiff fees ($28,712.50) and costs ($1,656.17) reasonably incurred in the total amount of $30,368.67. ORDERED that Defendants' Motion Requesting the Court to Review and Vacate the Clerk's Taxation of Costs, is hereby DENIED. AND IT IS SO ORDERED. NOTES [1] Cecil Lucas's denial of habeas corpus is on appeal to the Fourth Circuit. [2] All of Plaintiff's witnesses to the incident were death row inmates. For obvious security reasons, Plaintiff's attorney agreed to present their testimony to the jury by way of deposition. [3] Under Farrar, when a jury returns a nominal damage verdict, this court is not required to undertake a full scale fee analysis utilizing the twelve Johnson factors in reviewing counsel's request for attorney's fees if the court awards "low fees or no fees." Farrar, 506 U.S. at ___, 113 S.Ct. at 575 (citing Hensley v. Eckerhart, 461 U.S. 424, 430 n. 3, 103 S. Ct. 1933, 1937-38 n. 3 (1983)); Clark v. Sims, 28 F.3d 420, 424-25 (4th Cir.1994). However, this court ultimately applies the Johnson reasonableness factors test because it decides a fee award much greater than "low fees or no fees" is appropriate under the special circumstances of this case, and the Fourth Circuit has repeatedly directed district courts to apply these factors in determining an appropriate fee award. Trimper v. City of Norfolk, 58 F.3d 68, 73 (4th Cir.1995) (citing Daly v. Hill, 790 F.2d 1071, 1077 (4th Cir.1986)). [4] This court finds an adequate fee award is substantiated by Justice Thomas' majority opinion in Farrar. Although the court has been unable to find any published opinion of the Fourth Circuit adopting the three part O'Connor analysis, the court finds the analysis helpful in analyzing the appropriateness of the amount of the fee award and recognizes the use of the three part analysis by other circuits. See e.g., Milton v. Des Moines, Iowa, 47 F.3d 944, 946 (8th Cir.1995); Jones v. Lockhart, 29 F.3d 422, 423-24 (7th Cir.1994); Maul v. Constan, 23 F.3d 143, 145 (7th Cir. 1994); Cartwright v. Stamper, 7 F.3d 106, 109 (7th Cir.1993); Haywood v. Koehler, 885 F. Supp. 624, 629 (S.D.N.Y.1995). [5] This court realizes that the nominal damage verdict may have been a result of Plaintiff's inability to prove actual damages. There was no evidence of medical bills, expenses, nor any monetary losses incurred by Plaintiff, most likely because of Plaintiff's incarceration. However, this court recognizes the difficulty of proving such damages under the unique circumstances of the case and the reality that most jurors would find it difficult to award monetary damages to a death row inmate. This court does not believe that the jury's decision not to award compensatory or punitive damages to be fatal to this petition for attorney's fees. [6] In correspondence to the court from Plaintiff's counsel dated August 29, 1994, almost a year before the trial, counsel stated: "The case has merit and was filed without any intent to harass or for any other purpose than to vindicate the constitutional rights of Mr. Lucas." (Letter from J. Christopher Mills to the court of 8/29/94, at 1-2) (emphasis added). Defendants also knew this case was not about money in that they informed the court on September 16, 1994, that: "We expect that this case will be tried. It does not appear to be a case that is appropriate for summary judgment, nor is it a case that my clients intend to settle." (Letter from Defendants' counsel to the court dated 9/16/94, at 1) (emphasis added). [7] The court found that the lower court had erred in awarding fees in the amount of $25,000 based on the mistaken premise that the plaintiff had prevailed on a deliberate indifference to serious medical needs claim when in fact he had only prevailed on an excessive force cause of action. Therefore, the court reduced the fee award amount to $10,000. Jones, 29 F.3d at 423-24. In deciding to award attorney's fees, the court also found the award of punitive damages to be significant, but that award consisted of only one dollar. Id. at 423-24. [8] It makes little difference to a wrongfully beaten prisoner if the right against excessive force is "clearly established" when the facts reveal the correctional officers disregarded that "clearly established" right. Indeed, the essence of all civil right's claims are violations of "clearly established rights" and the purpose of section 1983 and section 1988 is to allow citizens an avenue for redress for violations of these rights. [9] See Clark v. Sims, 28 F.3d 420, 425 (4th Cir. 1994) ("In calculating the appropriate fee award, the court must also be guided by our recent holding in S-1 & S-2 v. State Board of Educ. In S-1 & S-2, we held that a court may not apply `catalyst theory' in determining what results are attributable to litigation."). [10] Additionally, four persons assisted as law clerks or project assistants at the rate of $35.00 per hour for a total of 12.55 hours. Counsel's paralegal also billed 63.05 hours at a $65.00 hourly rate. The court considers the rate for these services to be reasonable for the Columbia, South Carolina area. [11] This court finds the sixth Johnson factor is not relevant to the award in this case because "contingency multipliers may not be allowed in statutory fee cases." Sheppard v. Riverview Nursing Ctr., 870 F. Supp. 1369, 1380 (D.Md.1994) (citing City of Burlington v. Dague, 505 U.S. 557, 112 S. Ct. 2638, 120 L. Ed. 2d 449 (1992)). [12] This is not problematic because of the court's familiarity with the fees charged in that region. This court has been presented with affidavits in other cases supporting much higher hourly rates for lawyers who have half the talent and ability of Mr. Mills. However, lacking such familiarity and supporting affidavits, this court would have difficulty with this factor. In future petitions, counsel are encouraged to submit affidavits of other attorneys as the burden of establishing the reasonable rate rests with the fee applicant. Stacy v. Stroud, 845 F. Supp. 1135, 1138 (S.D.W.V. 1993) (citing Blum v. Stenson, 465 U.S. 886, 895-96 n. 11, 104 S. Ct. 1541, 1547 n. 11, 79 L. Ed. 2d 891 (1984)). [13] It is likely that Mr. Mills accomplished other work related to the file during that time, but it is not properly documented in his section of the bill. Descriptions of work accomplished by counsel's paralegal and associate attorney indicate conferences with Mr. Mills regarding trial preparation and the juror questionnaire that day.

2013-10-30 06:35:55.491244+00

Onion

491 S.W.2d 133 (1973) Sheila Ann FARMER, Appellant, v. The STATE of Texas, Appellee. No. 45616. Court of Criminal Appeals of Texas. January 31, 1973. Rehearing Denied March 21, 1973. James B. Turner, Houston, for appellant. Carol S. Vance, Dist. Atty., James C. Brough and James L. Muldrow, Asst. Dist. Attys., Houston, and Jim D. Vollers, State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. *134 OPINION ONION, Presiding Judge. This appeal is taken from a forgery conviction wherein the punishment was assessed at three years. Initially, appellant contends there "is doubt as to her identification in her mind." Reference is had to the in-court identification by Catherine Venglar, a Sears-Roebuck employee, who witnessed the appellant sign the sales slip in question. This would not appear to be an adequate ground of error under the requirements of Article 40.09, § 9, Vernon's Ann.C.C.P. Nevertheless, we shall treat the same as a challenge to the sufficiency of the evidence to sustain the conviction. Arnold C. Foster identified the account number on the alleged forged sales slip as that of his Sears-Roebuck account. He testified the name signed to the slip was that of his daughter, Janet G. Foster, but that the signature was not hers. He related that he had given his daughter permission to use the credit card but not the appellant or anyone else. Janet G. Foster testified she lost her wallet containing the credit card in question, as well as several others, on the night of December 7, 1970, in a shopping center. She related she did not know the appellant and did not give her permission to use the card. She also related the signature in question was not her signature. Catherine Venglar testified she was employed as a sales person in the women's sportswear department in the Sears-Roebuck store located on South Main in the City of Houston, and that on the night of December 8, 1970, the appellant and two other women entered her department and the appellant purchased a blouse and a pair of slacks and produced the Arnold Foster credit card and signed the name of Janet Foster to the sales slip. Testifying in her own behalf, the appellant denied the forgery, denied ever having been in the store in question, and claimed that, at the time of the alleged offense, she was working as a topless dancer at a nightclub. Her mother and another witness testified that her physical appearance was somewhat different at the time of the alleged offense and the time of the trial. Ralph Queen, Superintendent of the Houston Police Department's Identification Division, was called as a witness by the appellant. He testified that the signature on the forged instrument and a sample of appellant's known handwriting bore similarities but, without his equipment, he could not express an opinion that the writings were executed by the same person. In rebuttal, the State called Albert Smith, another employee of the Sears-Roebuck store, who identified the appellant as being in his department on December 8, 1970, and using the Foster credit card to purchase sone clothing from him. Viewing the evidence in the light most favorable to the court's judgment, we find it sufficient to sustain the conviction. Next, appellant complains because the court, during trial, refused to delay the progress of the trial and to order "a full and complete examination and analysis of her handwriting and that of the person who signed the writing in question...." The motion was made after Superintendent Queen testified he could not express an opinion without further study and use of his laboratory equipment, and that it would take him approximately one week to make high contrast negatives, etc., and do other work to be able to reach a positive opinion. The record reflects the indictment was returned on February 19, 1971 and trial did not commence until May 26, 1971, at which time appellant announced "ready." There is no question of indigency. The appellant was on bond and represented by retained counsel who admitted he had been in that capacity for many months. *135 The court did not abuse its discretion in overruling the motion. Appellant also contends the court erred in failing and refusing to order the witness Gehle Campbell to answer questions propounded to her on direct examination by defense counsel. After giving her name and address, the witness repeatedly claimed the Fifth Amendment privilege against self-incrimination. Before the witness took the stand, her attorney advised appellant's counsel the witness would claim the Fifth Amendment. Appellant's counsel then advised the court: "But there's other matters that I expect to inquire into that would not in anyway be incriminating as to this witness and I expect to only go into those matters." "In the first instance the witness is the judge as to whether his answer to a question will incriminate him. But he is not the exclusive judge of the matter.... The soundness of his contention must be determined by the court before which the refusal is made, from a consideration of all the facts and attending circumstances; and inquiry may always be conducted, in a legitimate and proper way, as to whether his refusal is made in good faith." 61 Tex.Jur.2d Witnesses § 32, pp. 565, 566. It appears from an examination of the character of the questions and other facts in the case that there was a substantial probability that the answers would have been incriminating. Appellant's counsel was apparently attempting to get the witness to admit that she had committed the offense in question while accompanied by another woman, Debbie Harper, who had the same physical appearance as the appellant. The court did not err in refusing to order the witness to answer the questions involved. Appellant's fourth ground of error is mulifarious and does not comply with Article 40.09, supra. As to appellant's claim that the court erred in failing to grant a new trial because a handwriting expert, Manton Marsh, testified at the hearing on motion for new trial that the signature on the forged instrument could not have been written by the appellant, we note that this could not be newly discovered evidence because there was a lack of due diligence. Appellant's retained trial counsel also represents her on appeal. In the last ground of error, the claim is advanced that the appellant was "inadequately and improperly represented by counsel ...." and denied a fair trial, that "said attorney was over-confident," and "took a casual attitude towards the presentation of cause," and "suggested to defendant that the same be tried before the court, which was done." No other argument or authorities are urged. We find no misconduct of non-appointed counsel which amounts to a breach of counsel's legal duty to faithfully represent an accused's interests. See Steel v. State, 453 S.W.2d 486 (Tex.Cr.App.1970). The contention is without merit. The judgment is affirmed.

2013-10-30 06:35:55.494396+00

Goodwin

901 F. Supp. 212 (1995) PIED PIPER, INC., a West Virginia corporation, Plaintiff, v. DATANATIONAL CORPORATION, an Ohio corporation, et al., Defendants. Civ. A. No. 3:95-0133. United States District Court, S.D. West Virginia, Huntington Division. October 12, 1995. *213 L. David Duffield and Scott W. Andrews, Huntington, WV, for Plaintiff. John Philip Melick, Lee van Egmond, Charleston, WV, R. Carter Elkins, Huntington, WV, Laura L. Gray, Peoria, IL, Leonard Shulman, Flint, MI, and Marjorie L. Kolin, Troy, MI, for Defendants. ORDER GOODWIN, District Judge. Pending before the Court are two Motions of defendant International Business Machines, Inc. (IBM) to dismiss Count V of the Complaint pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. The first Motion, filed on April 24, 1995, prior to the filing of the Amended Complaint, is DENIED as moot. The Court finds that West Virginia would not recognize a cause of action for negligent referral based upon the facts set forth in the Complaint and GRANTS the second Motion, thereby dismissing Count V of the Complaint. BACKGROUND This civil action involves a dispute regarding the alleged deficiencies of computer software purchased by plaintiff Pied Piper, Inc. (Pied Piper) from defendant Datanational Corporation (Datanational). The Amended Complaint alleges that following a presentation by IBM sales representatives, Pied Piper decided to purchase the IBM AS/400 computer system and custom programmed software for use in its retail business. The Amended Complaint alleges that IBM representatives advised Pied Piper that IBM did not directly market the computer hardware and software and recommended that Pied Piper purchase the computer system through Datanational, an authorized IBM dealer. Following negotiations, Pied Piper purchased customized software and IBM's AS/400 from Datanational. Pied Piper alleges that following installation of the computer system, the Datanational customized software developed numerous "bugs," which greatly impeded Pied Piper's ability to conduct its retail business,[1] and that the problems continued throughout 1993 despite Datanational's unsuccessful attempts at correction. Pied Piper alleges that Datanational breached its sales contract by providing this "inadequate and flawed" customized software.[2] In Count V of the Amended Complaint, Pied Piper alleges that "IBM breached its duty to Pied Piper when it recommended Datanational (an "IBM Business Partner") as the seller to Pied Piper." (Amended Complaint ¶ 67). Count V further alleges that: *214 65. Pied Piper relied on IBM's greater knowledge and experience to refer a suitable seller to Pied Piper, which seller should also have been knowledgeable concerning the AS/400 and the requirements of custom retail programming. 66. Because of its knowledge, size and dominance in the computer industry, IBM owed a duty to Pied Piper to refer a suitable seller to Pied Piper. (Amended Complaint, ¶¶ 65-66) (emphasis added). IBM moves to dismiss Count V of the Amended Complaint. STANDARD OF REVIEW In Mylan Laboratories, Inc., v. Matkari, 7 F.3d 1130, 1134 (4th Cir.1993), cert. denied ___ U.S. ___, 114 S. Ct. 1307, 127 L. Ed. 2d 658 (1994), the United States Court of Appeals for the Fourth Circuit set forth the standard of review in ruling on a motion to dismiss, stating: In general, a motion to dismiss for failure to state a claim should not be granted unless it appears certain that the plaintiff can prove no set of facts which would support its claim and would entitle it to relief. In considering a motion to dismiss, the court should accept as true all well-pleaded allegations and should view the complaint in a light most favorable to the plaintiff. Accepting the allegations set forth in Count V of the Amended Complaint as true and viewing those allegations in the light most favorable to the plaintiff, the Court finds that Count V fails to state a claim against IBM. DISCUSSION The West Virginia Supreme Court of Appeals has not addressed the issue of whether a cause of action exists for "negligent referral." However, this Court believes that the West Virginia Supreme Court would find that no such cause of action exists where the referral is commercial in nature and is made by one business entity to another. The Court finds highly persuasive two unpublished opinions dealing with the tort of negligent referral. In Haller v. Green Mountain Cabins, Inc., 884 F.2d 1388, 1989 WL 100660 (4th Cir.1989), the plaintiffs sued Green Mountain Cabins and their individual sales agents in contract and tort alleging that the agents had breached the duty to recommend a qualified builder. The United States Court of Appeals for the Fourth Circuit affirmed the district court's grant of the defendants' motion for a directed verdict on this issue, finding that neither Green Mountain nor the individual sales agents "had a duty, contractual or otherwise, to recommend a contractor" to the plaintiffs. Id. at 4. The Court further stated that the plaintiffs "have failed to establish that a cause of action for negligent referral is recognized in Virginia or would be recognized on the facts of this case." Id. In an analogous case, Electro-Matic Products, Inc. v. Prime Computers, Inc., 884 F.2d 579, 1989 WL 99044 (6th Cir.1989), the plaintiff contacted defendant, Prime Computers, Inc. (Prime), a manufacturer of computer hardware and expressed an interest in acquiring a new data processing system. Prime did not offer software for such manufacturing applications, but had licensing arrangements with software developers that marketed software compatible with the Prime hardware. A Prime sales representative referred the plaintiff to one of these software developers, Creata Data, Inc. (Creata Data),[3] and the plaintiff entered into various sales agreements with Creata Data. Delays were encountered and the plaintiff filed suit, alleging in Count I of its complaint that Prime was negligent in referring the plaintiff to Creata Data. The United States Court of Appeals for the Sixth Circuit affirmed the lower court's *215 grant of summary judgment in favor of Prime on the negligence claim, stating that: Accepting as true [plaintiff] Electro-Matic's allegations that Prime represented that Creata Data was the only available installer of Prime-compatible software, that Creata Data was incompetent, and that Prime failed to investigate Creata Data's competency, Electro-Matic cannot establish the existence of a legal duty Prime owed to it.... Electro-Matic cites no Michigan authority, nor is this court aware of any, which establishes a duty owed by one business entity to another to investigate the competency of a third entity to which a referral is made. Id. at 3 (emphasis added). Affirming the grant of summary judgment, the Sixth Circuit held that the plaintiff "failed to state a cognizable claim because Prime owed no legal duty to" it. Id. The existence of a legal duty is an essential element of a negligence claim under West Virginia law. See Robertson v. LeMaster, 171 W.Va. 607, 301 S.E.2d 563, 566 (1983); Hinkle v. Martin, 163 W.Va. 482, 256 S.E.2d 768, 770 (1979). In the case at bar, Pied Piper has failed to establish that IBM owed it any legal duty. The plaintiff cites only one case dealing with the tort of negligent referral — Reed v. Bascon, 124 Ill. 2d 386, 125 Ill. Dec. 259, 530 N.E.2d 417 (1988). That case held that a physician could be liable for negligent referral of a patient to another doctor. The duty in such cases arise out of fiduciary or special trust relationships. No such duties exist between commercial entities dealing with one another at arms length. Accordingly, Count V of the Complaint fails to state a cause of action again IBM and must be dismissed pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. CONCLUSION For the reasons set forth herein, the Court ORDERS that the defendant's Motion to Dismiss Count V of the Complaint be GRANTED and that Count V be stricken from the Complaint. NOTES [1] The Complaint does not allege any problems with the IBM AS/400 hardware. [2] Pied Piper also states claims for breach of implied warranty and breach of express warranty against Datanational. The Complaint further alleges that Datanational and IBM engaged in a joint venture. [3] The nature of the representations made by the Prime representative was in controversy. The plaintiff alleged that Prime's sales representative stated that Creata Data as the only available seller of Prime-compatible software, that the system of both hardware and software would perform all of the plaintiff's desired functions, and that Prime would stand behind the system. The Prime sales representative, on the other hand, testified that he merely suggested to the plaintiff that Creata Data was one of several sellers of Prime-compatible software and that Prime stood behind its hardware.

2013-10-30 06:35:55.505097+00

Opel

431 B.R. 580 (2010) In re Richard W. ALLAN and Linda S. Allan, Debtors. Richard W. Allan, Movant v. Putnam County National Bank, Respondent. No. 5-08-bk-52478 RNO. United States Bankruptcy Court, M.D. Pennsylvania. July 20, 2010. *581 Jeffrey S. Treat, Honesdale, PA, for Debtors. Mark J. Conway, Dunmore, PA, Trustee. OPINION ROBERT N. OPEL, II, Bankruptcy Judge. One of the Chapter 7 Debtors, Richard W. Allan ("Debtor"), filed a Motion to avoid a judicial lien held by the Respondent, Putnam County National Bank ("Bank"). For the reasons stated herein, I find that the lien of the Bank's judgment is avoidable as impairing the tenancy by the entirety exemption in Pennsylvania real property owned jointly by the Debtor and his filing spouse. I. Jurisdiction This Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 1334 and 157(b)(2). This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(A) and (K). II. Facts On September 4, 2008, the Debtor and his wife, Linda S. Allan, filed a joint Chapter 7 petition. On June 18, 2009, the Debtor filed a Motion for Order to Avoid Judgment Lien, seeking to avoid the lien of a judgment held by the Bank. Judgment was originally entered in Putnam County, New York, and was subsequently transferred to Wayne County, Pennsylvania. The Debtor and his filing spouse, own real property both in Putnam County, New York and in Wayne County, Pennsylvania. On February 16, 2010, the Debtor and the Bank filed a Stipulation of Facts. The stipulated facts, with the numbered paragraph reference taken from the Stipulation of Facts, include the following: 3. The Debtor, Richard W. Allan, identified and listed three (3) parcels of real estate on Schedule A consisting of a single family residence situated on two (2) lots at 5 Airpark Road, Cherry Ridge Township, Wayne County, Pennsylvania, owned jointly with his wife, Co-Debtor Linda S. Allan, and a house at 8 Nethermont Avenue, North White Plains, New York, owned jointly with his wife, Co-Debtor Linda S. Allen [sic], and a vacant lot at 16 Nethermont Avenue, North White Plains, New York, owned by Debtor, Richard W. Allan. 4. On Schedule C, the jointly owned real estate in Pennsylvania and New *582 York were claimed exempt pursuant to 11 U.S.C. Section 522(b)(3)(B). 5. No exemption claim for the vacant lot in New York was claimed. 6. Putnam County National Bank filed a proof of claim on July 9, 2009, asserting a secured claim of $2,642,359.69 on real estate pursuant to a Court judgment in the amount of $2,642,359.69 entered on September 26, 2003 at 8:58 a.m. in Putnam County, New York, and thereafter, recorded said judgment in Wayne County, Pennsylvania to No. 725-Judgment-2003, and revived on February 26, 2008, to No. 213-Judgment-2008. 10. The Debtors, Richard W. Allan and Linda S. Allan, are the record owners of real estate described on Schedule A and were lawfully married to each other on August 15, 1982, and remain lawfully married as of the date of this Stipulation. 11. The properties in New York and Pennsylvania were acquired during the Debtors' marriage. 12. Linda S. Allan is not indebted to or otherwise obligated to the Putnam County National Bank for a debt, personal guarantee or judgment. 13. With the exception of mortgage obligations upon jointly held real estate, there is no unsecured debt owed by both Debtors as joint and several obligations. III. Discussion In the original Motion for Order to Avoid Judgment Lien, the Debtor sought to avoid the Bank's lien against his real properties both in Pennsylvania and New York. The Bank filed an Answer in which it alleged that its lien did not impair the exemption claimed by the Debtor. Further, the Bank's Answer alleged that, under New York state law, the Debtor's interest in the one jointly owned real property located in New York state, even though held as entireties property, was encumbered by virtue of the Bank's judgment against the Debtor alone. A briefing schedule was set by the Court on January 13, 2010, and the Debtor has filed his Brief in support of the Motion for Order to Avoid Judgment Lien. The Bank did not file a brief as directed by the briefing schedule. Significantly, the Debtor's Brief argues that the Bank's judgment lien is not enforceable against the Debtor's real property situate in Pennsylvania. Debtor's Br. 3. I will treat the Debtor's submission as an amendment to the Motion seeking relief only with respect to the Debtor's real property in Wayne County, Pennsylvania and not seeking relief with respect to the Debtor's two properties located in Putnam County, New York. A. Has the Debtor claimed an exemption in the Wayne County, Pennsylvania residential real estate? Schedule C was filed herein on September 25, 2008. In part, it claims an exemption in 5 Airpark Road, Cherry Ridge Township, Wayne County, Pennsylvania, pursuant to 11 U.S.C. § 522(b)(3)(B)[1] in the amount of $450,000.00. No objections to the claimed exemptions were filed within thirty days as required under F.R.B.P. 4003(b). Unless the thirty-day time to object to a claim exemption is extended, the trustee or creditor *583 is precluded from challenging an exemption after the thirty-day period has expired. Therefore, the claimed property becomes exempt. Taylor v. Freeland & Kronz, 503 U.S. 638, 112 S. Ct. 1644, 1648, 118 L. Ed. 2d 280 (U.S.1992). It is noted that the Debtor elected to select the exemptions available under Pennsylvania state law pursuant to § 522(b)(3). Pennsylvania is not an "opt out" state. Therefore, individual debtors may elect to claim bankruptcy exemptions either under the so-called federal exemptions or exemptions available under applicable state law. The federal exemptions are delineated in § 522(d). The Debtor has asserted his exemptions pursuant to State law. A debtor may claim exemptions in accordance with the law of the state in which the: . . . debtor's domicile has been located for 730 days immediately preceding the date of the filing of the petition or if the debtor's domicile has not been located at a single State for such 730-day period, the place in which the debtor's domicile was located for 180 days immediately preceding the 730-day period or for a longer portion of such 180-day period than in any other place; Section 522(b)(3)(A); for discussion, see In re Varanasi, 394 B.R. 430, 435 (Bankr.S.D.Ohio 2008). Based upon the Stipulated Facts and the records herein, I find that Pennsylvania law is the suitable basis for the Debtor's claimed exemption. B. Pennsylvania tenancy by the entireties law. It is stipulated that the Bank's judgment is against the Debtor alone. It is also stipulated that the Pennsylvania real property is owned jointly by the Debtor with his filing spouse. It is further stipulated that there are no joint unsecured claims against both the Debtor and his filing spouse. Pennsylvania law generally provides that a husband and wife are said to be seized of the whole estate in the property and, during the term of the marriage, they do not have separate divisible interests in the property. "A husband and wife do not own separate interests in entireties property which can be reached by their individual creditors." Stop 35, Inc. v. Haines, 374 Pa.Super. 604, 607, 543 A.2d 1133, 1135 (1988); In re Houck, 184 B.R. 21, 23 (Bankr.E.D.Pa.1995). Thus, generally, only joint claims against both a husband and wife attach to entireties property. Napotnik v. Equibank and Parkvale Savings Ass'n, 679 F.2d 316, 320 (3d Cir. 1982). The record indicates that the Bank does not hold a joint claim. Further, § 522(b)(3)(B) specifically provides an exemption for tenancy the entirety property which ". . . is exempt from process under applicable nonbankruptcy law." Pursuant to Pennsylvania law, I find that the Debtor could exempt his interest in the Pennsylvania property, held as a tenancy by the entirety, from the claim of the Bank which is solely against the Debtor. I find that the Bank's lien is a judicial lien, a non-consensual lien, subject to avoidance pursuant to the provisions of § 522(f)(1). In re Simonson, 758 F.2d 103, 105 (3d Cir.1985). I further find that the Bank's judicial lien impairs the exemption to which the Debtor would have been entitled under Pennsylvania law and that the lien is subject to avoidance under § 522(f)(1). Owen v. Owen, 500 U.S. 305, 312-13, 111 S. Ct. 1833, 1837-38, 114 L. Ed. 2d 350 (U.S.1991). Finally, I note that, unlike the federal bankruptcy exemptions, there is no dollar limitation on the *584 amount of the tenancy by entirety exemption under Pennsylvania common law. IV. Conclusion The Debtor's Motion for Order to Avoid Judgment Lien with respect to Pennsylvania real property owned jointly with his filing spouse is granted. An order will be entered consistent with the foregoing Opinion. NOTES [1] Unless otherwise noted, all future statutory references are to the Bankruptcy Code, 11 U.S.C. § 101, et seq., as amended by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, Pub.L. No. 109-8, 119 Stat. 37 ("BAPCPA").

2013-10-30 06:35:55.566727+00

Per Curiam

152 N.J. 194 (1997) 704 A.2d 546 CAROL A. MENICHELLI, INDIVIDUALLY AND GUARDIAN AD LITEM OF RICHARD MENICHELLI, JR., AN INFANT, PLAINTIFF-APPELLANT, v. MASSACHUSETTS GENERAL LIFE INSURANCE COMPANY, A CORPORATION AUTHORIZED TO DO BUSINESS IN THE STATE OF NEW JERSEY, DEFENDANT-RESPONDENT. The Supreme Court of New Jersey. Argued October 20, 1997. Decided December 17, 1997. Charles J. Casale, Jr., argued the cause for appellant (Casale and Popp, attorneys). *195 Robert P. Casey, argued the cause for respondent (Lenox, Socey, Wilgus, Formidoni & Casey, attorneys). PER CURIAM. We granted certification, 149 N.J. 34, 692 A.2d 47 (1997), primarily to consider whether this case calls for an exception to the general rule that permits, within the two-year contestability period, rescission of a life insurance policy when the insured has made material misrepresentations in applying for the policy. Plaintiff urges that there be such an exception when the policy is required by a divorce judgment and serves the purpose of securing child support or education obligations after a divorced parent's death. Plaintiff is the beneficiary, in trust for her minor son, of a $100,000 life insurance policy that her former husband purchased in order to comply with the terms of a divorce judgment. On his application, her former husband misrepresented that he was not a cigarette smoker. After his death, which occurred within the contestability period, the defendant insurance company learned that he had been a cigarette smoker. It sought to rescind the policy on the basis of our opinion in Massachusetts Mutual Life Insurance Co. v. Manzo, 122 N.J. 104, 584 A.2d 190 (1991). We held in that case that misrepresentations that materially affect a carrier's acceptance of risk entitle the carrier to rescind an insurance policy, rather than merely recover the difference between the premium the insured would have paid but for the misrepresentation and the premium the insured actually paid. Id. at 110-11, 584 A.2d 190. Plaintiff does not dispute that a misrepresentation as to whether an insured smokes is one that materially affects either the acceptance of the risk or the hazard assumed by an insurance company. She urges, however, that when life insurance policies are purchased pursuant to a court order, an exception to the rule of rescission should apply when facts concerning the misrepresentation existed at the time of the application and *196 the insurance company issuing the policy could have discovered those facts through reasonable investigation. The Appellate Division, like the trial court, declined to create such an exception and allowed rescission. It observed, in its unreported opinion, Plaintiff correctly notes that life insurance requirements are a common element of divorce judgments where child support or alimony are provided during the lifetime of the parties. Nevertheless, the exception plaintiff seeks would create a disincentive to honesty and truthfulness on the part of matrimonial litigants who are required to obtain life insurance.[1] Were we to allow such an exception, applicants could gamble that they would live until the policy became incontestable, risking only that their estates would bear the extra premiums required to cover the higher rating costs in the event the insurance company discovered a material misrepresentation within the period of contestability. Finding no support for such an exception, the Appellate Division declined to create one. We also decline to create one for substantially the same reasons. As did the Appellate Division, we assume that plaintiff and her minor child may have a remedy against her former husband's estate. Because in some cases (and perhaps it will be so in this case), that remedy may be of little practical value, we encourage family practitioners and family court judges to examine closely the circumstances under which matrimonial litigants use life insurance policies to secure the payment of support. A court may consider including in such a decree a provision that a party benefitted by such a policy be furnished with a copy of the policy and the application as a means of detecting any misrepresentation. Courts might also require insureds to show their beneficiaries periodic proof of fulfillment of premium obligations. We realize that this may not be a complete answer because, depending on their circumstances, a former spouse may have no *197 way of knowing whether the other party is smoking or behaving in any other way that would create a materially different risk profile than the one the insurance company created based on the insured's misrepresentations. At oral argument, the parties discussed whether one might seek to bargain for an incontestability clause in the policy or demand that an insurance company examine a prospective insured to determine insurability. Because the record in this case sheds no light on that subject, we must leave it to future litigants and the insurance industry to determine whether those options are plausible. The judgment of the Appellate Division is affirmed. For affirmance — Chief Justice PORITZ and Justices HANDLER, POLLOCK, O'HERN, GARIBALDI, STEIN and COLEMAN — 7. Opposed — None. NOTES [1] Plaintiff also notes that parties routinely use life insurance policies to secure a variety of other legal obligations, such as tax liabilities, stock purchase agreements and estate administration obligations.

2013-10-30 06:35:55.574122+00

Stephenson

491 S.W.2d 706 (1973) ROBERTSON TANK LINES, INC., et al., Appellants, v. John H. WATSON et al., Appellees. No. 7419. Court of Civil Appeals of Texas, Beaumont. March 1, 1973. Motion for rehearing overruled March 22, 1973. *707 Russell McMains, Houston, for appellants. Dale Friend, Marc A. Sheiness, Shirley Helm, Houston, for appellees. STEPHENSON, Associate Justice. Two suits for damages arising out of an automobile and truck collision were consolidated in the court below. Trial was by jury and judgment was rendered for plaintiffs upon the verdict. It will be necessary to use the parties' names in many instances for clarity. The two suits arose out of an intersection collision between defendant's truck (driven by Clarence Watson) and an automobile driven by plaintiff, Ray Adams. The Adams vehicle then collided with the automobile driven by plaintiff, John Watson. Separate suits were filed against defendant, Robertson Tank Lines, Inc., and consolidated under motion filed by defendant. However, in the suit filed by plaintiff Watson, defendant's driver, Clarence Watson, was not made a party, although such driver was made a party defendant in the Adams suit. The judgment entered by the trial court does not mention the defendant, Clarence Watson, until the last paragraph in which the name Clarence Watson is interlined to show that he objected, excepted and gave notice of appeal. Defendants filed a motion for judgment nunc pro tunc, asking the trial court to correct its judgment which omitted recovery of plaintiff Adams against defendant Clarence Watson. The trial court overruled defendant's motion and that action is made the basis of defendant's first point of error here that there is no final judgment in this case. This point is overruled. The disposition of this point is controlled by the rule announced in North East Independent School District v. Aldridge, 400 S.W.2d 893, 897-898 (Tex.1966) as follows: "Analysis of the decisions we have discussed is sufficient to lead us to the statement of a rule for determining, in most instances, whether judgments in which parties and issues made by the pleadings are not disposed of in express language are, nevertheless, final for appeal purposes. When a judgment, not intrinsically interlocutory in character, is rendered and entered in a case regularly set for a conventional trial on the merits, no order for a separate trial of issues having been entered pursuant to Rule 174, Texas Rules of Civil Procedure, it will be presumed for appeal purposes that the Court intended to, and did, dispose of all parties legally before it and of all issues made by the pleadings between such parties. A claim duly severed under Rule 41 is a `case' within the meaning of the foregoing rule. The rule will be subject to the exception created by Davis v. McCray Refrigerator Sales Corporation [136 Tex. 296, 150 S.W.2d 377]; but it will apply to separate claims of the plaintiff, cross-actions and counterclaims by defendants against the plaintiff, cross-actions by defendants against other defendants and cross-actions by defendants against third-party defendants." *708 The exception mentioned [Davis v. McCray Refrigerator Sales Corporation, 136 Tex. 296, 150 S.W.2d 377 (1941)] has no application to the situation before us. Applying the Aldridge rule to the present case, the judgment here is not intrinsically interlocutory in character and was rendered following a conventional trial on the merits in which there was no order for separate trial of issues. It is presumed that the trial court intended to and did dispose of all of the parties legally before it and of all issues made by the pleadings between such parties. Even though defendants argue that their point of error is based upon the trial court's refusal to grant their motion for judgment nunc pro tunc, this approach does not alter the basic question as to the finality of the judgment. The Aldridge case still controls this question. See also Daniel Lumber Co. v. Settlemire, 256 S.W.2d 922 (Tex.Civ.App., Beaumont, 1953, error ref. n. r. e.), a case in which the facts are very similar to the one before us. In that case, the defendant's truck driver had been made a party defendant but had not been specifically disposed of in the judgment. That court reasoned as follows: that the driver was not a necessary party to the suit; that both the employer and employee were liable for the whole amount of the judgment; that they were not adverse parties to each other and were represented by the same counsel; that no cross-action had been filed for indemnity or contribution; that the employer was not precluded from recovery of contribution later; and, in any event, no harm had been shown under Rule 434. Defendants next complain that it was error for the trial court to admit testimony that defendants had made a compromise settlement with a witness of a claim arising out of the same collision. The record in this case shows that Larry Martin was the driver of still another automobile which was struck by the Adams vehicle in this collision. Defendants called Martin as a witness to testify as to the facts surrounding this accident. On cross examination, counsel for both plaintiffs were permitted to question Martin as to a compromise settlement agreement with Robertson Tank Lines, Inc. Counsel for defendants objected to such testimony but did not ask the court to limit the purpose for which the testimony was admitted, even though counsel for plaintiffs stated to the court, outside of the presence of the jury, that this evidence was admissible to show prejudice, bias or interest. We have made a careful study of the cases cited to us by defendants supporting their position as to this point of error. None of these cases pass directly upon this matter. These cases are: American General Ins. Co. v. Fort Worth Transit Co., 201 S.W.2d 869 (Tex.Civ.App., Fort Worth, 1947, no writ); McGuire v. Commercial Union Insurance Co. of N. Y., 431 S.W.2d 347 (Tex.1968); Skyline Cab Co. v. Bradley, 325 S.W.2d 176 (Tex.Civ.App., Houston, 1959, error ref. n. r. e.), and Otwell v. Scott, 425 S.W.2d 9 (Tex.Civ.App., Texarkana, 1968, no writ). All of these cases support the proposition that evidence of a compromise settlement agreement is not admissible to show an admission of liability or against interest. None of these cases deals directly with the question as to admissibility of such evidence for impeachment purposes to show interest, prejudice or bias. Defendant also argues that such evidence is inadmissible under Art. 3737f, Vernon's Ann.Civ.St., which reads as follows: "In a lawsuit being tried before a jury for damages for personal injuries which resulted from an occurrence which is also the basis for a claim for property damage and/or payment of medical expense, no evidence is admissible which informs the jury that the property damage claim or medical expense has been paid or settled." That statute became effective June 10, 1969, and we have found only one case passing upon it since that time. Osborne v. English, 458 S.W.2d 209, 213 (Tex.Civ. *709 App., Houston [1st Dist], 1970, error ref. n. r. e.), is a case in which the trial court sustained the defendant's motion in limine to exclude testimony concerning the property settlement made by defendant's insurance carrier with plaintiff. Neither the statute nor the Osborne case have application to the case before us. If defendants in our case had made property settlements with either or both of the plaintiffs, then, clearly, evidence as to such property settlement would not have been admissible under Art. 3737f, V.A.C.S. At the outset, we have serious doubt that the settlement made with Larry Martin is a "compromise settlement agreement" in spite of the recitation contained in the release executed by Martin. According to Martin's testimony, they asked him to submit an estimate as to the cost of repairs to his automobile and he did and they paid it. He did not request any amount other than that paid. He did not know why they settled with him. They made a voluntary offer. See Jackson v. Clark, 351 S.W.2d 292 (Tex.Civ.App., Amarillo, 1961, error ref. n. r. e.). We reach the result that the testimony was admissible, regardless of whether this was a "compromise settlement agreement" with Martin. We have concluded that this case is controlled by Hyde v. Marks, 138 S.W.2d 619 (Tex.Civ.App., Fort Worth, 1940, dism. judg. cor.). That case involved a collision between a bus and an automobile driven by plaintiff. The court permitted plaintiff to cross-examine three witnesses called by defendant who were passengers on the bus and show they received money from defendant prior to the time they offered to testify in the case. The opinion contains these statements of law: "We are not unmindful of the general rule so well established that compromises and offers of compromises are not admissible in evidence, yet we think the rule not applicable here. There is another rule of procedure equally as well settled as the one mentioned; it being that a party on cross-examination may develop any fact or circumstance which tends to show interest, prejudice or bias of a witness. Defendant introduced three witnesses who were passengers on the bus at the time of the collision; their testimony was such as to exonerate the bus driver of negligence, and to place the whole blame on plaintiff for the accident. In many respects their testimony was more favorable to the proper conduct of the driver than was his own. On cross-examination, plaintiff developed from the testimony of each of the witnesses that they had been paid for their respective claims against defendant. In offering the testimony, plaintiff's counsel stated to the court that he was offering the testimony to show the interest of the witness in the controversy between the parties. "Such testimony as that complained of is admissible as affecting the credibility of the witness before the jury. There is good reason for such a rule. The jury is entitled to know any fact which would tend to influence the testimony given by a witness; his interest in the outcome of the suit is a potent factor. The interest of a witness may be determined by a cross-examination on any point that is calculated to disclose a motive for the testimony offered. The rule is based upon the theory that the jury should know such facts, the better to enable them to weigh the words of the witness. Trinity County Lumber Co. v. Denham, 88 Tex. 203, 30 S.W. 856." (138 S.W.2d at 623) The court went on to say that the evidence was not admissible to establish a confession of negligence and, if requested, the trial court could have limited the testimony to showing the credibility of the witnesses. However, in that case as in the one before us, no such request was made. *710 Defendants have points of error that the jury finding that plaintiff John Watson was damaged in the amount of $75,000 is supported by no evidence, insufficient evidence, and that such finding is against the overwhelming weight and preponderance of the evidence. We consider only the evidence favorable to such finding in passing upon the no evidence point, and the entire record in passing upon the other two points of error. The jury found plaintiff John Watson to have been damaged as follows: past physical pain and mental anguish, $10,390; future physical pain and mental anguish, $25,000; past loss of earnings, $3,000; loss of earning capacity, $25,610; physical impairment in the past, $1,500; future physical impairment, $1,000; and future medical expense, $9,000. The parties stipulated past medical expenses of $1,804.59. The total amount of these damages was $77,304.59 which was reduced by the trial court to $5,000 to conform with the pleadings. We consider first the evidence favorable to the jury findings. The physical evidence including the photographs of plaintiff Watson's automobile shows this collision was a violent one. His automobile was damaged so severely on the driver's side that the door could not be opened. He was in a semiconscious condition with his head bleeding and his back, chest and ribs hurting. He was carried to the hospital in an ambulance where he remained for five days. He has been receiving medical attention since the date of this accident, July 28, 1969, through the date of trial, February 22, 1972. He was off from work for nine weeks before returning because of economic necessity. He has been unable to do many things, both at home and at work, that he could formerly do. Dr. Louis F. Brignac, Jr. saw him in the emergency room after the collision and treated him until he was discharged. He sutured plaintiff's lacerated forehead and face and had X-rays taken which revealed three fractured ribs. Plaintiff complained to him of pain in his chest and lower back. He found muscle spasm indicating some injury to the soft tissues. Dr. Frank L. Barnes, whose specialty is orthopedic surgery, saw plaintiff first on May 4, 1971. He has continued to see him once or twice a month since. Plaintiff has continually complained of pain in his upper back. His examinations revealed tenderness of the upper thoracic and lower cervical spine. Neurological examinations showed the absence of certain reflexes. X-rays taken at the time he first saw plaintiff showed the tips of some of the vertebrae to be deformed as if they had been fractured. He concluded that plaintiff had some fractures to the spinous processes which indicated a good deal of muscle damage. He was probably having a chronic strain or myositis and chronic irritation to the muscles of his back due to the injury he received in this accident. His condition is pretty static as of the date of trial and he will need medical care in the future from that day forward. He will continue to need physical therapy and medication. All of this evidence supports the jury findings. Considering the record as a whole, even though there is evidence which would indicate that plaintiff's injuries are not severe, we do not find the jury's answers to the damage issues to be clearly wrong or manifestly unjust. The points of error are overruled. Affirmed.

2013-10-30 06:35:55.588052+00

Sifton

901 F. Supp. 515 (1995) UNITED STATES of America v. Gabriel REGUER, Defendant. No. CR-88-155-02 (CPS). United States District Court, E.D. New York. January 9, 1995. *516 Stuart J. Grossman, Grossman, Lavine & Rinaldo, Forest Hills, NY, for Gabriel Reguer. Kelly A. Moore, U.S. Atty's Office, Crim. Div., Brooklyn, NY, for U.S. MEMORANDUM AND ORDER SIFTON, Chief Judge. Gabriel Reguer ("Reguer"), after pleading guilty to a charge of causing his bank to fail to file currency transaction reports in violation of 31 U.S.C. §§ 5313 and 5322(a), now moves, pro se, to expunge his conviction and recover amounts paid for fines and restitution in light of the Supreme Court's decision in Ratzlaf v. United States, ___ U.S. ___, 114 S. Ct. 655, 126 L. Ed. 2d 615 (1994). The government opposes Reguer's motion, contending that Ratzlaf does not apply to Reguer's conviction and that, even if it did, Reguer would only be entitled to a trial on the underlying information. For the reasons discussed below, Reguer's application is granted. His plea and conviction are vacated, and the parties are directed to appear on January 31, 1995, at 4:30 p.m. to set a date for trial. BACKGROUND The following facts are drawn from a stipulation signed at the time of sentencing by Reguer and the government setting forth facts to be considered by the Court in sentencing Reguer. In 1986 Reguer sold a counterfeit version of a rare Passover Haggadah *517 to an unsuspecting buyer. The Haggadah recounts the story of the exodus of the Jews from Egypt and is used during the Passover services. Reguer received $59,800 in cash for the Haggadah. Reguer then went to a bank to deposit the money and was informed that a single deposit of that size would be reported to the federal government. Reguer then "structured" his deposits into smaller amounts so that no individual deposit would trigger the reporting requirements. Reguer contends that he was concerned that a report of the deposits would lead the government to believe that he was a drug dealer. Subsequently, Reguer made two unsuccessful attempts to sell a counterfeit Haggadah to other buyers. In 1988 a grand jury indicted Reguer and his brother-in-law for mail fraud. After a jury was selected and the government had made its opening statement, Reguer decided to plead guilty to an information charging him with violating 31 U.S.C. §§ 5313, 5322(a) and 18 U.S.C. § 2 by causing The First National Savings Bank to fail to file a currency transaction report. Reguer maintained, however, that he was merely acting for his brother-in-law and did not know that he was dealing in counterfeits. In addition, Reguer admitted that he "structured" his transaction to avoid the reporting requirements, but contended that he was never aware that it was a crime to do so. Reguer was sentenced to three years of probation and a fine of $150,000. Reguer was also ordered to pay restitution to the victims, but that aspect of the sentence was vacated upon consent of the government because Reguer's offense did not cause direct loss to the victims. Reguer subsequently sent a letter to the Court seeking to expunge his conviction and recover amounts paid in restitution and towards the fine. Reguer contends that his conviction must be overturned in light of the Supreme Court's holding in Ratzlaf v. United States that a defendant is not guilty of structuring under 31 U.S.C. § 5324(3)[1] unless he knew that his actions were illegal. Reguer continues to maintain, as he did at sentencing, that, although he structured his deposits to avoid the reporting requirements, he did not know that he was committing a crime. Upon receipt of Reguer's letter, the Court directed the government to show cause why the relief requested should not be granted. The government contends that the Ratzlaf decision does not apply to Reguer because he was not convicted under 31 U.S.C. § 5324(3) but under 31 U.S.C. § 5313. The government argues that a defendant need only be shown to have been aware of and intended to avoid the reporting requirement in order to prove a willful violation of section 5313. The government asserts that Reguer's conviction may be distinguished from that of the petitioner in Ratzlaf because the conduct prohibited by section 5324(3), the section at issue in Ratzlaf, is the structuring of transactions and not, as under § 5313, causing a bank to fail to file the required reports. Finally, the government contends that, even if the Ratzlaf decision adds the element of knowledge to the crime to which Reguer pleaded guilty, Reguer's relief would be limited to allowing him to withdraw his guilty plea and proceed to trial on the underlying information. The government states that Reguer would then be entitled to a jury instruction that the government had to prove that Reguer knew that the structuring of his transactions was illegal. DISCUSSION As an initial matter, since Reguer was never sentenced to a term of imprisonment and has completed his term of probation, his letter to the Court cannot be construed as a petition for habeas corpus. He still may seek relief, however, if, following the generous pleading standards to be afforded to pro se litigants set forth in Haines v. Kerner, 404 U.S. 519, 92 S. Ct. 594, 30 L. Ed. 2d 652 (1972), the letter is considered as a petitioner for a writ of error coram nobis. In United States v. Morgan, 346 U.S. 502, 511, 74 S. Ct. 247, 252, 98 L. Ed. 248 (1954), the Supreme Court made clear that a federal district court is empowered to issue a writ of coram nobis, pursuant to the All-Writs *518 Act, 28 U.S.C. § 1651(a), "under circumstances compelling such action to achieve justice." The Court recognized that at times there is a need for this writ because "the results of the conviction may persist," even when a sentence has been completely served. Morgan, 346 U.S. at 512, 74 S. Ct. at 253. The writ "is used to attack allegedly invalid convictions which have continuing consequences." United States v. Stoneman, 870 F.2d 102, 105-106 (3d Cir.1989). According to the government, as of November 1993 Reguer still owed over $200,000 in fines and interest. Reuger's continuing obligation to pay the fines imposed on him satisfies the continuing consequences requirement of the writ. Despite the government's argument to the contrary, Ratzlaf has indeed added an element of knowledge to the crime to which Reguer pleaded guilty. In Ratzlaf, the Supreme Court held that by virtue of 31 U.S.C. § 5322(a), the enforcement provision of the Currency and Foreign Transactions Reporting Act, a violation of the antistructuring provision of the Money Laundering Control Act of 1986, 31 U.S.C. § 5324(3), occurs only when a defendant has "willfully violated" that section. Section 5322(a) provides: A person willfully violating this subchapter [31 U.S.C. §§ 5311 et seq.] or a regulation prescribed under this subchapter (except section 5315 of this title or a regulation prescribed under section 5315) shall be fined not more than $250,000 or imprisoned for not more than five years or both. The Court held that the willfulness requirement of section 5322(a) requires that the government show an intent to do the illegal act with the knowledge that the act itself was illegal. Thus the Court held that the petitioner in Ratzlaf could not have been found guilty of the structuring crime with which he was charged without a showing that he not only knew that he was evading the reporting requirements but that he knew it was a crime to do so. In reaching its decision, the Court relied upon the fact that various Courts of Appeals had construed the willfulness requirement of section 5322(a) to mean that the defendant had to have both knowledge of the reporting requirement and a specific intent to commit the crime, i.e., "a purpose to disobey the law." Ratzlaf, ___ U.S. at ___, 114 S.Ct. at 659. In particular, the Court cited approvingly United States v. Eisenstein, in which the Eleventh Circuit held that a willful violation of § 5313's reporting requirement for cash transactions requires "`proof of the defendant's knowledge of the reporting requirement and his specific intent to commit the crime,'" 731 F.2d 1540, 1543 (11th Cir.1984) (quoting United States v. Granda, 565 F.2d 922, 926 (5th Cir.1978)), and United States v. Dichne, 612 F.2d 632, 636 (2d Cir.1979), in which the Second Circuit held that a violation of currency reporting requirements of 31 U.S.C. § 5316 (concerning transporting money into or out of the United States) was shown only with proof that the defendant knew of the reporting requirement and intended to commit the crime. The Supreme Court held that the "willfulness" requirement of § 5322(a) should be read consistently throughout the statute, rejecting the contention that structuring itself is so inherently evil that the very act of engaging in structuring satisfied the willfulness requirement. In light of these decisions and, in particular, the decision in Eisenstein, the government's argument that the decision in Ratzlaf applies only to 31 U.S.C. § 5324 is unpersuasive. Section 5322, the enforcement provision on which the Supreme Court based its decision in Ratzlaf, is the same enforcement provision used against Reguer to make his actions a crime. The Ratzlaf analysis extends the willfulness requirement to all the subchapters of the Currency and Foreign Transactions Reporting Act, including section 5313. Nor is it of any significance that Reguer's criminal liability arose as the result of 18 U.S.C. § 2(b) rather than directly under section 5313. Section 5313 creates the reporting requirement that is applicable to banks and other such institutions. Section 2(b) makes it a crime to "willfully cause an act to be done which if directly performed ... by another would be an offense against the United States." While "willfulness" under section 2 might not require knowledge of the illegality of the act, criminal liability does not attach to *519 failure to report under section 5313 unless there was knowledge of the illegality of the act. The Ratzlaf Court made it clear that its construction of "willfully" in section 5322 applies uniformly to all the provisions of the Currency and Foreign Transaction Act. Ratzlaf, ___ U.S. at ___, 114 S.Ct. at 660 (citing Estate of Cowart v. Nicklos Drilling Co., 505 U.S. 469, 112 S. Ct. 2589.) As the Court noted, "[a]scribing various meanings to a single iteration of [§ 5322(a)'s requirement] — reading the word differently for each code section to which it applies — would open Pandora's jar." Ratzlaf, ___ U.S. at ___, 114 S.Ct. at 660. (quoting United States v. Aversa, 984 F.2d 493, 498 (1st Cir.1993) (en banc)). Petitioner must be shown to have the "mens rea" that would make the action illegal. As the Eleventh Circuit said in a case holding that liability was appropriate under section 2(b) for causing a financial institution to fail to comply with the currency reporting requirements, [i]t is but to quote the hornbook to say that in every crime there must exist a union or joint operation of act, or failure to act, and intent. However, this is far from suggesting that the essential element of criminal intent must always reside in the person who does the forbidden act. Indeed, the latter may act without any criminal intent whatever, while the mens rea — `willfulness' — may reside in a person wholly incapable of committing the forbidden act. When such is the case, as at bar, the `joint operation of act and intent' prerequisite to commission of the crime is provided by the person who willfully causes the innocent actor to commit the illegal act. And in such a case, of course, only the person who willfully causes the forbidden act to be done is guilty of the crime. United States v. Tobon-Builes, 706 F.2d 1092, 1101 (11th Cir.1983). Since no evidence was elicited by the Court about petitioner's state of mind (and, in fact, the only information was volunteered by petitioner who stated that he did not know that his conduct was illegal), the retroactive application of Ratzlaf to petitioner must be considered. When, as here, the Supreme Court resolves a conflict among circuits as to the interpretation of a statute, the decision is deemed to not be creating new law, but rather as interpreting the law as it should have been interpreted from its inception. See Strauss v. United States, 516 F.2d 980 (7th Cir.1975); United States v. Travers, 514 F.2d 1171, 1174 n. 4 (2d Cir.1974) ("There are not eleven omnipresences of federal law brooding over various portions of the United States; in the long run there is only one, although some time may be needed to reveal it."); see also Gates v. United States, 515 F.2d 73 at 75 (7th Cir.1975) ("A statute does not mean one thing prior to the Supreme Court's interpretation and something entirely different afterwards."). Because knowledge of illegality was, under the Court's holding in Ratzlaf, always an element of structuring as a crime, Reguer was convicted without any proof of one of the elements of the crime. That fact alone, however, does not necessarily render Reguer's conviction invalid. In Sunal v. Large, 332 U.S. 174, 67 S. Ct. 1588, 91 L. Ed. 1982 (1947), the Supreme Court addressed the issue of whether a change in the law can be used as the basis for a collateral attack on a conviction. At trial, petitioners Sunal and Kulick had been denied the opportunity to raise a specific defense. They were convicted and did not appeal. Approximately nine months after their convictions, the Supreme Court held in a case with comparable facts that the petitioners were entitled to defend themselves on the same grounds which were denied to Sunal and Kulick. When the new rule of law was announced, Sunal and Kulick immediately filed writs of habeas corpus, one of which was denied in both the district court and the Court of Appeals. The Supreme Court granted both writs of certiorari. While the Court conceded that the new rule of law would have applied to the petitioners had their cases been on appeal at the time the new rule was announced, the Court denied the petitions, reiterating the general rule that "the writ of habeas corpus will not be allowed to do service for an appeal." Sunal, 332 U.S. at 178, 67 S. Ct. at 1590 (quoting Adams v. United States ex rel. McCann, 317 U.S. 269, 274, 63 S. Ct. 236, 240, 87 L. Ed. 268 *520 (1942)). While the Court stated that there were exceptional circumstances where a writ should be issued even when the appellate route was not fully pursued, the Court found that Sunal and Kulick's situation was not exceptional. The Supreme Court ruled that, "if [petitioners] had pursued the appellate course and failed, their cases would be quite different. But since they chose not to pursue the remedy which they had ... they should not be allowed to justify their failure by saying they deemed any appeal futile." Sunal, 332 U.S. at 181, 67 S. Ct. at 1592. In Davis v. United States, 417 U.S. 333, 94 S. Ct. 2298, 41 L. Ed. 2d 109 (1974), the Court did apply a change in substantive law retroactively on collateral attack in a case where the petitioner raised the issue on direct appeal. The Court held that Sunal cannot be read to stand for the broad proposition that nonconstitutional claims can never be asserted in collateral attacks upon criminal convictions. Rather, the implication would seem to be that, absent the particular considerations regarded as dispositive in that case, the fact that a contention is grounded not in the Constitution, but in the `laws of the United States' would not preclude its assertion in a § 2255 proceeding. Davis, 417 U.S. at 346, 94 S. Ct. at 2305. The Court reasoned that, if due to a novel decision by the Supreme Court a conviction and punishment are for an act that the law does not make criminal, "[t]here can be no room for doubt that such a circumstance `inherently results in a complete miscarriage of justice' and `present[s] exceptional circumstances' that justify collateral relief." Davis, 417 U.S. at 346-347, 94 S. Ct. at 2305. It has been held that the "logic of the Davis opinion applies with equal force to petitions for writ of error coram nobis based on non-constitutional changes in the law after trial and appeal." United States v. Mandel, 672 F. Supp. 864 (D.Md.1987); see Travers, 514 F.2d at 1173 n. 1 ("Although the Davis case arose under 28 U.S.C. § 2255 the standards applied in federal coram nobis are similar.") In Travers, the Second Circuit applied a non-constitutional change in the law retroactively to a petitioner who filed a writ of error coram nobis. The petitioner was convicted under section 1341, a mail fraud statute, in 1969. Five years later, in United States v. Maze, 414 U.S. 395, 94 S. Ct. 645, 38 L. Ed. 2d 603 (1974), the Supreme Court interpreted the statute as only applying to certain types of credit card schemes. Under the interpretation of section 1341 in Maze, Travers' act was no longer criminal. He then filed a writ of coram nobis seeking to vacate his conviction. The motion was denied, and Travers appealed the decision. The Second Circuit found that, because of the Supreme Court's decision in Maze, Travers had been convicted for an act that was not a crime. The Court granted the motion, stating that "the Davis holding has been encapsulated as being `that fundamental notions of fairness are implicated by continued incarceration after a change in judicial interpretation of a statute makes the punished conduct free from sanctions.'" Travers, 514 F.2d at 1176 (quoting Note, The Supreme Court, 1973 Term, 88 Harv.L.Rev. 41, 218 (1974)). However, in light of the Court's holding in Sunal, the Court of Appeals limited its decision "to defendants who, like Travers, had gone through the full appellate process." Travers, 514 F.2d at 1177. The court decided to "leave to another day the determination of the proper result when less has been done." Id. Reguer, unlike Travers, did not make any effort to appeal his conviction. Thus the question is still open whether he can now, having failed to previously pursue his appellate remedies, benefit from the retroactive application of Ratzlaf. In certain circumstances, the Court of Appeals has declined to impose an exhaustion requirement on petitioners who sought the retroactive application of a change in the substantive law despite a failure to pursue the issue on direct appeal. In Ingber v. Enzor, 841 F.2d 450 (2d Cir. 1988), Ingber had been convicted of mail fraud. Two of the counts for which he was convicted involved the deprivation of intangible rights and were not connected to property. However, the Supreme Court in McNally v. United States, 483 U.S. 350, 107 S. Ct. 2875, 97 L. Ed. 2d 292 (1987), limited the statute under which he was convicted to the *521 protection of property rights and overruled established Second Circuit precedent to the contrary. Ingber, 841 F.2d at 453. Immediately after the McNally decision, Ingber filed a habeas petition attacking his mail fraud convictions on the ground that two of the counts for which he was convicted were not connected to property rights. This was an issue which Ingber did not bring up on direct appeal. Noting that by the time of Ingber's trial nearly every appellate decision for in the prior decade had determined that Ingber's conduct was made illegal by the mail fraud statute, the court chose not to penalize him "for failing to challenge such entrenched precedent." Ingber, 841 F.2d at 455. The court saw "no value in imposing a responsibility to pursue such a `patently futile' course," particularly since it would encourage appeals on even well-settled law. Id. Similarly, in United States v. Liguori, 438 F.2d 663 (2d Cir.1971), petitioners were convicted of narcotics offenses. At trial the government offered no proof regarding certain elements of the crime, and petitioners made no objection to the use of presumptions covering those elements. The judge incorporated these presumptions in his charge to the jury. In Leary v. United States, 395 U.S. 6, 89 S. Ct. 1532, 23 L. Ed. 2d 57 (1969), and Turner v. United States, 396 U.S. 398, 90 S. Ct. 642, 24 L. Ed. 2d 610 (1970), the Supreme Court found that these presumptions violated the due process clause of the Fifth Amendment. Petitioner immediately filed a section 2255 petition attacking his conviction in light of the recent decisions by the Supreme Court in Leary and Turner. The Court of Appeals stated that although "none of the appellees raised the issue on appeal, we hold that they are not therefore barred from raising it now. At the time of the trials only one case, Erwing v. United States, 323 F.2d 674 (9th Cir.1963), had held the presumption ... unconstitutional ... but no other circuit followed this holding and the decision was not binding in this Circuit." Liguori, 438 F.2d at 665. At the time of petitioner's conviction, the Second Circuit had decided United States v. Heyman, 794 F.2d 788 (2d Cir.1986), cert. denied, 479 U.S. 989, 107 S. Ct. 585, 93 L. Ed. 2d 587 (1986) two years earlier. In Heyman, the court held a person who willfully caused a financial institution to fail to file a currency transaction report was criminally liable. The court held that "willful" required only that the defendant know of the reporting requirement: [T]he requirement of § 2(b) that a defendant's acts be `willful' provides adequate protection for individuals who might unwittingly stumble into a violation of federal law. Village of Hoffman Estates v. The Flipside, Hoffman Estates, Inc., 455 U.S. 489, 499 [102 S. Ct. 1186, 1193, 71 L. Ed. 2d 362] reh'g denied, 456 U.S. 950 [102 S. Ct. 2023, 72 L. Ed. 2d 476] (1982) (a scienter requirement may mitigate a law's vagueness with respect to adequacy of notice that specified conduct is proscribed); Boyce Motor Lines v. United States, 342 U.S. 337, 342 [72 S. Ct. 329, 331, 96 L. Ed. 367] (1952) (`requirement of the presence of culpable intent as a necessary element of the offense does much to destroy any force in the argument that application of the Regulation would be so unfair that it must be held invalid'). Id. at 792. The court then said that "[w]e believe this lends persuasive support to the large number of cases holding that any individual, including a customer, may be held criminally liable for willfully causing a financial institution to fail to file CTRs" and cited the following cases: United States v. Sans, 731 F.2d 1521, 1531-32 & n. 12 (11th Cir. 1984), cert. denied, 469 U.S. 1111, 105 S. Ct. 791, 83 L. Ed. 2d 785 (1985); United States v. Puerto, 730 F.2d 627, 632-33 (11th Cir.1984), cert. denied, 469 U.S. 847, 105 S. Ct. 162, 83 L. Ed. 2d 98 (1985); Tobon-Builes, 706 F.2d 1092, 1099-1101 (11th Cir.1983); United States v. Massa, 740 F.2d 629, 645 (8th Cir. 1984), cert. denied, 471 U.S. 1115, 105 S. Ct. 2357, 86 L. Ed. 2d 258 (1985); United States v. Richter, 610 F. Supp. 480, 487-90 (D.C.Ill. 1985); United States v. Konefal, 566 F. Supp. 698 (N.D.N.Y.1983). The court specifically distinguished other decisions holding that bank customers could not be liable under section 2(b) on the ground that in those cases the banks were never under any obligation to file reports because the customers made only single deposits at each bank for less than *522 $10,000. Id. at 791-92. In particular, the Court distinguished United States v. Anzalone, 766 F.2d 676, 681 (1st Cir.1985), a decision in which the First Circuit noted that the reporting requirements did not specifically prohibit breaking transactions down into smaller amounts to avoid triggering a bank's duty to report. Thus the petitioner was faced with a Court of Appeals precedent holding that a defendant who was aware of the reporting requirement could be found guilty under section 2(b). As the court said in Loschiavo, and later in Ingber, "To say that in such circumstances the system of justice can provide no remedy because of a court-made rule that failure to take a direct appeal on the specific issue bars all later motions for collateral attack ... indicates a lack of due process in the judicial system." Ingber, 841 F.2d at 455 (quoting Loschiavo, 531 F.2d at 666). Accordingly, for the reasons stated above, the petition is granted; petitioner's conviction and plea of guilty are vacated; and the parties are directed to appear on January 31, 1995, at 4:30 p.m. to fix a trial date. See Perez v. United States, 315 F. Supp. 972, 974 (S.D.N.Y.1970), aff'd sub nom. United States v. Liguori, 438 F.2d 663 (2nd Cir.1971). SO ORDERED. NOTES [1] Sections 5324(1)-(3) have been recodified as 5324(a)(1)-(3). See Ratzlaf, ___ U.S. at ___ n. 5, 114 S. Ct. at 659 n. 5.

2013-10-30 06:35:55.616874+00

Jackson

491 S.W.2d 420 (1973) Ex parte Alfred LOPEZ. No. 46642. Court of Criminal Appeals of Texas. March 14, 1973. Jim D. Vollers, State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION JACKSON, Commissioner. Relator was convicted in 1961 as an habitual criminal for possession of heroin and assessed a life sentence, Lopez v. State, 171 Tex. Crim. 672, 352 S.W.2d 747 (1961), and has been continuously confined since March 2, 1961. Two of the three prior convictions alleged in the indictment and used for enhancement in his trial (No. 9331 and No. 9712) *421 were in United States District Courts for possession "of marihuana without having paid the transfer tax as required by said Act," the Act being Sec. 2593(a), Title 26, of the United States Code. These were in 1945 and 1947. Each of those two convictions is void because they are based upon a void and unconstitutional statute which required a defendant to incriminate himself in violation of his constitutional right against self-incrimination under the Fifth Amendment to the United States Constitution. Leary v. United States, 395 U.S. 6, 84 S. Ct. 1532, 23 L. Ed. 2d 57. Ex parte Taylor, Tex. Cr.App., 484 S.W.2d 748. In the 1970 case In re Johnson, 3 Cal. 3d 404, 90 Cal. Rptr. 569, 475 P.2d 841, the Supreme Court of California said: "Thus we have concluded that Leary v. United States, supra, 395 U.S. 6, 84 S. Ct. 1532 [23 L. Ed. 2d 57], is retroactive to the extent that a petitioner suffering a sentence augmented by a prior conviction as to which Leary established a complete defense may attack that prior conviction collaterally, and that the right to such an attack is not waived either by a failure to assert the defense against self-incrimination or by a guilty plea prior to the decision in that case." See Ex parte Taylor, supra. The third conviction used was No. 13,962 in the United States District Court for the Southern District of Texas, in which the relator was convicted of unlawfully importing a narcotic drug, a felony, by judgment dated February 21, 1952. In this latter case, the two prior convictions above referred to were used to enhance punishment and the relator was sentenced to ten years, the mandatory minimum. Since the 1945 and 1947 cases were void under Leary, supra, their use in the 1952 trial for enhancement rendered that conviction also void. Ex parte Taylor, supra; Ex parte Cross, Tex.Cr.App., 427 S.W.2d 64; Ex parte Auten, Tex.Cr.App., 458 S.W.2d 466; Loper v. Beto, 405 U.S. 473, 92 S. Ct. 1014, 31 L. Ed. 2d 374; Burgett v. Texas, 389 U.S. 109, 88 S. Ct. 258, 19 L. Ed. 2d 319. For the reasons stated, we hold that relator's conviction was void, order the writ of habeas corpus issued, and that relator be discharged from the custody of respondent and remanded to the custody of the sheriff of Harris County to stand trial on the offense alleged in the indictment. Opinion approved by the Court.

2013-10-30 06:35:55.703184+00

Jackson

491 S.W.2d 425 (1973) Tracy Lee THORN, Appellant, v. The STATE of Texas, Appellee. No. 46527. Court of Criminal Appeals of Texas. March 14, 1973. Pat McDowell, Dallas, for appellant. Henry Wade, Dist. Atty., John E. Rapier, Asst. Dist. Atty., Dallas, Jim D. Vollers, *426 State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION JACKSON, Commissioner. Appellant plead nolo contendere before the court to the offense of fondling the sexual parts of a ten year old girl with lascivious intent; the punishment five (5) years. His first ground of error is that the record shows he was convicted on a date prior to the return of the indictment. He was tried on May 26, 1972. While it is true that the order reciting the return of the indictment shows it to have occurred on November 29, 1972, the order receiving same shows the date to be November 29, 1971. The indictment shows to have been filed on November 29, 1971, as does the date of filing on the docket sheet. Also, the docket sheet shows appointment of counsel on December 20, 1971. It is obvious that the first date is a clerical error, and that the indictment was returned and filed on November 29, 1971, and was pending almost six months before the trial, hence, ground of error number one is overruled. Grounds of error two, three and four allege that the court failed to properly admonish appellant of the consequences of his plea of nolo contendere, failed to ascertain that he was sane, and that his plea was uninfluenced by any persuasion or delusive hope of pardon. These grounds will be discussed together. Article 26.13, Vernon's Ann.C.C.P. reads: "If the defendant pleads guilty, or enters a plea of nolo contendere he shall be admonished by the court of the consequences; and neither of such pleas shall be received unless it plainly appears that he is sane, and is uninfluenced by any consideration of fear, or by any persuasion, or delusive hope of pardon, prompting him to confess his guilt. Acts 1965, 59th Leg., vol. 2, p. 317, ch. 722." The consequences of his plea of nolo contendere were that he would be found guilty and his punishment fixed at confinement in the "state penitentiary" for any term not to exceed 25 years, or confinement in the county jail for not less than 30 days nor more than 2 years. This was explained to appellant after which he said he understood it and still wanted to plead nolo contendere. It is well established that if no issue of sanity is raised, the court need not hear evidence on this question. Zepeda v. State, 110 Tex. Crim. 57, 7 S.W.2d 527; Holloway v. State, 148 Tex. Crim. 33, 184 S.W.2d 479; Parrish v. State, 170 Tex.Cr. R. 186, 339 S.W.2d 670; Ring v. State, Tex.Cr.App., 450 S.W.2d 85; Kane v. State, Tex.Cr.App., 481 S.W.2d 808. The judgment of the court recited that in open court the defendant "pleaded nolo contendere to the charge contained in the indictment; thereupon the defendant was admonished by the court of the consequences of the said plea and the defendant persisted in entering said plea, and it plainly appearing to the court that the defendant is sane, and that he is uninfluenced in making said plea by any consideration of fear, or by any persuasion, or delusive hope of pardon prompting him," etc. Before accepting the plea of nolo contendere, the court asked the appellant how he plead to the allegations contained in the indictment, to which he answered, "Nolo contendere." Upon being questioned further by the court before accepting the plea, appellant assured the court that he was pleading nolo contendere as a free and voluntary act, that no one had threatened him, forced him, bribed him, given him any money or valuable thing, made any promises, held any offer of pardon or parole or inducement of that nature to try to get him to *427 enter the plea, that no one had coerced him or induced him to make that plea. After the punishment was explained to him as hereinabove set forth, the court asked him: "Knowing all that, do you still wish to enter a plea of nolo contendere to the charge?" To which he answered, "Yes, sir." Whereupon the court accepted the plea as voluntarily made. We hold that there was compliance with Art. 26.13, and that the recital in the judgment above quoted is amply supported. Grounds of error two, three and four are overruled. We have considered appellant's additional grounds of error and the record relating thereto and find them without merit and overrule them. The judgment is affirmed. No motion for rehearing will be entertained or filed with the clerk without leave of the court first being obtained after good cause has been shown. Opinion approved by the Court.

2013-10-30 06:35:55.728745+00

Dana

704 A.2d 312 (1997) 1997 ME 197 Dominic ROSETTI, Jr. v. LAND RECLAMATION and Crawford & Co. and W.H. Shurtleff Co. and Liberty Mutual Insurance Co. Supreme Judicial Court of Maine. Argued September 4, 1997. Decided September 26, 1997. James J. MacAdam, James Fongemie (orally), McTeague, Higbee, MacAdam, Case, Watson & Cohen, Topsham, for employee. Thomas E. Getchell (orally), Troubh, Heisler & Piampiano, P.A., Portland, for W.H. Shurtleff. Thomas R. Kelly (orally), Thomas Quartararo, Robinson, Kriger & McCallum, Portland, for Land Reclamation. Before WATHEN, C.J., and ROBERTS, CLIFFORD, RUDMAN, DANA, and LIPEZ, JJ. *313 DANA, Justice. [¶ 1] W.H. Shurtleff Co. appeals from a decision of the Workers' Compensation Board on a motion brought by Land Reclamation, the second employer in a successive injury case, ordering Shurtleff to reimburse Reclamation for fifty percent of Reclamation's obligation to pay continuing benefits to the employee pending appeal. 39-A M.R.S.A. § 205(9)(B)(2) (Supp.1996). Because we conclude that the Board has no authority to determine apportionment issues between insurers, we vacate the Board's decision.[1] 39-A M.R.S.A. § 354 (Supp.1996). [¶ 2] The employee, Dominic Rosetti, suffered two compensable low-back injuries; the first in 1979, while employed by Shurtleff, and the second in 1991, while employed by Reclamation. In 1993 Reclamation filed a petition for review and a petition for apportionment against Shurtleff, and in 1994 Rosetti filed a petition for restoration for the 1979 injury. In March 1995 the Board granted all of the petitions, in part, awarding total and partial benefits ending in June 1992. Because an exact apportionment was not possible, the Board apportioned liability equally between the two employers. The Board issued findings of fact and conclusions of law on June 29, 1995, and Rosetti filed a timely petition for appellate review from that decision.[2] [¶ 3] In September 1995 Reclamation filed a "Motion to Determine the Amount of Reimbursement" seeking reimbursement from Shurtleff for fifty percent of the continuing benefits that it pays to Rosetti pursuant to 39-A M.R.S.A. § 205(9)(B)(2), while Rosetti's petition for appellate review was pending with the Law Court. The Board granted the motion[3] and also filed its own motion with the Law Court pursuant to 39-A M.R.S.A. § 318 (Supp.1996), seeking to have its earlier decision amended to specify that both insurers must pay during the pendency of the appeal pursuant to section 205(9). [¶ 4] Shurtleff did not bring a timely petition for appellate review from the March and June decisions granting Reclamation's 1993 petition for apportionment, and, therefore, we have no authority to review the Board's decision on that petition.[4] 39-A M.R.S.A. § 322 (Supp.1996); Guaranty Fund Management Servs. v. Workers' Compensation Bd., 678 A.2d 578, 582-83 (Me.1996). Although we have not addressed whether an employer who successfully litigates a termination of the employee's benefits may be required to continue payment of benefits until the conclusion of appeal proceedings pursuant to 39-A M.R.S.A. § 205(9)(B)(2),[5] there *314 is no dispute among the parties in this case that Rosetti is entitled to continued payment during the pendency of his petition for appellate review. The issue on Reclamation's "motion to determine the amount of reimbursement," is solely a dispute between insurers and must be decided according to section 354. [¶ 5] 39-A M.R.S.A. § 354 provides: 1. Applicability. When 2 or more occupational injuries occur, during either a single employment or successive employments, that combine to produce a single incapacitating condition and more than one insurer is responsible for that condition, liability is governed by this section. 2. Liability to employee. If an employee has sustained more than one injury while employed by different employers, or if an employee has sustained more than one injury while employed by the same employer and that employer was insured by one insurer when the first injury occurred and insured by another insurer when the subsequent injury or injuries occurred, the insurer providing coverage at the time of the last injury shall initially be responsible to the employee for all benefits payable under this Act. 3. Subrogation. Any insurer determined to be liable for benefits under subsection 2 must be subrogated to the employee's rights under this Act for all benefits the insurer has paid and for which another insurer may be liable. Any such insurer may, in accordance with rules adopted by the Superintendent of Insurance, file a request for appointment of an arbitrator to determine apportionment of liability among the responsible insurers. The arbitrator's decision is limited to a choice between the submissions of the parties and may not be calculated by averaging. Within 30 days of the request, the Superintendent of Insurance shall appoint a neutral arbitrator who shall decide, in accordance with the rules adopted by the Superintendent of Insurance, respective liability among or between insurers. Arbitration pursuant to this subsection is the exclusive means for resolving apportionment disputes among insurers and the decision of the arbitrator is conclusive and binding among all parties involved. Apportionment decisions made under this subsection may not affect an employee's rights and benefits under this Act. 39-A M.R.S.A. § 354(3) (Supp.1996) (emphasis added). Pursuant to the plain language of this section, an insurer seeking apportionment is required to file a request for arbitration with the Superintendent of Insurance. This procedure is the "exclusive means for resolving disputes among insurers." 39-A M.R.S.A. § 354(3). The arbitrator does not enter into a factual determination of contributive fault, but is limited to a choice between apportionment proposals submitted by the insurers. 39-A M.R.S.A. § 354(3) (the arbitrator's "decision is limited to a choice between the submissions of the parties and may not be calculated by averaging"). [¶ 6] In this case, the Board focused on the last sentence of section 354(3) to conclude that, because an apportionment would affect the employee's rights to compensation, apportionment by an arbitrator is not appropriate. Even if the Board were correct in suggesting that a determination of the comparative contribution of two workrelated injuries in a successive injury case could affect an employee's level of benefits, we do not interpret the last sentence of section 354(3) as a grant of authority to the Board to determine apportionment disputes. Taken in context, the last sentence is intended only to clarify that no matter how liability is apportioned by an arbitrator, that apportionment does not alter the rights and benefits of the employee. [¶ 7] As we have stated, "the rights of a party under the Workers' Compensation Act are purely statutory," Jordan v. Sears, Roebuck & Co., 651 A.2d 358, 362 (Me.1994) (quoting Lavoie v. International Paper Co., *315 403 A.2d 1186, 1191 (Me.1979)). The Board has "no powers beyond those expressly granted to it by the Legislature, or such as emerge therefrom by implication as necessary and incidental to the full exercise of the powers explicitly granted." Wood v. Cives Constr. Corp., 438 A.2d 905, 908 (Me.1981). The Act plainly provides that arbitration pursuant to section 354 is the exclusive means for resolving apportionment disputes among insurers, and, accordingly, the Board had no authority to order Shurtleff to reimburse Reclamation for payments made pending appeal.[6] The entry is: The decision of the Workers' Compensation Board dated January 8, 1996, granting Reclamation's motion to determine the amount of reimbursement, vacated. NOTES [1] In the same order granting Shurtleff's petition for appellate review, we granted the employee, Dominic Rosetti's petition for appellate review and summarily vacated the decision on the issue of the average weekly wage. See Beaulieu v. Maine Medical Ctr., 675 A.2d 110, 111 (Me.1996). Rosetti has interpreted our order as an invitation to argue on appeal the other issues raised in his petition for appellate review. We believe it is clear on the face of the order that we only granted Rosetti's petition for appellate review for the limited purpose of vacating the Board's decision on the fringe benefit issue and we did not intend to grant review of the remaining issues raised by the employee. We therefore decline to address the issues raised in the employee's brief in this appeal. [2] In Shurtleff's response to Rosetti's petition for appellate review, Shurtleff stated that it was "cross petitioning" from the Board's March 1995 decision and subsequent findings of fact related to that decision. Shurtleff did not file a copy of the decision with the Clerk of the Law Court within 20 days after receipt of notice of the filing of the March or June, 1995 decisions by the hearing officer as required by 39-A M.R.S.A. § 322(1) (Supp.1996), nor did it pay the $100 filing fee as required by M.R. Civ. P. 73(j). Accordingly, we do not treat Shurtleff's response to Rosetti's petition for appellate review as a petition for appellate review or a "cross petition" for purposes of this appeal. [3] The Board's decision granting Reclamation's motion to determine the amount of reimbursement was incorrectly dated January 8, 1995. The actual date of the decision and the date that the decision was mailed to the parties was January 8, 1996. [4] Accordingly, we do not address the issue raised by Shurtleff, contending that it was error for the Board in the original decision to award an inflation adjustment pursuant to the law at the time of his first injury. [5] 39-A M.R.S.A. § 205(9)(B)(2) provides, in pertinent part: If an order or award of compensation or compensation scheme has been entered, the employer... shall petition the board for an order to reduce or discontinue benefits and may not reduce or discontinue benefits until the matter has been finally resolved through the dispute resolution procedures of this Act, any appeal proceedings have been completed and an order of reduction or discontinuance has been entered by the board. 39-A M.R.S.A. § 205(9)(B)(2) (emphasis added). [6] Because the Board had no authority to resolve reimbursement issues between insurers, the Board's motion to amend its decision pursuant to 39-A M.R.S.A. § 318, to include an order requiring Shurtleff to reimburse Reclamation for payments made pending appeal, is denied.

2023-08-23 14:17:52.166296+00

Reavley

REAVLEY, Justice (dissenting). I cannot quarrel with the desirability of either the result reached by this Court or the result reached by the Court of Civil Appeals. I also agree that the insurance company suffers no real harm by being required to advance payment of the attorney fees (except that the company suffers an impairment of its bargaining position to settle the case for less than the amount of the judgment). However, the question is the legal position of the parties under the Workmen’s Compensation Act. Texas Employers Insurance Association should pay only that amount of money at that time which a claimant of Motley’s disability and wage rate is entitled to receive under the terms of the statute. The sections of that statute which impose liability upon the insurance company direct the payment of a “weekly compensation” to the injured employee of not more than Forty-nine Dollars ($49) nor less than Twelve Dollars ($12). Art. 8306, secs. 10, 11 and 12. Death benefits within the same limits are set by section 8 to be by “weekly payment.” These sections likewise set the maximum length of the period of payment at 401 weeks, 360 weeks, 300 weeks, and the scheduled periods for specific injuries. An exception to weekly compensation is made in case of hardship, but that exception does not apply in this case. The statute does not merely compute the workman’s compensation by adding together weekly pay for a certain period; the liability it imposes upon the insurance company is to pay the compensation rate a week at a time for that period. And that is the only liability to which this company is subject. There is no added liability for the employee’s legal fees. His lawyer is compensated by board or court order out of the “amount recovered” by the employee. Art. 8306, sec. 7d. I would hold, under compulsion of the statute, that the company should pay $49 per week for the determined period and that it may not be required to pay a special award in a lump sum for attorney fees. WALKER, J., joins in this dissent.

2013-10-30 06:35:55.8328+00

Potter

901 F. Supp. 1018 (1994) James P. KRISTUFEK, Plaintiff, v. SAXONBURG CERAMICS, INC., Defendant. No. 3:94CV153-P. United States District Court, W.D. North Carolina, Charlotte Division. July 15, 1994. *1019 *1020 Harry B. Crow, Jr., Monroe, NC, for James P. Kristufek. *1021 James P. Kristufek, Monroe, NC, pro se. Randel E. Phillips, Moore and Van Allen, Charlotte, NC, David I. Cohen, Robert F. Prorok, Reed, Smith, Shaw & McClay, Pittsburgh, PA, for Saxonburg Ceramics, Inc. MEMORANDUM OF DECISION AND ORDER ROBERT D. POTTER, District Judge. THIS MATTER is before the Court on Defendant's motion to dismiss the amended complaint, filed June 24, 1994.[1] Plaintiff filed its response to the motion to dismiss on June 7, 1994. Defendant filed a reply brief on June 24, 1994. Also before the Court is Plaintiff's motion to remand, filed June 7, 1994. Defendant filed its response to this motion on June 24, 1994. The Court has carefully reviewed these motions. Based upon this review, the Court makes the following legal conclusions. In this action, Plaintiff is seeking damages for breach of an employment contract he entered into with Saxonburg Ceramics, Inc. (Saxonburg). Plaintiff is a North Carolina resident. Saxonburg is a Pennsylvania corporation. Saxonburg's corporate offices, and managerial personnel are located in Saxonburg, Pennsylvania which is also the meeting place of its board of directors. Saxonburg collects its outstanding bills, pays its accounts payable (including corporate taxes), makes its purchasing decisions and orders, and approves all employee salary adjustments from its plant in Saxonburg, Pennsylvania. Affidavit of Furman South. Of Defendant's 144 employees, 82 are located in Pennsylvania and 62 in its North Carolina plant. Plaintiff's amended complaint alleges Defendant, sometime in mid-1986, asked him to relocate to Union County, North Carolina to work in a new manufacturing plant Saxonburg built in the early 1980's. Defendant agreed to this request after receiving "promises by the defendant to the plaintiff which included the promise that the plaintiff, if he moved to Union County, North Carolina, to work for the defendant, would have his job with the defendant until he retired." Amended Complaint, pp. 1, 2 ¶ 7. Relying upon this promise, Plaintiff agreed to move to Union County, North Carolina where he satisfactorily performed his employment duties until May 15, 1992 when he was dismissed due to corporate "restructuring." Id. at p. 2 ¶ 12. PLAINTIFF'S MOTION TO REMAND The Court will first resolve the motion to remand to determine whether this Court properly has jurisdiction over this action. On May 9, 1994, Defendant removed this breach of contract action pursuant to 28 U.S.C. § 1441(a) from the Union County Superior Court because this action obtains the original jurisdiction conferred upon federal courts by 28 U.S.C. § 1332(a)(1) for persons of diverse state citizenship. Motions to remand cases from federal courts must be granted, and a removed case remanded to the state court from which it arrived "If at any time before final judgment it appears that the district court lacks subject matter jurisdiction...." 28 U.S.C. § 1447(c). "[T]he diversity statute w[as] designed to reduce the number of cases entering the federal courts solely on the basis of diversity of citizenship." Carolina Carbon and Stainless Products, Inc. v. IPSCO Corp., 635 F. Supp. 305, 306 (W.D.N.C.1986). Accordingly, § 1332 provides original jurisdiction in the federal courts "where the matter in controversy exceeds the sum or value of $50,000 ... and is between citizens of different States...." 28 U.S.C. § 1332(a)(1). "The crucial date for the determination of the Defendant's citizenship is, of course, the date the Complaint was filed." Carolina Carbon, 635 F.Supp. at 307; citing, Mullins v. Beatrice Pocahontas Co., 489 F.2d 260, 261 (4th Cir.1974). *1022 A corporate defendant is "deemed to be a citizen of any State by which it has been incorporated and of the State where it has its principal place of business...." 28 U.S.C. § 1332(c)(1). Corporations may have multiple citizenship. Defendant is a Pennsylvania corporation and is plainly a citizen of that state. Thus, the Court must determine whether it is also a citizen of North Carolina. The indices of citizenship which guide this inquiry, known colloquially as the "nerve center" and "bulk of activity" tests, have been considered alternative lines of analysis for determining corporate citizenship. Neither of which is preferable to the other in the Fourth Circuit. Mullins, 489 F.2d at 262. The Fourth Circuit has suggested that district courts "could advance the ultimate disposition of this question considerably by making findings of fact which are material to both theories." Id. This Court has consistently considered both indicators of corporate citizenship useful in elucidating the question and thus analyzes it by considering both the corporate "nerve center" and the place where the "bulk of activities" occurs in determining it's citizenship. Carolina Carbon, 635 F. Supp. 305. The "nerve center" test focuses on the "corporation's principal place of business ... where the executive and administrative offices are located, [and] from which the corporation's officers direct, control, and coordinate its policies and activities." Id. at 307. The "bulk of activities test," not surprisingly, looks to "where the corporation carries out the bulk of its activities as evidenced by the location of its physical assets and daily production or services activities rather than high-level policymaking." Id. Because of the lack of evidence relevant to the "bulk of activities" test presented in the affidavits and exhibits presently before the Court, it will confine its analysis, roughly speaking, to the "nerve center" standard.[2] Certainly, this standard fits the facts presented in this case since, "This test was developed for the situation in which a corporation is engaged in multi-state activities with offices or plants in various states." Carolina Carbon, 635 F.Supp. at 307. When examined under the "nerve center" standard, the Court believes Saxonburg's neural hub is in Pennsylvania and that it is therefore a citizen of Pennsylvania within the meaning of § 1332(c). The only evidence before the Court indicates all decisions vital to Defendant's corporate life; its bill paying and collecting, employment decisions, and planning activities are conducted in Pennsylvania. Defendant's board of directors and its officers are located in that state. Saxonburg's crucial decisions, ranging from long and short range planning to which bills are paid and when, issue from and are made in the Pennsylvania plant. It purchases its manufacturing material and equipment from Pennsylvania and does its accounting for the North Carolina plant there too. The Court therefore finds that Saxonburg's nerve center is in Pennsylvania. Thus, the Court concludes it is a citizen exclusively of Pennsylvania for purposes of § 1332(c). Therefore, since this action obtains original jurisdiction by virtue of the complete diversity of citizenship between the present litigants, the motion to remand must be denied. THE MOTION TO DISMISS Rule 12(b)(6) places the burden upon the party seeking dismissal to demonstrate the non-moving party has stated no facts in its complaint which entitle it to relief. In evaluating such a motion, the Court must assume all well pled facts are true and draw all reasonable inferences from those facts in favor of the non-moving party. Miree v. *1023 DeKalb County, 433 U.S. 25, 97 S. Ct. 2490, 53 L. Ed. 2d 557 (1977); Adams v. Bain, 697 F.2d 1213, 1216 (4th Cir.1982). Consequently, "a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45, 46, 78 S. Ct. 99, 101, 102, 2 L. Ed. 2d 80 (1957). In the amended complaint, Plaintiff contends he and Saxonburg had an employment contract which Saxonburg breached when it terminated Plaintiff on May 15, 1992 either because it was a contract for a definite period or was one backed by additional consideration. Defendant moves the Court to dismiss this breach of contract action because Plaintiff's employment status was simply that of an employee terminable at will. Thus, Defendant concludes, since there was neither a contract for a definite duration nor one supported by additional consideration, Plaintiff can state no claim for relief resulting from a breach of an employment contract. The long-established, firmly settled employment law of North Carolina is "that, `in the absence of an employment contract for a definite period, both employer and employee are generally free to terminate their association at any time and without any reason,' or for an irrational or arbitrary reason." McMurry v. Cochrane Furniture Co., 109 N.C.App. 52, 425 S.E.2d 735, 737 (N.C.App.1993); quoting, Salt v. Applied Analytical, Inc., 104 N.C.App. 652, 655, 412 S.E.2d 97, 99 (1991), disc. rev. denied, 331 N.C. 119, 415 S.E.2d 200 (1992) (citing, Still v. Lance, 279 N.C. 254, 182 S.E.2d 403 (1971); also citing, Coman v. Thomas Mfg. Co., 325 N.C. 172, 175, 381 S.E.2d 445, 447 (1989).[3] Thus, "[i]f an employment contract contains no provision concerning the duration of the employment or the means by which it may be terminated, such a contract is terminable at the will of either party, irrespective of the quality of performance by the other party." Iturbe v. Wandel & Goltermann Technologies, Inc., 774 F. Supp. 959, 960 (M.D.N.C.1991). Stated conversely, North Carolina law recognizes that employees and employers are free to terminate their employment relationships for a host of reasons, or no reason at all, unless they have created an employment contract specifying a definite duration of employment. It is not enough to establish an employment contract. Apart from specified statutory exceptions, the contract must also contain an additional condition requiring a define term of employment before it is taken out of the terminable at will rule. Buffaloe v. United Carolina Bank, 89 N.C.App. 693, 366 S.E.2d 918, 920 (N.C.App.1988) ("where a contract for employment does not fix a definite term, it is terminable at the will of either party, with or without cause except ... where the employee is protect from discharge by statute.") This standard of law works to the benefit of the employee as much as it does to that of the employer. It leaves both free to order their affairs and remain bound to each other according to their respective best interests. An at will employee who is offered greener pastures is at liberty to end an employment relationship with his employer, no matter how crucial that employee is to the employer's enterprise or how long his services have benefitted his employer. Similarly, the employer is privileged to rid itself of an employee who either does not satisfy the employer's unique objectives and replace that person with someone who does, or choose to end the employment of an employee for other reasons which benefit the well being of the employer and the remaining employees. Thus, on balance, the law of North Carolina contemplates as more compatible with liberty leaving those choices made in employment relationships to employees and employers without interference by the law. In sum, "[a]lthough the terminable-at-will rule may be falling out of favor in other jurisdictions, its continued vitality in North Carolina is clear." House v. Cannon Mills Co., 713 F. Supp. 159, 164 (M.D.N.C.1988). The employment at will doctrine is not exceptionless. Even when employment *1024 is at the will of the employer or employee, there remain two instances in which the law will intercede to restrict an employer's or employee's freedom. The first exception favors employees. This exception to the employment at will doctrine applies when an employee has been terminated for reasons contrary to the law or those which are said to offend public policy. Coman, 325 N.C. 172, 381 S.E.2d 445 (defining public policy as "the principle of law which holds that no citizen can lawfully do that which has a tendency to be injurious to the public or against the public good." Id. 325 N.C. at 175 n. 2, 381 S.E.2d at 447 n. 2 citations omitted.)[4] Thus, even if an employee is employed at the will of his employer, if his termination is premised upon a violation of the public good the law will intervene and prevent the terminable at will rule from operating fully. Nothing in this case implicates Coman's public policy exception to the terminable at will rule. The second exception, depending on the facts at issue, favors both employers and employees. This exception is known as the "additional consideration" rule. While at first stated quite broadly in Sides, it has since been "narrowly construed...." McMurry, 425 S.E.2d at 738. "One variant of this exception is when the employee is injured through the negligence of the company, and the employer and employee reach an agreement that the employee will drop all tort claims against the company in exchange for a promise of permanent employment." Iturbe, 774 F.Supp. at 961.[5] This variant of the employment at will doctrine is also inapposite on the facts before the Court. A second version of this exception is implicated where the employee leaves one job and moves to another city to take a different job. North Carolina's Court of Appeals has stated the rule accordingly, "[w]here the employee gives some special consideration in addition to his services, such as ... removing his residence from one place to another in order to accept employment ... such a contract may be enforced." Burkhimer v. Gealy, 39 N.C.App. 450, 454, 250 S.E.2d 678, 682 (1979), citing, Tuttle v. Kernersville Lumber Co., 263 N.C. 216, 139 S.E.2d 249 (1964). In applying Burkhimer and Tuttle, the North Carolina Court of Appeals in Sides, 328 S.E.2d at 828, appeared to state the additional consideration rule so broadly that it required merely a promise of employment except for incompetence coupled with "[t]he additional consideration that ... [one] move...." Id. It is now clear that the additional consideration rule has not been expanded so broadly as Sides intimated. In a later opinion applying the additional consideration rule, the Court of Appeals confined the Sides opinion by explaining its application of the rule as involving one who's move involved "foregoing career opportunities." Buffaloe v. United Carolina Bank, 89 N.C.App. 693, 366 S.E.2d 918, 921 (N.C.App. 1988). The Buffaloe court reasoned that the additional consideration rule was inapplicable within the context of an employee who left one town to take a position in another with the same employer. That court observed the employee, "did not forgo any other employment opportunities, and he merely moved in order to receive a promotion within the same bank." Id. The Buffaloe court, citing Burkhimer, ultimately held the additional consideration rule inapplicable to the facts before it because "[p]laintiff moved in order to get a promotion and not to accept a new job." Id. (emphasis added). After Buffaloe, it is now clear that a move alone is not sufficient additional consideration to bring an employment contract out of the terminable at will doctrine. The move must be made "in order to accept employment...." That is, one must move to take a new job, opting for alternate career opportunities with a different employer, rather than merely to obtain a promotion within an existing employment relationship with one's present employer. Id., quoting, Burkhimer, 39 N.C.App. at 454, 250 S.E.2d at 682. Other *1025 federal district courts applying this body of North Carolina law have concurred in this reading of the state of North Carolina employment law. As one such court put it, "[r]ecognition of a general exception whenever relocation or a job change is involved would emasculate the terminable-at-will rule, because many if not most hirings involve either a job change or a change of residences or both." House, 713 F.Supp. at 164.[6] Turning to the present case, the Court believes the contract Plaintiff and Saxonburg entered was one for employment terminable at the will of either party, and is not one which comes within the limited exceptions to the employment at will rule. The Court so concludes for the following reasons. The contract as issue was not for a definite term of employment. According to the amended complaint, "[plaintiff] agreed to move to Union County, North Carolina, and work with the defendant at its plant ... upon promises by the defendant [that he] ... would have his job with the defendant until the plaintiff retired." Amended Complaint, pp. 1, 2 ¶ 7. North Carolina courts have unambiguously said the agreement must, "fix a definite term ..." Burkhimer, 250 S.E.2d 678 at 680, Buffaloe, 366 S.E.2d at 920, of employment to become something other than one terminable at the will of employer or employee. See also, McMurry, 425 S.E.2d at 737. Said differently, the employment contract must not "in some form purport to provide for permanent employment, as where the agreement is for the employee to have a permanent position ... for ... as long as the employee desires the position...." Tuttle, 139 S.E.2d at 251, citing, 56 C.J.S. Master and Servant § 31. North Carolina's courts have applied this rule to a host of circumstances, each of which were found to inadequately define the duration of employment sufficient to exclude the contract from the terminable at will presumption.[7] The Court notes, "The burden to establish the specific duration of the employment contract lies with the employee." McMurry, 425 S.E.2d at 737. Plaintiff's contract was for employment until he retired. A term of employment until retirement is hardly a fixed period of time capable of exact measurement. It is quintessentially indefinite because the time at which retirement will occur almost always depends upon the unilateral decision of the employee, but is equally almost never tied to a certain date. It is not a determinate, measurable period of time if only because it is unknown at least by the employer, and usually also by the employee until the decision to retire is actually made. Unless the time of retirement is set at a date certain in the future, conditioning employment until the employee decides to retire is nothing more or less than conditioning employment upon the will of the employee. That is to say, employment "until retirement" is indefinite employment unless the employee brings it to an end or "for ... as long as the employee desires the position." Tuttle, 139 S.E.2d at 251. Since employment "until retirement" is not employment for a fixed duration, it is, according to the general rule of law in North Carolina, presumed to be employment terminable at the will of either employer or employee. McMurry, 425 S.E.2d at 737. By promising to employ Plaintiff until he retired, "[D]efendant provided nothing more than a gratuitous promise *1026 of continued employment," Id. at 739, in exchange for Plaintiff's promise to move. That is precisely the case here. Having concluded Plaintiff was an employee subject to a contract of employment terminable at the will of his employer, it remains for the Court to decide whether this employment at will arrangement is subject to the limited exceptions to this general rule. The only conceivable exception applicable on the facts before the Court is that provided for in the "additional consideration" line of cases. The Buffaloe decision makes clear that this exception does not apply here and remove Plaintiff's employment agreement from the terminable at will general rule. The amended complaint states Plaintiff "began working for Saxonburg Ceramics, Inc. in 1962, in Saxonburg, Pennsylvania" where he "was employed as a production supervisor." Amended Complaint, p. 1 ¶'s 3, 4. After Saxonburg decided to establish a manufacturing plant in North Carolina in 1986, "defendant ... asked the plaintiff to move from Pennsylvania to Union County, North Carolina, to work at the defendant's place of business...." Plaintiff accepted this offer and moved to North Carolina from Saxonburg, Pennsylvania to take a position with the same employer in a different state. Clearly, "moving from one town to another is not always sufficient to constitute additional consideration." McMurry, 425 S.E.2d at 738. Just as surely, moving from one place to another while remaining employed by the same employer does not amount to "foregoing career opportunities" but "merely [a] move[] in order to receive a promotion with the same [employer which is] not sufficient additional consideration to remove this case from the employment-at-will doctrine." Buffaloe, 366 S.E.2d at 921. Therefore, the Court concludes Plaintiff is not entitled to avail himself of the "additional consideration" exception to the employment at will doctrine. Accordingly, since Plaintiff was an employee terminable at the will of his employer, and is not availed of the exceptions to the terminable at will doctrine, the Court concludes Defendant was not precluded from terminating Plaintiff as an at will employee. Thus, the Court must grant Defendant's motion to dismiss. NOW, THEREFORE, IT IS ORDERED that Plaintiff's motion to remand be, and hereby is, DENIED. IT IS FURTHER ORDERED that Plaintiff's motion to amend his complaint be, and hereby is, GRANTED. IT IS FURTHER ORDERED that Defendant's motion to dismiss be, and hereby is, GRANTED. NOTES [1] On May 16, 1994, Defendant filed a motion to dismiss Plaintiff's original complaint. Plaintiff followed this motion with a motion to amend his complaint filed on June 7, 1994. Federal Rule of Civil Procedure 15(a) provides, "A party may amend the party's pleading once as a matter of course.... Fed.R.Civ.P. 15(a). The Court accordingly grants the motion to amend. The Court will also deny as moot Defendant's original motion to dismiss the unamended complaint. [2] The Court acknowledges that Plaintiff submitted evidence that Defendant's Union County facility was purchased at a cost of approximately $1,700,000.00 and that it possesses approximately $2,767,652.00 in personal property located in Union County. Yet, these numbers are worthless without some evidence about the relative value of Defendant's assets located in Pennsylvania by which a comparison can be made. Additionally, the Court notes there is no evidence before it to support a comparison between the output from Defendant's Pennsylvania and North Carolina plants. Regardless, the Court need not resolve whether both bases of citizenship are satisfied since it is sufficient to determine Saxonburg's citizenship, as the Court will do, under the "nerve center" analysis. [3] See also, Harris v. Duke Power Co., 83 N.C.App. 195, 349 S.E.2d 394, 395 (N.C.App.1986 aff'd, 319 N.C. 627, 356 S.E.2d 357 (1986), Roberts v. Wake Forest University, 55 N.C.App. 430, 434, 286 S.E.2d 120, disc. rev. denied, 305 N.C. 586, 292 S.E.2d 571 (1982). [4] See also, Sides v. Duke University, 74 N.C.App. 331, 342, 328 S.E.2d 818, 826, disc. rev. denied, 314 N.C. 331, 335 S.E.2d 13 (1985). [5] Citing, Dotson v. F.S. Royster Guano, Co., 207 N.C. 635, 178 S.E. 100 (1935); Stevens v. Southern Railway Co., 187 N.C. 528, 122 S.E. 295 (1924); Fisher v. John L. Roper Lumber Co., 183 N.C. 485, 111 S.E. 857 (1922). [6] See also, Iturbe, 774 F.Supp. at 961 (not foregoing other career opportunities and merely moving insufficient to implicate additional consideration under Buffaloe), Strickland v. MICA Information Systems, 800 F. Supp. 1320, 1327 (M.D.N.C.1992) ("This Court does not read the North Carolina law to imply as a condition of every employment agreement that whenever a person changes residences to accept or maintain employment she may thereafter be terminated only if her performance becomes unsatisfactory"). [7] See, Still, 279 N.C. at 259, 182 S.E.2d 403 ("a regular permanent job" is terminable at will); Tuttle, 263 N.C. at 219, 139 S.E.2d 249 ("employment for life" is "nothing more than one of indefinite hiring, terminable at will.); Malever v. Kay Jewelry Co., 223 N.C. 148 at 149, 25 S.E.2d 436 at 437 (1943) ("permanent employment" terminable at will); Fisher v. John L. Roper Lumber Co., 183 N.C. 485, 111 S.E. 857 (1922) (for life indeterminate duration); Dotson v. F.S. Royster Guano Co., 207 N.C. 635, 178 S.E. 100 (1934) (same); Jones v. Carolina Power & Light Co., 206 N.C. 862, 175 S.E. 167 (1934) ("at least ten years" indefinite).

2013-10-30 06:35:55.861374+00

Odom

491 S.W.2d 161 (1973) Judy TERRY, Appellant, v. The STATE of Texas, Appellee. No. 45614. Court of Criminal Appeals of Texas. January 24, 1973. Rehearing Denied March 21, 1973. *162 Douglas Tinker, Corpus Christi, for appellant. William B. Mobley, Jr., Dist. Atty., Phillip Westergren and Irma Rangel, Asst. Dist. Attys., Corpus Christi, and Jim D. Vollers, State's Atty., Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION ODOM, Judge. The jury in this cause found appellant guilty of the offense of murder without malice; the court assessed punishment at five years and this appeal is taken from the conviction. The evidence shows that the victim of this homicide was the infant son (approximately one month and three days old) of the appellant and her husband. Appellant complains of the admission in evidence of eight color pictures. *163 Recently, in Martin v. State, Tex.Cr. App., 475 S.W.2d 265, we discussed the admissibility of pictures in evidence and the holding therein is controlling. We will further elaborate and then determine if the pictures are admissible in the instant case. Photographs are admissible in evidence on the theory that they are pictorial communications of a witness who uses them instead of, or in addition to, some other method of communication. Thus, they are admissible on the same grounds and for the same purposes as are diagrams, maps, and drawings of objects or places, and the same rules of admissibility applicable to objects connected with the crime apply to photographs of such objects. This is true whether they are originals or copies, black and white or colored. So, a photograph, proved to be a true representation of the person, place, or thing which it purports to represent, is competent evidence of those things of which it is material and relevant for a witness to give a verbal description. And, we again point out, as we did in Martin v. State, supra, and Lanham v. State, Tex.Cr.App., 474 S.W.2d 197, that the admission in evidence of photographs must necessarily rest largely in the discretion of the trial judge, who determines whether they serve a proper purpose in the jury's enlightenment, and his action will not be disturbed in the absence of a showing of an abuse of discretion. Now, to the case at bar. Eight color slides were introduced and shown on a screen so the jury could view them. The first three (State's Exhibits 2, 3, and 4) show the nude body of the child depicting many bruises; the next (State's Exhibit 5) is an X-ray showing a broken bone in an arm; the remaining four (State's Exhibits 6, 7, 8, and 9) show areas of the body after an autopsy had been performed. The first three pictures, though gruesome, are admissible as they corroborate the verbal description and bring visibly to the jury the details of the crime by showing the location, nature and extent of the wounds or injuries to the body of the deceased child. Their probative value far outweighs any probable prejudicial effect on the jury. This is especially true since the appellant testified to a single, unintentional act of dropping the child and the pictures show what the jury could reasonably conclude to have been a continual assault. The X-ray showing the broken arm is admissible. It bears on the degree of the atrociousness of the crime. Such proves a relative issue and enables the jury to better understand the testimony. Now, we come to the pictures of parts of the body after an autopsy had been performed. State's Exhibit No. 6 shows an incision which exposes the upper interior part of the chest. State's Exhibit No. 7 shows, as described by the expert witness, "... the left shoulder, and... the flap cut from the chest down the arm ... to expose the fractured bone." The witness described State's Exhibit No. 8 as, "... the head. The bones of a child are not hard; they are almost rubbery, and to open the head, you reflect the scalp, and you can bend the bones back from the top of the brain. This shows the top of the brain, ..." State's Exhibit No. 9 shows, "... a fracture of the bone in this skull bone, a picture taken of the actual fracture in the skull ...." It is apparent from these exhibits that one sees primarily what was done by the person who performed the autopsy rather than that alleged to have been done by appellant. An example is evident from the following explanation of State's Exhibit No. 8: "Q. And does that reflect that the vessels all along there were torn or... A. No, it does not. This is one of the problems with dating this type of *164 injury, because if one vessels breaks and bleeds for 12 hours, it would probably cause as much injury as if more vessels were broken, so I can't begin to count how many vessels, because when I remove the skull, I am tearing others, so that the number of vessels determine how fast this bleeding will occur and how fast death will occur. This is why you are faced with the problem that we can't say it occurred 60 minutes after the injury, but we have to date it to minutes to hours. . . . . . . Q. But you don't know which vessels were torn, and that was too small, and you did some damage when you took the scalp apart? A. That's correct." With this in mind, we must determine if the probative value of these exhibits is sufficient to outweigh their inflammatory aspects, for as in Martin v. State, supra, 475 S.W.2d at page 268, we stated: "We recognize there will be cases where the probative value of the photographs is very slight and the inflammatory aspects great; in such cases it would be an abuse of discretion to admit the same." What is shown in these pictures is massive mutilation of the subject matter caused by the surgery in performing the autopsy. The jury, in the absence of the explanation of isolated areas pointed out by the expert witness, sees only severed parts of a human body. The bruises and injuries to the child had already been shown by verbal descriptions and State's Exhibits 2 through 5. After this was done, what material and relevant issues were necessary to be shown by these photographs taken after an autopsy had been performed? They are, at most, only remotely connected with the crime. We conclude that the autopsy pictures clearly served to inflame the minds of the jury, and the trial court abused its discretion by not sustaining appellant's objections to their admission. The judgment is reversed and the cause remanded.

2013-10-30 06:35:55.928184+00

Harris

491 S.W.2d 802 (1973) Charles Etta COX, Appellant, v. STATE of Arkansas, Appellee. No. 5802. Supreme Court of Arkansas. March 12, 1973. Rehearing Denied April 16, 1973. *803 R. W. Laster, Little Rock, for appellant. Jim Guy Tucker, Atty. Gen., by Frank B. Newell, Asst. Atty. Gen., Little Rock, for appellee. *804 HARRIS, Chief Justice. On September 1, 1970, appellant, Charles Etta Cox, was arrested in Grant County, Arkansas, and charged by Information with Grand Larceny. Preceding her trial on February 28, 1972, a hearing was conducted on her motion, earlier filed, to suppress certain evidence. Appellant called one witness, Trooper James Hale for this hearing, although the motion had raised issues relating to the absence of a search warrant, the absence of probable cause to justify the arrest, the unreasonableness of the search, and the authority of the officers to seize the property which was involved. The court denied the motion, and the case proceeded to trial; at the conclusion of the evidence, the jury retired and found appellant guilty, fixing her punishment at ten years confinement in the Arkansas Department of Correction. From the judgment so entered, appellant brings this appeal. Trooper Hale, in chambers, testified that he received a radio report from Deputy Sheriff A. J. Pitts concerning suspected shoplifters, the deputy giving a description of the occupants of the car, and the automobile in which they were riding. The officer stopped a 1956 Mercury which conformed to the description given and which was occupied by three black female adults and two children, on Highway 270 in Grant County, travelling toward Pine Bluff. Two bags[1] were in sight on the floorboard on the right hand side of the front seat, and were open at the top, disclosing merchandise, including clothing. The car was being operated by appellant and the trooper directed that it be driven back to Sheridan. The bags were taken out of the car and subsequently, after acquiring a search warrant, the car was thoroughly searched, but no additional contraband found. The property taken from the car was offered as exhibits. The court asked the trooper if the bags described were in open view to him, to which Hale responded "They were. They could be seen from the outside of the vehicle." The motion to suppress was denied. Hale subsequently testified that the car was stopped between 5:00 and 6:00 P.M. and that the automobile was being driven by appellant. An older woman was sitting in the front with her and a younger woman was in the back seat with the children. After arriving back at Sheridan, Mrs. Olga Winkle, the owner of the store, identified the merchandise as coming from her store. She testified that the value of the property was One Hundred and Four Dollars and a few cents.[2] Barbara Pruitt, employed at the store by Mrs. Winkle, testified that on September 1 she was the only clerk in the store, had several customers, and three black women came in, "mingled around in the store", then all separated, going to different places in the store, and, according to the witness, stayed quite a while. She identified appellant as one of the persons in the store. She said that she asked them several times if she could help and "when they finally left I got to checking around and found a box, you know, that had been merchandise, had been taken out of it and the box thrown under the counter." This box had contained lingerie. She said the women made no purchases. Barbara Bradshaw operates a beauty shop across the street and she stated that Mrs. Winkle was in the shop having her hair fixed. She noticed a red and white 1955 or 1956 Mercury stopped in the front, noticing it because a small child kept honking the horn. Subsequently, around 5:00 or 6:00 P.M. she saw the same automobile parked in front of the store. Mrs. Winkle testified that, while sitting in the beauty shop, she observed the automobile and saw three black women get out of the car and go into her store. Subsequently, the persons returned and she saw appellant, who *805 appeared to be carrying a shopping bag, get into the car and drive off. Upon returning to her establishment, she was shown the empty box which had contained merchandise just received.[3] Thereupon, she called Deputy Sheriff Pitts and described the car to him. Later in the afternoon, she identified appellant as the person who got into the car while she (the witness) was in the beauty shop, and she identified appellant at the trial as the same person. Mrs. Winkle stated that when she arrived in the evening, the car was being unloaded and the officers brought in pillow cases full of merchandise and a lot of merchandise fell out of one of the containers.[4] Deputy Pitts, relative to receiving information, testified: "I believe she called in by phone and told me what had happened about a shop lifting. She thought she had been shop lifted over there and she had information the type car and occupied by people and described them to me and I in turn gave it to Trooper Hale to be on the lookout for this vehicle." The deputy stated that when the car was driven back to the courthouse, permission was sought to look in the vehicle and they were told it was all right. He said tags were still on the merchandise. Sheriff Lewis Shirron also testified that the merchandise was new, still had the tags, sizes, etc., and he identified appellant as being present. When the merchandise was identified by the owner, appellant was arrested and subsequently charged with grand larceny. It is first argued that appellant's motion to suppress should have been granted, appellant contending that the evidence was illegally seized, it being stated that she was not under arrest at the time and that there was no search warrant when the property was taken from the car. Appellant asserts that the court apparently relied upon what is commonly referred to as the "plain view rule", but that this rule cannot be relied upon in the present instance. Appellant cites Coolidge v. New Hampshire, 403 U.S. 443, 91 S. Ct. 2022, 29 L. Ed. 2d 564, as pointing out that the use of "plain view" as a descriptive phrase is not coterminous with its use as a legal concept and that before this doctrine comes into effect, there must be a justifiable prior intrusion. Appellant argues that though the visual observation was legitimate, it did not justify the intrusion itself, but only furnished probable cause for the issuance of a search warrant. Actually, in Coolidge, the court held there were no exigent circumstances justifying the warrantless search of a car there involved, and it was pointed out that the "plain view" theory did not apply where the police had ample opportunity to obtain a valid warrant, knew in advance the car's description and location, had every intention of seizing it when they entered upon the petitioner's property, and no contraband or dangerous objects were involved. A contrary result was reached in Ker v. California, 374 U.S. 23, 83 S. Ct. 1623, 10 L. Ed. 2d 726; Chambers v. Maroney, 399 U.S. 42, 90 S. Ct. 1975, 26 L. Ed. 2d 419; and Warden v. Hayden, 387 U.S. 294, 87 S. Ct. 1642, 18 L. Ed. 2d 782. In these cases, a warrantless search and seizure of evidence was approved because of the exigencies of the situation. In Chambers, a warrantless search of a car was made, resulting in a seizure of evidence. This car at the time, had been taken to a police station, but the court noted that it could have been searched on the spot where it was stopped since there was probable cause to search and it was a fleeting target for a search. The court added that the probable-cause factor was still in existence at the station house and it was commented that the mobility of the car was still present; the court said that in terms of practical consequences, there was little to choose between an immediate search without *806 a warrant, and the car's immobilization until a warrant was obtained. "Given probable cause to search, either course is reasonable under the Fourth Amendment." In this opinion, the court also stated: "In terms of the circumstances justifying a warrantless search, the Court has long distinguished between an automobile and a home or office. In Carroll v. United States, 267 U.S. 132, 45 S. Ct. 280, 69 L. Ed. 543 (1925), the issue was the admissibility in evidence of contraband liquor seized in a warrantless search of a car on the highway. After surveying the law from the time of the adoption of the Fourth Amendment onward, the Court held that automobiles and other conveyances may be searched without a warrant in circumstances that would not justify the search without a warrant of a house or an office, provided that there is probable cause to believe that the car contains articles that the officers are entitled to seize." However, in Ker the court upheld a warrantless search and seizure of evidence because of exigent circumstances at a home; likewise in Warden, the court upheld an entry into a suspect's house and a subsequent warrantless search because "the exigencies of the situation made that course imperative." What are the circumstances in the case before us? Officer Hale had received a radio communication from a deputy sheriff of Grant County that merchandise was suspected to have been taken at Olga's Fabrics and Fashions Store, and the suspects were described, along with a description of the automobile. The officer observed such a car, stopped it, saw the sacks or pillow cases on the front floorboard, partly open, and articles of merchandise and wearing apparel were observed by the officer while standing outside the vehicle. Certainly this is a matter of evidence appearing in "plain view"; likewise, it would appear, with the information that Hale had received, that he had justification for stopping this automobile and upon observing the merchandise on the floorboard, ordering the car driven back to Sheridan. To first have obtained a warrant would mean, of course, that the occupants of the car could have driven on, with full opportunity to dispose of the merchandise in the vehicle. In other words, there was complete justification for an intrusion (considering the detention of the car as an intrusion). These were exigent circumstances requiring instantaneous action to preserve the existence of the evidence sought to be seized. Appellant argues that the primary essential element in a warrantless search and seizure is that such a search is incidental to a lawful arrest; that appellant had not been arrested, was not arrested until after the seizure of the articles, and such seizure was accordingly unlawful. We do not agree with this argument. In Carroll v. United States, supra,[5] the court stated "The right to search and the validity of the seizure are not dependent on the right to arrest. They are dependent on the reasonable cause the seizing officer has for belief that the contents of the automobile offend against the law." We have already stated that Hale was justified in the intrusion, and he certainly had reasonable cause to believe that the contents of the automobile offended the law. It is next asserted that appellant's motion for directed verdict should have been granted at the close of the State's testimony as there was insufficient evidence to convict her of the crime of grand larceny. Appellant correctly points out that *807 this court has held that where circumstantial evidence alone is relied upon to establish guilt of one charged with a crime, such evidence must exclude every other reasonable hypothesis than the guilt of the accused. Appellant then states that the most logical "reasonable hypothesis" in the case before us is that either or both of the women with Charles Etta Cox stole the merchandise, since both of them pleaded guilty.[6] It is argued that the containers holding the merchandise were on the floorboard near the right hand front seat of the car and there is no testimony that the bags were in the custody of, or under the control of, the appellant. It is true that no witness saw appellant take the merchandise, but we do not agree that it can be said that Charles Etta Cox did not have possession. Appellant certainly was in control of the automobile since she was driving it; the merchandise was in the automobile. It will be remembered also, that Mrs. Winkle, who was having her hair fixed in the beauty shop, testified that she observed appellant carrying what appeared to be a shopping bag, and saw her get into the car and drive off. It is stated by counsel for the State that research has not disclosed any Arkansas cases dealing specifically with stolen property found in vehicles, but authority from other states is cited, and the rationale appears to be entirely logical. In Lawson v. State, 38 Ala. App. 322, 82 So. 2d 812, the 2nd Division Court of Appeals of Alabama, in affirming a conviction of grand larceny, stated: "Possession is not limited to actual manual control upon or about the person. If under one's power and dominion the thing is possessed. That the appellant had knowledge of the presence of the stolen groceries can reasonably be inferred from his possession and control of the truck. Certainly, it was for the jury to so determine in the absence of any evidence by the appellant tending to justify his technical possession of the groceries." In Mason v. State, 9 Md.App. 61, 262 A.2d 576 (1970), the Court of Special Appeals of Maryland sustained the conviction of one who was driving a car containing stolen license plates. Two other men were also in the car at the time of the arrest. The court stated that appellant's presence in, and driving of the automobile, were sufficient to raise the inference that he was a thief and the court then said, "Appellant in no way refuted the inference and his conviction therefore must stand." Of course, in Arkansas, the possession of recently stolen property, if not explained to the satisfaction of the jury, is sufficient to sustain a conviction of larceny. Hammond v. State, 232 Ark. 692, 340 S.W.2d 280. To paraphrase the language in the cases cited, it certainly can reasonably be inferred from appellant's possession and control of the automobile, that she had knowledge of the presence of the stolen merchandise (which after all was only two or three feet away from her). Let it be remembered that appellant in no way refuted the inference that she was in possession of the property. As long ago as 1900, in the case of Lackey v. State, 67 Ark. 416, 55 S.W. 213, in an opinion by Justice Riddick, this court stated that the doctrine of reasonable doubt applies to the general issue of guilty or not guilty, but that it does not apply to each item of testimony or to each *808 circumstance tending to show the guilt of the defendant. The proof on behalf of the State was ample to make a jury question, and it was the function of that body to pass upon the matter. Finally, it is asserted that the court committed error in refusing to give appellant's requested Instructions No. 1 and No. 2. The first told the jury that the defendant was presumed to be innocent throughout the trial and that the State must prove her guilt beyond a reasonable doubt. The second questioned instruction defined reasonable doubt. We find no merit in either contention since the subject matter in both instructions was clearly covered, and even more comprehensively, by the court in other instructions given to the jury. On the whole case, finding no error, the judgment is affirmed. It is so ordered. NOTES [1] These were pillow cases. [2] The merchandise was subsequently returned to Mrs. Winkle and placed in stock. [3] This particular box contained a negligee set valued at $13.95. [4] Articles taken included negligee set, a suit, two dresses, bras, and panties. [5] This court has relied on the rationale of Carroll in numerous cases. For instance, see Tygart v. State, 248 Ark. 125, 451 S.W.2d 225 (1970), cert. denied, 400 U.S. 807, 91 S. Ct. 50, 27 L. Ed. 2d 36; Moore et al. v. State, 244 Ark. 1197, 429 S.W.2d 122 (1968), cert. denied, 393 U.S. 1063, 89 S. Ct. 714, 21 L. Ed. 2d 705 (1968); and Burke v. State, 235 Ark. 882, 362 S.W.2d 695 (1962). [6] Appellant herself twice pleaded guilty. On September 24, 1970, she entered a plea and was sentenced to a term of ten years in the penitentiary, with seven years suspended. Thereafter, a motion was filed by her then attorney to set aside her plea of guilty because she was not aware of the severe nature of the crime to which she pleaded guilty and the court granted this motion. On January 12, 1971, she again entered a plea of guilty and received the same sentence. Thereafter, her present attorney filed a motion to vacate the sentence under Criminal Procedure Rule I, alleging that her rights under the Federal and State Constitutions had been violated and asking that her sentence be vacated and the Circuit Court granted that motion. The case thereafter proceeded to trial on February 28, 1972.

2013-10-30 06:35:55.969914+00

Welborn

491 S.W.2d 257 (1973) STATE of Missouri, Respondent, v. Willie J. SMITH, Appellant. Nos. 56646, 57656. Supreme Court of Missouri, Division No. 1. February 12, 1973. Motion for Rehearing or to Transfer Denied March 12, 1973. John C. Danforth, Atty. Gen., Preston Dean, Assist. Atty. Gen., Jefferson City, for respondent. Robert C. Babione, Assist. Public Defender, St. Louis, for appellant. Motion for Rehearing or to Transfer to Court En Banc Denied March 12, 1973. WELBORN, Commissioner. Consolidated appeals from two judgments of conviction, on jury verdicts, for murder in the first degree, with consecutive life sentences. On the night of October 31, 1969, Hermine Rohs, her son, Willy, and Willy's wife, Marilyn, were stabbed to death by intruders in Mrs. Rohs' apartment in St. Louis. Various items of personal property were stolen from the victims and the women were raped. Clues at the scene of the crimes led officers to Edward Johnson who had previously done some odd jobs ior Mrs. Rohs. Johnson was arrested and information obtained by police led to the arrest of Willie J. Smith. Smith made a statement, detailing the offenses. He was indicted by a grand jury on three separate charges of murder in the first degree by indictments filed November 13, 1969. In Cause No. 2519-R, Smith was charged with the murder of Marilyn Rohs. He was tried on that charge, beginning November 9, 1970. The trial resulted in a verdict of guilty of murder in the first degree. After his motion for new trial was overruled, judgment in accordance with the verdict was entered on February 24, 1971. The appeal from such judgment is Cause No. 56,646 in this court. The indictment in Circuit Court Cause No. 2517-R charged Smith with first degree murder in the death of Willy Rohs. On March 30, 1971, a motion to dismiss that charge was filed. The grounds of the motion were that in the trial of Cause No. 2519-R the state introduced into evidence the fact of the death of Willy Rohs and that to try him for such offense in Cause No. 2517-R would constitute double jeopardy in violation of state and federal constitutional guaranties. The motion alternatively sought to exclude imposition of the death sentence in Cause No. 2517-R because a life sentence had been imposed in the prior trial. The motion was denied. *258 Smith was tried in Cause No. 2517-R, beginning December 13, 1971. A jury returned a verdict of guilty of murder in the first degree. After his motion for new trial had been overruled, judgment was entered in accordance with the verdict, with the sentence to run consecutively to that imposed in Cause No. 2519-R. The appeal from that judgment is Cause No. 57,656 in this court. In this court, the appeals were consolidated. However, no claim of error has been briefed or argued in Cause No. 56,646 and that judgment is, therefore, affirmed. In Cause No. 57,656, appellant contends that the conviction must be set aside because the issues in that case had clearly been determined by a valid and final judgment in the previous trial, and that the second trial placed him in jeopardy twice for the same offense, contrary to § 19, Article I, of the Constitution of Missouri, V.A.M.S., and Amendment XIV to the Constitution of the United States. The answer to this contention is to be found in this court's decision in State v. Moton, Mo., 476 S.W.2d 785. In that case the defendant and another had robbed two persons in a service station holdup. The prosecution and conviction of the defendant for robbery from one of the victims were held not to preclude his subsequent prosecution for the robbery from the other victim. In that case, the court distinguishes Ashe v. Swenson, 397 U.S. 436, 90 S. Ct. 1189, 25 L. Ed. 2d 469, and North Carolina v. Pearce, 395 U.S. 711, 89 S. Ct. 2072, 23 L. Ed. 2d 656, relied upon by appellant here. Nothing need be added here to demonstrate the inapplicability of those cases on the issue here presented. In the present situation, appellant was charged separately with the murder of two different persons. He was charged with two different offenses and found guilty of two separate and distinct offenses. As in Moton, substantially the same evidence was presented in both trials, but, unless and until the views of Mr. Justice Brennan in his concurring opinion in Ashe, 397 U.S. 448, 90 S. Ct. 1189, 25 L. Ed. 2d 469, are accepted as constitutional requisites, the similarity of the evidence does not result in a second charge for the same offense in a situation such as this. Appellant points to the "felony murder" instruction in both cases as instructing the jury that if "a homicide occurred while the defendant, either acting alone or jointly with another, was robbing Willy Rohs, then such perpetration stands in lieu of deliberation and premeditation as hereinbefore defined, and the jury will be warranted in finding the defendant guilty of murder in the first degree * * *." These instructions dealt only with the substitution of the finding that the homicide was committed in the perpetration of a robbery for the element of deliberation and premeditation, as set out in the verdict-directing instruction which required a finding in the first case that the defendant killed Marilyn Rohs, and in the second case that he killed Willy Rohs. See State v. Phillips, Mo.Sup., 299 S.W.2d 431, 437-438 [13-15]; State v. Schnelt, 341 Mo. 241, 108 S.W.2d 377, 382-383 [7-9]. The instructions did not permit a finding of guilt in either case if anyone was killed in the robbery. The jury was required in each case to find that the victim was the person named in the indictment. The argument, based on North Carolina v. Pearce, supra, that the issue of punishment had been litigated at the first trial is answered in State v. Moton, supra, where it was pointed out: "Pearce involved a retrial for the same offense. The case at bar involves two trials for two separate offenses." 476 S.W.2d 791. Appellant finally contends that, under § 545.110, RSMo 1969, V.A.M.S., the indictment in Cause No. 2517-R was suspended by the later indictment in Cause No. 2519-R. § 545.110, RSMo 1969, V.A. M.S., provides: "If there be at any time pending against the same defendant two indictments for the *259 same offense, or two indictments for the same matter, although charged as different offenses, the indictment first found shall be deemed to be suspended by such second indictment, and shall be quashed." That the "same matter" referred to in § 545.110, supra, means "same offense" is made clear by Rule 24.14, V.A.M.R., which now governs this question. Section 5, Article V, Constitution of Missouri. As previously demonstrated, the indictments here did not charge the "same offense." Judgments affirmed. HIGGINS, C., concurs. PER CURIAM: The foregoing opinion by WELBORN, C., is adopted as the opinion of the Court. All of the Judges concur.

2013-10-30 06:35:55.996668+00

Chatigny

994 F. Supp. 114 (1997) Brian BEGGS and Jennifer Beggs v. Robert V. ROSSI, Leslie A. Marcarelli, Rossi Law Offices, Ltd. No. 3:96CV1852 (RNC). United States District Court, D. Connecticut. September 29, 1997. *115 Joanne Faulkner, Law Offices of Joanne Faulkner, New Haven, CT, for plaintiff. Peter C. Schwartz, Christopher L. Slack, Gordon, Muir & Foley, Hartford, CT, for defendant. CHATIGNY, District Judge. ORDER After review and over objection, the Magistrate Judge's recommended ruling is hereby approved and adopted. So Ordered. RECOMMENDED RULING ON MOTION TO DISMISS MARTINEZ, United States Magistrate Judge. This action is brought under the Fair Debt Collection Practices Act ("FDCPA") 15 U.S.C. § 1692 et seq. and the Connecticut Unfair Trade Practices Act ("CUTPA"), Conn. Gen.Stat. § 42-110a. Pending before the court is the defendants' motion to dismiss for failure to state a claim upon which relief can be granted. The defendants contend that the plaintiffs' FDCPA claim fails because personal property tax obligations are not "debts" within the meaning of the FDCPA. The defendants also argue that the plaintiffs' CUTPA claim fails on the grounds that (1) a pendent state law claim standing alone is inadequate; (2) the ascertainable loss required to state a claim under CUTPA has not been adequately alleged; and (3) a CUTPA claim may not be brought against an attorney based on an underlying dispute with the attorney's client. For the reasons stated below, the court is persuaded that the FDCPA does not apply to the tax obligations at issue in this case and that pendent jurisdiction over the state law claim should not be exercised. Based on these conclusions, the court recommends that the defendants' motion to dismiss (doc. # 16) be GRANTED. I. The Allegations of the Amended Complaint The relevant allegations of the amended complaint are as follows. The plaintiffs, Brian *116 Beggs and Jennifer Beggs, are former residents of the Town of Exeter, Rhode Island, who moved to Connecticut in 1989. Brian and Jennifer Beggs each owned motor vehicles which they used for personal, family or household purposes. Personal property taxes were assessed on the plaintiffs' motor vehicles by the Town of Exeter, Rhode Island. In November 1989, the plaintiffs paid the motor vehicle personal property taxes to the Town of Exeter. The defendant Robert Rossi is an attorney but is not admitted to practice law in Connecticut. Attorney Rossi and his law firm, Rossi Law Offices, Ltd., collect consumer debts. The defendant Leslie Marcarelli, an attorney who is admitted to practice law in Connecticut, permits Attorney Rossi and Rossi Law Offices, Ltd. to use her name in their debt collection efforts so that they can evade certain Connecticut licensing requirements. On behalf of the Town of Exeter, the defendants communicated with the plaintiffs in an effort to collect the plaintiffs' personal motor vehicle tax obligations. The plaintiffs claim that the defendants' collection efforts violated the FDCPA on a number of grounds, including failure to include required notices, unfair practices and failure to validate the debt. The plaintiffs also claim that these alleged acts were unfair trade practices in violation of CUTPA. II. Standard of Review A motion to dismiss pursuant to Fed. R.Civ.P. 12(b)(6) involves a determination as to whether the plaintiff has stated a claim upon which relief may be granted. Fischman v. Blue Cross Blue Shield of Conn., 755 F. Supp. 528 (D.Conn.1990). The motion must be decided solely on the facts alleged. Goldman v. Belden, 754 F.2d 1059, 1065 (2d Cir.1985). In deciding a motion to dismiss, a court must assume all factual allegations in the complaint to be true and must draw reasonable references in favor or the nonmoving party. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S. Ct. 1683, 40 L. Ed. 2d 90 (1974). Such motion should be granted only where no set of facts consistent with the allegations could be proven which would entitle the plaintiff to relief. Conley v. Gibson, 355 U.S. 41, 45, 78 S. Ct. 99, 2 L. Ed. 2d 80 (1957). The issue is not whether the plaintiff will prevail, but whether he should have an opportunity to prove his claims. Id. III. Discussion A. Count I — The FDCPA Claim The dispositive issue in determining whether the first count of the amended complaint states a claim upon which relief can be granted is whether personal property taxes constitute a debt under the FDCPA. To answer this question, the court will consider the legislative purpose in enacting this law, its statutory language and the precedent interpreting the act. See Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 220-21, 106 S. Ct. 2485, 91 L. Ed. 2d 174 (1986). The Fair Debt Collection Practices Act was enacted in 1977 as an amendment to the Consumer Credit Protection Act to "eliminate abusive collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses." 15 U.S.C. § 1692(e). The purpose of the statute is to protect consumers in their dealings with business. Blackwell v. Professional Business Servs., Inc., 526 F. Supp. 535, 537 (N.D.Ga.1981). The FDCPA defines a debt as "any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance or services which are the subject of the transaction are primarily for personal, family, or household purposes, whether or not such obligation has been reduced to judgment." 15 U.S.C. § 1692a(5). The case law interpreting the meaning of debt under the FDCPA is "sparse." Mabe v. G.C. Servs. Ltd. Partnership, 32 F.3d 86, 88 (4th Cir.1994). The only case which directly addresses the question of whether a tax debt could constitute a consumer debt under the FDCPA is Staub v. Harris, 626 F.2d 275 (3d Cir.1980). In Staub, the court held that a *117 municipal per capita tax was not covered by the act. See also Newman v. Boehm, Pearlstein & Bright, Ltd., 119 F.3d 477, 481-82 (7th Cir.1997) (relying on Staub v. Harris in stating that past-due tax obligations are not "debts" under the FDCPA because taxes are generally used for communal rather than personal, family or household purposes). In Staub, the plaintiffs alleged that the defendants had violated the FDCPA in their attempt to collect delinquent taxes. Staub v. Harris, 626 F.2d at 276. The district court granted the defendants' motion to dismiss the plaintiffs' complaint on the ground that the per capita taxes at issue were not encompassed within the definition of "debt" under the FDCPA. Id. On appeal, the plaintiffs argued that services provided by a municipal government created an ongoing "transaction" with taxpayers and therefore a tax debt came within the statutory definition of consumer debt. Id. at 278. The defendants argued that only a debt arising out of a contractual relationship was protected by the statute. Id. Without deciding whether the act required that the debt arise out of a contractual relationship, the Third Circuit Court of Appeals held that "at a minimum, the statute contemplates that the debt has arisen as a result of the rendition of a service or purchase of property or other item of value." Id. at 277. The court reasoned that to the extent that taxes could be loosely described as purchasing goods and services, those purchases (such as roads and prisons) had generalized benefits for the entire community. Those generalized benefits exceed the statute's definition of consumer debt which limits the subject of the debt to personal, family or household use. Id. ("[t]he relationship between taxpayer and taxing authority does not encompass that type of pro tanto exchange which the statutory definition envisages"). The court observed that the legislative history of the act was bereft of any reference to taxes, and that there was nothing in the legislative history or language of the statute that would suggest that Congress intended to include tax debts within its definition of consumer debts. Id. Noting that the statutory language and legislative history limited the FDCPA to the protection of consumers, the Staub court concluded that the FDCPA "does not apply to practices occurring in the course of collection of taxes." Id. at 279. In the present action, the plaintiffs attempt to distinguish Staub by arguing that the personal property tax at issue here arises from the purchase or registration of a family car as opposed to the "purchase" of governmental services (the type of transaction argued in Staub). The plaintiffs mischaracterize the nature of a personal property tax. A personal property tax is not a tax on a transaction; it is a tax on ownership. A person can acquire ownership of a car by a gift or by inheritance or even by building it himself. How ownership is acquired is irrelevant to the assessment of the tax and therefore the tax cannot reasonably be said to arise out of the purchase of a car. See, e.g., Conn.Gen. Stat. §§ 12-71 (subjecting personal property to taxation) & 12-122 (requiring the town to levy taxes in order to pay for the town's expenses). Nor can it reasonably be said that the tax arises out of the registration of a vehicle. Registration merely permits the taxing authorities to identify the owner of the vehicle. The tax is not levied on the registration of the vehicle; the tax is levied on the ownership of the vehicle. Without any relation to a consumer transaction, there is no basis for distinguishing personal property taxes from the per capita taxes which were at issue in Staub. In light of the statutory language and in the absence of legislative history suggesting otherwise, the court concludes that the collection of delinquent personal property taxes are not protected by the Fair Debt Collection Practices Act. The court's conclusion is in accord with the Federal Trade Commission's ("FTC") comprehensive narrative interpreting the FDCPA, which excludes unpaid taxes from the definition of "debt". See Statements of General Policy or Interpretation, Staff Commentary on the Fair Debt Collection Practices Act, 53 Fed.Reg. 50,097, 50,102 (December 13, 1988), 1988 WL 269068 (F.R.). Although the FTC's interpretations of the FDCPA are not binding on the courts, the court nonetheless acknowledges the FTC's position and accords it due weight. *118 See Johnson v. NCB Collection Servs., 799 F. Supp. 1298, 1303 (D.Conn.1992) (because the FTC is the administrative body empowered to enforce the FDCPA, its interpretation of the statute is entitled to at least some weight) (Cabranes, C.J.); see also Newman v. Boehm, Pearlstein & Bright, Ltd., 119 F.3d 477, 482 n. 2 (7th Cir.1997) and Bass v. Stolper, Koritzinsky, Brewster & Neider, S.C., 111 F.3d 1322, 1327 n. 8 (7th Cir.1997) (due weight accorded FTC's interpretation of "debt" under FDCPA). Because the court concludes that the plaintiffs' motor vehicle personal property tax obligations are not "debts" within the meaning of the FDCPA, the court recommends that the motion to dismiss the plaintiffs' claim under the FDCPA claim be granted. B. Count II — The CUTPA Claim Having concluded that the plaintiffs' federal claim ought to be dismissed for failure to state a claim, the court next considers whether pendent jurisdiction should be exercised over the state law claim under CUTPA. Where all federal claims are eliminated before trial, "the balance of factors to be considered under the pendent jurisdiction doctrine — judicial economy, convenience, fairness, and comity — will point toward declining to exercise jurisdiction over the remaining state-law claims." Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350 n. 7, 108 S. Ct. 614, 98 L. Ed. 2d 720 (1988). See United Mine Workers v. Gibbs, 383 U.S. 715, 726, 86 S. Ct. 1130, 16 L. Ed. 2d 218 (1966). Because the federal claim should be dismissed under Fed.R.Civ.P. 12(b)(6), the court should decline to exercise jurisdiction over the pendent state law claim. Because the court recommends that jurisdiction not be exercised over the pendent state law claim, the court does not reach the other arguments offered by the defendants in support of their motion to dismiss the CUTPA claim. CONCLUSION For the forgoing reasons, the Court recommends that defendant's motion to dismiss (doc. # 16) be GRANTED. Either party may seek the district judge's review of this recommendation. See 28 U.S.C. § 636(b) (written objections to ruling must be filed within ten days after service of same); F.R.Civ.P. 6(a), 6(e) & 72; Rule 2 of the Local Rules for United States Magistrate Judges, United States District Court for the District of Connecticut; Thomas v. Arn, 474 U.S. 140, 155, 106 S. Ct. 466, 88 L. Ed. 2d 435 (1985); Frank v. Johnson, 968 F.2d 298, 300 (2d Cir.), cert. denied, 506 U.S. 1038, 113 S. Ct. 825, 121 L. Ed. 2d 696 (1992) (failure to file timely objection to Magistrate Judge's recommended ruling waives any further judicial review of the ruling). Sept. 4, 1997.

2013-10-30 06:35:56.047444+00

Venters

431 B.R. 830 (2010) In re SKYLINE WOODS COUNTRY CLUB, LLC, Debtor. Mid-City Bank, a Nebraska Banking Corporation; Liberty Building Corp., Nebraska Corporation; David Broekemeier; and Robin Broekemeier, Movants-Appellants, v. Skyline Woods Homeowners Assoc. and Skyline Woods Revitalization, LLC, Objectors-Appellees. No. 09-6073. United States Bankruptcy Appellate Panel of the Eighth Circuit. Submitted: May 28, 2010. Filed: June 17, 2010. *833 Robert Frederick, argued, Anna M. Bednar, on the brief, Omaha, NE, for appellant. Michael Thomas Eversden, argued, Robert J. Bothe, on the brief, Omaha, NE, for appellee. Before KRESSEL, Chief Judge, FEDERMAN and VENTERS, Bankruptcy Judges. VENTERS, Bankruptcy Judge. This is an appeal of the bankruptcy court's order denying the Appellants' motion to reopen the Debtor's bankruptcy case. For the reasons stated below, we affirm the decision of the bankruptcy court.[1] I. STANDARD OF REVIEW A bankruptcy court's decision whether to reopen a bankruptcy case is reviewed for an abuse of discretion.[2] A court abuses its discretion "when its ruling is founded on an error of law or a misapplication of law to the facts."[3] In its application, the abuse of discretion standard is nearly indistinguishable from the clearly erroneous standard.[4] II. BACKGROUND The Debtor, Skyline Woods Country Club, LLC, filed a Chapter 11 bankruptcy petition on December 15, 2004. On or about February 4, 2005, the Debtor sold substantially all of its assets, including a portion of a golf course, to Appellants David and Robin Broekemeier, who took title to the property in the name of Liberty Building Corp. ("Liberty"). Appellant Mid-City Bank ("Mid-City") financed the Broekemeiers' purchase of the Debtor's assets. On February 9, 2005, the bankruptcy court entered an order ("Sale Order") approving the sale "free and clear of claims, liens, and encumbrances." The Debtor's bankruptcy case was closed on January 31, 2006. The Broekemeiers decided to not reopen the golf course. On April 25, 2006, approximately *834 one month after learning of this decision, Skyline Woods Homeowners Association and individual homeowners (collectively, the "Homeowners") filed suit against Liberty and David and Robin Broekemeier in the District Court for Douglas County, Nebraska, asking the court to enforce certain restrictive covenants requiring that the property be used only as a golf course. Paisley, LLC, now known as Skyline Woods Revitalization, LLC, filed a separate suit for the same purpose. On June 9, 2006, Liberty filed a pleading entitled, "Motion for Enforcement of the Bankruptcy Court's February 9, 2005 Order, Including Request for Injunctive Relief," in the Debtor's closed bankruptcy case. The motion alleged that the statecourt lawsuits violated the February 9, 2005 Sale Order and sought an injunction to prevent those lawsuits from proceeding. The bankruptcy court notified Liberty on June 12, 2006, that its motion would not be heard unless it moved the court to reopen the case and paid the necessary filing fee. The court struck Liberty's motion from the record. Neither Liberty nor the Broekemeiers took any further action in the bankruptcy case at that time. On March 28, 2007, the state court granted the Homeowners' motion for summary judgment, finding that the restrictive covenants requiring the operation of a golf course run with the land and are enforceable against Liberty. The state court specifically held that the bankruptcy court order confirming the sale did not eliminate the restrictive covenants. On August 9, 2007, the state court issued an order clarifying the order on summary judgment and specifying with more particularity the requirements to maintain the golf course property in the manner required by the covenants. Liberty appealed the trial court's order to the Nebraska Supreme Court. On December 5, 2008, the Nebraska Supreme Court affirmed the trial court's order and held that the restrictive covenants are in effect and enforceable. Shortly thereafter, Liberty defaulted on its loan to Mid-City, and on December 24, 2008, Mid-City recorded with the recorder of deeds a Notice of Default and Election to Sell the property. On September 25, 2009, the Broekemeiers and Liberty, joined by Mid-City, filed a motion to reopen the Debtor's bankruptcy case for the explicit purpose of initiating an adversary proceeding to "enforce" the bankruptcy court's February 9, 2005 Sale Order. The complaint attached to the motion sought, inter alia, an injunction enjoining the homeowners from "enforcing the decisions of the Nebraska Supreme Court or any Orders arising there from (sic) ... [and] [d]eclaring that the Nebraska State Court's Orders that purport to modify or otherwise alter this Court's February 9, 2005 Order are void for lack of subject matter jurisdiction." After notice and a hearing, the bankruptcy court denied the Broekemeiers' and Mid-City's motion to reopen the Debtor's bankruptcy case. This appeal ensued. III. DISCUSSION Section 350(b) of the Bankruptcy Code governs the reopening of bankruptcy cases. It provides: "A case may be reopened in the court in which such case was closed to administer assets, to accord relief to the debtor, or for other cause."[5] The decision to grant or deny a request under § 350(b) to reopen a bankruptcy case is *835 committed to the broad discretion of the bankruptcy court.[6] A motion to reopen a bankruptcy case should be granted "only where a compelling reason for reopening the case is demonstrated."[7] And "[t]he longer the time between the closing of the estate and the motion to reopen the more compelling the reason for reopening the estate should be."[8] The availability of relief in an alternative forum is a permissible factor on which to base a decision not to reopen a closed bankruptcy case.[9] "[A] case should not be reopened to relieve a party of its own neglect or mistake."[10] The bankruptcy court denied the Appellants' motion to reopen the Debtor's bankruptcy case based on a determination that the dispute the Appellants sought to adjudicate if the case was reopened—i.e., whether the Sale Order eliminated the covenants purportedly requiring the operation of a golf course on the property—had already been decided by the Nebraska Supreme Court, which the bankruptcy court determined had concurrent jurisdiction to interpret the Sale Order. Citing In re Apex Oil Co., Inc., for the above-stated proposition that the availability of relief in an alternative forum is a permissible factor on which to base a decision not to reopen a bankruptcy case, the bankruptcy court declined to give the Appellants a "second bite at the apple" in the bankruptcy court after they had chosen an alternative forum for their dispute. We find no error in the bankruptcy court's findings or conclusions. A. The Nebraska Supreme Court had concurrent jurisdiction to interpret the Sale Order. Federal courts' jurisdiction over bankruptcy cases is governed by 28 U.S.C. § 1334. Section 1334(a) provides that the district court (and by delegation, the bankruptcy court)[11] has original and exclusive jurisdiction of "all cases under title 11;" Section 1334(b) confers original but not exclusive jurisdiction on all civil proceedings "arising under title 11, or arising in or related to cases under title 11;" and Section 1334(e) confers exclusive jurisdiction over all the property of the debtor as of the commencement of the case, and of property of the estate.[12] The Appellants argue that under § 1334(e) the bankruptcy court has exclusive jurisdiction to interpret the Sale Order because it involves property of the estate and the bankruptcy court had the exclusive jurisdiction to enter the order. The Appellants are correct that the bankruptcy court had the exclusive jurisdiction to enter the Sale Order, and if the Appellants had timely sought to appeal or modify the Sale Order, that action would also have been within the exclusive jurisdiction of the bankruptcy court under § 1334(e). However, the Appellants are mistaken in their argument that the bankruptcy court has exclusive jurisdiction to interpret the Sale Order. At this juncture, the Sale Order is final, and the property sold to the Broekemeiers/Liberty is no longer property of the estate. Moreover, despite the Appellants' framing of the issue in terms *836 of whether the Nebraska Supreme Court had the jurisdiction to "modify" the Sale Order, there has been no modification of that order. The Nebraska Supreme Court simply interpreted the scope of the Sale Order as it applies to implied covenants running with the land. The fact that the Appellants disagree with the court's interpretation does not, in and of itself, transform the interpretation into a modification of the Sale Order. In short, § 1334(e) does not limit jurisdiction to interpret the Sale Order exclusively to the bankruptcy court. Perhaps the strongest basis for the bankruptcy court's jurisdiction over this dispute is its implicit authority and jurisdiction to interpret or enforce its own prior orders,[13] but that jurisdiction is not exclusive, even with regard to the interpretation of orders approving sales of estate property.[14] Matters not committed to the exclusive jurisdiction of the federal courts are subject to the concurrent jurisdiction of state courts.[15] Therefore, the Nebraska State courts had jurisdiction to interpret the Sale Order, and the bankruptcy court was therefore correct in its conclusion that alternate relief was available to the Appellants and within its discretion to deny the Appellants' motion to reopen the Debtor's bankruptcy case. B. Res judicata warranted a denial of the Appellants' motion to reopen the case.[16] The bankruptcy court's decision can also be affirmed on the basis that reopening the case would have been futile and a waste of judicial resources,[17] because the doctrine of res judicata precludes review of the Nebraska Supreme Court judgment, which is exactly the relief the Appellants sought. The doctrine of res judicata prohibits the re-litigation of claims where: 1) a court of competent jurisdiction rendered the prior judgment, 2) the prior judgment was final and on the merits, 3) both suits involve the same parties (or those in privity with them), and 4) both suits are based upon the same claims or causes of action.[18] The party against whom res judicata is asserted must also have had a full and fair opportunity to litigate the matter in the proceeding that is to be given preclusive effect.[19] The preclusive effect of res judicata includes not only claims and defenses that were offered and received in the first action, but *837 matters which might have been decided.[20] The Nebraska Supreme Court judgment, as well as the trial court's judgment, satisfies all of these elements. First, the litigation between the Broekemeiers and the Homeowners resulted in a final judgment on the merits. The trial court entered a summary judgment against the Broekemeiers on March 26, 2007, holding that the restrictive covenants on the property are enforceable and run with the land, and that the bankruptcy Sale Order did not eliminate restrictive covenants. The Nebraska Supreme Court affirmed the trial court's decision on December 5, 2008. Both of those decisions are final and not appealable. Second, as discussed above, the Nebraska State courts had jurisdiction to interpret whether the bankruptcy court's Sale Order eliminated the restrictive covenants. Third, the state court litigation involved the same parties because Mid-City is in privity with Liberty. In the Eighth Circuit, "[p]rivity denotes mutual or successive relationship to the same right of property."[21] A privy is "a person so identified in interest with another that he represents the same legal right."[22] Mid-City's interest in this lawsuit derives from its security interest in Liberty's property. If Mid-City forecloses that interest, which it has announced it intends to do, it would be a direct successor to Liberty's interests in the property. Thus, Mid-City is in privity with Liberty for the purpose of applying the doctrine of res judicata to the state court judgments at issue in this case.[23] Fourth, the central issue the Appellants sought to litigate in the bankruptcy court was the same as they litigated in the state court action—i.e., whether the Sale Order eliminated the implied restrictive covenants requiring the operation of a golf course on part of Liberty's land. Fifth, the Appellants—directly or through privity—had a full and fair opportunity to litigate those issues before the state courts. At least, no allegation to the contrary has been made. Therefore, the judgments entered by the Nebraska trial court and the Nebraska Supreme Court are entitled to preclusive effect under the doctrine of res judicata. Reopening the bankruptcy case to re-litigate the issues decided in those judgments *838 would have been futile. Thus, the bankruptcy court properly exercised its discretion in refusing to reopen the Debtor's bankruptcy case. IV. CONCLUSION For the reasons stated above, the bankruptcy court's order denying the Appellants' motion to reopen the case is affirmed. NOTES [1] The Honorable Timothy J. Mahoney, United States Bankruptcy Judge for the District of Nebraska. [2] In re Pennino, 299 B.R. 536, 538 (8th Cir. BAP 2003). [3] First Nat'l Bank of Olathe, Kansas v. Pontow (In re Pontow), 111 F.3d 604, 609 (8th Cir. 1997). [4] Gourley v. Usery (In re Usery), 242 B.R. 450, 457 (8th Cir. BAP 1999). [5] 11 U.S.C. § 350(b) (West 2010). [6] In re Apex Oil Co., Inc., 406 F.3d 538, 542 (8th Cir.2005). [7] See In re Borer, 73 B.R. 29, 31 (Bankr. N.D.Ohio 1987) [8] In re Apex Oil Co., Inc., 406 F.3d at 543 (quotations omitted). [9] Id. at 542. [10] In re Borer, 73 B.R. at 31. [11] 28 U.S.C. 157. [12] Section § 1334(c) governs abstention; it is not a grant of jurisdiction. [13] In re Eveleth Mines, L.L.C., 318 B.R. 682, 687 (8th Cir. BAP 2004) (citations omitted). [14] Id. at 690-92 (holding that state court had jurisdiction to interpret "free and clear" language in sale order as it applied to state taxes and directing bankruptcy court to abstain in favor of state court). See also, In re Middlesex Power Equip. & Marine, Inc., 292 F.3d 61, 66 (1st Cir.2002) (finding that state court had concurrent jurisdiction to interpret "free and clear" language in sale order as it applied to state taxes and abstaining in favor of state court). [15] Gulf Offshore Co. v. Mobil Oil Corp., 453 U.S. 473, 477, 101 S. Ct. 2870, 2875, 69 L. Ed. 2d 784 (1981). [16] We may affirm the bankruptcy court's order on any basis supported by the record, even if that ground was not considered by the trial court. Power Equip. Co. v. Case Credit Corp. (In re Power Equip. Co.), 309 B.R. 552, 559 (8th Cir. BAP 2004). [17] See In re Carberry, 186 B.R. 401, 402 (Bankr.E.D.Va.1995). [18] See Rutherford v. Kessel, 560 F.3d 874, 877 (8th Cir.2009). [19] Id. [20] See Nevada v. United States, 463 U.S. 110, 129-30, 103 S. Ct. 2906, 77 L. Ed. 2d 509 (1983) [21] In re Marlar, 267 F.3d 749 (8th Cir.2001) [22] Id. [23] At the Court's request, the parties briefed the issue of whether the Rooker-Feldman doctrine should be applied in this case. Quite clearly, that doctrine applies to the Broekemeiers and Liberty. However, in contrast to the doctrine of res judicata, the Rooker-Feldman doctrine does not apply to those in privity with the original litigants. Whatever the impact of privity principles on preclusion rules, Rooker-Feldman is not simply preclusion by another name. The doctrine applies only in "limited circumstances," Exxon Mobil, supra, at 291, 125 S. Ct. 1517, where a party in effect seeks to take an appeal of an unfavorable state-court decision to a lower federal court. The Rooker-Feldman doctrine does not bar actions by nonparties to the earlier state-court judgment simply because, for purposes of preclusion law, they could be considered in privity with a party to the judgment. Lance v. Dennis, 546 U.S. 459, 466, 126 S. Ct. 1198, 1202, 163 L. Ed. 2d 1059 (2006). Mid-City's participation in the lawsuit contemplated in the Appellants' motion to reopen thus precludes the application of the Rooker-Feldman doctrine. We decline to address the issue of laches for the same reason. Evidence of collusion might dictate a different conclusion, but we have no evidence of collusion here.

2023-08-23 14:18:01.139124+00

Houser

HOUSER, Commissioner. This is a second appeal of the conviction of Peter Festus Bridges of the crime of murder in the first degree. On the first appeal this Court affirmed the judgment of guilt and sentence to life imprisonment. State v. Bridges, Mo.Sup., 349 S.W.2d 214. Defendant not having been represented by counsel on the first appeal, this Court on May 8, 1972 set aside its judgment of af-firmance in accordance with Bosler v. *545Swenson, 8 Cir., 363 F.2d 154, reinstated the cause on the docket of this Court, ordered the circuit court to appoint counsel and directed counsel to file a brief in this Court. On this second appeal appellant’s counsel has filed a brief raising three points. First, appellant asserts error in overruling his objection to the admission of his confessions on the basis that they were involuntary as a matter of law, in that they were obtained after appellant was subjected to intense, repeated interrogation by multiple groups of police officers for a period of over twenty hours while being held incommunicado without food or aid of counsel and while suffering from complete mental hysteria. This issue was thoroughly litigated on the first appeal and decided adversely to appellant in an exhaustive review of the evidence and law. State v. Bridges, supra, 349 S.W.2d l.c. 216-219 [2, 3 and 4], Appellant’s present suggestions throw no new light upon the question. On reconsideration we reach the same conclusions arrived at on the first appeal, for the same reasons. In this connection see Evans v. State, Mo.Sup., 465 S.W.2d 500, 502, and cases cited Keynote 2; State v. Tettamble, Mo.Sup., 450 S.W.2d 191, 192 [1]. It may be taken as established in this case that the statements and confessions of appellant were not involuntary as a matter of law. Appellant’s brief further suggests that the court’s findings with respect to the voluntariness of appellant’s confession were not unmistakably clear under the rulings in Jackson v. Denno, 378 U.S. 368, 84 S.Ct. 1774, 12 L.Ed.2d 908, 1 A.L.R.3d 1205, and Sims v. Georgia, 385 U.S. 538, 87 S.Ct. 639, 17 L.Ed.2d 593, and that at the very least the case should be remanded for the entry of clear findings with respect to the voluntariness of appellant’s confession after an evidentiary interlocutory hearing. This suggestion was meritorious. The transcript of the record shows that the court did not with unmistakable clarity find the confessions to be voluntary. Accordingly, after this appeal was submitted and on November 8, 1972 this Court ordered the trial court to conduct a hearing and make an express finding on the question. That hearing was conducted on January 19, 1973. Testimony was heard and on the basis of all the evidence, both that introduced during the course of the trial on May 4 and 5, 1960 and at the interlocutory hearing of January 19, 1973, the circuit court found that all statements, admissions and confessions, both oral and written, introduced in evidence at the original trial “were voluntarily given and made by the defendant, and were not obtained by means of force, threats, duress, coercion, or any other illegal means.” This interlocutory finding, however, is not conclusive on the question whether the confessions were voluntary. The ultimate decision was for the jury, under proper instructions. Appellant’s principal point is that this question was not properly submitted to the jury; that the court erred in giving Instruction No. 7 on the question of voluntariness of the confessions, as follows : “The Court instructs the jury that any oral or written statement made by the defendant, even though it should contain matters that prove his guilt, is admissible in evidence against the defendant and is to be given such probative value as evidence as you believe it deserves, if you find it was voluntarily given. And in this regard, the Court instructs you that by the term ‘voluntary’ the Court means not secured by duress, that is, by striking or beating the defendant or by threats of physical harm to him, or by promise of immunity to him by anyone competent to grant such immunity. However, the Court instructs you that to make a confession voluntary in nature it is not necessary to show that such confession or statement be spontaneous, that it is made without either persuasion or questioning, but in this connection you *546are further instructed that the facts and circumstances under which the confession was made should be considered, and if you find and believe from all the evidence that the confession was not a voluntary one then you are free to disregard it.” Appellant contends that No. 7 completely ignored the issue of psychological or mental duress or coercion; that throughout the trial appellant contended that the effect of the intense interrogation and deprivation of food and drink, emotionally and psychologically, was to coerce him into making a false confession against his will; that the issue of psychological coercion was the only issue relating to voluntariness of the confession. Except for one brief, isolated reference,1 there is no evidence that any of the twelve officers touched appellant at any time; no evidence in this 769-page transcript that appellant was beaten, struck, threatened with physical harm, or promised immunity, in order to induce or extort a confession. On the contrary, all evidence relating to voluntariness of the confessions, from both sides of the case, bore upon the existence (or nonexistence) of psychological or mental coercion. In addition to the recital of the facts in the original opinion bearing on the subject of mental coercion, State v. Bridges, supra, 349 S.W.2d l.c. 218-219, the transcript of the original trial reveals that during the first hours of interrogation appellant was not informed as to the reason for his arrest but was told only that he was “wanted” in Webster Groves; that at midnight he was placed in a cell without a mattress or blanket, with nothing but iron to sleep on; that from time to time during the interrogation he sobbed, yelled and “hollered”; that during the questioning numerous photographers entered the room and took pictures; that “bulbs were going off”; that appellant “couldn’t hold [his] emotions” and “broke down”; that he was “in a low state of mind,” weak, hungry and thirsty; that after seeing the pictures of his friends and thinking how nice they had been to him and how “inhumanly” they had been treated he “couldn’t stand it”; that he just cried and hollered and made up a story — made up all the details and asked them to “let him alone.” After the confession, when food and drink were given appellant, he ate fifteen sandwiches and drank four or five cups of coffee. Pointing to the absence of evidence of striking, beating, threats of physical harm, or promise of immunity to defendant (the only elements of duress submitted for the jury’s consideration in the definition of “voluntary”) appellant argues that in cautioning in the third paragraph of No. 7 that persuasion and questioning do not make a confession involuntary the court was instructing that the jurors were to disregard any psychological coercion which occurred; that No. 7 contains a positive and highly prejudicial misstatement of the law, since the only issue which could or should have been submitted to the jury was whether mental duress sufficient to render his confession involuntary was practiced on appellant. Appellant’s contentions in this respect are irrefutable under previous decisions of this Court. In State v. Williams, Mo.Sup. en Banc, 369 S.W.2d 408, the identical situation was presented. There was no evidence and no contention that Williams’ confession was produced by threats, physical abuse, hope of lenience or reward. The only evidence bearing on the issue of voluntariness related to continuous and extended interrogation over a long period of time without allowing Williams to sleep, rest or have proper food and drink. Instruction No. 7 in that case failed to include the issue of mental duress in the definition of voluntarily, and submitted only the elements of threats, physical abuse and statements offering hope of lenience or re*547ward. Because the real issue in the case (mental duress and coercion) was not presented to the jury the instruction was held “clearly erroneous” and the conviction was reversed on this ground. The Williams case was followed in State v. Goacher, Mo.Sup., 376 S.W.2d 97, in which throughout the case the defendant pressed the issue that the confession was induced by mental coercion and duress, but in which Instruction No. 7 defined “voluntarily” in terms of not holding out any hope of reward or leniency or fear of punishment, without mentioning coercion, duress, intimidation, mental pressure or any equivalent term. Citing Williams this Court reversed the conviction for error in giving Instruction No. 7, pointing out that if certain elements were to be singled out the instruction “should certainly have mentioned specifically the element of coercion or duress which was the real issue,” adding that the omission to hypothesize the basic factual issue was not cured by adding the generality that the jury had the right to consider all of the surrounding circumstances in determining voluntariness. See also State v. Deyo, Mo.Sup., 358 S.W.2d 816. The State does not meet this issue on the merits. The State takes the position that this allegation of error was not properly preserved for review since no objection was made to the giving of No. 7; no instruction on the subject was offered by appellant; the point was not made in the motion for new trial, and that No. 7 should not be reviewed under the plain error rule.2 While this Court will not consider any matter relating to instructions as “plain error” unless the court has so misdirected or failed to instruct the jury on the law of the case as to cause manifest injustice, State v. Auger, 434 S.W.2d 1, 4 [1] (Mo.1968), and trial errors involving instructions are not to be raised collaterally unless the error is so glaring as to make the trial unfair, Tucker v. State, 481 S.W. 2d 10, 14 [4] (Mo. 1972), the conclusion is compelled that manifest injustice and an unfair trial resulted from the giving of Instruction No. 7. The State’s case stood or fell on the issue of voluntariness of the confession, for there was little in the way of circumstantial evidence independent of the confessions to connect appellant with this crime. Therefore it was of critical importance to the administration of justice that the jury be clearly and properly instructed on the meaning of the word “voluntary”; that the jurors be accurately informed and directed as to the proper elements they could and should take into consideration in determining whether the confessions were voluntarily given. The plain error in this case consists in instructing that “voluntary” means absence of duress, and then defining duress as striking, beating, threatening physical harm or promising immunity, when none of these factors was shown in evidence. The error was compounded by failing to define voluntariness in terms of psychological and mental coercion, which was the soul, body and substance of the evidence on this issue. Misdirecting the jury by including irrelevant elements and omitting relevant elements in defining the term “voluntary” constituted plain error affecting substantial rights of the accused, resulting in manifest injustice and denial of his right to a fair trial. Furthermore, not only did No. 7 submit extraneous and improper criteria for the jury’s consideration and omit elements vital and essential to the determination, but also in paragraph three it went further and effectively negated the possibility of the jury finding involuntariness on the basis of psychological or mental coercion. In paragraph three the court instructed the jury that to make a confession voluntary it is not necessary to show that it is made with*548out persuasion or questioning. The court thereby justified some persuasion and questioning. On the basis of paragraph three the jury may have concluded that the amount of persuasion and questioning employed in this case, and the deprivation of food and drink resulting in appellant’s admittedly marked emotional reactions, were within permissible limits. No. 7 should have prescribed the limits beyond which persuasion and interrogation may not go, but no standard or measuring stick was given the jury by which they could determine whether permissible limits were exceeded in this case. As stated in State v. Goacher, supra, 376 S.W.2d l.c. 105, “We are hesitant to reverse a case for error in an instruction after a long, arduous, and conscientiously conducted trial, but we cannot disregard so recent a mandate of our Court on an issue which we deem to be indistinguishable.” This reluctance is accentuated by the fact that the error in No. 7 was not brought to light on the first appeal but has lain dormant for many years during which the judgment of conviction has been officially considered final. The saving grace afforded by paragraph (c) of Rule 27.20, however, is not limited by the passage of time. Manifest injustice must be corrected, “better late than never.” For error in giving Instruction No. 7 the judgment is reversed and the cause is remanded for a new trial. STOCKARD, C., concurs. PER CURIAM: The foregoing opinion by HOUSER, C, is adopted as the opinion of the court. MORGAN, P. J., and HENLEY, J., concur. DONNELLY, J., concurs in separate concurring opinion filed. . That just prior to the time he confessed an officer “was gripping [his] shoulder blade at [his] neck.” Transcript, p. 710. . Supreme Court Rule 27.20(c) : “Plain errors affecting substantial rights may be considered on motion for new trial or on appeal, in the discretion of the court, though not raised in the trial court or preserved for review, or defectively raised or preserved, when the court deems that manifest injustice or miscarriage of justice has resulted therefrom.”

2023-08-23 14:18:01.143731+00

Donnelly

DONNELLY, Judge (concurring). I concur in the principal opinion but desire to direct attention to relatively recent expressions by the United States Supreme Court on procedures for determining vol-untariness of confessions: (1) In Lego v. Twomey, 404 U.S. 477, 489, 490, 92 S.Ct. 619, 627, 30 L.Ed.2d 618 (1972), the Court said: “We also reject petitioner’s final contention that, even though the trial judge ruled on his coercion claim, he was entitled to have the jury decide the claim anew. To the extent this argument asserts that the judge’s determination was insufficiently reliable, it is no more persuasive than petitioner’s other contentions. To the extent the position assumes that a jury is better suited than a judge to determine voluntariness, it questions the basic assumptions of Jackson v. Denno; it also ignores that Jackson neither raised any question about the constitutional validity of the so-called orthodox rule for judging the admissibility of confessions nor even suggested that the Constitution requires submission of voluntariness claims to a jury as well as a judge. Finally, Duncan v. Louisiana, 391 U.S. 145, 194, 88 S.Ct. 1444, 20 L.Ed.2d 491 [522] (1968), which made the Sixth Amendment right to trial by jury applicable to the States, did not purport to change the normal rule that the admissibility of evidence is a question for the court rather than the jury. Nor did that decision require that both judge and jury pass upon the admissibility of evidence when constitutional grounds are asserted for excluding it. We are not disposed to impose as a constitutional requirement a procedure, we have found wanting merely to afford petitioner a second forum for litigating his claim.” (2) In Swenson v. Stidham, 409 U.S. 224, 230, 93 S.Ct. 359, 363, 34 L.Ed.2d 431 (1972), the Court agreed with our conclusion that “the Jackson v. Denno error, if any, was sufficiently remedied.” However, the Court then said: “This, of course, does not end the matter. A state prisoner is free to resort to federal habeas corpus with the claim that, contrary to a state court’s judgment, his confession was involuntary and inadmissi*549ble as a matter of law. Neither the District Court nor the Court of Appeals reached this issue. We are asked to decide the question here but it is not our function to deal with this issue in the first instance. “The judgment of the Court of Appeals for the Eighth Circuit is reversed and the cause is remanded for further proceedings consistent with this opinion.” It would seem accurate to say that, at least since 1966 (State v. Washington, 399 S.W.2d 109 (Mo.1966) ; Stidham v. Swenson, 443 F.2d 1327 (8th Cir. 1971), we have followed the Massachusetts practice in determining the voluntariness of confessions. It was described in Commonwealth v. Marshall, 338 Mass. 460, 155 N.E.2d 798, 800 (1959), as follows: “That practice has been referred to in Commonwealth v. Lee, 324 Mass. 714, 720, 88 N.E.2d 713, as a ‘humane practice,’ giving the defendant two chances: first before the presiding judge who may decide to exclude the statements; and then before the jury who may disregard them. If the judge excludes them, the particular testimony is never heard by the jury; if the judge determines that they are competent, the jury may nevertheless disregard them.” In view of the holdings in Lego v. Twomey and Swenson v. Stidham, supra, I believe we should, if and when the question is presented to us on appeal, review the practice of submitting to the jury the issue of voluntariness of a confession. (See Missouri cases cited in Jackson v. Denno, 378 U.S. 368, at 397 and 415, 84 S.Ct. 1774, 12 L.Ed.2d 908) I do not take an irreversible position on the question at this time. However, now that an accused is assured that the voluntariness of his confession will be determined by state judges (State v. Stidham, 449 S.W.2d 634 (Mo. 1970)), and then by federal judges (Swen-son v. Stidham, supra), I doubt that he needs the protection of a jury determination.

2013-10-30 06:35:56.105325+00

Clifford

704 A.2d 417 (1998) 1998 ME 18 MAINE GRAVEL SERVICES, INC. v. Eleanor HAINING, et al. Supreme Judicial Court of Maine. Submitted On Briefs October 23, 1997. Decided January 23, 1998. David A. King, Bath, for plaintiff. David R. Weiss, Stinson, Lupton, Weiss & Gabree, P.A., Bath, for defendants. Before WATHEN, C.J., and ROBERTS, CLIFFORD, RUDMAN, DANA and LIPEZ, JJ. CLIFFORD, Justice. [¶ 1] Maine Gravel Services, Inc. appeals from a declaratory judgment entered in the Superior Court (Cumberland, Saufley, J.) declaring defendants Philip and Eleanor Haining,[1] and Paul and Patricia Sullivan, to be the *418 owners of real estate located in Brunswick. Maine Gravel contends that the Superior Court erred in finding that defendants carried their burden of proving adverse possession. We discern no error and affirm the judgment. [¶ 2] This case involves competing claims to an unimproved ten-acre woodlot located in Brunswick, identified as lot 3A. The lot is bisected by a brook. Pursuant to 14 M.R.S.A. § 5951-5963 (1980) Maine Gravel brought a complaint seeking a declaratory judgment that it is the owner of lot 3A and to establish its boundary lines. The defendants, the Hainings and the Sullivans, filed a counterclaim seeking a declaration that they are the record owners of lot 3A by virtue of recorded deeds, or, in the alternative, that they have established title by adverse possession. The court found record title to be in Maine Gravel,[2] but concluded that the defendants had proven the elements of adverse possession, and accordingly, declared title to lot 3A to be in the defendants. The court based its conclusion on the use of the land by the Haining family consistent with ownership from 1945 forward.[3] Maine Gravel appeals from that judgment. [¶ 3] Possession sufficient to establish title by adverse possession must be "actual, open, notorious, hostile, under claim of right, continuous, and exclusive for a period of at least twenty years." Cates v. Smith, 636 A.2d 986, 988 (Me.1994) (quoting Emerson v. Maine Rural Missions Ass'n, 560 A.2d 1 (Me.1989)). "Whether specific possessory acts are sufficient to establish title through adverse possession can only be resolved in light of the nature of the land, the uses to which it can be put, its surroundings, and various other circumstances." Emerson, 560 A.2d at 2 (citing McMullen v. Dowley, 418 A.2d 1147, 1154 (Me.1980)). To establish their claim of adverse possession the claimants must show that their use and enjoyment of the property has been the same "in kind and degree as the use and enjoyment to be expected of the average owner of such property." Howe v. Natale, 451 A.2d 1198, 1200 (Me.1982). A trial court's determination of adverse possession will be upheld if supported by credible evidence in the record. Id. [¶ 4] The court found that the defendants "demonstrated a consistent use of the land under their claim of title for 20 years,"[4] and that the Haining family treated the lot as its own since 1945. That use has included cutting wood for cedar posts, bridging the stream to allow foot and horse traffic, clearing out a small picnic area, placement of a log cabin on the lot by one of the defendants' children, and regular use of the property for such purposes as walking, hunting, fishing and recreation.[5] [¶ 5] There was also evidence that a person paid the Haining family to do substantial logging on lot 3A. Harry Crooker, father of the two principal owners of Maine Gravel, had sought permission from the Haining family *419 to go on the lot to remove beaver dams in the 1960's. Central Maine Power Company (CMP) sought an easement over lot 3A and Roland Haining, the father of Philip Haining, gave a quit claim deed to CMP in 1947. The real estate taxes have been paid by the Haining family since 1945. Large piles of the cord wood cut on the lot were visible by the neighbors, including Maine Gravel's predecessors-in-interest. [¶ 6] It is true, as Maine Gravel points out, that timber harvesting over the statutory period does not necessarily demonstrate adverse possession, See Webber v. McAvoy, 117 Me. 326, 329, 104 A. 513 (1918), Webber v. Barker Lumber Co., 121 Me. 259, 265, 116 A. 586 (1922). Such activity, however, may, in various circumstances, demonstrate sufficient activity consistent with an adverse claim to prove adverse possession. McMullen v. Dowley, 418 A.2d at 1152.[6] [¶ 7] The defendants contend that, consistent with reasonable forestry practices, their logging has been continuous over fifty years, and the court found that the use made of the property by the defendants was "in kind and degree the same as the use and enjoyment to be expected of the average owner of such property." Howe v. Natale, 451 A.2d at 1200. Moreover, defendants did far more than conduct the substantial timber harvests. They paid taxes on the lot, and demonstrated a "consistent" use of the land under their claim of title for over 20 years. See Stowell v. Swift, 576 A.2d 204, 205-206 (Me.1990).[7] [¶ 8] Evidence that for over forty years, from 1945 to 1986, four generations of Hainings used the property as if it were theirs, and paid the taxes on it, supports the court's finding that the use of the lot made by the defendants is sufficient to establish title by adverse possession. The entry is: Judgment affirmed. NOTES [1] Philip Haining has since died and Eleanor Haining, as personal representative of the Estate of Philip Haining, has been substituted as a party pursuant to M.R. Civ. P. 25(a). [2] The finding that Maine Gravel established itself to be the record title holder is not challenged by the defendants on appeal. [3] The Sullivans purchased a two-acre portion of the land by deed. They rely on the action of the Hainings to establish their claim of adverse possession. [4] In concluding that the defendants had established their adverse possession claim, the trial court did not make clear whether it was relying on 14 M.R.S.A. § 801 (1980) or the common law. The analysis of adverse possession is the same for either, however. Johnson v. Town of Dedham, 490 A.2d 1187, 1189 (Me.1985) ("[S]ection 801 is a twenty year statute drafted in terms of an absolute statute of limitations which we have interpreted to be subject to the general elements of adverse possession.") (emphasis added). The court concluded that the defendants failed to prove their claim to adverse possession pursuant to 14 M.R.S.A. § 816 (1980) (requiring the adverse claimant to have claimed under a recorded deed), because the deed on which they relied did not adequately describe lot 3A. [5] Maine Gravel also asserts that the 1986 entry upon the property of one of its principals, Theodore Crooker, terminates the period of defendants' adverse possession, and that evidence of use of the property by defendants subsequent to that date is irrelevant. We disagree. See Gonthier v. Horne, 576 A.2d 745, 748 (Me.1990) (claimant's acts after the statutory period "rationally could be considered indicative" of the nature of his prior holding during that period). [6] In McMullen we explained that, consistent with the precept that "each case must be separately considered on the basis of the particular circumstances presented," id. at 1152, the same degree of intermittent cutting in one location may be open and notorious, even if it would not be in a more remote location. [7] Cf. Great Northern Paper Co., Inc. v. Eldredge, 686 A.2d 1075, 1077 (Me.1996) (A claimant's use may be intermittent and need not be constant to be continuous for purposes of establishing a prescriptive easement "if it is consistent with the normal use that an owner of the property would make and is sufficiently open and notorious to give notice to the owner of the servient estate that the user is asserting an easement.").

2023-08-23 14:18:02.092998+00

Chattin

OPINION CHATTIN, Justice. On January 18, 1972, Veach was found guilty by a jury of driving an automobile upon a public highway while his driver’s license was revoked. The jury fixed his punishment at sixty days in jail. The facts are undisputed. Veach’s driver’s license was revoked on June 28, 1965, pursuant to T.C.A. Section 59-1204 of the Tennessee Financial Responsibility Act due to his involvement in an accident. He has been unable to regain his license by proof of financial responsibility or by obtaining liability insurance. On October 20, 1970, he was arrested for driving an automobile upon a public highway while his driver’s license was revoked. He was later indicted, tried and convicted with the resulting sentence as above stated. Veach has perfected an appeal to this Court. He insists it was error to convict him of driving a motor vehicle on a public highway while his driver’s license was revoked when the revocation was pursuant to an unconstitutional statutory scheme. In support of this assignment, he insists it was a prerequisite to a conviction under T.C.A. Section 59-716 that his driver’s license must have been legally cancelled, suspended or revoked prior to the time of the alleged crime He then argues that since his license was revoked pursuant to T.C.A. Section 59-1204 the revocation of his license was unconstitutional and void; and that, therefore, his conviction cannot stand. T.C.A. Section 59-1204 provides: “Security required following accident unless evidence of insurance — Suspension for failure to. deposit security. — The commissioner shall, within sixty (60) days after receipt of the report of a motor vehicle accident occurring in this state which has resulted in bodily injury, or death, or damage to the property of any one (1) person in excess of one hundred dollars ($100), revoke the license and all registrations of each operator and owner of a motor vehicle in any manner involved in such accident, and in case of a nonresident, the privilege of operating a motor vehicle within the state and of the use within this state of any motor vehicle owned by him, unless such operator, owner, or both shall deposit security in a sum which shall be sufficient, in the judgment of the commissioner, and in no event less than five hundred dollars ($500) to satisfy any judgment or judgments for damages resulting from such accident which may be recovered against such operator, owner or both, and unless such operator and owner shall give and maintain proof o.f financial responsibility; provided, notice of such revocation shall be sent by registered mail to the last known address of such operator and owner not less than ten (10) days prior to the effective date of such revocation and shall state the amount required as security and the requirement of giving proof of financial responsibility.” The Section does not provide for a hearing prior to a revocation of a driver’s license. The Georgia Financial Responsibility Act is identical in all major respects to the Tennessee Act in that neither Act provides for a hearing prior to a revocation. In Bell v. Burson, 402 U.S. 535, 91 S.Ct. 1586, 29 L.Ed.2d 90 (1971), a decision handed down eight months prior to Veach’s trial and conviction, the United States Supreme Court held the revocation of a person’s driver’s license and registra*83tion under the Georgia Financial Responsibility Act was a deprivation of due process under the Fourteenth Amendment to. the United States Constitution. The Court held due process requires that an individual’s license and registration be not suspended or revoked prior to a hearing for the determination of liability, if any, as a result of an accident. Specifically, the Court held: “* * * [B]efore the State may deprive petitioner of his driver’s license and vehicle registration it must provide a forum for the determination of the question whether there is a reasonable possibility of a judgment being rendered against him as a result of the accident.” Bell v. Burson, supra. The State contends we cannot reach the constitutionality of the statute without giving Bell vs. Burson, supra, retroactive effect. We disagree. The conviction of Veach occurred after the decision in Bell. Veach has shown the applicability of the statute and that he is thereby adversely affected, or about to be adversely affected by its operation. Persons adversely affected may question the validity of a law. Corlew v. State, 181 Tenn. 220, 180 S.W.2d 900 (1944) ; Brooks v. Briley, 274 F.Supp. 538, affirmed 88 S.Ct. 1671, 391 U.S. 361, 20 L.Ed.2d 647 (1967). In fairness to the trial judge, we should point out that the question of the constitutionality of the statute was not urged during the trial of the case nor in the motion for a new trial. It was raised in this Court for the first time. Generally, appellate courts review only questions presented for determination in the trial court. Supreme Court Rules, Rule 14(4) and (5) ; Kirby v. State, 214 Tenn. 296, 379 S.W.2d 780 (1964); Hester v. State, 2 Tenn.Cr.App. 11, 450 S.W.2d 609 (1969). However, generally a constitutional question may be raised at any time. Shaw v. Woodruff, et al., 156 Tenn. 529, 3 S.W. 2d 167 (1928). Also, the rule will be waived in cases involving the deprivation of life or liberty. Herron v. State, 3 Tenn.Cr.App. 39, 456 S.W.2d 873 (1970). Since Veach’s driver’s license was illegally and unconstitutionally revoked, his conviction must be reversed and dismissed.

2023-08-23 14:18:02.097231+00

ON PETITION TO REHEAR The State has filed a petition to rehear. There is filed as an exhibit to the petition an alleged regulation No. 2 relative to the Financial Responsibility Law, T.C.A. Section 59-1204, issued on June 9, 1971, by the Commissioner of Safety. Specifically, the petition requests this Court to clarify our original opinion by “determining whether T.C.A. Section 59-1204 and Regulation No. 2 as they presently stand and are applied are constitutionally permissible pursuant to the mandate of Bell v. Burson, 402 U.S. 535, 91 S.Ct. 1586, 29 L.Ed.2d 90 (1971).” This Court is not authorized to give an advisory opinion. De Saussure v. Hall, 201 Tenn. 164, 297 S.W.2d 90 (1956). The petition is denied. DYER, C. J., HUMPHREYS and Mc-CANLESS, JJ., and WILSON, Special Judge, concur.

2013-10-30 06:35:56.130828+00

Goodstein

994 F. Supp. 1012 (1998) POLAR MANUFACTURING CORP., Plaintiff, v. MICHAEL WEINIG, INC., Defendant. No. 97-C-538. United States District Court, E.D. Wisconsin. February 19, 1998. *1013 Sarah L. Rudolph, Wausau, WI, for Plaintiff. Donald R. Peterson, Milwaukee, WI, for Defendant. ORDER GOODSTEIN, United States Magistrate Judge. On March 21, 1997, the Polar Manufacturing Corporation commenced this action in the Langlade County, Wisconsin Circuit Court in which it seeks to rescind its contract to purchase saws from Michael Weinig Incorporated, alleging that the defendant breached its express and implied warranties. On May 6, 1997, pursuant to 28 U.S.C. § 1446, Weinig removed the case to the federal district court for the Eastern District of Wisconsin. The case was randomly assigned to this court and the parties consented to this court's full jurisdiction. See 28 U.S.C. § 636(c)(1). Currently pending is Weinig's motion to dismiss, transfer venue, or stay all further proceedings until arbitration is completed. I. BACKGROUND The following facts are undisputed for purposes of Weinig's motion. Polar is a Wisconsin corporation engaged in the manufacturing of lumber. (Second Amended Complaint at ¶ 1). Weinig is a North Carolina corporation with its principal place of business in Statesville, North Carolina (Jeffrey Davidson Aff. at ¶¶ 2, 4). On March 15, 1996, Polar contracted with Weinig at the Woodtechnology Clinic and Show in Portland, Oregon to purchase a Dimter saw for a cost of $126,000.00. (Davidson Aff. at ¶ 5, Ex. 1). On April 22, 1996, Polar contracted with Weinig by mail to purchase an additional saw for $119,500.00. (Jeff Maguire Aff. at ¶ 5; Davidson Aff. at ¶ 6, Ex. 8). Both the March 15 and April 22 contracts contain the following forum-selection clause: Any and all claims or causes of action which cannot be mutually settled and agreed to by the parties, shall and must be brought or asserted by Purchaser only in the U.S. District Court for the Western District of North Carolina or the North Carolina General Court of Justice, Superior Court Division, in Charlotte, North Carolina, and Purchaser hereby expressly agrees, consents and stipulates to the exercise of personal jurisdiction over it and subject matter jurisdiction over any such controversy with respect to such claims or actions being only with such courts ... If for any reason this stipulation covering both jurisdiction and venue shall be determined by a competent court of law to be invalid or unenforceable, then the parties hereby agree, consent and stipulate that all such claims or causes of action shall be submitted to and resolved by arbitration with the American Arbitration Association in Charlotte, North Carolina. (Davidson Aff., Exs. 1 & 2, ¶ 13). The March 15 and April 22 contracts also contain the following choice of law clause: *1014 These Terms and Conditions and any claim or controversy arising out of same, the Products or to any other documents pertaining to the Products shall in all respects be governed by the laws of the state of North Carolina, U.S.A., exactly as if all of the parties were all commercial entities located within said jurisdiction and that all of the Terms and Conditions relate entirely to the sale of the Products and the performance of services solely within that jurisdiction. (Davidson Aff., Exs. 1 & 2, ¶ 12). Curtis Klement, Polar's president, states that the parties did not negotiate either sale and that Weinig set the terms for both sales, with minor exceptions unrelated to the forum-selection clause. (Klement Aff. at ¶¶ 4, 5). Jeff Maguire, Weinig's regional sales manager who was responsible for Weinig's transactions with Polar, states that Klement reviewed the first contract before he signed it and did not ask to modify any terms in the contract. (Maguire Aff. at ¶ 4). Maguire also states that Klement did not request changes to any terms contained in the second contract. (Maguire Aff. at ¶ 5). Weinig states that five of the seven witnesses it believes must be present in court to defend its interests are North Carolina residents. (Davidson Aff. at ¶ 10). Polar states that 20 of its 21 witnesses hail from Wisconsin and the lone exception is a resident of nearby Rockford, Illinois. (Klement Aff. at ¶ 6). II. ANALYSIS Weinig presents three alternative theories to support its motion: 1) pursuant to Fed. R.Civ.P. 12(b)(2) and/or (3), Weinig seeks to dismiss for lack of personal jurisdiction and/or improper venue based on the forum-selection clause; or 2) pursuant to 28 U.S.C. § 1404(a), Weinig seeks to transfer this action to the Western District of North Carolina based on the convenience of the parties; or 3) Weinig seeks the court to stay all proceedings until the contractually stipulated arbitration is complete. A. Validity As an initial matter, the parties dispute whether the forum-selection clause is valid. The plaintiff argues that because the clause was not freely negotiated and because Polar did not have an equal bargaining position with Weinig, the clause is not valid. Weinig, on the other hand, contends that simply because the clause was not individually negotiated does not render it invalid and that Polar must be held accountable to the contract it signed, whether or not Polar representatives read the contract. Although not raised by the parties, it is not clear whether federal common law, Wisconsin law, or North Carolina law governs the validity issue. The circuit courts are split whether a forum-selection clause's validity is substantive and therefore subject to the law of the state in which the federal district court sits or procedural and therefore subject to federal common law, see Northwestern Nat'l. Ins. Co. v. Donovan, 916 F.2d 372, 374 (7th Cir.1990) (citing cases), with the Seventh Circuit having yet to directly address the issue. See id. at 374 (issue of validity is probably matter of federal law). Notwithstanding the circuit split, the contracts in dispute state that any claim arising from the terms and conditions of the contracts shall "in all respects be governed by the laws of the state of North Carolina, U.S.A., exactly as if all of the parties were all commercial entities located within [North Carolina]." (Davidson Aff., Exs. 1 & 2, ¶ 12). Despite the parties' agreement indicating that North Carolina law governs all disputes arising out of the contract, both parties rely upon federal common law for their respective arguments. In Northwestern, the parties disputed a forum-selection clause's validity and relied upon federal common law to resolve the issue. Thus, because the litigants are permitted to designate what law shall control a contract's validity, the court applied federal common law. See Northwestern, 916 F.2d at 374; cf Roberts & Schaefer v. Merit Contracting, Inc., 99 F.3d 248, 251 (7th Cir.1996) (holding that Illinois law determines validity of forum-selection clause where contract specifies Illinois law as controlling and where parties agree that Illinois law is controlling). Here, as in Northwestern, the parties cite and rely upon federal common law in arguing the validity issue, despite the contracts' clauses that state North Carolina law shall *1015 control the contracts' terms. Because the parties may determine what law shall control this issue, and the parties have apparently waived their right to rely upon North Carolina law, the court will apply federal common law to determine the forum-selection clauses' validity. See generally Luce v. Edelstein, 802 F.2d 49, 57 n. 4 (2d Cir.1986) (court ignored choice of law clause when not raised by the parties), LFC Lessors, Inc. v. Pacific Sewer Maintenance Corp., 739 F.2d 4, 6-7 (1st Cir.1984) (same). As mentioned above, the plaintiff contends that the forum-selection clause is invalid because it was not freely negotiated and because applying the forum-selection clause to the instant case would be unfair as most events surrounding the transaction occurred in Wisconsin. The court notes that the plaintiff's argument regarding fairness is more properly addressed once the court determines whether the forum-selection clause is valid. The question of validity is separate from the question of enforceability, and Polar's argument that enforcing the forum-selection clause will be unfair because most events surrounding the dispute occurred in Wisconsin is an issue more appropriate for addressing if the court considers whether the clause should be enforced. Proceeding to the forum-selection clause itself, the court finds that it is valid. "Like any contract provision, a forum-selection clause will be enforced unless enforcement would be unreasonable or unjust or the provision was procured by fraud or overreaching." Paper Express, Ltd. v. Pfankuch Maschinen, 972 F.2d 753, 757 (7th Cir.1992). Polar states that Weinig prepared the contracts, which included the forum-selection clause, without negotiating the terms with Polar representatives. Thus, Polar asserts that a standard contract containing "boilerplate" language cannot be considered "freely negotiated." In Northwestern, a similar issue was presented to the Seventh Circuit, where the defendant sought to invalidate a forum-selection clause because it was "buried in the fine print" and not "freely negotiated." The court rejected the defendant's position, noting that "`mere inequality of bargaining power does not of itself make every term of the contract unconscionable. The questions are rather whether the parties had a reasonable opportunity to read and understand the term, and whether the term itself is unreasonable or oppressive.'" Northwestern, 916 F.2d at 377 (quoting Bastian v. Wausau Homes, Inc., 635 F. Supp. 201, 203-04 (N.D.Ill.1986)). Thus, after observing that the forum-selection clause was legible and not any more inconspicuous than other clauses in the contract, the court held that the forum-selection clause was valid. See id. In the instant case, similar circumstances lead this court to conclude that the forum-selection clause is valid. For one, the entire contract is contained on one page. Second, the forum-selection clause is printed in small, but legible, writing and the size of print is consistent with other terms of the contract, none of which the plaintiff seeks to invalidate based on their legibility. Moreover, the forum-selection clause is not buried in the middle of a paragraph but is provided a separate section clearly entitled "Choice of Forum, Venue and Consent to Jurisdiction." Polar presents no evidence that Weinig took advantage of any vulnerabilities unique to Polar. Curtis Klement, Polar's representative who signed the contract, did not ask to modify the contract and he did not request Weinig representatives to clarify any portions of the contract. See (Jeff Maguire Aff. at ¶ 4). To paraphrase the Northwestern court, if Polar makes a habit of signing contracts without reading them, they must bear the consequences. See Northwestern, 916 F.2d at 378; see also, Paper Exp., Ltd. v. Pfankuch, 972 F.2d 753, 757 (7th Cir.1992) (citing 3 Arthur L. Corbin, Corbin on Contracts 607 (1989)); 13 Samuel Williston, Williston on Contracts 1577 (1988) (noting fundamental principle of contract law is that a person who signs a contract is presumed to know its terms and consents to be bound by them). The plaintiff, citing Van's Supply & Equipment, Inc. v. Echo, Inc., 711 F. Supp. 497 (W.D.Wis.1989), contends that because it did not have equal bargaining power with the defendant, the forum-selection clause is not valid. However, the plaintiff does not present facts to support its assertion that it did not have equal bargaining power. Although *1016 the plaintiff states that it is a closely-held corporation and the defendant is a wholly owned subsidiary of a large multinational German corporation, this fact alone does not establish that the parties did not have equal bargaining power. Presumably, the market for this type of saw is competitive and Polar was not obligated to purchase saws from Weinig. Considering that Polar and Weinig conducted business at a trade show, Polar could have sought out Weinig's competitors by simply exploring the trade show further. Moreover, although Polar is a closely held corporation, it is still a presumably sophisticated business that should be familiar with contract negotiations. In Van's, by contrast, a case brought under the Wisconsin Fair Dealership Law, the court did not enforce a forum-selection clause because the Fair Dealership law presumes that the dealer has an inferior bargaining position and because Wisconsin has a strong interest in enforcing the Fair Dealership Law, which provides that forum-selection clauses may not circumvent the Law's remedial goals. Van's, 711 F.Supp. at 503. No law relevant to the instant case presumes that the plaintiff did not have equal bargaining power, and Wisconsin does not have a strong interest in regulating the parties' standard contract dispute. The court therefore concludes that the forum-selection clause is valid. B. Enforceability Having determined that the forum-selection clause is valid, the court must now address whether the clause should be enforced. Weinig seeks to enforce the clause by: 1) dismissing the case for lack of personal jurisdiction pursuant to Fed. R. Civ. P 12(b)(2); 2) dismissing the case for improper venue pursuant to Rule 12(b)(3); or 3) transferring this case to the Western District of North Carolina pursuant to 28 U.S.C. § 1404(a). The parties disagree regarding the appropriate standard for determining whether the forum-selection should be enforced. Weinig contends that, under M.S. Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 92 S. Ct. 1907, 32 L. Ed. 2d 513 (1972), and Heller Financial, Inc. v. Midwhey Powder Co. Inc., 883 F.2d 1286 (7th Cir.1989), the forum selection clause is presumptively valid and the plaintiff must show that a trial in North Carolina will be so gravely difficult and inconvenient that Polar will for all practical purposes be denied its day in court. See Heller, 883 F.2d at 1291 (quoting Bremen, 407 U.S. at 18). Polar argues that, because Weinig's motion to dismiss is in effect a motion to transfer venue, Stewart Organization, Inc. v. Ricoh Corporation, 487 U.S. 22, 108 S. Ct. 2239, 101 L. Ed. 2d 22 (1988), governs this case and the forum-selection clause is just one of various factors that the court must consider under 28 U.S.C. § 1404(a), which allows district courts to transfer a case to another district for the convenience of parties and witnesses and in the interests of justice. In Bremen, an American corporation, Zapata, contracted with Unterweser, a German corporation, to tow Zapata's oil drilling rig from Louisiana to Italy. The contract contained a provision that any litigation arising from the agreement would be litigated in England. When the rig was damaged in the Gulf of Mexico, Zapata brought suit in admiralty in the United States District Court for the Middle District of Florida. Invoking the forum-selection clause, Unterweser moved to dismiss based on lack of personal jurisdiction or forum non conveniens. The district court denied Unterweser's motion to dismiss, which was affirmed by the court of appeals. The Supreme Court vacated the court of appeals' affirmance and remanded, directing the district court to give additional weight to the forum-selection clause. Bremen, 407 U.S. at 8. The Court reversed the historical view that forum selection clauses are disfavored and held that such clauses are prima facie valid and should be enforced unless enforcement is shown to be unreasonable under the circumstances. Id., 407 U.S. at 10. Although Bremen was an admiralty case, subsequent courts have applied its favored application of forum-selection clauses to cases in which federal courts sit in diversity jurisdiction. See Stewart, 487 U.S. at 33 (Kennedy, J., concurring); Heller, 883 F.2d at 1291. In Stewart, an Alabama corporation contracted with a New Jersey corporation. The contract specified that any lawsuit arising under the agreement would be brought in *1017 New York. However, the Alabama corporation commenced an action for breach of contract in the District Court for the Northern District of Alabama. Thereupon, relying on the forum-selection clause, the New Jersey corporation moved either to transfer the case to the Southern District of New York pursuant to 28 U.S.C. § 1404(a) or to dismiss for improper venue under 28 U.S.C. § 1406. The district court, relying on Alabama law, denied the motion, citing the fact that Alabama law did not look favorably upon forum-selection clauses. See Stewart, 487 U.S. at 24. The court of appeals reversed, concluding that a question of venue in diversity actions is a matter of federal law and that the forum-selection clause was enforceable under federal law. See id. at 25. The Supreme Court affirmed, but modified the court of appeals' analysis, which was based upon Bremen. The Court held that federal law, specifically 28 U.S.C. § 1404, governs the parties' venue dispute and that under § 1404, the presence of a forum-selection clause is a significant factor for courts to weigh when considering a motion to transfer venue; however, courts must also consider convenience, fairness and the interests of justice as required by § 1404(a). Id. at 28-29. The Court stated: "The forum-selection clause, which represents the parties' agreement as to the most proper forum, should receive neither dispositive consideration (as respondent might have it) nor no consideration (as Alabama law might have it), but rather the consideration for which Congress provided in § 1404(a)." Id. at 31. The Seventh Circuit has also decided cases where forum-selection clauses were at issue. In Heller, the plaintiff, an Illinois corporation, commenced a breach of contract action in the district court for the Northern District of Illinois. The defendants, all Wisconsin corporations, moved to dismiss for lack of personal jurisdiction or to transfer venue, which the district court denied. On appeal, the Seventh Circuit affirmed the district court's order refusing to dismiss or transfer the case. The court noted that a forum-selection clause contained in the contract at issue purported to vest exclusive jurisdiction and venue over all disputes in Illinois. The court, citing Bremen, held that the forum-selection clause should control unless there is a strong showing that it should be set aside. Heller, 883 F.2d at 1290-1291. "Thus, absent a showing that trial in the `contractual forum will be so gravely difficult and inconvenient that [the party challenging the clause] will for all practical purposes be deprived of his day in court ... there is no basis for concluding that it would be unfair, unjust, or unreasonable to hold that party to his bargain.'" Id. at 1291 (quoting Bremen, 407 U.S. at 18). Based on the forum-selection clause, according to the Seventh Circuit, the district court did not abuse its discretion when it found that the defendants consented to jurisdiction in Illinois. The court of appeals also analyzed the defendants' motion to transfer venue and, citing Stewart, noted that despite a forum-selection clause, courts could still transfer venue under § 1404(a) because "only one of § 1404(a)'s factors — convenience of the parties — is within the parties' power to waive." Id. at 1293. "In other words, a valid forum-selection clause may waive a party's right to assert his own inconvenience as a reason to transfer a case, but district courts still must consider whether the `interest[s] of justice' or the `convenience of witnesses' require transferring a case." Id. at 1293. Nevertheless, the court affirmed the district court's refusal to transfer. See id. at 1294. Heller demonstrates that a court must bifurcate its analysis when considering a motion to dismiss or transfer venue based on a forum-selection clause — the motion to dismiss should be considered by applying the standard set in Bremen and the motion to transfer should be considered by applying the standard set in Stewart. See also Northwestern Nat'l Ins. Co. v. Frumin, 739 F. Supp. 1307, 1310-1311 (E.D.Wis.1990) (bifurcating analysis for enforcing forum selection clause pursuant to motion to dismiss and motion to transfer venue). Thus, a bifurcated analysis requires the court to consider: 1) whether it retains personal jurisdiction and whether venue is proper in light of the forum-selection clause; and 2) if it does retain personal jurisdiction and if venue is proper, whether it should nevertheless transfer the case due to the forum-selection clause, in addition to the interests of justice and the convenience of witnesses. *1018 At the outset, the court notes that the defendant does not contend that its contacts with Wisconsin are insufficient to confer jurisdiction upon this court. Indeed, the defendant availed itself of this state's laws when it conducted business with the plaintiff, a Wisconsin corporation. Rather, the defendant contends that the forum-selection clause acts to withdraw personal jurisdiction which is otherwise proper. As indicated above, because the court is analyzing the forum-selection clause in light of a motion to dismiss, Bremen provides the proper standard for determining whether the clause may be enforced with respect to the defendant's motion to dismiss for lack of personal jurisdiction and/or improper venue. Forum-selection clauses should be enforced absent a "strong showing" that the clause should be set aside. Heller, 883 F.2d at 1290 (citing Bremen, 407 U.S. at 15). "Thus, absent a showing that trial `in the contractual forum will be so gravely difficult and inconvenient that [the party challenging the clause] will for all practical purposes be deprived of his day in court,'" the parties will be held to their bargain as contained in the forum-selection clause. Id. at 1291 (quoting Bremen, 407 U.S. at 18) (alteration in original). Polar contends that to enforce the forum-selection clause and require it to appear in North Carolina would be unfair, unreasonable and unjust because Polar did not have any contacts with Weinig in North Carolina, other than several telephone calls directed to Weinig's North Carolina facility. However, the plaintiff's retrospective rationale for not enforcing the forum-selection clause does not address the relevant prospective consideration — whether requiring Polar to appear in North Carolina will effectively deprive Polar of its day in court. Moreover, Polar essentially argues that its contacts with North Carolina are not sufficient to subject it to personal jurisdiction in North Carolina. However, Polar waived its right to contest personal jurisdiction in North Carolina when it signed the contract containing the forum-selection clause. See Heller, 883 F.2d at 1290 (personal jurisdiction may be conferred by express or implied consent). Next, Polar states that most witnesses to this action are located in Wisconsin and Illinois. In fact, Polar contends that if this case proceeds to trial, Polar anticipates that nine of its employees will be required to testify — three managers and six saw operators — and that their absence will require Polar to lay off 70 percent of its workforce. However, the convenience of witnesses issue is a wash. Whether Polar is required to attend a trial in North Carolina or Weinig is required to attend a trial in Wisconsin, one party is inconvenienced. Moreover, as the defendant asserts, if this case is maintained in the Eastern District of Wisconsin, any trial will be held in Milwaukee. Thus, Polar's employees, who work in Polar, Wisconsin, nearly 200 miles from Milwaukee, will have to miss work whether the trial is in Wisconsin or North Carolina. Finally, Polar does not explain why, if requiring the witnesses to appear at trial is such an inconvenience, such witnesses could not offer depositions or videotaped testimony in lieu of live testimony. To conclude, Polar does not establish that court proceedings in North Carolina will be so gravely difficult and inconvenient that, for practical purposes, it will be deprived of its day in court. Indeed, Polar acknowledges that this action could have been brought in Wisconsin or North Carolina. Given that the contract between Polar and Weinig establishes that any legal proceedings be conducted in North Carolina, and given that Polar provides no basis from which it may be relieved of its contractual agreement, this court finds that it lacks personal jurisdiction over the parties. See Andrews v. Heinold Commodities, Inc., 771 F.2d 184, 187 (7th Cir. 1985) (forum-selection clause establishing Illinois as forum state functions to deprive Indiana federal district court of personal jurisdiction because personal jurisdiction may be waived by parties). Whether venue is proper in the Eastern District of Wisconsin is therefore moot. See id. at 188. Because the court finds that it lacks personal jurisdiction over the parties, the court need not address the defendant's motion with respect to its request to transfer this case or stay the case pending arbitration. *1019 However, rather than dismissing this case, which would require that Polar refile its claim in North Carolina and perhaps subject Polar to an applicable statute of limitations, the court finds that the interests of justice and judicial economy justify transferring the case to the federal district court for the Western District of North Carolina pursuant to 28 U.S.C. § 1406(a). See Sinclair v. Kleindienst, 711 F.2d 291, 294 (D.C.Cir.1983) (holding that the procedural obstacles which may be removed by a transfer pursuant to § 1406(a) include the lack of personal jurisdiction). IT IS THEREFORE ORDERED that Defendant Michael Weinig Incorporated's motion to dismiss and/or motion to transfer is granted. Pursuant to 28 U.S.C. § 1406(a), the Clerk of Court is directed to transfer this case to the federal court for the Western District of North Carolina.

2013-10-30 06:35:56.142084+00

Harris

491 S.W.2d 46 (1973) Dannie Devoid PICKARD, Appellant, v. Sharon Stone STEWART, Appellee. No. 5-6162. Supreme Court of Arkansas. February 26, 1973. Atchley, Russell, Hutchinson & Waldrop, by Victor Hlavinka, Texarkana, Tex, for appellant. Lynn Cooksey and Charles G. Hall, by Charles G. Hall, Texarkana, Tex., for appellee. HARRIS, Chief Justice. Sharon Stone Stewart, appellee herein, instituted proceedings against Dannie DeVoid Pickard for damages allegedly sustained in an automobile accident on October 5, 1968. Appellant admitted liability but the cause was tried before a jury to determine the only remaining question—the proper amount of damages. A verdict was returned assessing damages at $6,000, and from the judgment so entered, appellant brings this appeal. For reversal, two points are asserted, it first being contended that the trial court erred in allowing into evidence statements by Dr. George M. Hilliard that he made his examination at the *47 request of, and was paid by, a liability insurance carrier. Dr. Hilliard's discovery deposition had been taken at the instance of counsel for appellant, but the deposition was offered at the trial by appellee. Ark.Stat.Ann. § 28-348(f) (Repl.1962) provides that the introduction into evidence of the deposition or any part thereof for any purpose other than that of contradicting or impeaching the deponent makes the deponent the witness of the party introducing the deposition. Appellant objected to two portions of the deposition being read, and moved to strike such portions, but the motion was denied by the court. Dr. Hilliard had been asked the occasion for his having seen Mrs. Stewart in 1968. The portion sought to be excluded then provides: "Q. Back in 1968? A. I was asked by Mr. Billy Stone of the Gulf Insurance Company to examine her with regard to possible spine injuries she may have received in an automobile accident in October of '68." Subsequently, another portion included in the objection was read as follows: "Q. Do you know who Mr. Billy Stone works for? A. Yes, sir. I believe he said he works for the—he's an agent for the Gulf Insurance Company in Tyler, Texas. Q. Okay. And did Gulf Insurance pay your bill for that first visit? A. Yes. On December 12th, 1968." The objections were made on the basis of the contention that these answers unnecessarily injected the existence of insurance in the case, and, says appellant, were prejudicial, entitling him to a reversal of the judgment. We have held in numerous instances that unnecessarily bringing to the attention of a jury that insurance is involved is reversible error. Strahan v. Webb, 231 Ark. 426, 330 S.W.2d 291; Pekin Stave & Manufacturing Co. v. Ramey, 104 Ark. 1, 147 S.W. 83. We have also said that the injection of insurance coverage is not proper unless it is "relevant and pertinent to some issue in the case". Industrial Farm Home Gas Co. v. McDonald, 234 Ark. 744, 355 S.W.2d 174. The trial court, in overruling the objection, relied on Murray v. Jackson, 180 Ark. 1144, 24 S.W.2d 960, where a physician, testifying on behalf of the defendant, was asked on cross-examination for whom he made the examination, the witness replying that he did not remember, but believed it was for an insurance company; further that the Southern Insurance Company asked him to make a report on the case. The defendant contended that the question was asked solely for the purpose of showing an insurance company was defending the case, and that the question and answer constituted prejudicial error. Commenting that the cross-examination under the circumstances was permissible, we said: ". . . . . The testimony of the physician introduced by the defendant tended to contradict the testimony of the physician introduced by Mrs. Jackson as to the character and extent of her injuries and as to the necessity of expending the money that was expended for her for hospital bills and attendance by nurses and a physician. The cross-examination was proper for the purpose of impeaching or contradicting the witness. The jury might have found that the employment of the physician made him biased in favor of the defendant, or at least tended to show the interest of the witness in the case." The facts of that case are not here applicable for reasons subsequently pointed out. Appellee also asserts that the instant case should be decided on the basis of our decision in Lin Manufacturing Co. of Arkansas v. Courson, 246 Ark. 5, 436 S.W.2d 472, but we do not agree. There, the appellee *48 was asked on cross-examination at whose instance he went to see a Dr. Reed and he responded "Well, because the insurance company or someone—". In holding that error had not been committed, we stated that the question itself was apparently asked in sincerity; that, under the circumstances, there was a valid reason for asking it, and when a question is asked in good faith rather than in a deliberate attempt to prejudice the jury, an admonition by the court is ordinarily sufficient to correct the error. That situation is not present in the case now before us. In the first place, here, the evidence was offered by the plaintiff, appellee herein. In the next place, it does not appear relevant nor pertinent to any issue in the case that had arisen. Certainly, it was not an answer given "accidentally"; to the contrary it was deliberately offered, and not for the purpose of impeachment. In other words, we agree that the answers unnecessarily injected the existence of insurance in the case. Counsel for appellee contends that if deemed improper, counsel for appellant could have moved that the court admonish the jury not to consider the evidence under discussion; that in fact, the court offered to so admonish the jury, but counsel for appellant declined to have this done. However, as heretofore pointed out, we have held that an admonition is ordinarily sufficient to correct the error where the reference to insurance occurs in good faith. Here, the objection to the testimony was offered before the deposition was ever read, and it is, of course, apparent that the evidence was intentionally introduced. The second point for reversal relates to the answer of Tommy Stewart, the husband of appellee, to a question propounded to him on cross-examination by counsel for appellant. The witness was asked about money he paid for repair of his car and he replied, "Well, that was the money that I got from your company", and appellant says that this, too, unnecessarily injected the question of insurance into the case. We cannot pass on this contention since the record does not reflect that any objection was made, and, for that matter, it is not likely to recur at another trial. Because of the error discussed in point one, the judgment is reversed and the cause remanded. It is so ordered.

2013-10-30 06:35:56.150875+00

Albert

431 B.R. 855 (2010) In re TRIGEM AMERICA CORPORATION, Debtor(s). Keith F. Cooper, Plaintiff(s), v. Centar Investments (Asia) Ltd, CQS Convertible & Qualitative Strategies Master Fund, Credit Suisse (Hong Kong) Limited, Credit Suisse International, Credit Suisse Securities (Europe) Limited, Stark Asia Master Fund Ltd, Defendant(s). Bankruptcy No. 8:05-BK-13972-TA. Adversary No. 8:07-AP-01140-TA. United States Bankruptcy Court, C.D. California. June 8, 2010. *857 Christopher T. Williams, Douglas C. Emhoff, Jennifer Levin, Venable LLP, Los Angeles, CA, for Plaintiff. Aluyah I. Imoisili, Delilah Vinzon, Fred Neufeld, Jerry L. Marks, Milbank Tweed Hadley & McCloy LLP, Los Angeles, CA, for Defendants. STATEMENT OF DECISION ON MOTIONS FOR SUMMARY JUDGMENT THEODOR C. ALBERT, Bankruptcy Judge. The trustee's and defendants' cross motions for summary judgment were heard April 8, 2010. After oral argument the Court took the motions under submission. This case requires an analysis of the elements of fraudulent conveyance as may be affected by the "earmarking doctrine" as *858 well as by the statutory safe harbor for swap agreements found at 11 U.S.C. § 546(g). As may be relevant to this decision, the facts are not substantially in dispute. The following is a very condensed summary of the facts. 1. Facts TriGem Computer, Inc. ("TGI") was a Korean computer manufacturer and publicly-traded company on the Korean Stock Exchange ("KSE"). TriGem America Corporation ("TGA"), a wholly owned subsidiary of TGI, was established as a California Corporation in 1991. TGA acted as the distributor in North America of TGI's computers. On April 13, 2004, TGI issued zero-coupon convertible bonds ("Original Bonds") to the defendants, certain investors represented by defendants Credit Suisse International, Credit Suisse (Hong Kong) Ltd. and their affiliates (collectively "bondholders"). The Original Bonds matured and were due April 14, 2008. The Original Bonds also had a "put" provision such that prior to maturity at the option of the holders the bonds could be presented to TGI for redemption at ascending percentages of par on scheduled dates; 104.5% of par was available on the scheduled redemption date of April 14, 2005. In early 2005, TGI's business was falling off steeply and its business relationships with major customers, such as Hewlett Packard and Gateway, were rapidly deteriorating. On March 11, 2005, TGI was warned by the KSE that its stock would be placed under special supervision (in Korean gwarijongmok) due to a precipitous decline in TGI's capital ratio; however the KSE gave TGI until March 31, 2005, to increase its capital ratio so as to avoid gwarijongmok. Facing plummeting stock values and the prospect of impending exercise of the "put" from the Bondholders, which would have severely exacerbated TGI's dwindling cash position if the bonds were redeemed, TGI asked the Bondholders represented by defendant Credit Suisse International to convert their Original Bonds to mandatory convertible bonds without a put option. TGI's stated plan was to sell the TGI stock within two to three months thereafter, at a hopefully recovering price after gwarijongmok was avoided. There is much dispute over whether there was any realistic prospect at that point of TGI stock retaining any value, much less gaining value. Moreover, the bondholders demanded a substantial portion of the price in cash as "security" in case sufficient prices were not achieved on the stock after the conversion. As it happened, trading in TGI stock was suspended shortly after these transactions. This plan was memorialized in "Confirmation Agreements," which were designated as "swap agreements" on International Swaps and Derivatives Association confirmation forms. These "swaps" were documented at a total price of $23.8 million. There is also considerable dispute whether these were really "swaps," or were instead disguised guarantees because of their allegedly one-sided nature, since it seems in retrospect that the ultimate holder of the TGI common stock had comparatively little chance of doing better than the holder of the cash position at the end of March, 2005. Because of concern over potential delays of as much as thirty days in working with the Bank of Korea (which apparently regulated fund transfers to foreign entities from TGI), and considering the strict March 31 deadline and the "put" coming due April 14, TGI orchestrated the transfer of funds to the Bondholders through TGA, which would be subject to different regulations and was not dependent on the Bank of Korea. TGA, acting by its recently *859 appointed CEO Brian Yoon[1], agreed to enter into the Confirmation Agreements with the bondholders March 24, 2005. Immediately after receiving $15.6 million by wire from TGI to TGA's account, and after TGA borrowed $2 million from Comprehensive Computer Services, Inc. ("CCS")[2] arranged by TGI (this transaction was essentially a delayed payment owed by CCS to TGI as TGI could not immediately pay the full $17.6 million amount), and using another $250,000 of TGA's own cash, TGA transferred the aggregate of $17.85 million called for in the Confirmation Agreements to the Bondholders on March 24, 2005, as instructed by TGI. This is the transfer that the Trustee now attacks as a fraudulent conveyance ("challenged transfer"). Per the Confirmation Agreements, and after receipt of this "Initial Exchange," the Bondholders amended the bonds on March 25, 2005. TGA was instructed by TGI to mark the receipt of the $15.6 million as payment on account of an $88 million inter-company receivable owed by TGI to TGA. The CCS borrowing was repaid to TGA by TGI on April 26, 2005, and likewise TGA recorded this as collection of part of its "due from parent" account receivable. TGA had no immediate expectation of receiving the funds but for the transaction with the Bondholders.[3] After the Initial Exchange, the Bondholders made requests to TGA and TGI for the additional payments (the difference between $17.9 million and $23.8 million); however the bondholders did not receive any additional payments from either company as TGI's and TGA's financial positions collapsed. On May 18, 2005, TGI filed a bankruptcy/receivership proceeding in Korea and on June 3, 2005, TGA filed its Chapter 11 bankruptcy petition in California. Upon TGI filing its receivership proceedings, the Bondholders could no longer sell the remainder of TGI stock on the public market at any price. Additionally, it was TGI's bankruptcy in Korea that caused TGA to file its own bankruptcy petition in California. 2. Standards for Summary Judgment FED. R. Bankr.P. 7056 makes Fed. R. Civ. P. 56 applicable in bankruptcy proceedings. Rule 56(c) provides that, after adequate time for discovery and upon motion, the trial judge shall grant summary judgment if there is no genuine issue as to any material fact and if the moving party is entitled to judgment as a matter of law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). A party seeking summary judgment bears the initial responsibility of demonstrating the absence of a genuine issue of material fact and establishing that it is entitled to judgment as a matter of law as to those matters upon which it has the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 2552, 91 L. Ed. 2d 265 (1986). Rule 56(e) requires that the non-moving party who opposes the motion go beyond the pleadings and make an affirmative showing through depositions, responses to interrogatories and admissions, that specific facts reveal a genuine issue for trial does exist. Id. at 324, 106 S. Ct. 2548. Whether a genuine issue of material fact exists turns *860 on whether there is a need for a trial and whether the evidence is such that a reasonable jury could return a verdict for the non-moving party. Anderson, 477 U.S. at 250, 106 S. Ct. 2505. The judge need not make any findings of fact, but must view the evidence presented in a light most favorable to the non-moving party. Id. If reasonable minds could differ on the inferences that may be drawn from the factual evidence presented, summary judgment is not appropriate and should be denied. Adickes v. S.H. Kress & Co., 398 U.S. 144, 90 S. Ct. 1598, 26 L. Ed. 2d 142 (1970). 3. The Earmarking Doctrine The parties raise numerous arguments concerning such issues as whether reasonably equivalent value was received for the challenged transfer, whether the debtor was insolvent or rendered insolvent by reason of the transfer, whether the challenged transfer was part of a scheme and thus made with actual intent to hinder, delay and defraud creditors, or whether, conversely, the transfer was within the statutory safe harbor for swap agreements found at § 546(g), and the like. After careful consideration, the Court has determined that the bulk of this case comes down to a single, pivotal issue. Was it actually an "interest of the debtor in property" that was transferred within the meaning of § 548(a)(1), or related law, such that the trustee has the power to now avoid that transfer for benefit of creditors? Just as a chain breaks at its weakest link, here the Court concludes that the Trustee's weakest link is that the challenged transfer (except for the sum of $250,000) was actually not of the debtor's property as determined in case law, and therefore the creditors of this estate never had any reasonable expectation of being able to resort to these assets as part of their recovery. Stated differently, the funds down-streamed from TGI were effectively "earmarked" by the parent, and so the debtor was, as to those sums, effectively merely a conduit of TGI's transaction. The creditors of TGA therefore have no equitable basis now to recover these for pro rata distribution. In reaching this conclusion, however, the Court analyzes several of the Trustee's arguments which, although appealing and very well presented, are not in the end persuasive. First, the Court has no doubt that these transactions were part of a carefully crafted scheme to evade regulatory authority in Korea. The Court was tempted to simply disregard entirely the earmarking defense under the ancient precept that one seeking the protection of equity must come to court with clean hands. It might be said that these parties to the challenged transfers were just a bit too clever and so should garner little sympathy in their belated appeals to equity. But in the end the evidence was inconclusive that the challenged transfers were actually illegal under any law, including Korea's. Moreover, the pivotal issue for the Court was that there was little about this convoluted transaction which actually affected the preexisting, legitimate interests of debtor's creditors, and so the Court resolves that it could not determine that defendants came to court with unclean hands. But the Trustee raises several other important arguments, each of which is analyzed below. A. Property of the Debtor and The Pay-down of the Inter-Company Receivable Among the strongest arguments of the Trustee is that the $15.6 million of the challenged transfer, and perhaps the $2 million CCS borrowing as well, should indeed be regarded as the debtor's property for the simple reason that the parties actually *861 documented it as such by recording this as a pay down of the $88 million owed to TGA by TGI. Ironically, had TGA and TGI not added this notation to TGA's books, this would have been a rather obvious case against the Trustee. But shouldn't the parties' own camouflage now work against them? But the Court must also decide whether this bookkeeping notation makes any real difference, or similarly, whether because the funds were for a short time actually deposited into the debtor's account upon which Mr. Yoon clearly had the power (if not the inclination) to write a check or wire for any other purpose, this should matter. Based on a careful reading of the case law, however, the Court concludes that it does not matter. This is so because in virtually all of the earmarking cases it could be said that the debtor had the actual power to ignore the earmarking scheme. But the theoretical power to divert the funds elsewhere is apparently not the test; it is just not that simplistic under established case law. Where there is an agreement to observe the earmarking and the funds come into the debtor's possession on the express condition that the earmarked amounts fund a specific transfer, this is sufficient to invoke the earmarking doctrine. Adams v. Anderson (In re Superior Stamp & Coin Co., Inc.), 223 F.3d 1004, 1010 (9th Cir.2000). This is contrasted with situations where funds are lent but it is the debtor, not the lender, who designates who will be paid. See, e.g., Hansen v. MacDonald Meat Co. (In re Kemp Pac. Fisheries), 16 F.3d 313, 316-17 (9th Cir. 1994); In re Smith, 966 F.2d 1527, 1533 n. 9 (7th Cir.1992) cert. dismissed, 506 U.S. 1030, 113 S. Ct. 683, 121 L. Ed. 2d 604 (1992); McCuskey v. Nat'l Bank of Waterloo (In re Bohlen Enterprises, Ltd.), 859 F.2d 561, 566-67 (8th Cir.1988). But the Trustee argues that no written agreement exists between TGI and TGA regarding how the funds down-streamed from TGI were to be used. But this argument ignores the reality not only of this case but of most earmarking cases and is not determinative. An oral instruction will suffice. Ragsdale v. Bank South, N.A. (In re Whiteacre Sunbelt, Inc.), 206 B.R. 1010, 1019-20 (Bankr.N.D.Ga.1997). Even a mere "understanding" rather than a formal agreement may suffice. Coral Petroleum, Inc. v. Banque Paribas-London, 797 F.2d 1351, 1359 (5th Cir.1986). The Trustee does not even contest that there was a "common understanding" that TGI would provide the money for TGA to use to fund the challenged transfers in accord with TGI's instructions. See "Keith F. Cooper's Separate Statement of Uncontroverted Facts ..." ¶¶ 70-80; Bondholders' "Separate Statement of Uncontroverted Facts ..." ¶¶ 69-80 with citations to Lee and Yoon depositions. The record is fairly clear that TGA and Brian Yoon were acting under instructions from TGI to utilize the wired funds from TGI for the sole purpose of funding the transactions contemplated in the Confirmation Agreements; indeed, the Trustee himself goes to some considerable length to emphasize that Mr. Yoon and TGA were completely controlled by the parent, TGI, and would clearly not have received the $15.6 million or the $2 million from CCS arranged by TGI unless TGA agreed to follow instructions. See "Keith F. Cooper's Separate Statement of Genuine Items in Dispute..." ¶¶ 47-50; 60. So there is no room left for any argument that there was not an "agreement" regarding distribution of the challenged transfers. The case authorities make clear that the obvious or incriminating evidence of a "smoking gun" written agreement is not required for earmarking to apply. Considering the context in which these issues often arise, such a requirement would be unrealistic. *862 It is also necessary to evaluate the Trustee's argument that the Court should regard the transfer as indeed involving debtor's property because even the parties themselves designated these transactions as pay downs by TGI on the intercompany receivable. Thus, the argument goes, by making these accounting entries the cash wired by TGI became nothing more than payment of an account and, consequently, clearly the debtor's money. While there is much to be said for this argument (and while it is always satisfying to see too-clever actors hoisted upon their own petard) in the end the Court is not persuaded. In correctly evaluating earmarking cases, particularly in a fraudulent conveyance context (see below), it is necessary to look at the transactions as a whole. The Trustee points to excerpts from Mr. Yoon's deposition where he apparently testified that he believed the receivable from the parent TGI might be paid sometime in 2005; this makes it sound like the intercompany receivable was a solid asset and by the TGI wire it was simply partly liquidated into cash. See "Keith F. Cooper's Separate Statement of Genuine Items in Dispute" ¶¶ 77-79. Whatever might have been Mr. Yoon's subjective belief, the facts strongly suggest otherwise. In its Consolidated Financial Statement dated December 31, 2004, TGA reported a "due from parent" receivable of $88,223,598 but a $291,659,000 payable to the parent TGI for goods sold. Declaration of Delilah Vinzon, Exhibit "3" at pages 00333 and 00335. In other words, by a three to one margin, TGA was a net inter-company debtor. Given the desperate financial condition of both entities in the first quarter of 2005, TGI's starved cash position and considering that within about 60 days of the challenged transfers both entities were in bankruptcy proceedings, it is very hard to see the intercompany receivable as really debtor's "asset" or the cash wire as "proceeds" within the meaning of the earmarking doctrine. True, the accounting entry was used as a pretext or a camouflage. But the Court is persuaded that the defendants' "but for" analysis is the correct one (See, e.g., In re Barefoot Cottages Development Co., LLC, 2009 WL 2842735 *3 (Bankr.N.D.Fla. Jul.28, 2009)), particularly when evaluating transfer of earmarked funds in a fraudulent conveyance context (see below). There is no question that "but for": (i) the pressure to improve its capital ratio from the KSE and the impending March 31 deadline; (ii) the impending exercise of the "put" from the bondholders; and (iii) the resulting decision by TGI to use its subsidiary TGA as a conduit to timely (if temporarily) cure its capital ratio problem, this "due from parent" receivable would clearly never have been paid in whole or in part. As further support for this approach, and as discussed at greater length below, for similar reasons there was no net diminishment of the estate by reason of this transfer because, had the attempt to fix TGI's capital ratio not occurred, TGA's ability to recover anything more from its insolvent parent on account of an intact receivable, particularly in view of its position as the net debtor, could only have been minimal at most.[4] Evaluated as a whole, the Trustee's evidence is that both entities were clearly insolvent not only as of the date of the challenged transfers but for months before. *863 Moreover, the Court should disregard the camouflage labels placed on the transactions by the parties in favor of standing back and looking at the entire substance of what happened. See, e.g., Nordberg v. Sanchez (In re Chase & Sanborn Corp.), 813 F.2d 1177, 1180-82 (11th Cir.1987) [Court in evaluating earmarking overrules finding that deposit account not denominated in debtor's name meant that debtor's funds were not involved]. B. Does/should earmarking apply outside of preference cases in the Ninth Circuit? The Trustee argues that the earmarking doctrine should not apply at all outside of preference cases. He bases this argument solely on the lack of reported earmarking cases in the Ninth Circuit outside of a preference context. Of course, there are several fraudulent transfer cases from outside of this circuit where the earmarking doctrine as a defense has been carefully discussed and embraced. See, e.g., In re Chase & Sanborn Corp., 813 F.2d at 1180-82; In re A.W. Lawrence & Co., 346 B.R. 51, 56-57 (Bankr.N.D.N.Y.2006); In re Cambridge Capital Group, Inc., 2009 WL 3823185 (Bankr.D.Dist.Col. Nov. 16, 2009). There is always a first case on every issue, and so the lack of a reported fraudulent conveyance earmarking case to date in the Ninth Circuit cannot by itself be considered determinative. However, the earmarking doctrine as an appropriate defense in both § 547 and § 548 cases was discussed by the Ninth Circuit in an unauthorized post-petition transfer case under § 549. Indeed, the Ninth Circuit in Aalfs v. Wirum (In re Straightline Invs.), 525 F.3d 870, 877-78 (9th Cir.2008) even cited to Chase & Sanborn for the principle underlying the earmarking doctrine, i.e. that for any avoidance action to lie there should be a diminution of property of the estate and, conversely, where there is no diminution there should be no avoidance. The Straightline court could simply have proclaimed that earmarking does not apply outside of preference cases, but it conspicuously did not. While the Straightline court declined to expressly decide the issue of whether earmarking also applies in § 549 cases, its open discussion of the underlying precept, i.e. diminishment of property of the estate as a prerequisite to all avoidance cases, is instructive. The Straightline court ultimately determined that the defendant did not as a factual matter meet the elements of the earmarking test in any event. To bolster his argument that earmarking should only apply in preference cases, the Trustee cites Straightline and similar Ninth Circuit cases which have, in discussing earmarking, included a list of elements of the defense: [T]he earmarking doctrine applies `when a third party lends money to a debtor for the specific purpose of paying a selected creditor.' In re Superior Stamp & Coin Co., 223 F.3d at 1008 (quoting Hansen v. MacDonald Meat Co. (In re Kemp Pac. Fisheries), 16 F.3d 313, 316 (9th Cir.1994)).[T]he earmarking doctrine requires: "(1) the existence of an agreement between the new lender and the debtor that the new funds will be used to pay a specified antecedent debt; (2) performance of that agreement according to its terms; (3) the transaction viewed as a whole ... does not result in any diminution of the estate." Id. quoting In re Bohlen Enterprises, Ltd., 859 F.2d at 566 Straightline, 525 F.3d at 881-82 The Trustee argues that "new lender" and "lends money to a debtor for the specific purpose of paying a selected creditor" *864 and "antecedent debt" only make sense in the context of a preference since a fraudulent conveyance typically does not involve borrowed money or a lender, or even necessarily payment to a creditor; rather, it is usually a transfer of debtor's existing property either with actual intent to hinder, delay or defraud creditors, or under constructively fraudulent circumstances. But the Trustee reads too much into these lists as each arose in the context of a preference case and so there was no occasion to discuss the doctrine in other contexts. In the Court's view it is far more illuminating to consider the theoretical underpinnings of the earmarking doctrine. The earmarking doctrine is entirely a court-made interpretation of the statutory requirement that a voidable preference (or arguably a fraudulent conveyance) must involve a "transfer of an interest of the debtor in property." In re Bohlen Enterprises Ltd., 859 F.2d at 565. But "transfer of an interest of the debtor in property" is equally a statutory requirement of an action under § 548(a)(1) as it is for preferences. If creditors have no other right or expectation of resort to property which has been transferred to a debtor for an earmarked purpose, then why should it matter that the theory of avoidance of that property's transfer is in preference or fraudulent conveyance?[5] In both instances what matters is that in an earmark case there is no diminishment of the estate, and it is that diminishment of assets that would otherwise be available to pay creditors that is at the heart of all avoidance actions. In re Bullion Reserve of N. Am., 836 F.2d 1214, 1217 (9th Cir. 1988); In re Kemp Pac. Fisheries, supra, 16 F.3d at 316; In re Bohlen Enterprises, 859 F.2d at 567. Reduced to its essence, the earmarking defense merely holds for the unsurprising conclusion that where creditors would not otherwise have any reason or expectation to look to the assets transferred, there is no diminution of the net recovery on account of the earmarked funds and there can therefore be no avoidance. It is not so much an affirmative defense as it is a challenge to the trustee's claim that the particular funds are part of the bankruptcy estate. Metcalf v. Golden (In re Adbox, Inc.), 488 F.3d 836, 842 (9th Cir.2007). Here is where the defendants' "but for" analysis seems correct. But for this conduit transaction, the debtor would have never touched any part of the "due from parent" receivable, and given the woefully insolvent position of both debtor and parent in March 2005, and given that TGA was a net debtor in any event and entirely dominated by its parent as the Trustee concedes, no part of the receivable would ever have been paid or could have expected to be paid under any reasonable scenario. The Trustee may argue that the Court should not engage in "big picture" analysis, and merely focus on the trees and not the forest, i.e. the money was deposited into an account of the debtor and an intercompany receivable was debited so property of the debtor was transferred ... *865 end of story. Of a similar vein is the argument that earmarking only applies in preference actions. But to do this is, in the Court's view, to ignore not only the case law but, more importantly, the underlying logic and principles from which the earmarking doctrine evolved. The Court should look instead at the big picture and ask, if the debtor was only a conduit and its creditors would not otherwise have had any reasonable expectation of recovering this money, why should those creditors receive a windfall now? From the standpoint of debtor's creditors, in whose behalf the Trustee brings suit, there was no net diminution of expected recovery, which is and must be the touchstone of every avoidance action whether under §§ 547, 548 or 549. 4. The $250,000 But what of the money that both sides agree was property of the debtor and whose loss does diminish the recovery of the creditors? In defense to recovery of this portion defendants argue that either debtor was not insolvent as of March 25, 2005, that reasonably equivalent consideration was received or that in any event the transaction qualifies for a safe harbor under § 546(g). The Court analyzes these arguments in reverse order. A. The § 546(g) safe harbor Section 546(g) provides that a trustee may not recover a transfer made "in connection with any swap agreement... except under § 548(a)(1)(A) of this title." "Swap agreement" is a defined term under § 101(53B). This section was enacted by Congress to shield markets in ordinary swap arrangements as are created in securities exchanges from instability that might be threatened by unnecessary and inappropriate litigation by bankruptcy trustees seeking to reverse settled transactions. Kaiser Steel Corp. v. Charles Schwab & Co., (In re Kaiser Steel Corp.), 913 F.2d 846, 848 (10th Cir.1990). However, to avail of the safe harbor, the form of settlement payment must be "commonly used" within the industry. Enron Corp. v. Bear, Stearns Int'l Ltd. (In re Enron Corp.), 323 B.R. 857, 870 (Bankr.S.D.N.Y. 2005). Congress also had no intent to shield transactions illegal under local law under the cover of a "swap" label. See Enron Corp. v. Credit Suisse First Boston Int'l (In re Enron Corp.), 328 B.R. 58, 67 (Bank.S.D.N.Y.2005), citing Bear, Stearns Int'l, 323 B.R. at 876. In Bear Stearns the purported swap violated Oregon law which made transfers from an insolvent corporation to acquire its own shares illegal. Id. at 876. Therefore, such voidable transfers could not qualify as settlement payments of the kind that would qualify for § 546(g) protection. While not precisely on point, there is much about the transaction at bar that echoes the ruling in Bear Stearns. The Court cannot determine from the evidence presented that the down streaming of money by TGI to TGA, and use of TGA as a conduit to give the bondholders the "security" they wanted for amending the put agreement into mandatory convertible bonds, was necessarily illegal under Korean law. But it seems clear enough that it was structured this way to evade Korean regulatory authorities and to bypass strictures imposed by the Bank of Korea, and to disguise TGI's transaction to appear as one made by its wholly owned subsidiary, TGA. Apparently, Korean law requires equality of treatment among shareholders and giving the bondholders (who TGI needed to become shareholders without a put agreement to improve its capital ratio) a guaranteed stock price would have been viewed by Korean authorities as an improper guaranty by TGI to a portion of its shareholder body and thus void. Moreover, had TGI tried to enter into the confirmation *866 Agreements without involving TGA, this likely would also have required Bank of Korea authorization and would likely not have been approved. See Y.S. Lee Report ¶¶ 37-54. Likewise, the Court does not buy for a moment the defendants' argument that this was just an ordinary swap agreement viewed from TGA's standpoint. First, everything was structured by TGI; Mr. Yoon, who signed for TGA, not only did not negotiate it on behalf of TGA, he had no prior experience with swap transactions. Yoon Deposition 222:8-11; 35:9-36; 41: 25-42:5; 218: 10-21; 222:16-19. Moreover, the deal was very one-sided. TGA did not stand to gain anything (apart maybe from a short extension on life by avoiding the parent's immediate gwarijonmok) and in fact was obligated to pay the difference between the stock sales (supplemented by the $17.85 million "collateral") and $27.251 million to the bondholders within a period of only two months. TGI's stock price would have had to increase KRW 2,530 to KRW 3,677 per share, over $30.94 million, a 45% increase in only two months for any profit to be enjoyed by TGA, an extremely unlikely scenario given the precipitous decline in TGI's fortunes in March-May, 2005. Ultimately, the actual sale of stock when combined with the $17.85 million collateral yielded only $25.75 million, saddling TGA with a liability of another $1.52 million to the bondholders. Trustee's Exhibit 19; Exhibit 14, Schaeffer Report at App. D and at ¶ 30; Exhibit 13, Elson Report at 52. The Court does not believe that either § 546(g) or any of the case law interpreting it can be read to say that the Court should second guess bad swap agreements made by debtors and re-weigh them with benefit of hindsight. Indeed, the purpose of § 546(g) is the opposite. However, as interpreted in Bear Stearns and similar authority, there is a requirement that settlement payments be of the kind ordinarily used within the securities industry. Almost everything about this transaction smells of an ad hoc attempt to evade the Korean authorities, which, combined with its manifestly one-sided structure and the fact that it was foisted upon TGA by TGI, brings it outside of the protection of the statute because it was not the same or similar to anything commonly used in the securities trade. Enron, 328 B.R. at 67, citing Bear, Stearns at 870. Nor is it any reasonable argument that the Court should merely accept the parties' designation of the transaction as a "swap agreement" because an International Swaps and Derivatives Association form was used; it is an ancient precept that equity will disregard labels and inquire into the substance of a transaction. Young v. Higbee Co., 324 U.S. 204, 209, 65 S. Ct. 594, 597, 89 L. Ed. 890 (1945); Schering-Plough Corp. v. United States, 651 F. Supp. 2d 219, 272 (D.N.J.2009) [swap agreement was in substance a loan]; 27A Am.Jur.2d "Equity" § 90. B. Solvency Nor can there be any reasonable argument that TGA was not insolvent as of March 25, 2005. Although the presumption of insolvency appearing at § 547(f) only applies in preference cases, and not in fraudulent conveyance actions, it must be perfectly obvious that TGA, only 60 days before bankruptcy, was indeed insolvent when the challenged transfer occurred. One starts from the fact that TGA was extremely, if not totally dependent upon TGI for its business, TGI filed a bankruptcy petition within 60 days of the challenged transfer and, having lost its HP and Gateway business entirely, TGI was clearly on the ropes weeks if not months earlier. TGA filed its petition only a few days after its parent. Then one considers that an inordinate percentage of TGA's balance *867 sheet was an $84 million note receivable from CCS; but since CCS had lost its TGA-referred HP warranty repair business and therefore had no prospects, its note was consequently of very doubtful collectability as its own officer plainly attests. Kimm Decl. ¶¶ 6-10. By simply readjusting the value of the CCS note from $84.1 million to zero on the TGA "adjusted balance sheet," defendants' own expert's valuation that assets exceeded liabilities by about $42 million must completely change. Instead, TGA was underwater by at least $40 million by reason of this one asset alone. Exhibit 53, Gordon Klein report at its exhibit 3. The Court reviewed Mr. Klein's opinion regarding valuations based upon recent audited and unaudited reports and the like, but since the authors of those reports now testify their reports would have been very different had they known the true facts [Exhibit 11, Kiho Choi Declaration ¶¶ 7-13], the Court is given very little comfort that Mr. Klein's report has any grounding in reality. Similarly, the discussion about "going concern" valuation methodology rings hollow to the Court since we now know with clarity that neither TGA nor CCS (whose note provided one of the few remaining assets on the TGA balance sheet) actually did much if any business after March 25 and before TGA filed its bankruptcy petition about two months later. In sum, the Trustee clearly carried his burden of proof on the insolvency issue and defendants fail to raise any cognizable case of solvency in rebuttal. C. Reasonably Equivalent Value The remaining issue is whether TGA received reasonably equivalent value in return for the challenged transfer. What did the debtor get for its $250,000? As described above, the possibility that the TGI stock could have enjoyed a steep turnaround of over 45% on TGI stock in only two months such that the debtor might have enjoyed an actual profit after remitting to the bondholders under the Confirmation Agreements seems, in retrospect, to be very far-fetched indeed. Moreover, under the Confirmation Agreements as dictated by TGI, any loss was to be reflected only upon TGA's books. Of course, this is exactly what happened as a loss of another $1.52 million as a liability was the end result. While there might be some analogy to gambling cases which hold that the price of a wager must be regarded as reasonably equivalent value [see, e.g., Allard v. Flamingo Hilton (In re Chomakos), 69 F.3d 769, 771 (6th Cir.1995)], this implies a voluntary decision to sit at the gaming table. But here TGA had little or no choice in the matter on these steep odds. Whatever remote prospects there might have been for a 45 + % rebound in the TGI stock were exchanged for $250,000 cash at a time when both TGA and TGI were starved for cash, and the exchange was not at the behest of TGA's own management, but by TGI's, and in retrospect it seems perfectly obvious that the transaction was structured entirely for TGI's benefit, not TGA's. But the defendants argue for an "indirect" benefit, i.e. that by avoiding TGI's gwarijonmok TGA, as a largely dependent subsidiary, lived to fight another day (actually, about 68 days). Indirect benefits can suffice as reasonably equivalent value if they are "fairly concrete and identifiable." Official Comm. of Unsecured Creditors of TOUSA v. Citicorp N. Am (In re TOUSA, Inc.), 422 B.R. 783, 846-50 (Bankr.S.D.Fla.2009) [subsidiaries who conveyed liens for borrowed funds used for debts for which they were not liable received little or no benefit in merely forestalling the parent's bankruptcy]; Greenspan v. Orrick, Herrington & Sutcliffe LLP et al. (In re Brobeck, Phleger & *868 Harrison, LLP), 408 B.R. 318, 341 (Bankr.N.D.Cal.2009) [insolvent law firm's waiver of profits in unfinished business in favor of individual partners did not result in sufficient indirect benefit]. Once the plaintiff makes a prima facie showing that no sufficient direct benefit was received in the transaction, it is the defendants' burden to prove sufficient indirect benefit that is tangible and concrete. In re Brobeck, 408 B.R. at 340; In re TOUSA, 422 B.R. at 844, citing Pummill v. Greensfelder, Hemker & Gale (In re Richards & Conover Steel Co.), 267 B.R. 602, 614 (8th Cir.BAP2001); see also Clark v. Security Pac. Business Credit, Inc. (In re Wes Dor, Inc.), 996 F.2d 237, 243 (10th Cir.1993); Leonard v. Mountainwest Fin. Corp. (In re Whaley), 229 B.R. 767, 775 (Bankr. D.Minn.1999). Moreover, the issue of "reasonably equivalent value" is determined from the perspective of the transferor's creditors and the court must analyze all the circumstances surrounding the transfer. In re Brobeck, 408 B.R. at 341-42. The bondholders do not carry their burden that any value was received for the challenged transfer, direct or indirect. There is case law suggesting that upstream parent-subsidiary transfers, or transfers on behalf of parent corporations to third parties, are presumed to be for nominal value to the subsidiary absent specific proof to the contrary. Pajaro Dunes Rental Agency, Inc. v. Spitters (In re Pajaro Dunes Rental Agency), 174 B.R. 557, 577 (Bankr.N.D.Cal.1994); Smith v. Am. Founders Fin. Corp., 365 B.R. 647, 667 (Bankr.S.D.Tex.2007). As things turned out, we know that both parent and debtor were unable to reverse the irresistible tide of insolvency in the approximate sixty days following the challenged transfers and no showing is made that the debtor was, as a consequence of the transfers, able to conduct any meaningful business that, from its creditors standpoint, could have led to any better recovery. Indeed, the opposite was true as TGA was saddled with deepening insolvency by the addition of another $1.52 million in liability. Merely delaying the consequence of insolvency is not a measurable benefit to the subsidiary. Leonard v. Norman Vinitsky Residuary Trust (In re Jolly's, Inc.), 188 B.R. 832, 843 (Bankr. D.Minn.1995). While it may be true that this is the view from the clarity of hindsight, it is also true that the burden falls upon the bondholders to show some specific, quantifiable value received by the debtor. The Court is not persuaded that merely delaying the inevitable for two months by itself is reasonably equivalent value; the answer might be different if the bondholders could point to some imminent and concrete chance of a solution that might have come to pass in the ensuing 60 days, if only TGI could stay in business, i.e. some expected contract, sale or intervention that would have saved the day. But the Court has seen no evidence of this and those few suggestions that alternative sources of business were on the horizon seem to the Court so vague, ephemeral and insubstantial as to amount to little or nothing. Certainly they can not be the reasonable equivalent of $250,000 in cash. 5. Conclusion Based upon the declarations, deposition transcripts and uncontradicted evidence, the Court concludes that no triable issue of material fact remains. With respect to all but $250,000 of the challenged transfer, the trustee fails to prove that property of the debtor was involved. Instead, it appears to the Court that the bulk of the challenged transfer was actually TGI's money and TGA acted merely as a conduit. Viewed from the perspective of TGA's *869 creditors, the creditors had no reasonable expectation of ever seeing any of that money absent the challenged transfer and so it is not equitable that they should recover it now through a fraudulent transfer action. The Court is persuaded that earmarking has a role to play in fraudulent transfers as well as preference actions, even in the Ninth Circuit. Concerning the $250,000 however, this was clearly TGA's money and the challenged transfers were clearly made while the debtor was insolvent. No reasonably equivalent consideration was received in return for the challenged transfer when viewed from the perspective of debtor's creditors. Therefore, as to the sum of $250,000 a judgment avoiding this transfer from the defendants may be entered in favor of the trustee; otherwise judgment shall be entered in favor of defendants. This statement of decision will serve as findings in the matter under FED. R. Civ. P. 52 made applicable in bankruptcy adversary proceedings in FED. R. BANKR.P. 7052. The trustee shall prepare a form of judgment consistent with this statement of decision. NOTES [1] Mr. Yoon had apparently been brought in by TGI to help run TGA only a few months earlier. [2] CCS was apparently a warranty/repair entity previously a part of TGA which was spun off as a nominally separate corporation. However, it was entirely dependent on TGI and TGA for its business. [3] Indeed, TGA actually reportedly owed TGI over $291 million, so debtor was by a large measure the net obligor on inter company receivables. [4] The parties did not provide any analysis of whether unsecured creditors enjoyed or expect a dividend in TGI's bankruptcy proceeding on account of general unsecured claims. However, considering that TGI's much larger "due from subsidiary" receivable owed by TGA has also not yet been paid, and since both entities are in bankruptcy, one strains to imagine any scenario in which a net recovery could be made of any portion of the account receivable owed to TGA. [5] The Court acknowledges that some courts within the Ninth Circuit have in dicta been reluctant to expand the earmarking doctrine beyond its origins, i.e. where guarantors also liable for the debt advanced the earmarked funds and were provided an equitable defense where requiring a return of the funds might potentially impose liability twice upon the guarantor. In re Kemp Pac. Fisheries, 16 F.3d 313, 316 n. 2 (9th Cir. 1994), citing In re Bohlen Enterprises, Ltd., 859 F.2d 561, 565-66 (8th Cir. 1988) and In re Ludford Fruit Products, Inc., 99 B.R. 18, 21 (Bankr.C.D.Cal. 1989). Whatever force this somewhat distant "reluctance" might bring to bear is outweighed, in the Court's view, by not only evolving case law but by the force of the underlying principle that, absent a diminishment of the estate, there is no equitable basis for avoidance in the first place.

2023-08-23 14:18:04.236563+00

Onion

*401OPINION ONION, Presiding Judge. This appeal is taken from a rape conviction where the punishment was assessed at 25 years. The sufficiency of the evidence is not challenged. Suffice it to say that the State’s evidence reflects the appellant drove the prosecutrix in his car to a deserted location near Lake Arlington and there, by force and threats, raped the prosecutrix without her consent. She was finally able to escape by jumping from the moving car. Testifying in his own behalf, appellant admitted having sexual intercourse with the prosecutrix, but believed that it was done with her consent. In his first ground of error, appellant contends the court erred at the guilt stage of the trial in allowing the court reporter to read back to the jury testimony in excess of what the jury had requested. The record reflects that during deliberations the jury requested all of the testimony given by the prosecutrix and by the appellant. The court properly refused to permit the same unless the jury specified what portions of the testimony, if any, were in dispute. Article 36.28, Vernon’s Ann.C.C.P., provides, as follows: “In the trial of a criminal case in a court of record, if the jury disagree as to the statement of any witness they may, upon applying to the court, have read to them from the court reporter’s notes that part of such witness testimony or the particular point in dispute, and no other; but if there be no such reporter, or if his notes cannot be read to the jury, the court may cause such witness to be again brought upon the stand and the judge shall direct him to repeat his testimony as to the point in dispute, and no other, as nearly as he can in the language used on the trial.” See Vasquez v. State, 415 S.W.2d 188 (Tex.Cr.App.1967); Thrash v. State, 482 S.W.2d 213 (Tex.Cr.App.1972); Odumes v. State, 445 S.W.2d 218 (Tex.Cr.App. 1969). Thereafter, the jury sent the following note to the court signed by the foreman: “Mrs. -’s testimony just following their exit from the car at the lake and before intercourse to determine threats with gun or bodily harm. “Also, Swindell’s testimony in same time period.” Thereafter, the court reporter read back certain portions of the testimony. A small portion of the testimony thus reproduced did relate to threats made and acts which occurred after the alleged rape. However, there was no objection offered at any time. In Maldonado v. State, 425 S.W.2d 646 (Tex.Cr.App.1968), this court held that in the absence of any objection, the defendant was in no position to complain of the court’s action in having all of one witness’s testimony read to the jury as well as the direct examination of another witness. See also Martin v. State, 459 S.W.2d 845 (Tex.Cr.App.1970). The appellant relies upon Pugh v. State, 376 S.W.2d 760 (Tex.Cr.App.1964), but there the defendant objected to the action of the court. It is, thus, to be distinguished as it was in Maldonado. See also Duncan v. State, 459 S.W.2d 822 (Tex.Cr.App.1970). Further, in light of the manner in which the testimony was developed, it would have been difficult for the court reporter to separate it as to certain time periods. We are not inclined to agree that an excessive amount of testimony was read back by the court reporter. See Duncan v. State, 454 S.W.2d 736 (Tex.Cr.App.1970). Next, appellant contends the court erred in commenting on the weight of evidence. This complaint grows out of the *402fact that the court, in addition to having the testimony read back, also gave them a written note in response to the request for the reproduced testimony which read: “MEMBERS OF THE JURY: I thought there was another place where a gun was mentioned but I can not find it.” In the testimony reproduced there were two references to appellant’s statements that he had a gun and that he would kill the prosecutrix. In other portions of the testimony not reproduced we find three other references to a gun. While the court should not have sent the note or made the statement, we find no objection thereto and we cannot agree, under the circumstances, that reversible error is shown. Cf. Mathis v. State, 471 S.W.2d 396 (Tex.Cr.App.1971); Odumes v. State, supra. There is no showing made that the appellant and his counsel were not present when the note was given to the jury. Lastly, appellant complains the court erred in limiting the number of his character witnesses at the penalty stage of the trial. In addition to the appellant and his wife, there were four character witnesses who testified for the defense. Appellant does not point out where in the record the court made a ruling limiting the number of character witnesses and we have been unable to find any such ruling. The record simply does not support the appellant’s contention. The judgment is affirmed.

2023-08-23 14:18:04.240488+00

Jackson

OPINION ON APPELLANT’S MOTION FOR REHEARING JACKSON, Commissioner. Appellant now calls the Court’s attention to an addition to the statement of facts, which addition is certified to by the trial court, disclosing that after defense counsel had placed four witnesses on the stand to attest to his good general reputation as a peaceable and law-abiding citizen, the court then asked defense attorney how many character witnesses he had in the hall, and he said he had eleven. The court told defense counsel at that time that he would not permit him to put on that many witnesses. Counsel for the State at that time had a witness on the stand and defense counsel told the court, “I am not going to ask him any questions, then T’ve got some others.” The court further certified that defense counsel was never told not to put on any more witnesses but was told he could not put on all eleven additional character witnesses. The defense thereafter did not call any additional witness but then announced, “We rest, Your Honor.” We find no objection to this ruling of the court, and no tender of any additional character witnesses, hence the appellant is in no position to complain. We have reviewed the record in the light of appellant’s motion, find the original opinion correctly disposed of the case, and overrule the motion for rehearing. Opinion approved by the Court.

2013-10-30 06:35:56.175582+00

Sporkin

994 F. Supp. 401 (1998) UNITED STATES of America v. Ronald B. FORD, Defendant. Crim. Action No. 94-00074(SS). United States District Court, District of Columbia. March 2, 1998. Beverly Gay Dyer, Federal Public Defender for D.C., Mark J. Rochon, Kohlman, Rochon & Roberts, Washington, DC, for Ronald B. Ford. Paul Kevin Carwile, U.S. Department of Justice, Washington, DC, for U.S. MEMORANDUM OPINION SPORKIN, District Judge. This matter comes before the Court on Defendant's Amended Motion To Vacate, Set Aside, or Correct Sentence. On March 3, 1994, Defendant pled guilty to the distribution of 50 or more grams of cocaine base in violation of 21 U.S.C. §§ 841(a)(1) and 841(b)(1)(A)(iii)(1997). This Court, on October 19, 1994, sentenced Defendant to a term of imprisonment of 135 months and a term of five years supervised release. Pursuant to 21 U.S.C. § 841(a)(1), "it shall be unlawful for any person knowingly or intentionally ... to manufacture, distribute, or dispense, or possess with the intent to manufacture distribute or dispense, a controlled substance ...." 21 U.S.C. § 841(a)(1)(1997). A controlled substance is defined as "a drug or other substance, or immediate precursor, included in schedule I, II, III, IV, or V ...." 21 U.S.C. § 802(6)(1997). Defendant claims that because cocaine base, one version of which is commonly referred to as "crack," is not specifically listed in any of the schedules of controlled substances in 21 U.S.C. § 812, it is not a controlled substance, and consequently it was not illegal for him to distribute the substance. Defendant further contends that if the distribution of the substance was not illegal, it was inappropriate to sentence him according to the Anti-Drug Abuse Act of 1986, 21 U.S.C. § 801 et. seq., which provides for enhanced penalties for the possession or *402 distribution of cocaine base. Consequently, Defendant moves to have this Court vacate, set aside, or correct his sentence. Despite Defendant's semantic argument, this Court finds that cocaine base, even if not specifically listed, is nonetheless contained in the broadly defined schedules. Cocaine-related controlled substances are described in Schedule II as: [c]oca leaves and any salt, compound, derivative, or preparation of coca leaves, and any salt, compound, derivative, or preparation thereof which is chemically equivalent or identical with any of these substances, except that the substances shall not include decocanized coca leaves or extraction of coca leaves, which extractions do not include cocaine or ecgonine. 21 U.S.C. § 812(b)(1997). Cocaine base clearly fits within this general definition of a controlled substance. According to the definition in Schedule II, a substance is controlled if it is "chemically equivalent or identical with any of these [coca leaves and any salt, compound, derivative, or preparation of coca leaves] substances." 21 U.S.C. § 812(b)(1997). Cocaine base satisfies this definition because "freebase cocaine, ha[s] the same chemical formula as cocaine: C17H21NO4." United States v. Booker, 70 F.3d 488, 491 (7th Cir.1995). Cocaine base is a derivative or product of coca leaves. As such, it is a controlled substance according to the definition in the schedule. To make cocaine hydrochloride, otherwise known as powder cocaine, coca leaves are converted into paste "by mixing the leaves with alkaline material (e.g., sodium bicarbonate), an organic solvent (e.g., kerosene), and water." Id. at 490 (footnotes omitted). The paste is then mixed with hydrochloric acid and water. See id. at 491. The mixture of a base (cocaine) and an acid (hydrochloride) results in a salt (powder) called cocaine hydrochloride. See id. Cocaine base in the form of crack cocaine is produced by dissolving cocaine hydrochloride and baking soda in water. See id. The mixture is then boiled until only a solid substance is left, and the mass is left to dry. See id. No matter what form the cocaine ultimately takes, cocaine base is derived from coca leaves. As such, it is included as a controlled substance under 21 U.S.C. § 812 (1997). In the alternative, Defendant argues that this Court should vacate, set aside, or correct his sentence because the statute under which he was sentenced is ambiguous as to the penalty for a violation involving cocaine base. Section 841(b)(1)(A)(ii) provides that for a violation involving "5 kilograms or more of a mixture or substance containing" a substance derived from coca leaves, a person "shall be sentenced to a term of imprisonment which may not be less than ten years or more than life ...." 21 U.S.C. § 841(b)(1)(A)(ii). However, § 841(b)(1)(A)(iii) prescribes the same penalty for a violation involving 50 grams or more of cocaine base, a significantly lesser amount than the 5 kilograms or more required under § 841(b)(1)(A)(ii). Defendant contends that if both § 841(b)(1)(A)(ii) and § 812 define cocaine-related substances as derivatives of coca leaves, as they both do, and if this Court determines that cocaine base is included in the definition in § 812, as it has, then cocaine base must be encompassed in the definition of the substances to which § 841(b)(1)(A)(ii) applies. Defendant further contends that this causes ambiguity in the statute because clause (ii) and clause (iii) both appear to apply to offenses involving cocaine base. Yet, the amounts that trigger the 10 year minimum sentence differ, one clause requires 5 kilograms and the other requires 50 grams. In light of the conflict, Defendant argues that the rule of lenity should apply, requiring the Court, in the face of this ambiguity, to impose the lesser of two penalties. In this case, Defendant argues that he should be sentenced as if he committed a violation involving 50 or more grams of a cocaine-related substance other than cocaine base. When construing a statute, "rules of statutory construction require [the court to] ... give meaning to all statutory provisions and seek an interpretation that permits [it] ... to read them with consistency." United States v. Fisher, 58 F.3d 96, 99 (4th Cir.1995) (citing United States v. Nordic Village, Inc., 503 U.S. 30, 36, 112 S. Ct. 1011, 117 L. Ed. 2d 181 (1992)). To reach such an interpretation, *403 "[t]he court must consider not just the language of the sentencing regime, but also its `structure, legislative history, and motivating policies ....'" United States v. Sloan, 97 F.3d 1378, 1382 (11th Cir.1996) (quoting Bifulco v. United States, 447 U.S. 381, 387, 100 S. Ct. 2247, 65 L.Ed.2d 205(1980)). The Court finds that there is no ambiguity in the statute because § 841(b)(1)(A)(ii) addresses cocaine-related substances other than cocaine base, while § 841(b)(1)(A)(iii) addresses cocaine base substances. With respect to the structure of the statute, the court of appeals held in United States v. Fisher, 58 F.3d 96, 99 (4th Cir.1995), that: [when] reading clause (ii) and clause (iii) together, [the court] ... can only conclude that the purpose of clause (iii) is to carve out a heavier penalty for the particularly harmful form of cocaine known as "cocaine base" or "crack." And, if clause (iii) isolates crack cocaine for special treatment, it is illogical then to read clause (ii) also to include crack cocaine. Thus, the only rational interpretation that [the court] ... can give this statute as a whole is to conclude that clause (ii) addresses cocaine powder and the other forms of cocaine identified therein, except for "crack" cocaine which is expressly separately addressed. Additionally, the legislative history and motivating policies of the statute support reading § 841(b)(1)(A)(ii) as applying to cocaine-related substances other than cocaine base and § 841(b)(1)(A)(iii) as applying only to cocaine base substances. The Anti-Drug Abuse Act of 1986 ("ADAA") created the two tiers of penalties for violations involving cocaine-related controlled substances. Legislators made it clear that the ADAA was passed to enhance the penalties for cocaine base, primarily in the form of crack cocaine. See, e.g., 132 Cong. Rec. S14270-01 (Sept. 30, 1986) (statement of Sen. Reigle) (the act "updates the Controlled Substances Act to include new and devastating drugs like `crack'...."); 132 Cong. Rec. S13741-01 (Sept. 26, 1986) (statement of Sen. Chiles) ("We have enhanced the penalties for drugs, but especially crack cocaine."). Based on the intent expressed by the legislators it is clear that § 841(b)(1)(A)(iii) was created to enhance the penalties for those who traffic in cocaine base or crack cocaine. See United States v. Jackson, 84 F.3d 1154, 1160 (9th Cir.1996); See also, United States v. Sloan, 97 F.3d 1378, 1382-83 (11th Cir.1996), U.S. v. Booker, 70 F.3d 488, 492-93 (7th Cir.1995), United States v. Fisher, 58 F.3d 96, 99-100 (4th Cir.1995). Section 812 was designed as an all-encompassing description of every type of cocaine-related substance, both present and future. Unlike § 812, clauses (ii) and (iii) of § 841(b)(1)(A) do not set forth a broad description of which cocaine-related substances are illegal. Rather, these clauses specify punishments for various types of cocaine-related substances contained under the umbrella definition in § 812. There is no inconsistency between the distinction made by clauses (ii) and (iii) and the broad definition established by § 812. It is clear that clause (ii) was designed to apply to cocaine-related substances other than cocaine base substances and that clause (iii) was designed to apply to cocaine base substances.

2013-10-30 06:35:56.210104+00

Dice

491 S.W.2d 428 (1973) Brady BLACK, Appellant, v. The STATE of Texas, Appellee. No. 45668. Court of Criminal Appeals of Texas. January 31, 1973. Rehearing Denied March 28, 1973. *429 Vern F. Martin, Midland, for appellant. James A. Mashburn, Dist. Atty., Jerry Buckner, Asst. Dist. Atty., Midland, Jim D. Vollers, State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION DICE, Commissioner. The conviction is for the unlawful possession of a narcotic drug; to-wit, marihuana; the punishment, assessed by the jury, ten (10) years. In his first two grounds of error appellant complains of the court's action in admitting in evidence certain packets of marihuana found in appellant's automobile over the objection that the contraband was obtained as the result of an unlawful search and seizure. The facts surrounding the search of appellant's automobile are summarized in the State's brief as follows: "On September 4, 1970, Officer Ralph Ward, a Texas Highway Patrolman, was on patrol in Midland County, Texas, approximately ten miles west of Midland on Interstate Highway 20, when he observed a 1966 model Cadillac being driven by John Plumb and occupied by Brady Black, who was a passenger in the car. Officer Ward stated that the occupants of the vehicle appeared to be nervous and were looking at each other and attempting to look back at him. Because of the demeanor of the occupants *430 and the out of state tags on the vehicle, Officer Ward stopped the vehicle for a driver's license and registration check. Officer Ward stepped to the left rear of the Cadillac vehicle and requested the driver to step to the rear of his vehicle. The driver, John Plumb, produced a valid Indiana driver's license. Officer Ward asked Mr. Plumb who the vehicle belonged to and Mr. Plumb replied, `I think it belongs to him,' pointing toward the passenger, Brady Black. Officer Ward approached the passenger's side of the vehicle, where appellant was seated, and asked Mr. Black if the Cadillac automobile was his vehicle. Mr. Black stated that it was his vehicle. Officer Ward then requested Mr. Black to show him some registration papers or identification for the vehicle. Mr. Black opened the door of his vehicle and stood out of the vehicle. Officer Ward then observed a .38 pistol lying in the front seat of the vehicle. Officer Ward testified that he could not determine whether Mr. Black was sitting on the pistol or whether the pistol was right beside Mr. Black. Officer Ward testified that he was working by himself and that he had Mr. Black and Mr. Plumb stand out of the vehicle for his own protection. Directly behind the passenger's seat, in the rear floorboard, Officer Ward observed a box of the approximate size in which a pistol could be concealed. Half of the box was covered by coveralls which contained packages. Officer Ward removed the coveralls from the top of the box. The coveralls were partially zipped and the Officer observed several red cellophane packages with holes punched in them. Officer Ward smelled one of the packages and believed that he detected the odor of marihuana. The automobile was a two door vehicle and there was a space between the seat and the door of the vehicle sufficiently large for a person seated in the passenger's seat to reach to the back seat and touch the coveralls and the box. After smelling the marihuana in the package, the Officer removed the rest of the packages from the coveralls. There was a total of eight packages contained in the coveralls. Investigation revealed that the driver of the automobile was a hitchhiker." Officer Ward testified that he arrested the appellant and his companion Plumb for unlawful possession of marihuana and, subsequently, filed charges against them. It was further shown that the eight packages taken from appellant's automobile contained 2725 grams of marihuana. From the evidence adduced it is clear that the search of appellant's automobile was not one incident to an arrest as the officer's testimony shows that the arrest followed the search. The question, therefore, presented is whether Officer Ward had probable cause to search. We conclude that he did. The officer had the right to stop appellant and his companion for the purpose of determining whether the driver of the vehicle had a driver's license. This authority is conferred upon an officer by Art. 6687b, Sec. 13, Vernon's Ann.Texas Civ.St. See also Oliver v. State, Tex.Cr.App., 455 S.W.2d 291. After having stopped the vehicle the officer saw in plain view the .38 caliber pistol on the front seat where appellant had been sitting. Upon observing the box on the back floor board, the officer was warranted, under the circumstances, in making a search of the automobile. Breckenridge v. State, Tex.Cr.App., 460 S.W.2d 907. See also Gutierrez v. State, Tex.Cr.App., 423 S.W.2d 593. Chimel v. California, 395 U.S. 752, 89 S. Ct. 2034, 23 L. Ed. 2d 685, cited by appellant, is not here controlling as that case dealt with a search incident to a lawful arrest. The grounds of error are overruled. *431 In his ground of error number three, appellant complains that the court erred in limiting his right of cross-examination of the State's witness Chemist Wolf, in that he was not permitted to ask the witness the medical distinction between marihuana and other narcotic drugs; that he was not allowed to ask this witness whether or not the witness had personally smoked marihuana; that he was not allowed to ask this witness of his knowledge of the various effects of marihuana on individuals; and that he was not allowed to ask this witness what the comparative physical effects of marihuana were as opposed to alcohol and cigarettes. We perceive no error. The question as to whether marihuana is a narcotic drug is one of law and not of fact. The jury was properly instructed in the charge that marihuana is a narcotic drug. See Art. 725b, Vernon's Ann.P.C.; Locke v. State, 168 Tex. Crim. 507, 329 S.W.2d 873. In his ground of error number four appellant insists that the court erred in failing to grant a mistrial on the ground of jury misconduct when the jury, during their deliberation on the issue of punishment, sent the following note to the court: "Your Honor: We desire information re: the amount of `time off' for good behavior that is allowed under a prison sentence. "Leslie R. Hinds "P.S. For example (15 yrs.)" The record reflects that the trial judge responded to the inquiry as follows: "You are limited in your deliberations only to the instruction contained in the court's charge." After giving such answer, the court refused to declare a mistrial or further instruct the jury on the matter. In the absence of affidavits from some of the jurors and testimony presented on motion for a new trial this Court is not in a position to pass upon the question of alleged jury misconduct. Cf. Alejandro v. State, Tex.Cr.App., 394 S.W.2d 523. By ground of error number five appellant complains of the court's failure to charge the jury in the terms of Art. 38.23, Vernon's Ann.C.C.P., to disregard any evidence obtained by an officer or other person in violation of the Constitution or laws of this State or of the United States.[1] The requested charge would have submitted to the jury a question of law rather than of fact; hence, its refusal by the court was not error. Further, no disputed fact issue was raised by the evidence on the question of probable cause. In his sixth ground of error appellant insists that the trial court erred in failing to instruct the jury to disregard a reference to him as "trash" by the prosecuting attorney in his final argument to the jury. In his argument State's counsel stated: "I just ask you one more thing. Give the citizens of the State of Texas their rights. Let's not have this kind of—this kind of trash carrying this kind of contraband through Midland County—" Counsel for appellant requested the court to instruct the jury to disregard the argument *432 on the ground that it was an appeal to prejudice to which request the court stated, "The court will not comment." While we do not condone unjustified verbal attacks upon an accused by State's counsel, the argument was not, under the facts, such as to call for a reversal of the conviction. Hess v. State, 168 Tex. Cr.R. 425, 328 S.W.2d 308, and Gauntt v. State, 169 Tex. Crim. 520, 335 S.W.2d 616. The ground of error is overruled. The sentence pronounced by the court orders that appellant be confined in the penitentiary for ten years. The same is reformed so as to give application to the indeterminate sentence law, Art. 42.09, V. A.C.C.P., and order that he be confined in the penitentiary for not less than two nor more than ten years. The judgment as reformed is affirmed. Opinion approved by the Court. NOTES [1] Appellant's objection and requested charge reads as follows: "Defendant objects to the omission of a charge based upon Vernon's Code of Criminal Procedure, Article 38.23, and requests and tenders the following: "`Article 38.23 of the Texas Code of Criminal Procedure provides that: No evidence obtained by an officer or other person in violation of any provisions of the Constitution or laws of the State of Texas, or of the Constitution or laws of the United States of America, shall be admitted in evidence against the accused on the trial of any criminal case. "`Accordingly, you are instructed that if you believe, or have a reasonable doubt, that the evidence presented, or any of it, was obtained in violation of this Article, then and in such event, you will disregard any such evidence so obtained.'"

2013-10-30 06:35:56.226001+00

Parell

994 F. Supp. 278 (1998) Robert BOYADJIAN, Plaintiff, v. CIGNA COMPANIES, AFIA Worldwide Insurance, and Cigna's AFIA Retirement Plan Administrator, Defendants. No. Civ.A.95-4453 (MLP). United States District Court, D. New Jersey. March 6, 1998. Robert Boyadjian, Somerset, NJ, pro se. Janetta D. Marbrey, Law Offices of K. Ruth Larson, New Brunswick, NJ, for Defendants. *279 MEMORANDUM OPINION PARELL, District Judge. This matter is before the Court on motion by plaintiff pro se Robert Boyadjian ("Boyadjian") for costs pursuant to Local Rule 54.1. For the reasons expressed in this Memorandum Opinion, plaintiff's motion is granted in part and denied in part. BACKGROUND The facts underlying the instant action are set forth in detail in this Court's Opinion filed July 29, 1997. In the interest of clarity, we will briefly restate them here. Plaintiff commenced this action on August 21, 1995, seeking relief under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001-1461. Boyadjian alleged that he was employed by defendant AFIA Worldwide Insurance ("AFIA") from June, 1971 through March, 1982 and was therefore eligible for benefits under the company's retirement plan (the "Plan"). (Compl. at 2.) Initially, CIGNA Companies ("CIGNA") took the position that plaintiff did not establish his eligibility under the Plan. By Memorandum and Order dated July 17, 1996, the Court denied without prejudice defendants' motion for summary judgment, finding that there was a genuine issue of material fact as to whether plaintiff was employed by AFIA for the ten years required to become eligible for retirement benefits. (Mem. & Order dated July 17, 1996.) After the Court denied defendants' initial motion for summary judgment, defendants determined that plaintiff was entitled to benefits under the Plan, and so informed Boyadjian. Subsequently, the parties filed cross-motions for summary judgment. Defendants sought dismissal of plaintiff's claims for lack of jurisdiction, arguing that their actions in informing plaintiff of his eligibility and rights under the plan rendered plaintiff's claims moot. Plaintiff moved for summary judgment, arguing that he was entitled to: (1) attorney's fees and costs related to this suit; (2) $100 per day from July 29, 1993 to September 3, 1996, pursuant to 29 U.S.C. § 1132(c), for defendants' failure to provide requested information concerning the Plan; and (3) damages for emotional distress and punitive damages. (Pl.'s Br. in Supp. of Mot. for Summ.J. at 2.) By an Opinion dated July 29, 1997, the Court granted the motions in part and denied them in part. See Boyadjian v. Cigna Comp., 973 F. Supp. 500 (D.N.J. 1997). With respect to plaintiff's attorney's fee request, the Court denied plaintiff's application, holding that pro se plaintiffs are not entitled to recover attorney's fees under ERISA, 29 U.S.C. § 1132(g)(1). The Court stated, however, that plaintiff was entitled to "litigation costs reasonably incurred." Id. at 503. The Court directed plaintiff to submit "a Bill of Costs in accordance with Local Civil Rule 54.1 within 30 days of the entry of the Order" accompanying the Opinion. Id. Plaintiff filed his Bill of Costs with the Court on August 11, 1997. In it, plaintiff seeks the following amounts: (1) $150.00 paid as a filing fee; (2) $8,129.84 incurred in "discovery" (which includes amounts for telephone, postage, copying and "time spent"); (3) $14,002.20 for "litigation and court action" (which includes amounts for telephone, postage, copying, the purchase of a computer and "time spent"); (4) $708.60 for travel mileage for time spent traveling to and from various libraries; and (5) $119.70 for a subscription to America On-Line. The total amount of costs is $23,110.34.[1] Plaintiff indicates that "time spent refers to preparation of motions, oppositions, legal research, reading, internet lookup of House of Representative Law Library and Lexis-Nexis Law Library, etc." (Pl.'s Bill of Costs.) Plaintiff has not submitted to the Court any verification of these amounts, and has not provided any receipts in support of his application. Defendants oppose plaintiff's motion, arguing that (1) various expenses listed in the Bill of Costs cannot be awarded pursuant to 28 U.S.C. § 1920 and (2) charges for "time spent" are in essence, attorney's fees. (Defs., Ltr. Br. at 1-2.) DISCUSSION 29 U.S.C. § 1132(g) provides that in "any action under this subchapter ... by a participant, *280 beneficiary, or fiduciary, the court in its discretion may allow a reasonable attorney's fee and costs of action to either party." 29 U.S.C. § 1132(g)(1). By its terms, § 1132(g)(1) does not specifically state what costs are to be awarded under the statute. However, the Supreme Court has held that a court may not shift costs beyond those found in 1920 and § 1821 (not applicable here) without express statutory authority to do so. West Virginia Univ. Hosps., Inc. v. Casey, 499 U.S. 83, 86, 111 S. Ct. 1138, 113 L. Ed. 2d 68 (1991); Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437, 444-45, 107 S. Ct. 2494, 96 L. Ed. 2d 385 (1987). Thus, we must turn to 28 U.S.C. § 1920, which provides that a judge or clerk of any court of the United States may tax as costs the following: (1) Fees of the clerk and marshal; (2) Fees of the court reporter for all or any part of the stenographic transcript necessarily obtained for use in the case; (3) Fees and disbursements for printing and witnesses; (4) Fees for exemplification and copies of papers necessarily obtained for use in the case; (5) Docket fees under section 1923 of this title; (6) Compensation of court appointed expert, compensation of interpreters, and salaries, fees, expenses, and costs of special interpretation services under section 1828 of this title. 28 U.S.C. § 1920. Local Rule 54.1(g) provides the general rules to be followed by the Clerk of the Court in awarding costs under the Local Rules. Local R. 54.1(g). The guidelines found in Rule 54.1(g) are similar to those found is 28 U.S.C. § 1920. We also note that Local Rule 54.1(b) requires the Bill of Costs to: precisely set forth each item thereof, so that the nature of the charge can be readily understood, and shall be verified by the attorney for the applicant, stating that (1) the items are correct, (2) the services were actually and necessarily performed, and (3) the disbursements were incurred in the action or proceeding. Counsel shall append to the verified Bill of Costs copies of all invoices in support of the request for each item. Local R. 54.1(b). When the party seeking costs fails to comply with Local Rule 54.1(b), the costs are waived. The initial question presented is whether plaintiff has waived his right to costs by failing to comply with Local Rule 54.1(b), which requires a verified Bill of Costs and receipts for the amounts claimed to have been spent on each expenditure. While we recognize that plaintiff has failed to comply with Local Rule 54.1(b), plaintiff's pro se status evokes the concern that a "misstep ... may be decisive to the outcome" of his claim for costs. Heyl & Patterson Int'l v. F.D. Rich Housing, 663 F.2d 419, 427 (3d Cir.1981). Thus, we will entertain plaintiff's motion at this time. However, in order to determine whether plaintiff is entitled to recover costs for the items designated in the Bill of Costs, the Court finds it necessary to address each expenditure individually. A. Photocopying Expenses Plaintiff seeks a total of $78.30 for photocopying expenses. To be recoverable as taxable costs, photocopying expenses must have been incurred for copies that were "necessarily obtained for use in the case." 28 U.S.C. § 1920(4). These costs are taxable under 28 U.S.C. § 1920 even if the documents are not offered into evidence at trial. See Haagen-Dazs Co. v. Double Rainbow Gourmet Ice Creams, Inc., 920 F.2d 587, 588 (9th Cir.1990); Illinois v. Sangamo Constr. Co., 657 F.2d 855, 867 (7th Cir.1981); see also Hurley v. Atlantic City Police Dept., No. 93-260, 1996 WL 549298, at * 3 (D .N.J. Sept. 17, 1996). Local Rule 54.1(g) provides that fees for exemplification and copies are taxable when (A) the documents are admitted into evidence or necessarily attached to a document required to be filed and served in support of a dispositive motion, and (b) they are in lieu of originals which are not introduced at the request of opposing counsel. *281 Local R. 54.1(g)(9). Here, plaintiff has failed to submit invoices documenting his copying expenses. It is clear that the photocopies under the heading of "discovery" would not be recoverable pursuant to Local Rule 54.1(g)(9). However, it is unclear whether the photocopies under the heading "litigation and court action" fall within the category of expenses which are recoverable as costs pursuant to § 1920. (See Pl.'s Bill of Costs.) Rather than engage in speculation, and in light of plaintiff's pro se status, we will deny this portion of plaintiff's application without prejudice at this time. The Court directs plaintiff to submit any receipts or other documentation which demonstrate his entitlement to reimbursement for his photocopying expenses pursuant to § 1920 and Local Rule 54.1(g) within 30 days of the Order accompanying this Memorandum Opinion. B. Telephone Calls Made in the Course of Discovery and Litigation. Plaintiff seeks a total of $50.50 which he claims he spent in making telephone calls. Long distance phone calls may be charged as part of attorney's fees, but not costs. See Abrams v. Lightolier, 50 F.3d 1204, 1225 (3d Cir.1995); see also Ezelle v. Bauer Corp., 154 F.R.D. 149, 155 (S.D.Miss.1994). Moreover, neither Local Rule 54.1(g) nor § 1920 permit recovery of long distance telephone expenditures. Thus, plaintiff may not recover his telephone expenses. See Crawford Fitting, 482 U.S. at 444. C. Postage Spent in the Course of Discovery and Litigation Plaintiff seeks $168.24 in postage used during discovery and in litigation of this action. Postage costs are not listed in § 1920, and are not mentioned in Local Rule 54.1(g). Moreover, expenses for postage are reimbursable as part of attorney's fees. See Abrams, 50 F.3d at 1225; Hurley, 1996 WL 549298 at *4. Because we have determined that plaintiff is not entitled to attorney's fees, he cannot recover amounts spent on postage. D. Travel Fees Plaintiff claims that he spent $708.60 on travel to and from various libraries to prepare his motions and discovery responses. (Pl.'s Bill of Costs.) Travel expenses of attorneys are not a taxable cost. See Abrams, 50 F.3d at 1225 (traveling costs are part of attorney's fee award); Wahl v. Carrier Mfg. Co. Inc., 511 F.2d 209, 216 (7th Cir.1975); Walters v. President and Fellows of Harvard College, 692 F. Supp. 1440, 1442 (D.Mass. 1988) (successful litigant in diversity action could not recover travel, parking and miscellaneous expenses incurred by her attorney). Moreover, Local Rule 54.1(g) and § 1920 provide that only mileage fees for witnesses to travel to the courthouse and attend depositions are recoverable as costs. See 28 U.S.C. § 1920; Local R. 54.1(g). Because there is no provision which provides that travel expenses of attorneys or litigants are taxable costs, plaintiff cannot recover these amounts. See Crawford Fitting, 482 U.S. at 444. E. Purchase of Computer, Computerized Legal Research and Six-Month Subscription to America On-Line. Computerized legal research is not independently taxed as a cost under 28 U.S.C. § 1920, but such expenses are considered part of attorney's fees. See Hurley, 1996 WL 549298, at *4-5. It should be noted that a case decided by the Third Circuit states that computerized legal research is assessable as a reasonable cost of litigation. See Wehr v. Burroughs Corp., 619 F.2d 276, 285 (3d Cir.1980). The court in Wehr relied on a theory that a court has discretion to award costs which are not specifically allowed by statute pursuant to Rule 54 of the Federal Rules of Civil Procedure. Wehr can no longer be considered good law on this point, however, in light of the Supreme Court's most recent pronouncements in Crawford Fitting and West Virginia Hospitals. The Supreme Court rejected the reasoning in Wehr and held that a court may only asses those costs which are specifically outlined in § 1920. Crawford Fitting, 482 U.S. at 441; West Virginia Hosps., 499 U.S. at 93; see also Neyer, Tiseo & Hindo, Ltd. v. Russell, No 92-2983, 1994 WL 158917 (E.D.Pa. Apr.29, 1994) (recognizing implicit overruling of Wehr). *282 Applying the same reasoning to plaintiff's request for reimbursement for the purchase of a computer and an America On-Line subscription, such expenses are not taxable as costs. See Crawford Fitting, 482 U.S. at 444 ("Any argument that a federal court is empowered to exceed the limitations explicitly set out in §§ 1920 and 1821 without plain evidence of congressional intent to supersede those section ignores our longstanding practice of construing statutes in pari materia."). F. "Time Spent" Plaintiff claims that he should be reimbursed $21,015.00 for "time spent" during discovery and litigation of this matter. Plaintiff notes that "time spent refers mostly to search for records or documents to prove employment and eligibility to pension ... preparation of motions, oppositions, legal research, and internet lockup." (Pl.'s Bill of Costs.) This claim clearly falls within the realm of attorney's fees. See Abrams, 50 F.3d at 1225. However, we have already determined that plaintiff may not recover attorney's fees. See Boyadjian, 973 F.Supp. at 503. G. Filing Fee Section 1920 and Local Rule 54.1(g) permit the recovery of plaintiff's filing fee of $150.00. See 28 U.S.C. § 1920(1); Local R. 54.1(g)(1). CONCLUSION We have found that plaintiff is entitled to be reimbursed for the $150.00 filing fee incurred in instituting this action. We have also stated that plaintiff's expenditures for photocopying may fall within the costs allowable under § 1920 and Local Rule 54.1., but that the record at present does not provide sufficient information for us to make that determination. As to plaintiff's remaining expenditures, we have determined that § 1920 does not authorize plaintiff's recovery of those amounts. An appropriate Order accompanies this Memorandum Opinion. NOTES [1] Plaintiff states in his Bill of Costs that the total amount sought is $22,960.34. It appears, however, that plaintiff miscalculated that amount by failing to include the $150.00 filing fee.

2013-10-30 06:35:56.274988+00

Billings

491 S.W.2d 29 (1973) Edgar CURTIS, Plaintiff-Appellant, v. Jane Maxine CURTIS, Defendant-Respondent. Nos. 9205, 9269. Missouri Court of Appeals, Springfield District. January 30, 1973. *30 Harold Henry, West Plains, for plaintiff-appellant. Esco V. Kell, Newton C. Brill, West Plains, for defendant-respondent. BILLINGS, Judge. Plaintiff-husband has appealed from the trial court's order granting defendant-wife a new trial following a decree of divorce to her, but without alimony or attorney fees, on her cross-bill. Plaintiff has lodged a second appeal from the lower court's allowance of temporary alimony pending the appeal and an allowance of attorney's fees *31 and suit money for the appeal. The appeals have been consolidated. The parties were married in 1938 and separated in 1966. On October 6, 1969, the husband filed his petition for divorce. Three days later the wife filed her answer and on November 5 filed her motion for suit money, attorney fees and alimony pendente lite. On November 21 she was awarded $125.00 weekly for temporary alimony and $250.00 for her attorney fees "on account". The suit remained dormant until September 25, 1971, at which time the wife filed an amended answer and a cross-bill. The cross-bill was in three counts with the first seeking a divorce, alimony and attorney fees. The remaining counts were for an accounting and partition, respectively. Husband's reply on October 2, 1971, joined the issues raised in the cross-bill. On October 6, 1971, the parties and their attorneys appeared for trial. Plaintiff dismissed his petition and the wife proceeded on her count for divorce with the remaining counts being continued to November 19, 1971. During the presentment of her evidence for a divorce the wife testified she was not asking for alimony; that all she was asking for was a divorce; that she understood she was to pay her own attorney fees, and by not getting any alimony in the proceeding she could never get any alimony. Cross-examination of the wife was limited to having her acknowledge payment in full of temporary alimony. The trial court awarded the wife a divorce and set Counts II and III for trial November 19. Fourteen days later, on October 20th, the wife, (with new counsel), filed her motion for new trial seeking ". . . (A) rehearing and a new trial on the issue of the allowance of alimony and attorney fees requested in Count I of defendant's Cross-Bill, or in the alternative, defendant requests a new trial on all issues submitted in her Cross-Bill . . .". As grounds for her request she alleged the following: "1. The trial court erred in failing to enter an order awarding defendant alimony after finding that she was the innocent and injured party. 2. That in failing to enter an order awarding her alimony, the Court failed to take into account and apply the provisions of 452.070 RSMo [V.A.M.S.] 3. That the court erred in failing to award alimony in that such failure was against the law and the evidence before the court. 4. The Court erred in failing to enter a final order with regard to all issues raised by the pleadings and more particularly failed to make any findings consistent with failure to award alimony as prayed for in Count I of defendant's Cross-Bill. 5. The court erred in failing to make a final appealable judgment under the pleadings. 6. Defendant prayed for alimony in gross in Count I of her Cross-Bill and defendant did not waive her right to the alimony requested, or in the alternative defendant was coerced by plaintiff and by her own attorney to proceed with the hearing on Count I of her Cross-Bill without mentioning her demand for alimony and such coercion amounted to fraud both upon defendant and this court." At the hearing on the motion for new trial the husband assumed the laboring oar and offered the testimony of the wife's original attorney and the transcript of the testimony of the October 6 proceeding. In summary, the attorney testified that as a result of several conferences with the husband's attorney and his former client (the wife) on the morning of the trial, aimed at settling some of the issues, it was agreed the husband would dismiss his petition, the wife would abandon any claim for alimony and further attorney fees and proceed on her cross-bill for a divorce; that the remaining counts would be disposed of on November 19. He denied coercing his client and said that on October 6 his client was not any more distraught and upset than she usually had been in conferences with him about the matter in the preceding two years. The husband's attorney made a statement into the record that it was pursuant to an agreement reached as a result of negotiations that he dismissed his client's petition on October 6. *32 In support of her motion the wife testified that prior to the time her cross-bill for divorce was presented her attorney said "now we can't get any alimony today" or "can't get any alimony" and she was surprised but then he said "well, we might be lucky to get five thousand dollars." Under cross-examination she acknowledged that on the day of the trial she was aware there were negotiations between her attorney and plaintiff's attorney concerning the alimony. However, she denied her attorney discussed with her the various propositions concerning a settlement then testified her attorney told her "we couldn't get any alimony." She said she had asked for alimony and had expected alimony but did not deny that at the trial she was asked about alimony by her attorney. She was aware her husband had dismissed his petition and that she was permitted to proceed on her cross-bill for divorce and ". . . (I) was under the impression that if I didn't take any action whatsoever that it would seem as if I was the guilty party. So therefore I took this action which I did." The court thereupon entered its order sustaining the wife's motion for a new trial but without specifying the ground or grounds for such action, and the first appeal followed. Thereafter the wife filed her motion for "attorneys fees pending appeal". The prayer of this motion also requested alimony pending the appeal and following a lengthy hearing on January 18, 1972, the court entered judgment in favor of the wife for $65.00 a week for temporary alimony, attorney fees in the sum of $500.00 and $50.00 for suit money. The husband's motion for new trial was overruled and he filed his second appeal to this court. In these consolidated appeals our initial duty is to ascertain whether we have appellate jurisdiction. State ex rel. Beeler v. City of Raytown, Mo., 439 S.W.2d 481; Williams v. Williams, Mo.App., 480 S.W.2d 525; Herndon v. Ford, Mo.App., 470 S.W.2d 168. Defendant has suggested the judgment is not final, and inferentially at least, the appeal on Count I is premature. The right of appeal is purely statutory and, when not granted by statute, no such right exists. Rule 81.01, V.A.M.R. [formerly 82.01]; Williams v. Williams, supra, 480 S.W.2d at 526. And if we were limited to that portion of § 512.020, RSMo 1969, V.A.M.S., which extends the right of appeal only to parties who may be aggrieved by any final judgment in the case, a judgment being defined as "the final determination of the right of the parties in the action" [Rule 74.01, V.A.M.R. § 511.020, RSMo 1969, V.A.M.S.] we would have to dismiss the appeal of our own motion. Kansas City Power and Light Company v. Kansas City, Mo., 426 S.W.2d 105; Williams v. Williams, supra; Herndon v. Ford, supra. This for the reason that defendant's remaining counts for an accounting and partition have not been determined. However § 512.020 is not so limited, as was ruled in Travagliante v. J. W. Wood Realty Company, Mo., 425 S.W.2d 208. The statute also permits an appeal from any order granting a new trial. In Travagliante the court held the right to appeal an order granting a new trial existed notwithstanding there were other counts remaining undisposed of after its entry. Having concluded we have jurisdiction we turn first to the action of the trial court in granting defendant a new trial on her count for divorce. The record entry is as follows: "Thereafter, on November 19, 1971, Motion for New Trial was argued and sustained by order of the Court." Since the lower court did not comply with Rule 78.01, V.A.M.R., which requires specification of the ground or grounds for granting a new trial to defendant, the scope of our review is narrow. In the absence of such grounds, a different set of principles governs our review. As stated in Northeast Missouri Power Coop. v. Todd, Mo.App., 401 S.W.2d 161, at 162, these are: "First, we may not indulge in any presumption that the new trial was granted on discretionary grounds. Second, we presume that the new trial was granted *33 erroneously. Third, the burden is on the plaintiff-respondent to demonstrate on the record that there was reversible error. Fourth, in meeting that burden the plaintiff-respondent is confined to the errors specified in both its motion for a new trial and its brief. Civil Rules 83.06(b) and (c) [now Rule 84.05(b) and (c), V.A.M.R.]; McCormack v. St. Louis Public Service Co., Mo., 337 S.W.2d 918 [2]; Myers v. Moffett, Mo., 312 S.W.2d 59 [3]; Drake v. Hicks, Mo., 261 S.W.2d 45 [1-3]; Gayer v. J. C. Penney Co., Mo.App., 326 S.W.2d 413 [1]." Defendant seeks to escape the impact of these principles by referring to statements and comments of the trial judge at the time her motion for new trial was sustained. She says in her brief: "Appellant's contention that the Court failed to state its reasons is utterly without support on the record. The court . . . set its previous order aside stating: `. . . I want the record to show that the Motion for New Trial is being sustained more out of practice of the court than the evidence here . . . I think that these parties were somewhat confused, perhaps particularly Mrs. Curtis. I recall her testifying; she was distraught . . . [T]he Court intends to announce from the bench that it is going to have a very liberal policy in granting a new trial where there is a default divorce involved . . .'." [Since both parties had appeared, filed pleadings and were present at the trial the decree of October 6 was actually not a "default". Rule 74.045, V.A.M.R.; Hamm v. Hamm, Mo.App., 437 S.W.2d 449] Defendant's reliance upon these statements as being in compliance with Rule 78.01, V.A.M.R., is misplaced. The provisions of this rule requires the ground or grounds to be in the trial court's order. This was clearly stated by this court in Land Clear. For Redev. Auth. v. Joplin Union Depot Co., Mo.App., 429 S.W.2d 806, 1. c. 808: ". . . [A]nd the reported decisions leave no room for doubt but that the trial court's order is the sole official repository for the court's grounds, thoughts or reasons for sustention of the motion for new trial [citing cases]." We therefore hold that the statements of the trial judge ore tenus are not a part of his order granting defendant a new trial. Green v. First Nat. Bank of Kansas City, 236 Mo.App. 1257, 163 S.W.2d 788. In the defendant-respondent's motion for a new trial she asserted six grounds and has not briefed any of them here. Her only point contends the trial court was exercising its discretion in granting the new trial. Because of the restricted scope of our review we cannot presume the trial court's order was based on the discretionary grounds suggested by defendant. The trial court's power to grant a new trial is discretionary only as to questions of fact and matters affecting the determination of the issues of fact. There is no discretion in the law of a case. And while an appellate court may be more liberal in upholding the court's action than it would in reversing a judgment on the same ground it does not follow that the granting of a new trial is always the exercise of a judicial discretion which will be upheld unless abused. McCormack v. St. Louis Public Service Company, supra; Cooper v. 804 Grand Bldg. Corp., Mo., 257 S.W.2d 649; Warren v. Kansas City, Mo., 258 S.W.2d 681. In view of Rule 84.05(c) we decline to consider discretionary grounds as a basis for the grant of a new trial to plaintiff. Defendant further suggests the trial court's authority to re-open the case under Rule 78.01 and its thirty-day control of the judgment pursuant to Rule 75.01 are justification for the new trial grant. In so doing she relies upon the "broad discretion" of the lower court. What we have said concerning discretionary grounds above applies equally as well to this suggestion. Also, such a proposition ignores (a) the fact that the order specifically was a grant of a new trial, and, (b) that a court invoking Rule 75.01 is limited to "good *34 cause" in its action [Vaughn v. Ripley, Mo. App., 446 S.W.2d 475] and the grant of a new trial under this Rule likewise calls for specification of the grounds therefor. In this appeal defendant does not undertake her burden to demonstrate reversible error in the court granting her a divorce without an award of alimony and for her attorney fees. This is undoubtedly due to her unequivocal testimony at the trial as follows: "Q. Now you are not asking for alimony in this case, are you? A. No, sir. . . . . . . Q. All you're asking for on count one is a divorce, isn't it? Is that right? A. Yes, sir. Q. You understand that you are to pay your own attorney fees and divide the costs? A. Yes, sir. . . . . . . Q. Mrs. Curtis, you understand by not getting any alimony today, you can never get alimony? A. Yes." Since defendant has not briefed the various grounds set forth in her motion for new trial they are not properly before us in this review. Our independent review of the evidence presented at the hearing on the motion for new trial leads to the conclusion that, as indicated by the comment of the trial judge, they were without merit and unsupported by the evidence. As was declared in Hamm v. Hamm, Mo.App., 437 S.W.2d 449, 1. c. 454, [quoting from Parker v. Britton, 133 Mo.App. 270, 278, 113 S.W. 259, 261] "[A] party is bound and presumed to know the general leading points which will be litigated in his case [and] if he omits to procure evidence, which with ordinary diligence he might have procured, in relation to those points, upon the first trial, his motion for a new trial for the purpose of introducing such testimony shall be denied." The trial court did not commit error in failing to award defendant alimony and further attorney fees. In granting defendant a divorce without these awards the trial court gave defendant all the relief she requested. There was no evidence to support such allowances, and, to the contrary, defendant's own testimony negated and disclaimed alimony and attorney fees. Alimony is not mandatory and if allowed, upon the facts of the case, it must be fixed at the time the divorce is granted. Smith v. Smith, 350 Mo. 104, 164 S.W.2d 921; Ruckman v. Ruckman, Mo.App., 337 S.W.2d 100. The chancellor, in limiting the decree to a divorce had no alternative and did not err in omitting the now-claimed allowances. However charitable the motive of the chancellor in granting defendant a new trial the Rules, decisions and principles set forth herein compel us to reverse the order granting defendant a new trial. This leaves the question in the second appeal, namely, the award of the lower court to defendant of temporary alimony, attorney fees and suit money, pending the appeal on Count I. Plaintiff first contends the lower court had no jurisdiction to make these allowances since (1) defendant had obtained a divorce without alimony, (2) the divorce was final, and, (3) § 452.070, 1969 RSMo, V.A.M.S., limits alimony to "pending the suit for divorce". Such a strict construction of this statute is not warranted by the many decisions construing it and Ruckman v. Ruckman, Mo.App., 337 S.W.2d 100, cited by plaintiff in support of his contention, does not aid him. In Ruckman the wife sought a divorce, alimony and attorney fees. The decree was granted with an allowance for her attorney fees. She filed a motion for new trial on the issues of alimony and inadequate attorney fees and following submission of the motion, the court set aside the original decree and entered a new judgment granting plaintiff a divorce, alimony in gross, and the same allowance for her attorney fees. On appeal, inter alia, the court held there *35 was no showing that the trial court did not have sufficient evidence on which to base an allowance of alimony and there was no need for a new trial when the court has the entire case in its breast and upon discovering its error of law, only sought to give a new judgment and to correct its erroneous judgment previously entered. The court further held that the trial court's action was taken within the authority granted it under § 510.330, 1969 RSMo, V.A.M.S., [Rule 78.01, V.A.M.R.] and if the trial court felt that it should have fixed alimony at the time the divorce was granted and failed to do so, it had a sufficient "legal ground" to reconsider its prior judgment when this failure to allow alimony was brought to its attention through plaintiff's motion for a new trial. The court also noted that the trial court did not order a new trial but entered a new judgment responsive to the relief sought by plaintiff. If the divorce decree in the instant case was "final" there would be merit in plaintiff's position. Smith v. Smith, supra; Baker v. Baker, Mo.App., 274 S.W.2d 322; Stokes v. Stokes, Mo.App., 222 S.W.2d 108. Plaintiff's argument overlooks the fact that the decree of October 6, 1971, is not yet final since the trial court granted defendant a new trial and this action of the lower court is the subject of this appeal. Section 452.070, RSMo 1969, V.A.M.S., vests the trial court with requisite authority to make such allowances to a wife, pending appeal, since the divorce action is still pending until the appeal is disposed of. Nolker v. Nolker, Mo., 257 S.W. 798. And this is true whether the judgment be for or against her. Williamson v. Williamson, Mo.App., 167 S.W.2d 94. The authorities cited by plaintiff are not applicable and in the argument portion of his brief concedes the foregoing to be the law of this state by stating: "That a trial court may award a wife an allowance for temporary alimony and suit money pending an appeal is not questioned." Plaintiff further urges that the trial judge abused his discretion in making the allowances pending the appeal since defendant had some separate income of her own, and, jointly owned property with plaintiff. It would serve no useful purpose here to reiterate the principles to be followed by trial courts in exercising their discretion in making such allowances [Biggs v. Biggs, Mo.App., 397 S.W.2d 337(6)]. Nor would a detailed statement of the evidence of the parties, consisting of 50 transcript pages, at the hearing for the allowances shed any material light on the issues. Much of the evidence as to the income, assets, expenditures, and needs of the parties was in conflict and the trial court was in a superior position to resolve the same. Berbiglia v. Berbiglia, Mo.App., 442 S.W.2d 949. Our examination of the transcript and authorities cited in the briefs reveals that the allowances pending the appeal are based upon substantial evidence and are therefore not clearly erroneous; further, that no error of law appears. No manifest abuse of discretion appearing, we defer to the judgment of the trial judge. Gross v. Gross, Mo.App., 319 S.W.2d 880. See Rule 84.16, V.A.M.R. We therefore hold that in granting the divorce without an allowance of alimony or additional attorney fees, there was no trial error to correct and the grant of a new trial was erroneous. The trial court's order granting a new trial is reversed and the decree of divorce is ordered reinstated. The judgment of the trial court as to the allowances pending appeal is affirmed. The costs in case no. 9205 are taxed in favor of the plaintiff and against the defendant. The costs in case no. 9269 are taxed in favor of the defendant and against the plaintiff. TITUS, C. J., STONE, J., and GREENE, Special Judge, concur. HOGAN, J., took no part in the consideration or decision of this case.

2013-10-30 06:35:56.559425+00

Davis

491 S.W.2d 888 (1973) Carmen MENDOZA, Appellant, v. The STATE of Texas, Appellee. No. 45993. Court of Criminal Appeals of Texas. March 28, 1973. *889 Randell C. Riley, Fort Worth, for appellant. Doug Crouch, Dist. Atty., and Michael R. Thomas, T. J. Haire and James J. Heinemann, Asst. Dist. Attys., Fort Worth, Jim D. Vollers, State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION DAVIS, Commissioner. Appeal is taken from a conviction of assault with intent to murder with malice. Appellant contends the court's charge was fundamentally erroneous in that it authorizes a conviction for assault with intent to murder without requiring the jury to find an intent to kill. The complained of portion of the court's charge reads: "Now if you believe from the evidence beyond a reasonable doubt that on or about the 24th day of April, 1971, in Tarrant County, Texas the defendant Carmen Mendoza, with malice aforethought, as that term has been defined, did make an assault in and upon R. W. Bishop, you will find the defendant guilty of an assault with intent to murder with malice aforethought." This Court was faced with a similar question in Smith v. State, 155 Tex. Crim. 190, 233 S.W.2d 138, where the complained of portion of the charge read: "But if from the evidence you believe beyond a reasonable doubt that the defenant, Harrison Smith, on or about the 11th day of December, 1949, in the county of Lubbock and state of Texas, with a deadly weapon, to wit, a rifle, and without malice, as that term has been hereinbefore defined to you, and not in his own proper self-defense, did assault Charles B. Sims, you will find the defendant guilty of assault with intent to murder without malice ...." In Smith v. State, supra, it was held: "A charge is fundamentally erroneous if it authorizes a conviction for an assault with intent to murder without requiring the jury to find an intent to kill." In the instant case, the court did not require the jury to find that appellant did make an assault in and upon R. W. Bishop with intent to kill said R. W. Bishop and, thus, authorized a conviction for an assault with intent to murder without requiring the jury to find an intent to kill. Such omission in the court's charge constitutes fundamental error. Smith v. State, supra; 4 Branch's Ann.P.C., Sec. 1846 (2d ed); Garza v. State, 162 Tex. Crim. 655, 288 S.W.2d 785; see Willson's Texas Criminal Forms, Sec. 3472; McClung's Jury Charges, p. 25. The judgment is reversed and the cause remanded. Opinion approved by the Court.

2013-10-30 06:35:56.56325+00

Rodowsky

704 A.2d 1246 (1998) 348 Md. 526 Stephen P. GINSBERG et al. v. Virginia A. McINTIRE et al. No. 52, Sept. Term, 1997. Court of Appeals of Maryland. January 23, 1998. Modifying Decision on Grant of Reconsideration February 6, 1998. *1247 Carter G. Phillips (Mark D. Schneider, Michael J. Hunseder, Sidley & Austin, on brief), Washington, DC, for appellants. Dale A. Cooter (Cooter, Mangold & Tompert, P.L.L.C., James E. Tompert, all on brief), Washington, DC, for appellees. Before BELL, C.J., ELDRIDGE, RODOWSKY, CHASANOW, RAKER and WILNER, JJ., and ROBERT L. KARWACKI, J. (retired, Specially Assigned). RODOWSKY, Judge. We granted certiorari on our own motion in this appeal, prior to its consideration by the Court of Special Appeals, primarily to consider the following, somewhat argumentatively phrased, issue: "Did the trial court commit reversible error by permitting appellee to call a sitting Maryland state court judge as a witness on an irrelevant issue and to trumpet continually his judicial status before the jury, thereby allowing appellee to stamp her case with the imprimatur of a sitting judge?" The appeal also raises sufficiency of the evidence issues, embellished by the parties' disagreement over who are parties appellant and what damages are included in the final judgment. Kensington Professional Center, Inc. (KPC) developed a relatively small (13,127 s.f.), three-story office building at 10901 Connecticut Avenue in Montgomery County. Formed in November 1984 under Maryland law by Stephen P. Ginsberg, an ophthalmologist and one of the appellants, and by John N. McIntire, the owner of a chain of hardware stores, a builder, and a non-practicing lawyer, KPC was their vehicle for the construction, leasing, and operation of the then contemplated office building. Dr. Ginsberg owned fifty percent of the KPC stock and John McIntire placed his fifty percent of KPC stock in his living trust. Dr. Ginsberg's objective in the venture seems to have been to secure a suitable and stable location for his practice, while John McIntire's objective seems to have been investment. John McIntire died before the building was completed. On his death his widow, Virginia A. McIntire, one of the appellees, became beneficial owner of his KPC stock. When the building was completed Dr. Ginsberg occupied the second floor and managed the building for KPC. In the litigation now before us Virginia McIntire alleges, inter alia, that Dr. Ginsberg violated his duty of loyalty to KPC in a number of ways, including particularly by unilaterally reducing the second floor rent that had been agreed upon with John McIntire. Inasmuch as the verdicts of the fact finders were in favor of the appellees, plaintiffs below, we shall present the facts most favorable to the plaintiffs. Before doing so, however, we point out that there are at least three different leases that appear in the evidence for Dr. Ginsberg's medical offices on the second floor of the KPC building. Each of these leases is to Stephen P. Ginsberg, M.D., P.A., Dr. Ginsberg's professional association (the P.A.). Each lease and any addendum are signed for KPC by Dr. Ginsberg, each lease and any addendum are signed for the P.A. by Dr. Ginsberg, and Dr. Ginsberg admits that he prepared each of the leases. Specifically the leases are: a lease dated February 21, 1987, at an annual rent of $108,200 or $20 per square *1248 foot, for an initial term of five years with four additional five-year extensions at the option of the P.A. (PX 21); a lease dated September 1, 1987, at an annual rent of $86,560 or $16 per square foot, for an initial term of five years with four additional five-year extensions at the option of the P.A., and containing an addendum exercising the first renewal option as of September 1, 1987 (PX 18); and a lease dated September 1, 1987, at an annual rent of $86,560 or $16 per square foot, for an initial term of ten years together with four additional five-year extensions at the option of the P.A. (PX 19). Each lease dated September 1, 1987, bears a legend typed at the top of the first page and reading, "This lease takes precedence over the earlier lease between same parties dated February 21st, 1987." At KPC's organizational meeting Dr. Ginsberg was elected president and a director, John McIntire vice president and a director, Dr. Ginsberg's wife, Ruth Ginsberg, one of the appellants, secretary and treasurer, and John McIntire's longtime accountant, Glenn M. Hendrickson (Hendrickson), assistant secretary-treasurer. John McIntire's stock in KPC was issued to his living trust in consideration of his having contributed the land to the venture, valued at $36,000, and in consideration of services rendered and to be rendered in managing the project Dr. Ginsberg executed a demand note to the order of KPC in the amount of $125,000 in consideration of his stock. KPC also obtained a construction loan from Citizens Savings Bank, F.S.B. (Citizens) for $1,344,000 that closed October 3, 1986, and was repayable in five years from that date. The McIntires and the Ginsbergs personally guaranteed that loan. By November 1986 John McIntire had been stricken with cancer that was so painful that his wife administered shots to him approximately every two and one-half hours. Nevertheless, McIntire was able, through a real estate broker, to acquire Merrill Lynch Realty/Chris Coile, Inc. (Merrill Lynch) as the tenant for the first floor of the building. The lease to Merrill Lynch, dated February 4, 1987, was for a term of ten years commencing on October 1, 1987, at an annual rent of $120,494.04 or $22 per square foot. John McIntire died in Florida on February 25, 1987, of a heart attack following an automobile accident. He and Virginia McIntire had left for Florida on Sunday, February 22, 1987. On the day before their departure, Saturday, February 21, 1987, there was a luncheon at the McIntire home attended by their children and grandchildren who anticipated that John McIntire would not return alive from Florida because of his cancer. After John McIntire's death Dr. Ginsberg assumed the business direction of KPC. Costs of the project exceeded the construction loan, and it was necessary for KPC to borrow an additional $200,000 from Citizens that was secured by a second mortgage dated July 31, 1987. Dr. Ginsberg, Mrs. Ginsberg, and Virginia McIntire personally guaranteed the second mortgage. The discussions between Dr. Ginsberg and Virginia McIntire concerning cost overruns and the additional mortgage financing were the first discussions that she had with Dr. Ginsberg concerning the KPC project after John McIntire's death. In the late summer of 1987, Dr. and Mrs. Ginsberg came to Virginia McIntire's home and explained that additional funds were needed to meet the cost of the building. Mrs. McIntire advanced $120,000. Merrill Lynch moved into the first floor space in August or September of 1987, and the P.A. occupied the second floor beginning in October of that year. The P.A. paid rent at the rate of $16/s.f. The amount that Dr. Ginsberg and John McIntire had agreed upon as KPC's contribution to improving leased space for particular tenants, called "tenant improvements" or "build-outs," was $8/s.f. (the tenant standard). The cost of Merrill Lynch's build-outs were at the tenant standard. Dr. Ginsberg's medical offices, however, were much more expensive. The build-out for the P.A. totaled approximately $145,000 or $26.62/s.f. No part of the third floor was rented until March 1989. That floor consisted of 2240 s.f., 800 s.f. of which were leased in 1989 to a physical therapist for $18/s.f., with four months free rent in lieu of tenant improvements. The rents generated from the two or three tenants were insufficient to meet the expenses *1249 of the building so that the stockholders of KPC regularly advanced monies to offset the negative cash flow. It appears that the building broke even in 1993 and had a slightly positive cash flow in 1994. To the time of trial in February 1996, Mrs. McIntire had loaned roughly $300,000 to the venture, and the Ginsbergs had loaned about $370,000. The repeated calls for stockholder loans to KPC prompted Mrs. McIntire to ask her son-in-law, Richard Michael Powell (Powell), to advise her concerning KPC. Powell had business experience, principally in government-assisted, equity syndication of central city real estate ventures. Following a meeting with Dr. Ginsberg in August of 1988, Dr. Ginsberg sent Powell copies of the respective leases for the first and second floors. The document transmitted as the lease for the second floor was PX 19, a lease with an initial term of ten years at a rental of $16/s.f. The notation on the top of the first page of PX 19 prompted Powell to inquire of Dr. Ginsberg about the February 21, 1987 lease referred to therein. Dr. Ginsberg told Powell that the February 21, 1987 lease had been lost but that its terms were the same as the lease dated September 1, 1987, and that the latter lease had been constructed to replace the lost lease of February 21. Powell explored refinancing the KPC building to reduce expenses, but his efforts were unsuccessful because the cash flow was insufficient. Powell concluded that relief for Mrs. McIntire could not be obtained through refinancing in view of the deal that had been struck between John McIntire and Dr. Ginsberg as evidenced by the lease dated September 1, 1987 (PX 19). The first and second trust loans to Citizens were due December 1, 1992. The loans would have to be refinanced, but Mrs. McIntire took the position that she would not execute any guarantees. By September 1992 both Dr. Ginsberg and Mrs. McIntire had engaged counsel. A meeting was held in October 1992 attended by the Ginsbergs, Powell, who then held a power of attorney to act for Mrs. McIntire, and their respective counsel. In the course of the meeting counsel for Mrs. McIntire asked Dr. Ginsberg if he had a copy of the February 21 lease, and Dr. Ginsberg replied that he did not. Counsel asked why the September 1 lease had been constructed, and Dr. Ginsberg replied that the February lease had been lost. Counsel asked if the terms and conditions of the September lease were identical to those of the February lease, and Dr. Ginsberg replied that they were one and the same. In the fall of 1992 Dr. Ginsberg had again sent to Powell, at his request, operating statements for KPC and copies of the leases, including the new lease for part of the third floor. The lease for the second floor furnished on this occasion, PX 18, differed from the copy previously received by Powell, PX 19, in that PX 18 was for an initial term of five years and contained an addendum exercising the first five-year renewal option. By December 9, 1992, Citizens agreed with the Ginsbergs to extend its loans for three years, on personal guarantees.[1] Mrs. McIntire, however, would not agree, and Citizens proceeded with foreclosure. Ultimately, at the foreclosure sale on May 11, 1993, Mrs. McIntire agreed to the loan extension and signed the guarantee, but only after a prospective buyer whom she knew decided not to bid on the property. In September 1993, Powell received from a Florida attorney who was representing the estate of John McIntire copies of financial statements and correspondence that had been transmitted to that attorney by Hendrickson in September 1987. Included in the material was a letter of July 20, 1987, to Citizens from the appraiser who had valued the KPC property for the first trust construction loan. That appraisal contained synopses of the Merrill Lynch and P.A. leases and reported the latter to be at $20/s.f. Powell had previously asked Hendrickson for a copy of the February 21 lease but Hendrickson said he did not have it and that Dr. Ginsberg "had everything." Powell then engaged counsel, Durke Thompson, Esq. *1250 (Thompson), to determine if the February 21 lease could be located. Thompson, utilizing Maryland Rule 2-404, "Perpetuation of Evidence," deposed Citizens for the purpose of requiring it to produce its records concerning the loans to KPC. That deposition took place on February 9, 1994. Among the documents produced at that deposition was a copy of the February 21, 1987, $20/s.f. lease to the P.A. Also produced at the deposition was a copy of a September 1, 1987 lease to the P.A. at $16/s.f., PX 26, which is identical to PX 18, a lease that the representatives of Mrs. McIntire had previously obtained from Dr. Ginsberg. The instant action was filed July 7, 1994, and was tried on a second amended complaint. The plaintiffs are Mrs. McIntire and The John N. McIntire Trust (the Trust) by and through its trustees, Mrs. McIntire and her daughter, Susan Lawrence. At least two of the counts of the three-count complaint asserted derivative claims on behalf of KPC which is joined as a nominal defendant. Count I alleged breaches by Dr. and Mrs. Ginsberg of their duties of loyalty to KPC. Count II claims on behalf of KPC against the P.A. for non-payment of rent, with late charges and interest, based on the February 21, 1987 lease. Count III of the second amended complaint sounded in deceit and can be read as a claim by Mrs. McIntire in her own right against Dr. Ginsberg only. The plaintiffs demanded a jury trial which the defendants successfully opposed as to Count II, the rent claim, because the preprinted provisions in the form utilized for all of the leases to KPC contained a waiver of jury trial. Counts I and III, however, were tried to a jury.[2] Dr. Ginsberg and Mrs. Ginsberg had separate counsel. By the time this action came to trial in February and March of 1996, the claims asserted under Count I included, in addition to unpaid rent, claims based on the unpaid stock acquisition note, unpaid tenant improvements, unpaid passthroughs to the tenants of landlord's expenses, and the payment by KPC of allegedly excess interest costs on refinanced loans. The claims for compensatory damages against Dr. and Mrs. Ginsberg on Count I were submitted to the jury on special interrogatories, and the jury found against each defendant, awarding compensatory damages to KPC totaling $1,049,852.87. Prior to submission of the case to the jury, Count III, the fraud count, was the subject of extended discussion between court and counsel. With the consent of the plaintiffs, Count III was submitted to the jury as a claim on behalf of KPC. It was submitted against Mrs. Ginsberg as well as against Dr. Ginsberg. The jury found in favor of KPC against Dr. Ginsberg on Count III and awarded the identical damages that had been awarded under Count I. On Count III the jury found in favor of Mrs. Ginsberg. The docket entry of March 5, 1996, reads, "Verdict: As to breach of fiduciary duty and fraud in favor of the plaintiff," followed by an entry reading simply, "Verdict sheet, filed." The clerk's file contains the four verdict sheets described above which itemize, but do not total, the damages and which identify the defendant against whom the damages are assessed. The jury trial resumed the next day to consider punitive damages. The docket entry of March 6, 1996, reads, "Verdict on punitive damages in favor of the plaintiff against the defendant Stephen Ginsberg," followed by the entry, "Verdict sheet, filed." The verdict sheet asked, "Is there an award for punitive damages against Stephen Ginsberg?" to which the jury replied, "Yes," awarding $360,000. On March 8, 1996, the court, sitting nonjury, considered Count II and awarded KPC $196,853.25 in damages, $36,980 in attorney's fees, and $2,979.27 in expenses against the P.A. On March 13, 1996, the clerk noted on the docket the entry in the judgment index of the $360,000 punitive damages judgment as one "in favor of the plaintiff Virginia A. McIntire against the defendant Stephen P. Ginsberg." That same day the clerk noted on the docket the entry in the judgment index of the judgment on Count II in favor of KPC against the P.A. in the amounts set forth above. *1251 Dr. Ginsberg, Mrs. Ginsberg, and the P.A. filed post-trial motions on March 18, 1996. Present appellate counsel for the appellees entered his appearance on May 30, 1996. A hearing was held on the motions on June 11, 1996. The motions were denied, and the docket so noted that day. On August 8, 1996, the clerk docketed an order denying the defendants' post-trial motions and made an entry, "Judgment Entered." On August 19, 1996, the clerk made a docket entry that judgment was entered in favor of KPC against Dr. Ginsberg in the amount of $1,049,852.87, and made a separate docket entry that judgment in the same amount had been entered in favor of KPC against Mrs. Ginsberg. In order to clarify that the judgments against Dr. and Mrs. Ginsberg were joint and several, appellants moved on August 19, 1996, further to amend the judgment, and, by order signed and docketed August 29, 1996, judgment was entered in favor of KPC against Dr. and Mrs. Ginsberg, jointly and severally, in the amount of $1,049,852.87. The order for appeal was filed September 6, 1996. In relevant part the notice of appeal reads as follows: "Dr. Stephen Ginsberg and Ruth Ginsberg, Defendants, hereby notice an appeal from the final judgment entered in this case on August 29, 1996 (by Order vacating the judgment of August 8, 1996 and entering a revised judgment), and from all adverse interlocutory orders and partial judgments." I We begin by addressing appellate procedural issues. Appellants contend that the entire final judgment is that entered on August 29, 1996, and that it does not include either the punitive damages awarded against Dr. Ginsberg or the breach of contract damages awarded against the P.A. Appellees point out that on March 13, 1996, the jury's $360,000 punitive damage verdict and the court's awards totaling $236,812.52 were entered on the docket as judgments and indexed. The issue is governed by Maryland Rule 2-601, prior to its amendment effective October 1, 1997, and by Maryland Rule 2-602. The entry of judgment requires an entry on the file jacket or on the docket. Maryland Rule 2-601(b). Under Rule 2-602(a), "an order or other form of decision ... that adjudicates fewer than all of the claims in an action ... or that adjudicates less than an entire claim, or that adjudicates the rights and liabilities of fewer than all the parties to the action: "(1) is not a final judgment; "(2) does not terminate the action as to any of the claims or any of the parties; and "(3) is subject to revision at any time before the entry of a judgment that adjudicates all of the claims by and against all of the parties." Under Rule 2-602(a) judgment in this action became final on August 29, 1996, when the final adjudications on the claims asserted in Counts I and III were entered, but the document signed by the court and entered on the docket on August 29 did not embrace all of the adjudications that became final judgments on that date. Following the return of the jury verdicts on the claims in Count I and on the compensatory damages part of the claims in Count III, the clerk did not effectively enter judgment on the verdict. The docket entry of March 5, 1996, did not identify the party or parties against whom the verdicts were rendered, and the mere docket notation that the verdict sheet was filed in the court file did not docket the amount of the judgment or identify the parties. The intent of Rule 2-601 at the time of the subject proceedings was for the judgment to be discernable from the docket, without the necessity of examining papers in the court file. See Estep v. Georgetown Leather Design, 320 Md. 277, 577 A.2d 78 (1990). Judgment, however, was effectively entered on Count II by the docketing of the court's order of March 8, 1996, and judgment on that part of the claim in Count III seeking punitive damages was effectively entered on March 13, 1996, by the docketing as a judgment of that verdict. But because the adjudication of all of the claims as to all of the parties had not been docketed, all of the adjudications remained interlocutory until *1252 August 29, 1996. See Quartertime Video & Vending Corp. v. Hanna, 321 Md. 59, 580 A.2d 1073 (1990) (per curiam); Planning Bd. v. Mortimer, 310 Md. 639, 530 A.2d 1237 (1987). A peculiarity in the instant matter has to do with the parties in whose favor judgment is entered on Count III. The August 29, 1996 order in effect merges the amounts of the judgments for compensatory damages against Dr. Ginsberg on Count III and on Count I into a single judgment. That judgment, consistent with the verdict sheet, is in favor of KPC and treats the claim for compensatory damages on Count III as a derivative claim. The judgment for punitive damages on Count III, however, is docketed as a judgment in favor of Mrs. McIntire. No appellant has raised any issue in this Court concerning that discrepancy. Consequently, our only concern is whether the discrepancy prevents the adjudications of the claims in Count III from constituting a final judgment. We hold that the judgment on Count III is final, and that it became appealable when judgment in the action became final and appealable on August 29, 1996. An adjudication which clearly determines an entire claim as to all parties is a final judgment, even if it is or might be in error. The appellees contend that the P.A. is not a party to this appeal because of the way in which the order for appeal was phrased. The consequence, appellees say, is that the judgment on Count II is final but not appealed so that it operates as issue preclusion against the only appellants, Dr. and Mrs. Ginsberg, as to the determination that the lease calling for $20/s.f. rent was the lease agreed upon between Dr. Ginsberg and Mr. McIntire. We need not decide whether the P.A. is a party to this appeal and whether Dr. and Mrs. Ginsberg are precluded from contesting the jury's finding, implicit in the judgment on Count I against Dr. Ginsberg, that the operative lease was that at $20/s.f. This is because we hold in Part II of this opinion that there was sufficient evidence to support the verdict on Count I against Dr. Ginsberg and our reversal of the judgment on Count I against Mrs. Ginsberg, discussed in Part III of this opinion, recognizes the $20/s.f. lease as the operative lease. II Dr. Ginsberg contends before us that his motion for judgment at the conclusion of all of the evidence should have been granted. His brief focuses only on two claims, the one based on the payment of $16/s.f. as opposed to $20/s.f. in rent to KPC, and a claim that a reduction from $125,000 to $50,000 of his note to KPC for stock was unauthorized. Dr. Ginsberg testified that he agreed with John McIntire that the market value rental of the second floor was $16/s.f. According to Dr. Ginsberg, the lease reciting a rent of $20/s.f. was prepared and signed at the request of John McIntire for his use in obtaining the second trust additional financing from Citizens. Similarly, Dr. Ginsberg testified that his stock purchase obligation was reduced by agreement with John McIntire when the latter realized that, because of his cancer, he would be unable to render the anticipated amount of services to KPC so that the $75,000 reduction would equalize the contributions between the corporation's two founders. Dr. Ginsberg's position concerning these two claims was substantially supported by the testimony of Hendrickson who was called as a witness for the defense. Because Hendrickson and Dr. Ginsberg were the only two living people who had personal knowledge of the agreements between Dr. Ginsberg and John McIntire, Dr. Ginsberg submits that his motion for judgment should have been granted. The argument fails both procedurally and substantively. Procedurally, Dr. Ginsberg's motions for judgment at the end of all of the evidence and at the conclusion of the plaintiffs' case did not challenge the sufficiency of the evidence. At the end of the entire case Dr. Ginsberg sought judgment as a matter of law by arguing that limitations had run on all of the claims, and he sought to have Count III dismissed as duplicative of Count I. In arguing that motion for judgment, counsel for Dr. Ginsberg renewed arguments that he had made at the end of the plaintiffs' case in support of his motion for judgment, but the arguments made earlier had not attacked the general sufficiency of the evidence. In any event Dr. Ginsberg's argument rests on credibility and not on the lack of *1253 sufficient evidence. He argues that no reasonable juror could fail to believe Dr. Ginsberg's position because it was fully corroborated by Hendrickson. The short answer, of course, is that the jury need not have believed either Dr. Ginsberg or Hendrickson. Further, the claims on which Dr. Ginsberg focuses are supported by sufficient evidence. John McIntire is said by Dr. Ginsberg to have agreed to the $16/s.f. rental and to a $50,000 payment for stock, but there is no writing signed by John McIntire that corroborates the alleged agreements. Another major credibility issue in the case involved when the leases were signed. Dr. Ginsberg testified that the February 21 and September 1 leases were signed by him in Mr. McIntire's presence at a meeting between only those two persons in McIntire's office, beginning at 10:00 a.m. on Saturday, February 21, 1987. Members of the McIntire family testified that Mr. McIntire was at home that morning and too ill to leave home by himself. Although Dr. Ginsberg argues that the claims against him rest on speculation and not evidence, if the jury found that Dr. Ginsberg had misrepresented that the February 21 lease was lost and had misrepresented that it was identical to the September 1 lease, then the jury properly could infer that the February 21 lease was the true lease. Further, if the jury disbelieved Dr. Ginsberg and Hendrickson concerning the reduction in the stock purchase obligation, the stock purchase claim is supported by Dr. Ginsberg's note to KPC for $125,000. III Mrs. Ginsberg contends that her motion for judgment should have been granted. We agree. Mrs. Ginsberg did not testify at the liability, compensatory damages phase of this trial. Her activities, vis-a-vis KPC, are described principally by Mrs. McIntire and by Hendrickson. The testimony by Mrs. McIntire concerning Mrs. Ginsberg did not involve any claim on which the jury found against Mrs. Ginsberg. Mrs. McIntire described Mrs. Ginsberg's accompanying her husband when he sought loans from Mrs. McIntire to KPC. No claim, however, was based on advances made during the construction period or on the advances made monthly during the years when KPC had a negative cash flow. Hendrickson testified that when the building was completed Mrs. Ginsberg took over paying the bills and running the checkbook. She deposited the rent checks but had no role in determining rent. She had no role in preparing financial statements, which Hendrickson continued to do. Mrs. McIntire also expressed disappointment that, when she offered to assist Mrs. Ginsberg in maintaining the checkbook for KPC, Mrs. Ginsberg advised that she did not need any help. Against the foregoing background, we consider the evidence concerning the specific claims comprising the Count I judgment as that evidence bears on Mrs. Ginsberg. There is no evidence that Mrs. Ginsberg had knowledge of the $20/s.f. lease any earlier than did Mrs. McIntire. Dr. Ginsberg bases the reduction in his obligation to KPC for stock on a memorandum of special meeting of stockholders of KPC dated February 13, 1987, which is signed by Dr. Ginsberg and was prepared for signature by John McIntire or by his wife, but is unsigned. There is no evidence that Mrs. Ginsberg should have questioned those unsigned minutes any earlier than did Mrs. McIntire. There was evidence that Mrs. Ginsberg accompanied Hendrickson to the builder's offices to review and verify the builder's cost figures for the improvements to the medical suite on the second floor. Hendrickson testified that there was an agreement between Dr. Ginsberg and Mr. McIntire under which Dr. Ginsberg would receive the $8/s.f. tenant standard allowance and that, in addition, Dr. Ginsberg would personally expend up to $100,000. If the build-out of the medical suite exceeded the combined amount, as it did by $45,632.77, then, as Hendrickson described the agreement, KPC would carry the amount as an open account until Dr. Ginsberg could pay. Thereafter, when Mrs. McIntire did not make loans to KPC to the same extent as did Dr. Ginsberg, the latter credited his excess "advances" against his obligation for excess build-out. Those credits were carried until 1994 when, on the advice of counsel, they were reversed. *1254 Mrs. McIntire's position in the trial court did not challenge that there was a special arrangement concerning Dr. Ginsberg's build-out, but she did question the length of time the $45,632.77 obligation to KPC remained outstanding and the lack of any interest payments while KPC was carrying this loan to Dr. Ginsberg. Mrs. McIntire claimed that the principal amount should have been paid by January 1, 1990. The jury agreed and awarded $45,632.77 to KPC with interest from January 1, 1990, compounded at eight percent per annum.[3] Appellees' position in this Court is that Mrs. Ginsberg should have collected the debt due to KPC from her husband. But the evidence is that Dr. Ginsberg was paying on the debt by crediting the excess of his advances over those of the other fifty percent stockholder and that by this method the principal was reduced to about $24,000. The record does not inform us of the reason why counsel advised reversing those credits in 1994, and there is no basis in the evidence for considering that Mrs. Ginsberg should have anticipated that advice. Consequently, there is insufficient evidence to hold Ms. Ginsberg liable on the claim for non-payment of the excess build-out. The jury also found Mrs. Ginsberg liable for the failure to collect passthroughs from the P.A. and from the other tenants. Dr. Ginsberg testified that early in 1988 he and Mrs. McIntire agreed to split the passthroughs, that is, each of the two owners would absorb the expenses that otherwise could be passed on to the tenants as additional rent. Dr. Ginsberg said that the agreement recognized that Merrill Lynch was paying a very high rent, and the owners did not want to increase that rent by charging the passthroughs as well. With respect to the second floor, he said that the agreement recognized his services in managing the building. Mrs. McIntire testified in rebuttal that there was no agreement to forego passthroughs, and the jury believed Mrs. McIntire. There is no direct evidence as to what explanation, if any, was given to Mrs. Ginsberg with respect to the non-payment of passthroughs. Mrs. McIntire chose not to call Mrs. Ginsberg as an adverse witness in order to explore Mrs. Ginsberg's knowledge of the details of KPC's business. On the record before us the jury could only speculate whether Mrs. Ginsberg was knowingly aiding and abetting Dr. Ginsberg in violating the rights of the other shareholder or whether Mrs. Ginsberg in good faith believed that the arrangement between her husband and Mrs. McIntire was as described by him in his testimony. The core of Mrs. McIntire's argument for liability of Mrs. Ginsberg on the claims reviewed above is that Mrs. Ginsberg had a duty to collect monies due to the corporation. Here, a determination of whether monies were due to KPC involved a credibility determination adverse to Mrs. Ginsberg's husband. She was thus in a position of conflicting interests, but she was put in that position with the approval of John McIntire, acting as one of the two directors of KPC. This divided loyalty does not in and of itself constitute a breach of duty by Mrs. Ginsberg as treasurer. Compare Goldman v. Rubin, 292 Md. 693, 708, 441 A.2d 713, 722 (1982) (appointment as personal representatives by testator of four of the five directors of the corporation founded by testator caused personal representatives to deal with themselves as directors "as inexorably as if the will had expressly so directed"). Further, Mrs. Ginsberg was not in a position, acting alone, to bring an action in the name of the corporation or to cause the corporation to sue its president, sole surviving director, and fifty percent stockholder. The judgment against Mrs. Ginsberg also includes a claim that KPC paid an amount of interest on its refinanced loans that was beyond that supportable by a proper business judgment, and the claim includes interest on that excess interest. There is no evidence that Mrs. Ginsberg negotiated those loans, or recommended them to the corporation, or had the authority to commit the corporation to those loans. For the foregoing reasons, the judgment against Mrs. Ginsberg will be reversed. *1255 IV Prior to opening statements the defense moved in limine "that if [Thompson] testifies that there be no reference to his present occupation in his testimony."[4] The expressed concern was that this would prejudice the jury. The court denied the motion, observing that "[a]ll witnesses who come and take the stand bring with them whatever history, background or the like they have." Appellants contend that the ruling was erroneous and that the resulting repeated references to Thompson as Judge Thompson so improperly prejudiced the jury that a new trial is required. Mrs. McIntire's threshold response is that a motion in limine does not preserve the issue for appeal. She contends that it was necessary for the defendants to object at the time the references to Judge Thompson were made. We do not agree. That which the motion contemplated would happen did in fact happen. Inasmuch as the court had already ruled that it would not prevent the jury from learning that Thompson had become a judge of the Circuit Court for Montgomery County, there was no need for the defense to insist on the court's reiterating the same ruling when Thompson was referred to as a judge, unless counsel considered that the particular circumstances created some special prejudice. In opening statement counsel for Mrs. McIntire referred to Judge Thompson. By way of example we set forth the following passage: "[Powell], after the aborted foreclosure sale, hires a lawyer in Montgomery County named Durke Thompson. Durke Thompson is now a Circuit Court judge, as is Judge Beard [the trial judge]. Judge Thompson is going to testify in this trial. "And Judge Thompson, then Mr. Thompson, is saying to the bank, everybody is saying to Ginsberg and their lawyers, where is the lease? Do not know, does not matter, same terms. "Thompson is saying to the bank and the bank's lawyers, do you have a copy of this lease? This lease here? The bank is saying, no, we do not have anything like that. And ultimately, Judge Thompson was suspicious, as was Mr. Powell." In the opening statement on behalf of Dr. Ginsberg, his counsel said: "At which point, Durke Thompson, who is now a Judge, but was then an attorney, files a petition to take a deposition at the bank. Everybody knows in advance that the lease is coming up at this deposition. "It is in the files. It is not someone who walks in with it at the last minute. It is not a surprise. We knew exactly what we were doing when we went there to get this deposition." After Mrs. McIntire and Powell had testified, Thompson took the stand. The introductory portion of his testimony is set forth below: "[Mrs. McIntire's Counsel]: I call Judge Durke Thompson..... "Q Judge Thompson, good afternoon. "A Good afternoon. "Q Are you employed, sir? "A Yes, I am. "Q How are you employed? "A I am a judge here in the Circuit Court for Montgomery County. "Q The same court that we are in, like Judge Beard? "A Yes. "Q All right. "A Right upstairs, in fact. "Q And how long have you been a Circuit Court judge? "A It will be two years this minute [sic]. "Q Prior to your appointment as a Circuit Court judge in the Circuit Court for Montgomery County, did you have occasion to represent Mrs. Virginia McIntire? "A Yes, I did. "Q ... You are here pursuant to subpoena? Is that accurate? "A That is correct. *1256 "Q And it is your order to be here just like anybody else? "A That is correct." With but one exception there was no objection to the substance of Thompson's testimony on direct. The objection was sustained to Thompson's statement that it struck him as "unusual" that the February 21, 1987 lease was not with the other documents in Citizens' file. On cross-examination, the first words from Dr. Ginsberg's counsel were, "Judge Thompson." On cross by counsel for Mrs. Ginsberg, the first words were, "Two questions. Judge, good afternoon." A principal defense in this case was limitations. The trial court submitted that issue to the jury, instructing that damages could not be awarded for wrongs that could reasonably have been discovered before June 1991. In the opening phase of final arguments for the plaintiffs, Mrs. McIntire's counsel argued that the lease dated September 1, 1987, was not in fact prepared until after John McIntire's death. In the course of that argument counsel submitted: "[H]ow willing [was Dr. Ginsberg] to answer just a simple question [with] a simple answer, yes, no, I do not know, as opposed to a story which was completely motivated by Durke Thompson's discovery of this document, Judge Thompson? "If Judge Thompson had not discovered this document, [Dr. Ginsberg] would have gotten away with it. Now, not only that, but his story on this transaction on the 21st is impossible. It could not have happened that way." Further: "Never once, ever, until this dispute started, after Durke Thompson had discovered that document, did [Dr. Ginsberg] ever talk about a $16 ... lease to the outside world, never once and never once." Counsel for Mrs. Ginsberg made the summation on behalf of all defendants. Of relevance to the restrictions sought by the motion in limine is the following passage from that argument: "The plaintiff called Judge Thompson, and I have no disagreement with what that man did. Judge Thompson inquired of the bank to see if they had any leases other than this $16 lease, and I do not think they would respond to him..... "So Judge Thompson was a lawyer. He took a records deposition. . . "He succeeded where the doctor did not. Judge Thompson did the right thing. He found the document. It is the same document that Dr. Ginsberg was looking for. Remember, he signed it. He gave it to Mr. McIntire. He did not know what happened to it, and it has been seven years." The prohibition which the defendants sought by their motion in limine is well removed from the central prohibitions against judicial testimony. Maryland Rule 5-605 states flatly that "[t]he judge presiding at the trial may not testify in that trial as a witness. No objection need be made in order to preserve the point." See also Fed. R.Evid. 605.[5] Maryland Rule 16-813, the Maryland Code of Judicial Conduct, Canon 2 B, in part provides: "A judge should not use the prestige of judicial office to advance the private interests of others. . . . A judge should not testify voluntarily as a character witness." The commentary to Canon 2 B points out that, "[t]he testimony of a judge as a character witness injects the prestige of judicial office into the proceeding in which a judge testifies and may be misunderstood to be an official testimonial." Canon 2, in its various manifestations in our sister states, has been used as the starting point for analysis of issues concerning testimony by judges. For example, in Fuller v. Wolters, 119 Idaho 415, 807 P.2d 633 (1991), relied upon by Dr. Ginsberg, the Canon stated that " `[e]xcept in a proceeding involving him personally or in response to an official summons, a judge shall not testify as witness in any court proceeding.' " Fuller, 807 P.2d at 639. In that case the trial court had prohibited two judges who were under *1257 subpoena for the defense in a legal malpractice case from testifying as to their opinion of the competence of the attorney who was sued. Id. The trial court was held not to have abused its discretion because it had "correctly considered the danger of unfair prejudice which could result if a judge testifies. A judge brings the authority of his office to the stand, and jurors might be likely to give greater weight to his testimony than to the testimony of other witnesses. Furthermore, the trial court reached his conclusion "with consideration that other competent experts who are not sitting judges may be called by counterdefendant's attorneys to assist the jury in issues they must decide.'" Id. It has also been held to be "prejudicial to one party for a judge to testify as an expert witness on behalf of the other party with respect to matters that took place before him in his judicial capacity." Merritt v. Reserve Ins. Co., 34 Cal. App. 3d 858, 883, 110 Cal. Rptr. 511, 528 (1973) (bad faith failure to settle). In reliance on Merritt, Cornett v. Johnson, 571 N.E.2d 572 (Ind.Ct.App.1991), held that a judge who heard the action underlying a legal malpractice action should not testify in the subsequent suit. Id. at 575. Similarly, McCool v. Gehret, 657 A.2d 269 (Del.1995), held that, at the trial of a severed claim for tortious interference, based on witness intimidation, the judge who presided over a prior proceeding should not testify that, in the judge's opinion, the witness was very effective at the prior proceeding. Id. at 278-81. Similarly, in an action for legal malpractice in defending a prosecution, the judge who presided over the criminal trial and who was to testify that the government's case was weak, was properly excluded as a witness. See Battle v. Thornton, 646 A.2d 315, 325 (D.C.1994). Relying on the commentary to Canon 2 B, the court in State v. Grimes, 235 N.J.Super. 75, 561 A.2d 647, cert. denied, 118 N.J. 222, 570 A.2d 976 (1989), held that a judge could not be an expert witness on an issue of local law, even if that testimony were otherwise admissible. Grimes, 561 A.2d at 649-50. In Joachim v. Chambers, 815 S.W.2d 234 (Tex.1991), a legal malpractice case, the court held that "[a] judge who testifies as an expert witness for a private litigant provides more than evidence; the judge also confers the prestige and credibility of judicial office to that litigant's position, just as a judge who testifies to the litigant's character." Id. at 238. In a bad faith failure to settle case the Supreme Court of Appeals of Virginia spoke of the "air of unfairness [that] crept into the trial below" when the United States district judge who had heard the underlying action testified for the plaintiff and advised the jury that he had been appointed by the President of the United States and confirmed by the United States Senate. Aetna Cas. & Sur. Co. v. Price, 206 Va. 749, 760, 146 S.E.2d 220, 227 (1966). Reversing a judgment for the defendant in a legal malpractice case, the court in Helmbrecht v. St. Paul Ins. Co., 117 Wis. 2d 74, 343 N.W.2d 132 (Ct.App.1983), aff'd in part and rev'd in part on other grounds, 122 Wis. 2d 94, 362 N.W.2d 118 (1985), referred to the danger that the jury would give undue weight to the testimony of the judge who had tried the underlying action. Helmbrecht, 343 N.W.2d at 135. The court concluded that judges should not be permitted to testify as expert witnesses because judges should be impartial but expert witnesses frequently appear to be advocates. Id. When a judge is subpoenaed as a fact witness, however, the prohibitions are not nearly as stringent. An example is United States v. Frankenthal, 582 F.2d 1102 (7th Cir.1978), where the Government called in rebuttal the judge who had previously been assigned to the case but who had recused after a longtime family friend of the defendants engaged the judge in conversation about the case. Id. at 1105-06. The friend testified for the defense and, on cross-examination, admitted telling the judge that a trial of the case, as scheduled, would hurt the defendants' business, but the witness denied discussing the outcome of the trial. Id. at 1105. On rebuttal the judge testified that the witness was concerned about the effect of a conviction on the business. Id. at 1106. Rejecting an argument that the probative value of the judge's testimony was outweighed by the unfair prejudice derived from the authority and prestige of the judge's *1258 office, the court pointed out that the judge gave only factual testimony and emphasized that the judge, "possessed factual knowledge that was highly pertinent to the jury's task, and he was the only possible source of testimony on that knowledge." Id. at 1108. Nevertheless, the court did agree with the defendants "to the extent that calling a judge to give testimony in any proceeding is a very delicate matter." Id. at 1107. Other cases considering testimony by a judge concerning earlier proceedings over which the judge had presided also have cautioned against calling a judge as a witness. The Colorado intermediate court in People v. Drake, 841 P.2d 364 (Colo.Ct.App.1992), articulated a standard of necessity, saying: "[T]here is no statutory or ethical prohibition in Colorado preventing a judge from testifying as a witness in a case not on trial before that judge about matters arising in a former trial over which that judge presided. Nevertheless, given the weight to which a jury might accord such evidence and given the judge's other duties, we view the practice of doing so as one which should be sparingly used and only when the proponent of the evidence shows that the judge's testimony is not only relevant but also necessary to prove a material element of the case." Id. at 368. There, in a prosecution for perjury of a witness at a prior trial, the state called the judge who presided over that trial to testify as to the material issues. Id. at 367. Because those issues could have been proved by other evidence, the appellate court concluded that there had been no necessity to call the judge. Id. at 368. This was not plain error, however, inasmuch as the defense was duress. Id. Drake's standard was quoted favorably in Battle, 646 A.2d at 325. Much the same approach has been taken by the Supreme Court of Connecticut. In Gold v. Warden, State Prison, 222 Conn. 312, 610 A.2d 1153 (1992), a prisoner petitioning for habeas corpus relief contended that he was incompetent at the time of his conviction, Gold, 610 A.2d at 1154, and the state called the judge who had presided over the criminal trial to testify as to the petitioner's demeanor at that trial. Id. at 1156. The court recognized that "[a] judge is not disqualified and is a competent witness to testify at a new trial or collateral proceeding to observed facts that occurred before him or her at a former trial or proceeding," id. at 1157, and that "an examination of the mental processes of a judge in arriving at a judicial decision should not be permitted." Id. n. 11. Further, the court said that "[w]e do not encourage the calling of a judge as a witness in subsequent proceedings in a case over which the judge presided. Where there is a compelling need for a judge's testimony as to observed facts in order that justice be done, however, a judge is a competent witness and should not be precluded from testifying." Id. at 1157 (citation omitted). Because the judge-witness had been afforded "a unique opportunity to observe the petitioner's demeanor throughout the entire trial," there was a "compelling need" for the judge to testify in the habeas corpus proceeding. Id. More analogous factually to the case now before us is People v. Jordan, 205 Ill.App.3d 116, 150 Ill. Dec. 415, 562 N.E.2d 1218 (1990), appeal denied, 136 Ill. 2d 549, 153 Ill. Dec. 379, 567 N.E.2d 337 (1991). Jordan was a prosecution for the rape and murder of an eleven-year-old child. Jordan, 150 Ill.Dec. at 416, 562 N.E.2d at 1219. The accused had confessed to a prosecuting attorney who became a circuit court judge before the criminal case came to trial. Id. at 417, 562 N.E.2d at 1220. By motion in limine the accused unsuccessfully sought to prevent the jury from being told that the former prosecutorwitness was employed as a judge. Id. at 418, 562 N.E.2d at 1221. This denial was affirmed on appeal on the following rationale: "In the present case, we cannot say that the trial court manifestly abused its discretion in denying defendant's motion in limine. Certainly, the jury was entitled to know that [the former prosecutor] was now employed as an associate judge in Du Page County. The reason for this is that the witness' occupation and related background is of value to the jury in determining the credibility of the witness and his testimony." Id. Although the motion in limine in Jordan was denied, the trial court instructed the *1259 state not to refer to the witness as judge. Id. During direct examination of the witness the state referred to him as "judge" nine times and in final argument referred to the witness as judge four times. Id. On appeal the defendant argued that the cumulative effect of these references was improperly prejudicial. Id. This argument was not successful because the jury knew the witness's occupation and because the defense had also referred to the witness as a judge. Id. at 419, 562 N.E.2d at 1222. In the instant matter the testimony elicited from witness Thompson did not concern any judicial activity of Judge Thompson. His testimony was limited to factual matters that were relevant to the case and that occurred while he was practicing law. The evidence, however, that the $20/s.f. lease was first obtained on a records deposition to perpetuate evidence was available from sources other than Thompson. Indeed, the deponent, the custodian of records at Citizens, testified to the same facts, but this does not mean that the evidence given by and through Thompson was unnecessary and that he should not have been called. The principal defense in this case was the statute of limitations, inasmuch as Dr. Ginsberg had been paying $16/s.f. rent since 1987. There was evidence that Hendrickson annually reviewed the general ledger with Mrs. McIntire, but Mrs. McIntire did not sue until 1994. Faced with a serious limitations problem, Mrs. McIntire was not required to try her case in a sterile fashion. She was entitled to present the evidence through the attorney who was hired to search for the February 21 lease and thus emphasize the difficulty of the investigation as a justification for the delay. The fact that the attorney had become a judge in the interim did not preclude this tactic. Inasmuch as Mrs. McIntire had a right to call her former attorney as a fact witness, the jury was entitled to hear that the witness was, at the time of testifying, a circuit court judge in Montgomery County. It is simply a part of the customary, preliminary background examination of any fact witness. What we said in Baltimore v. Zell, 279 Md. 23, 367 A.2d 14 (1977), is apropos here: "It is a routine practice in trials for an attorney to ask his witness certain preliminary questions which may not be relevant to the issues being litigated, which may go beyond mere identification and which are designed to show that the witness will be somewhat credible or not biased in favor of the side calling him. For example, the educational background or professional status or employment position of a nonexpert witness may be asked, or the witness's lack of prior contact with the side who has called him may be brought out. These questions give the jury some knowledge of the individual and a more complete perspective in considering his testimony." Id. at 28, 367 A.2d at 17. We point out that the issue under review is the denial of the defendants' motion in limine. During opening statements, the eliciting of evidence, and final argument, both sides repeatedly referred to "Judge" Thompson, but the defendants did not object to any of these references by Mrs. McIntire. Thus, the defendants did not consider that the particular circumstances surrounding the use of the title, "judge," on any particular occasion caused the use of the title to be any more prejudicial than had been indicated in the argument in support of the motion in limine. V We summarize. •Judgment against Dr. Ginsberg for compensatory damages of $1,049,852.87 on Count I in favor of KPC and for punitive damages of $360,000 on Count III in favor of Mrs. McIntire are affirmed. •Judgment against Mrs. Ginsberg on Count I is reversed. •Judgment against the P.A. for compensatory damages of $236,812.52 (including $36,980 in attorney's fees and $2,979.27 in expenses) in favor of KPC on Count II is affirmed. The extent to which any satisfaction of the judgment against the P.A., in whole or in part, operates as satisfaction of the judgment against Dr. Ginsberg is not ripe. JUDGMENTS OF THE CIRCUIT COURT FOR MONTGOMERY COUNTY AGAINST APPELLANTS, STEPHEN P. GINSBERG AND STEPHEN P. GINSBERG, M.D., P.A., ARE AFFIRMED. JUDGMENT AGAINST APPELLANT, *1260 RUTH GINSBERG, IS REVERSED. COSTS TO BE PAID SIXTY-SIX AND TWO-THIRDS PERCENT BY THE APPELLANTS, STEPHEN P. GINSBERG AND STEPHEN P. GINSBERG, M.D., P.A., AND THIRTY-THREE AND ONE-THIRD PERCENT BY VIRGINIA A. McINTIRE, ONE OF THE APPELLEES. ELDRIDGE, J., concurs in the result only. ON MOTION FOR RECONSIDERATION Dr. Ginsberg has moved for reconsideration, limited to the judgment for punitive damages of $360,000 entered by the Clerk of the Circuit Court for Montgomery County as a judgment in favor of Mrs. McIntire. Dr. Ginsberg avers that this judgment was mistakenly entered in favor of Mrs. McIntire and should be modified to a judgment in favor of KPC. He seeks leave from this Court to file a motion under Rule 2-535(d) in the Circuit Court for Montgomery County in order to have that court correct the name of the party in whose favor the judgment for punitive damages was entered. Now, therefore, it is this 6th day of February, 1998, by the Court of Appeals of Maryland ORDERED that Part V of the opinion and the mandate in the above-referenced appeal are modified to read as follows: "V "We summarize. "•Judgment against Dr. Ginsberg for compensatory damages of $1,049,852.87 on Count I in favor of KPC is affirmed. "•Judgment against Dr. Ginsberg for punitive damages of $360,000 on Count III is remanded, without affirmance or reversal, in order to rule on a motion by Dr. Ginsberg pursuant to Rule 2-535(d) seeking the relief described above. "•Judgment against Mrs. Ginsberg on Count I is reversed. "•Judgment against the P.A. for compensatory damages of $236,812.52 (including $36,980 in attorney's fees and $2,979.27 in expenses) in favor of KPC on Count II is affirmed. The extent to which any satisfaction of the judgment against the P.A., in whole or in part, operates as satisfaction of the judgment against Dr. Ginsberg is not ripe. "JUDGMENTS OF THE CIRCUIT COURT FOR MONTGOMERY COUNTY AGAINST APPELLANT, STEPHEN P. GINSBERG, ON COUNT I AND AGAINST STEPHEN P. GINSBERG, M.D., P.A., ON COUNT II ARE AFFIRMED. "JUDGMENT AGAINST STEPHEN P. GINSBERG FOR PUNITIVE DAMAGES ON COUNT III IS REMANDED, WITHOUT AFFIRMANCE OR REVERSAL, FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION ON MOTION FOR RECONSIDERATION. "JUDGMENT AGAINST APPELLANT, RUTH GINSBERG, IS REVERSED. "COSTS TO BE PAID SIXTY-SIX AND TWO-THIRDS PERCENT BY STEPHEN P. GINSBERG AND STEPHEN P. GINSBURG, M.D., P.A., AND THIRTY-THREE AND ONE-THIRD PERCENT BY VIRGINIA A McINTIRE, ONE OF THE APPELLEES. NOTES [1] The work up for the Board of Directors of Citizens recommending the extension of the KPC loans utilized $16/s.f. as the rent paid by the P.A. [2] No issue has been raised before us as to the propriety, under Maryland practice, of trying to a jury a stockholder's derivative claim on behalf of a corporation against its director and/or officer. [3] No issue concerning the computation of damages is presented in this appeal. [4] The motion was made by counsel for Mrs. Ginsberg, but, inasmuch as the motion, if granted, would benefit all defendants, we consider that all non-nominal defendants joined in the motion. [5] These rules effect a 180-degree alteration from the early common law. 6 Wigmore, Evidence § 1909, at 761 (Chadbourn rev. 1976), states: "That a judge may give testimony as a witness in a trial before a court of which he is a member seems in the classical English practice not to have been doubted, though the precedents are scanty."

2013-10-30 06:35:56.57768+00

Crow

994 F. Supp. 1322 (1998) UNITED STATES of America, Plaintiff, v. Asceneth VILLOTA-GOMEZ aka Asceneth Villota Gomez, and Luis Armando Perea-Vivas, aka Jorge Colon Perez, Defendants. Nos. 97-40084-01-SAC, 97-40084-02-SAC. United States District Court, D. Kansas. January 21, 1998. *1323 *1324 *1325 *1326 Marilyn M. Trubey, David J. Phillips, Office of Federal Public Defender, Topeka, KS, for Asceneth Villota-Gomez aka Asceneth Villota Gomez, defendants. Thomas G. Luedke, Office of U.S. Atty., Topeka, KS, for U.S. MEMORANDUM AND ORDER CROW, Senior District Judge. On October 7, 1997, the grand jury returned a two count indictment charging the defendants, Asceneth Villota-Gomez and Luis Armando Perea-Vivas, with one count of possession with the intent to distribute in excess of five kilograms of cocaine (21 U.S.C. § 841) and one count of conspiracy to possess with the intent to distribute approximately five kilograms of cocaine hydrochloride (21 U.S.C. § 846). This case comes before the court upon the following pretrial motions filed by the defendants: MOTIONS FILED BY VILLOTA-GOMEZ (Represented by Marilyn M. Trubey) 1. Motion and Memorandum in support of Motion to Suppress Evidence (Dk.33). 2. Motion for a Bill of Particulars (Dk.32). 3. Motion for Disclosure of 404(b) Evidence (Dk.31). MOTIONS FILED BY PEREA-VIVAS (Represented by F.G. Manzanares): 1. Motion to Suppress Evidence (Dk.29). 2. Motion for Trial Severance (Dk.23); Memorandum in Support of Motion for Trial Severance (Dk.24). 3. Motion to Compel Disclosure of Existence and Substance of Promises of Immunity, Leniency or Preferential Treatment (Dk.25); Memorandum in Support of Defendant Perea-Vivas' Motion to Compel Disclosure of Preferential Treatment (Dk.26). 4. Motion by Defendant Luis Armando Perea-Vivas For an Order Directing the Government to Disclose Whether it Intends to Offer into Evidence Proof of Other Crimes, Wrongs or Acts Under Rule 404(b) of the Federal Rules of Evidence (Dk.27). 5. Motion of (Sic) Disclosure of Plea Agreement (Dk.28). *1327 The government has filed responses to the defendants' motions. See (Dk.__ and __). Motion and Memorandum in support of Motion to Suppress Evidence (Dk.33). Villota-Gomez contends that her Fourth Amendment rights were violated when she was unlawfully stopped by Trooper Smith of the Kansas Highway Patrol. In her brief, Villota-Gomez denies that she was speeding. However, Villota-Gomez did not testify at the hearing. Villota-Gomez proffers that she only sped up by two or three miles per hour as Trooper Smith approached from behind "in order to allow Trooper Smith's vehicle to pass her." Villota-Gomez contends that she was unlawfully detained following the unlawful stop and that her subsequent consent is invalid.[1] The government responds, indicating that Villota-Gomez was stopped for speeding, that all of the facts known to Trooper Smith gave him a reasonable suspicion to ask additional questions following the completion of the traffic stop and that Villota-Gomez' consent to search was voluntary. Legal Standards In general, there are three types of citizen-police encounters: (1) consensual encounters, which involve a citizen's voluntary cooperation with an official's non-coercive questioning and which are not seizures within the meaning of the Fourth Amendment; (2) investigative detentions or "Terry stops," which are seizures that are justified only if articulable facts and reasonable inferences drawn from those facts support a reasonable suspicion that a person has committed or is committing a crime; and (3) arrests, which are seizures characterized by highly intrusive or lengthy detention and which require probable cause to believe that the arrestee has committed or is committing a crime. United States v. Seslar, 996 F.2d 1058, 1060 (10th Cir.1993). "[A] traffic stop is valid under the Fourth Amendment if the stop is based on an observed traffic violation or if the police officer has reasonable articulable suspicion that a traffic or equipment violation has occurred or is occurring." United States v. Botero-Ospina, 71 F.3d 783, 787 (10th Cir.1995). "Our sole inquiry is whether this particular officer had reasonable suspicion that this particular motorist violated any one of the multitude of applicable traffic and equipment regulations of the jurisdiction." Id. (quoting Delaware v. Prouse, 440 U.S. 648, 661, 99 S. Ct. 1391, 59 L. Ed. 2d 660 (1979)). For purposes of Fourth Amendment analysis, it does not matter whether: (1) "the stop in question is sufficiently ordinary or routine according to the general practice of the police department or the particular officer making the stop," quoting United States v. Ferguson, 8 F.3d 385, 391 (6th Cir.1993), cert. denied, 513 U.S. 828, 115 S. Ct. 97, 130 L. Ed. 2d 47 (1994); and (2) "the officer may have had other subjective motives for stopping the vehicle." Botero-Ospina, 71 F.3d at 787. The law governing the conduct of an officer during a traffic stop is well-settled in the Tenth Circuit: An officer conducting a routine traffic stop may request a driver's license and vehicle registration, run a computer check, *1328 and issue a citation. When the driver has produced a valid license and proof that he is entitled to operate the car, he must be allowed to proceed on his way, without being subject to further delay by police for additional questioning. [quoting United States v. Fernandez, 18 F.3d 874, 878 (10th Cir.1994).] United States v. Gonzalez-Lerma, 14 F.3d 1479, 1483 (10th Cir.1994) teaches that further questioning and the concomitant detention of a driver are permissible in either of two circumstances: (1) during the course of the traffic stop the officer acquires an objectively reasonable and articulable suspicion that the driver is engaged in illegal activity (see, e.g., United States v. Soto, 988 F.2d 1548, 1554 (10th Cir.1993); United States v. Horn, 970 F.2d 728, 732 (10th Cir.1992)) or (2) the driver voluntarily consents to the officer's additional questioning. In the first situation a Fourth Amendment seizure has taken place, but it is reasonable and consequently constitutional. In the second there is no seizure, and hence the Fourth Amendment's strictures are not implicated. But if neither of those factors is present, evidence derived from further questioning (or, a fortiori, from an ensuing search) is impermissibly tainted in Fourth Amendment terms. United States v. Sandoval, 29 F.3d 537, 539-540 (10th Cir.1994); see United States v. Lee, 73 F.3d 1034-1039 (10th Cir.1996). Voluntariness of Continued Encounter Florida v. Bostick, 501 U.S. 429, 439, 111 S. Ct. 2382, 2389, 115 L. Ed. 2d 389 (1991) has reconfirmed the Supreme Court's adherence: to the rule that, in order to determine whether a particular encounter constitutes a seizure, a court must consider all the circumstances surrounding the encounter to determine whether the police conduct would have communicated to a reasonable person that the person was not free to decline the officers' requests or otherwise terminate the encounter. That totality-of-the-circumstances approach means that "[n]o single factor dictates whether a seizure has occurred" (United States v. Houston, 21 F.3d 1035, 1037 (10th Cir.1994)). In the context of traffic stops this Circuit has adopted as an indicium of a seizure the officer's taking of necessary documentation (driver's license and vehicle registration) from a driver, and we have also considered as a necessary (but not always sufficient) condition of the termination of that seizure the officer's return of such documentation — both of those rulings being based on the premise that the requisite consent is impossible because no "reasonable person" would feel free to leave without such documentation (United States v. McKneely, 6 F.3d 1447, 1451 (10th Cir.1993)). After the point at which the driver has his or her other documentation back, the touchstone of our analysis is simply whether — adapting the language of Bostick to the circumstances of a traffic stop — the driver (United States v. Werking, 915 F.2d 1404, 1408 (10th Cir.1990)): has an objective reason to believe that he was not free to end his conversation with the law enforcement officer and proceed on his way. Where such a belief is present based on the "objective" facts of the situation, a voluntary police-citizen encounter is said to arise (see, e.g., McKneely, 6 F.3d at 1451-53; Werking, 915 F.2d at 1409). Sandoval, 29 F.3d at 540; see Lee, 73 F.3d at 1040 (The Tenth Circuit has "consistently held `that an encounter initiated by a traffic stop may not be deemed consensual unless the driver's documents have been returned to him.'") (quoting United States v. Gonzalez-Lerma, 14 F.3d 1479, 1483 (10th Cir.), cert. denied, 511 U.S. 1095, 114 S. Ct. 1862, 128 L. Ed. 2d 484 (1994)). "A limited number of routine questions about travel plans and relationship to passengers, followed by a question about possession of contraband and a request to search, are not sufficient to render an otherwise consensual encounter coercive." United States v. Hernandez, 93 F.3d 1493, 1499 (10th Cir.1996). Reasonable Suspicion Detention "can only be justified if specific and articulable facts and rational inferences drawn from those facts gave rise to a reasonable suspicion of criminal activity." Sandoval, 29 F.3d at 542. *1329 Consensual Searches Under the Fourth and Fourteenth Amendments a search conducted without a warrant issued upon probable cause is per se unreasonable, subject only to a few specifically established and well-delineated exceptions. Schneckloth v. Bustamonte, 412 U.S. 218, 219, 93 S. Ct. 2041, 36 L. Ed. 2d 854 (1973). A search authorized by consent is wholly valid and is a well-recognized exception to the prohibition against warrantless searches. 412 U.S. at 219. Voluntariness is a question of fact to be determined from the totality of all the circumstances. 412 U.S. at 227. The Government has the burden of proving the voluntariness of the consent. 412 U.S. at 222; Soto, 988 F.2d at 1557 ("The voluntariness of consent must be determined from the totality of the circumstances, and the government bears the burden of proof on the issue.").[2] The government "must demonstrate with clear and positive testimony that consent was `unequivocal and specific' and `freely and intelligently' given." United States v. Dewitt, 946 F.2d 1497, 1500 (10th Cir.1991) (quoting United States v. Abbott, 546 F.2d 883, 885 (10th Cir.1977)), cert. denied, 502 U.S. 1118, 112 S. Ct. 1233, 117 L. Ed. 2d 467 (1992). The Government must also prove that the consent was given without duress or coercion, express or implied. Id. The Tenth Circuit has developed a two-step inquiry to determine whether the government has sustained its burden of showing that the consent to search was voluntary. To admit evidence obtained from a search, wherein consent was given, the following must be found: (1) There must be a clear and positive testimony that consent was unequivocal and specific and freely given; and (2) The government must prove consent was given without duress or coercion, express or implied. United States v. Butler, 966 F.2d 559, 562 (10th Cir.1992) (citing United States v. Price, 925 F.2d 1268, 1270-71 (10th Cir.1991)). "When making this determination, the court should not presume that the consent was either voluntary or involuntary." Soto, 988 F.2d at 1557. A law enforcement officer is not required to specifically tell the driver that he is free to leave in order for an encounter to be consensual. United States v. Anderson, 114 F.3d 1059 (10th Cir.1997) (citing Ohio v. Robinette, 519 U.S. 33, 117 S. Ct. 417, 421, 136 L. Ed. 2d 347 (1996) (rejecting per-se rule that detention pursuant to a traffic stop cannot become consensual until officer has told detainee that he is free to leave) and United States v. Elliott, 107 F.3d 810, 814 (10th Cir.1997) (noting that encounter was consensual even though officer did not tell driver she was free to go)). Findings On October 7, 1997, Kansas Highway Patrolman Brian K. Smith was on routine patrol on I-35 as it passes through Osage County, Kansas. I-35 is a highway commonly used to transport narcotics from the south to the north. As Trooper Smith was traveling in a southbound direction, he observed Villota-Gomez' vehicle, a 1991 Buick Park Avenue, approaching from the opposite direction on I-35 at a speed he believed to be in excess of 70 m.p.h., the lawful speed limit.[3]*1330 Trooper Smith's radar detector indicated that the vehicle was traveling at 79 m.p.h., or nine miles per hour over the posted speed limit. Trooper Smith then turned across the median separating the north and southbound lanes and proceeded to overtake the Buick. Trooper Smith activated the lights on his vehicle and the Buick pulled to the side of the road. At the time that the lights were activated, the video-recorder in Trooper Smith's car automatically began recording.[4] Trooper Smith asked the driver of the vehicle for her driver's license, registration and proof of insurance. As Trooper Smith stood next to the car, he noticed the strong odor of "bondo," a substance used as body putty, and fresh paint coming from the interior of the car. However, Trooper Smith saw no signs of recent repair. From his knowledge and experience, Trooper Smith knew that drug traffickers often used bondo or similar substances to close hidden compartments used for transporting narcotics. The Texas drivers license indicated that the driver's name was Asceneth Villota-Gomez. The passenger carried a Texas identification card bearing the name Jorge Colon Perez. After handing his identification to Trooper Smith, the passenger simple stared forward and avoided eye contact with Trooper Smith. After receiving the occupants' identification and the other paperwork regarding the automobile, Trooper Smith noticed that neither the driver nor the passenger was the owner of the automobile. The occupants seemed unusually nervous. At Trooper Smith's request, Villota-Gomez followed him back to his patrol car. As Trooper Smith was completing his computer checks and preparing the warning citation he struck up a conversation with Villota-Gomez, asking her about the owner of the car and where she was going. Villota-Gomez indicated that she had borrowed the car from a person she knew as "Yolanda," but did not know her last name. Villota-Gomez also indicated that she was going to her cousin Amanda's wedding in Kansas City. However, Villota-Gomez did not know where the wedding was going to be held and apparently did not know her cousin's exact address. Instead, Villota-Gomez was to meet someone in Kansas City on "Indiana" at a convenience store. After completing the computer checks and filling out the citation, Trooper Smith returned the paperwork to Villota-Gomez. Trooper Smith only issued a warning citation to Villota-Gomez for speeding. Based upon his mounting suspicion, Trooper Smith asked for consent to search the vehicle. Villota-Gomez consented and opened the trunk. During his search of the vehicle, Trooper Smith found over five kilograms of cocaine behind the rear seat in a hidden compartment. Both Villota-Gomez and Perea-Vivas were placed under arrest. Analysis Based upon the facts presented at the December 17, 1997, hearing, the court denies Villota-Gomez' motion to suppress. Villota-Gomez was lawfully stopped for speeding. Trooper Smith's questions while waiting for the computer checks to be completed did not lengthen the time necessary to issue the warning citation. Upon the return of her identification and other paperwork, Villota-Gomez should have reasonably understood that she was free to leave, albeit that Trooper Smith did not tell her so expressly. In short, this case bears none of the indicia that might have given rise a reasonable belief that Villota-Gomez and her passenger were *1331 not free to leave. See McKneely, 6 F.3d at 1451 (citing United States v. McKneely, 810 F. Supp. 1537, 1544 (D.Utah 1993)). After it is was clear that she was free to leave, Villota-Gomez voluntarily consented to the search of the vehicle.[5] Nothing in the manner in which Trooper Smith asked for permission to search the vehicle was coercive. The government has presented clear and positive testimony that Villota-Gomez' consent was unequivocal and specific and freely given and that her consent was not the product of duress or coercion, express or implied. Villota-Gomez' motion to suppress is denied. Motion to Suppress Evidence (Dk.29). Perea-Vivas seeks an order suppressing his post-arrest statements to Senior Special Agent Sal Molina of the Immigration and Naturalization Service. In his motion, Perea-Vivas argues that at the time he made statements to SA Molina, he had invoked his Miranda rights.[6] Consequently, the defendant seeks suppression of his statements based upon a Miranda violation. Because the defendant's motion is not accompanied by a memorandum or any discussion of the facts, he does not identify with any specificity the statements he seeks to suppress. The government responds, indicating that the only statements made by Perea-Vivas were elicited during routine booking procedures. *1332 Those statements apparently recant Perea-Vivas' previous false statements regarding his identity and place of origin. The government contends that Senior Special Agent Sal Molina was merely attempting to obtain accurate biographical information to properly identify the defendant and was not attempting to elicit incriminating information from him. Miranda and Booking Procedures In United States v. Parra, 2 F.3d 1058 (10th Cir.),[7]cert. denied, 510 U.S. 1026, 114 S. Ct. 639, 126 L. Ed. 2d 597 (1993), the Tenth Circuit considered an issue similar to the one apparently at bar: Mr. Sotelo contends that the district court erred in denying his motion to suppress statements regarding his identity that he made during questioning by Agent Robert Godshall of the Immigration and Naturalization Service ("INS"). The district court held, and the government now argues, that the questioning fell within the "routine booking questions" exception to Miranda. We disagree with the district court, but conclude that its error was harmless. Agent Godshall first questioned Sotelo shortly after his arrest at the motel room on May 14, 1991. At that time, Sotelo gave his name as Ricardo Duarte Antion. He also confessed to having entered the country illegally. After Sotelo was taken into state custody at the Bernalillo County Detention Center ("BCDC"), the INS placed a detainer on him so that when he was released, he would be released into federal custody. While Sotelo was in state custody, Agent Godshall attempted to research the immigration history of Ricardo Duarte Antion. Unable to find any reference to a person of that name, Agent Godshall conducted further research and determined that Sotelo was Jose Sotelo Duarate and that he had been deported from the United States. Upon being informed by officials at the BCDC on May 17, 1991 that Sotelo was about to post bond, Agent Godshall proceeded to the BCDC to take Sotelo into federal custody. At the BCDC, Agent Godshall encountered Sotelo in the booking area where Sotelo was attempting to recover his belongings in preparation for his release. Hoping to get Sotelo to admit his real name, Agent Godshall asked Sotelo, "How is it going, Jose?" After Sotelo responded affirmatively to that name, Agent Godshall said, "So that's your name, Jose. It's not Ricardo Duarte?" Sotelo admitted that Duarte was not his name. Agent Godshall testified that he engaged Sotelo in this conversation to get him to admit his true name. He further testified that information related to Sotelo's identity would help him determine whether Sotelo was in the country illegally. Sotelo contends that this questioning at the BCDC was in violation of his Miranda rights. We agree. It is well established that a suspect may not be subjected to custodial interrogation in the absence of an attorney once that suspect has chosen to exercise her Miranda rights. See Edwards v. Arizona, 451 U.S. 477, 484-85, 101 S. Ct. 1880, 1884-85, 68 L. Ed. 2d 378 (1981); United States v. Giles, 967 F.2d 382, 385 (10th Cir.1992). Unless the suspect knowingly and intentionally waives those rights, the police must refrain from questioning the suspect outside the presence of her lawyer. Edwards, 451 U.S. at 482, 484-85, 101 S. Ct. at 1884-85; Giles, 967 F.2d at 385. The government concedes that Agent Godshall subjected Sotelo to custodial questioning, but contends that the encounter falls within the exception for "routine booking questions." In Pennsylvania v. Muniz, 496 U.S. 582, 110 S. Ct. 2638, 110 L. Ed. 2d 528 (1990), a plurality of the Court recognized the exception "which exempts from Miranda's coverage questions to secure the `biographical data necessary to complete booking or pretrial services.'" Id. at 601-02, 110 S. Ct. at 2650-51 (quoting United States v. Horton, 873 F.2d 180, 181 n. 2 (8th Cir.1989)) (plurality of four justices). The government argues that the questions regarding Sotelo's name fall *1333 squarely within this exception. We disagree. The underlying rationale for the exception is that routine booking questions do not constitute interrogation because they do not normally elicit incriminating responses. See United States v. Clark, 982 F.2d 965, 968 (6th Cir.1993); United States v. Monzon, 869 F.2d 338, 342 (7th Cir.), cert. denied, 490 U.S. 1075, 109 S. Ct. 2087, 104 L. Ed. 2d 650 (1989). As the Muniz plurality itself recognized, "the police may not ask questions, even during booking, that are designed to elicit incriminatory admissions." 496 U.S. at 602 n. 14, 110 S. Ct. at 2650 (internal quotations omitted). Thus, where questions regarding normally routine biographical information are designed to elicit incriminating information, the questioning constitutes interrogation subject to the strictures of Miranda. See United States v. Henley, 984 F.2d 1040, 1042 (9th Cir.1993). In this case, Agent Godshall did not question Sotelo to obtain general booking information. Rather, he questioned Sotelo about his true name for the direct and admitted purpose of linking Sotelo to his incriminating immigration file. Under these circumstances, the questioning was reasonably likely to elicit incriminating information relevant to establishing an essential element necessary for a conviction of being an illegal alien in possession of a firearm. See United States v. Equihua-Juarez, 851 F.2d 1222, 1227 (9th Cir.1988). We therefore conclude that the district court erred when it found that Agent Godshall did not interrogate Sotelo. Because the government concedes that Sotelo was in custody and had not waived his Miranda rights, we further conclude that the court erred in denying the motion to suppress Sotelo's oral statements regarding his identity. Id. at 1067-68. The Tenth Circuit found, however, that the error was harmless beyond a reasonable doubt as the defendant's "identity was never issue during trial" and that there was overwhelming evidence that the defendant used an alias. Id. at 1068. See United States v. Minkowitz, 889 F. Supp. 624, 626-28 (E.D.N.Y.1995) (thoroughly discussing factors to consider in determining whether statements fall within the limited "booking" exception).[8] Findings At the time of his arrest, Perea-Vivas carried a Texas identification card identifying himself as Jorge Colon-Perez. Because it was apparent that Perea-Vivas barely understood the English language, Senior Special Agent Molina, an agent of the Immigration and Naturalization Service, was contacted by law enforcement officers to interview Perea-Vivas. SA Molina is fluent in both Spanish and English. SA Molina arrived during the time Perea-Vivas was being booked. Perea-Vivas identified himself as Jorge Colon-Perez, the same name found on the Texas identification card. In response to SA Molina's question, Perea-Vivas stated that he was from Puerto Rico. Based upon his knowledge of accents, SA Molina was confident that Perea-Vivas' accent was more consistent with the accent a person from Columbia, rather than Puerto Rico. To confirm his suspicion, SA Molina asked Perea-Vivas questions like "What do you call an orange in Puerto Rico?" Perea-Vivas' responses to that question and other similar questions further indicated to SA Molina that Perea-Vivas was not a denizen of Puerto Rico as he claimed. At the time, although he had no information other than Perea-Vivas' own statements regarding his identity and place of origin, SA Molina believed it likely that Perea-Vivas was an illegal alien. In his work with INS, it is obvious that SA Molina is charged with investigating the presence of illegal aliens within the United States. SA Molina advised Perea-Vivas of his Miranda rights in Spanish. Perea-Vivas refused to waive those rights and declined to talk further with law enforcement officers. Despite the fact that Perea-Vivas had invoked his Miranda rights, SA Molina made one additional attempt to extract Perea-Vivas' true identification. SA Molina approached Perea-Vivas one more time and stated something to the effect that "Hey, if you get sick or die while you are in jail, we *1334 won't have any way to contact your family or anyone. Why not tell us the truth about your identity?" Apparently succumbing to the pressure exerted by that question and its predicate, Perea-Vivas revealed his true identity and citizenry to SA Molina. Analysis During the entire time that SA Molina questioned Perea-Vivas, Perea-Vivas was obviously in custody within the meaning of Miranda. It is also clear that prior to the conclusion of the interview by SA Molina, Perea-Vivas was advised of his Miranda rights and that he invoked them prior to admitting his true identity. The only issue is whether SA Molina's custodial questions were part of the routine booking procedure or were they beyond the scope of mere "booking procedures," and instead were questions intended to illicit incriminating statements. Stated another way, were the final questions asked by SA Molina simply part of a predominately clerical procedure intended primarily for bookkeeping, or were they primarily intended for the improper investigative purpose of eliciting incriminating statements from a person who has invoked his Miranda rights? The court believes that the Tenth Circuit's decision in Parra essentially compels it to grant the defendant's motion to suppress his statements about his identity made to SA Molina following his invocation of his Miranda rights. The government's attempt to characterize SA Molina's questions as those concomitant with routine booking ignores the factual similarity of Parra. It is clear that SA Molina's questions to Perea-Vivas following his invocation of his right to remain silent were intended to elicit incriminating admissions regarding Perea-Vivas' "false" identity. In fact, SA Molina essentially admitted that he was attempting to elicit incriminating admissions from Perea-Vivas' about his false identity, while the agent in Parra basically used a "trick" (How is it going, Jose [the defendant's real name]?) as the initial form of "interrogation" in Parra. Although proving a false identity is not an element of either drug trafficking crime with which Perea-Vivas is charged in this case, it is beyond peradventure that a defendant's use of false identification is evidence relevant to show evidence of consciousness of guilt. See United States v. Gomez, 810 F.2d 947, 955 (10th Cir.), cert. denied, 482 U.S. 908, 107 S. Ct. 2488, 96 L. Ed. 2d 379 (1987); United States v. Wilson, 11 F.3d 346, 353 (2nd Cir.1993) ("Moreover, the use of false identification is relevant and admissible to show consciousness of guilt, see United States v. Morales, 577 F.2d 769, 772 (2d Cir.1978) ..."), cert. denied, 511 U.S. 1130, 114 S. Ct. 2142, 128 L. Ed. 2d 870 (1994); Minkowitz, 889 F.Supp. at 628 ("Indeed, the Second Circuit has repeatedly held (at the government's urging) that a defendant's use of false identification is relevant to show consciousness of guilt.") (citing Wilson). That Perea-Vivas gave a false identity to law enforcement officers would clearly undercut any assertion that he was merely an unwitting passenger in the vehicle transporting cocaine. Although SA Molina's questioning was clearly designed to elicit incriminating information regarding Perea-Vivas' alien status, and thereby prove an element of one of the crimes SA Molina suspected Perea-Vivas to have committed, it was also designed to elicit the admission that Perea-Vivas had provided a false identity to law enforcement officers. From the defendant's standpoint, these questions were clearly designed to elicit incriminating information. The fact that the information obtained by that question was actually used in booking the defendant under his true name does not convince the court under the circumstances of this case that this mode of inquiry was part of a routine booking procedure. The government attempts to distinguish Parra in that the agent in Parra was virtually certain that the defendant had given a false identity, whereas SA Molina merely deemed it very likely that Perea-Vivas had given law enforcement officers false identification. The court believes that this is a distinction without a difference in this case, as SA Molina, based upon the information and personal knowledge that he possessed, knew or should have known that his questions were likely to elicit an incriminating response from Perea-Vivas. If this were not so, the court seriously doubts that SA Molina would have pressed the matter of definitely resolving any questions about the defendant's *1335 identity following his invocation of his Miranda rights. In short, the differences in timing and circumstances in Parra seem inconsequential. SA Molina's questioning crossed beyond the bounds of "routine" or "basic" booking procedures. SA Molina's statement and questions were a guise for obtaining incriminating information rather than a perfunctory clerical procedure. In sum, the court concludes Perea-Vivas' statements regarding his true identity were the product of custodial interrogation that cannot be fairly characterized as simply part of routine booking procedures. Perea-Vivas' statements in response to SA Molina's statement and question, "Hey, if you get sick or die while you are in jail, we won't have any way to contact your family or anyone. Why not tell us the truth about your identity?" are suppressed. Motion for a Bill of Particulars (Dk.32). Villota-Gomez seeks an order requiring the government to file a bill of particulars. She contends that a bill of particulars is necessary to avoid unfair surprise, to plead double jeopardy in subsequent cases, to identify coconspirators, aiders and abettors, and to determine the quantity of drugs she is alleged to have conspired to distribute. The government opposes the defendant's motion, arguing that a bill of particulars is unwarranted under the applicable legal standards. The government suggests that based upon his conclusory arguments, the defendant is merely seeking additional discovery in the form of a bill of particulars. Bill of Particulars "An indictment is sufficient `if it contains the elements of the offense charged, putting the defendant on fair notice of the charge against which he must defend and if it enables a defendant to assert an acquittal or conviction in order to prevent being placed in jeopardy twice for the same offense.'" United States v. Poole, 929 F.2d 1476, 1479 (10th Cir.1991) (quoting United States v. Staggs, 881 F.2d 1527, 1530 (10th Cir.1989), cert. denied, 493 U.S. 1020, 110 S. Ct. 719, 107 L. Ed. 2d 739 (1990)). In the Tenth Circuit, it is usually enough for the indictment to track the statute when the statute adequately expresses all of the elements to the offense. United States v. Dunn, 841 F.2d 1026, 1029 (10th Cir.1988). An indictment is held only to minimal constitutional standards. United States v. Edmonson, 962 F.2d 1535, 1541 (10th Cir.1992). The sufficiency of an indictment is judged "by practical rather than technical considerations." Id. The district court has broad discretion in deciding a motion for bill of particulars. Id. "`The purpose of a bill of particulars is to inform the defendant of the charge against him with sufficient precision to allow him to prepare his defense, to minimize surprise at trial, and to enable him to plead double jeopardy in the event of a later prosecution for the same offense.'" Dunn, 841 F.2d at 1029 (quoting United States v. Cole, 755 F.2d 748, 760 (11th Cir.1985)). See United States v. Ivy, 83 F.3d 1266, 1281 (10th Cir.1996) ("The purpose of a bill of particulars is to inform the defendant of the charge against him with sufficient precision to allow him to prepare his defense.") (quoting United States v. Levine, 983 F.2d 165, 166-67 (10th Cir.1992)) (citations and internal quotation marks omitted), cert. denied, ___ U.S. ___, 117 S. Ct. 253, 136 L. Ed. 2d 180 (1996); United States v. Kunzman, 54 F.3d 1522, 1526 (10th Cir.1995). Though it may provide more information, a bill of particulars is not intended to serve as a discovery device or to compel the government's disclosure of the factual proof planned for trial. Dunn, 841 F.2d at 1029.[9] Nor is it a way to require the government's explanation of the legal theories expected at trial. United States v. Gabriel, 715 F.2d 1447, 1449 (10th Cir.1983). Analysis Based upon these standards, the defendant's request for a bill of particulars is denied. The defendant has clearly made an *1336 inadequate showing that a bill of particulars is warranted in this case. The indictment adequately apprises the defendant of the crimes charged. A comparison of the allegations in both counts with those found in the case law establishes the sufficiency of the indictment. As the government suggests, the defendant appears to be fishing for information regarding another, ongoing criminal investigation. Moreover, the government has provided both defendants with "full discovery" which should enable the defendants to understand the government's case. "A bill of particulars is not required when information necessary for a defendant's defense can be obtained through `some other satisfactory form'" United States v. Canino, 949 F.2d 928, 949 (7th Cir.1991) (citations omitted), cert. denied, 504 U.S. 910, 112 S. Ct. 1940, 118 L. Ed. 2d 546 (1992). "The nature and operations of the `open file' policy is an adequate `satisfactory form' of information retrieval, making the bill of particulars unnecessary." Id. (citations omitted); see Kunzman, 54 F.3d at 1526; United States v. Sturmoski, 971 F.2d 452, 460 (10th Cir.1992) (given the government's full disclosure and the defendant's failure to show that he was actually surprised at trial and thereby incurred prejudice to his substantial rights, the district court did not abuse its discretion in denying the defendant's motion for a bill of particulars). In light of the discovery provided by the government, a bill of particulars is not warranted. Under these circumstances, the defendant's request for a bill of particulars is denied. Motion for Disclosure of 404(b) Evidence (Dk.31); Motion by Defendant Luis Armando Perea-Vivas For an Order Directing the Government to Disclose Whether it Intends to Offer into Evidence Proof of Other Crimes, Wrongs or Acts Under Rule 404(b) of the Federal Rules of Evidence (Dk.27). Both defendants seek an order compelling the government to disclose information it intend to offer under Fed.R.Evid. 404(b). The government responds, indicating that at this time it does not intend to offer 404(b) evidence. "If such information becomes available, the government will notify the Court and defendant's counsel immediately." In light of the government's response, the defendant's motions are denied as moot. Motion for Trial Severance (Dk.23). Perea-Vivas seeks a severance under Fed. R.Crim.P. 14. In support of his motion, Perea-Vivas claims that his defendant has made out of court statements which, if introduced, will violate his right of confrontation as established in Bruton v. United States, 391 U.S. 123, 88 S. Ct. 1620, 20 L. Ed. 2d 476 (1968). Perea-Vivas also argues that the jury will not be able to compartmentalize the evidence against each defendant, and the danger of "spillover" will preclude him from receiving a fair trial. None of these claims are described with any factual precision. The government opposes the defendant's motion. In support of this position, the government invokes the general rule in the Tenth Circuit that persons jointly indicted should be jointly tried. In short, the government argues that nothing the defendant argues is sufficient to carry his heavy burden of demonstrating that severance is appropriate. Because the defendant has not presented anything to substantiate his general claim of prejudice, the government asks the court to deny the defendant's request. Analysis Fed.R.Crim.P. 8 provides that "two or more defendants may be charged in the same indictment or information if they are alleged to have participated in the same act or transactions constituting an offense or offenses." In the Tenth Circuit, defendants charged jointly under Rule 8 are not entitled to separate trials as a matter of right. To determine whether joinder is appropriate under Rule 8, the court must consider the facts and circumstances of each case. See United States v. Bailey, 952 F.2d 363, 364-65 (10th Cir.1991).[10] Under proper circumstances, the court may grant severance even if joinder under Rule 8 is appropriate. United States v. Hollis, 971 F.2d 1441, 1456 (10th Cir.1992), *1337 cert. denied, 507 U.S. 985, 113 S. Ct. 1580, 123 L. Ed. 2d 148 (1993). Fed.R.Crim.P. 14 provides in pertinent part: If it appears that a defendant or the government is prejudiced by a joinder of offenses or of defendants in an indictment or information or by such joinder for trial together, the court may order an election or separate trials of counts, grant a severance or provide whatever other relief justice requires... "In determining the merits of a motion for severance, the court must weigh the prejudice to a particular defendant caused by the joinder against the important considerations of economy and expedition in judicial interests." United States v. Mabry, 809 F.2d 671, 681 (10th Cir.), cert. denied, 484 U.S. 874, 108 S. Ct. 33, 98 L. Ed. 2d 164 (1987), and overruled on other grounds, Mathews v. United States, 485 U.S. 58, 108 S. Ct. 883, 99 L. Ed. 2d 54 (1988). Severance is a matter of discretion, not of right, and the defendant bears a heavy burden of demonstrating prejudice to his case. Hollis, 971 F.2d at 1456. "The Supreme Court has emphasized that trial courts have `a continuing duty at all stages of the trial to grant a severance if prejudice does appear.'" United States v. Peveto, 881 F.2d 844, 857 (10th Cir.), cert. denied, 493 U.S. 943, 110 S. Ct. 348, 107 L. Ed. 2d 336 (1989) (quoting Schaffer v. United States, 362 U.S. 511, 80 S. Ct. 945, 4 L. Ed. 2d 921 (1960)). The fact that evidence against one defendant is more incriminating than another is not, standing alone, a basis for severance. United States v. Dill, 693 F.2d 1012 (10th Cir.1982); see also United States v. Cox, 934 F.2d 1114, 1120 (10th Cir.1991) (that the government's evidence was stronger on some counts than on others does not mandate severance under Rule 14). Severance is not required because a defendant might have a better chance of acquittal if the trials had been severed. Peveto, 881 F.2d at 857; United States v. Petersen, 611 F.2d 1313 (10th Cir.), cert. denied, 447 U.S. 905, 100 S. Ct. 2986, 64 L. Ed. 2d 854 (1979). Similarly, a complaint that the "spillover effect" from the evidence that was overwhelming or more damaging against the co-defendant than the evidence against the moving party is insufficient to warrant severance. United States v. Hack, 782 F.2d 862, 870 (10th Cir.), cert. denied, 476 U.S. 1184, 106 S. Ct. 2921, 91 L. Ed. 2d 549 (1986); United States v. Cox, 934 F.2d 1114, 1119 (10th Cir.1991). Moreover, the court may instruct the jury that it should consider individually the charges against each defendant and the evidence presented, and not consider any evidence admitted solely against one defendant against another defendant. See United States v. Warner, 971 F.2d 1189, 1196 (6th Cir.1992) (severance not required if some evidence is admissible against some defendant and not others); see also United States v. Cardall, 885 F.2d 656 (10th Cir.1989) (the assumption that juries can and will follow the instructions they are given is fundamental to our system). Besides being a "preference in the federal system," joint trials "`play a vital role in the criminal justice system.'" Zafiro v. United States, 506 U.S. 534, 113 S. Ct. 933, 122 L. Ed. 2d 317, 324 (1993) (quoting Richardson v. Marsh, 481 U.S. 200, 209, 107 S. Ct. 1702, 95 L. Ed. 2d 176 (1987)). Joint trials promote economy and efficiency and "serve the interests of justice by avoiding the scandal and inequity of inconsistent trials." Richardson, 481 U.S. at 209. Such interests are obviously served in having a joint trial of defendants who are indicted together and are alleged to have participated mutually in the charged offense. See U.S. v. Jenkins, 904 F.2d 549, 557 (10th Cir.), cert. denied, 498 U.S. 962, 111 S. Ct. 395, 112 L. Ed. 2d 404 (1990). Consequently, "[c]ourts generally adhere to the principle that `those indicted together, especially co-conspirators, should be tried together.'" Peveto, 881 F.2d at 857 n. 16 (quoting 8 J. Moore, W. Taggert & J. Wicker, Moore's Federal Practice ¶ 14.05, pp. 14-82 (2 ed.1989)); see Jenkins, 904 F.2d at 556-557 (persons jointly indicted should be tried together); United States v. Brantley, 986 F.2d 379, 383 (10th Cir.1993) (defendants indicted together should be tried together). The Supreme Court recently discussed the issue of severance under Rule 14 in Zafiro: We believe that, when defendants properly have been joined under Rule 8(b), a district court should grant a severance under *1338 Rule 14 only if there is a serious risk that a joint trial would compromise a specific trial right of one of the defendants, or prevent the jury from making a reliable judgment about guilt or innocence. Such a risk might occur when evidence that the jury should not consider against a defendant and that would not be admissible if a defendant were tried alone is admitted against a codefendant. For example, evidence of a codefendant's wrongdoing in some circumstances erroneously could lead a jury to conclude that a defendant was guilty. When many defendants are tried together in a complex case and they have markedly different degrees of culpability, this risk of prejudice is heightened. See Kotteakos v. United States, 328 U.S. 750, 774-775, 66 S. Ct. 1239, 90 L. Ed. 1557 (1946). Evidence that is probative of a defendant's guilt but technically admissible only against a codefendant also might present a risk of prejudice. See Bruton v. United States, 391 U.S. 123, 88 S. Ct. 1620, 20 L. Ed. 2d 476 (1968). Conversely, a defendant might suffer prejudice if essential exculpatory evidence that would be available to a defendant tried alone were unavailable in a joint trial. See, e.g., Tifford v. Wainwright, 588 F.2d 954 (5th Cir.1979) (per curiam). The risk of prejudice will vary with the facts in each case, and district courts may find prejudice in situations not discussed here. When risk of prejudice is high, a district court is more likely to determine that separate trials are necessary, but, as we indicated in Richardson v. Marsh, [481 U.S. 200, 107 S. Ct. 1702, 95 L. Ed. 2d 176 (1987)] less drastic measures, such as limiting instructions, often will suffice to cure any risk of prejudice. See 481 U.S. at 211. Zafiro, 113 S.Ct. at 938, 122 L. Ed. 2d at 325. Rule 14 does not compel severance even when the risk of prejudice is shown, for the trial court still retains the discretion to create a remedy which will abate the risk of prejudice. Id. The mere fact that one defendant seeks to cast blame on the other does not create prejudice. In United States v. Linn, 31 F.3d 987 (10th Cir.1994), the Tenth Circuit rejected a claim of "mutually antagonistic" defenses as a ground for a severance: Here, the mutual antagonism complained of by defendants amounts to no more than finger pointing. The Sturlins maintained that they had nothing to do with the fire at all and that Mr. Linn and others committed the arson as part of a scheme to coerce Guy Sturlin to invest money. Likewise, Mr. Linn contended that he had nothing to do with the fire and that the Sturlins and Mr. Kerns committed the arson. Of course, Defendants also posited that each had nothing to do with the fire and that it was either accidental or due to an unknown arsonist. These defenses simply are not so contradictory that the jury must have necessarily disbelieved one to believe another. The jury could have believed all of Defendants' theories and acquitted all of them, but, unfortunately for Defendants, did not. 31 F.3d at 992. The defendants assert without elaboration that a Bruton problem[11] exists. "`[F]or Bruton to apply, a codefendant's statement must be clearly inculpatory standing alone.'" United States v. Arias, 984 F.2d 1139, 1142 (11th Cir.) (quoting United States v. Satterfield, 743 F.2d 827, 849 (11th Cir.), cert. denied, 471 U.S. 1117, 105 S. Ct. 2362, 86 L. Ed. 2d 262 (1985)), cert. denied, 508 U.S. 979, 113 S. Ct. 2979, 125 L. Ed. 2d 676 (1993); see United States v. Glass, 128 F.3d 1398, 1402-04 (10th Cir.1997) (distinguishing Arias); United States v. Hill, 901 F.2d 880, 884 (10th Cir.1990) (Bruton applies only to "`clearly inculpatory' comments that are `vitally important to the government's case.'" (quoting United States v. Espinosa, 771 F.2d 1382, 1399 (10th Cir.), cert. denied, 474 U.S. 1023, 106 S. Ct. 579, 88 L. Ed. 2d 561 (1985))). Thus, there is not a Bruton problem when "the statement `was not incriminating on its *1339 face, and became so only when linked with evidence introduced later at trial'" United States v. Brazel, 102 F.3d 1120, 1140 (11th Cir.) (quoting Richardson v. Marsh, 481 U.S. 200, 208, 107 S. Ct. 1702, 95 L. Ed. 2d 176 (1987)), cert. denied, ___ U.S. ___, 118 S. Ct. 78, 139 L. Ed. 2d 37 (1997). "Bruton, ..., does not hold that defendants in joint trials involving Bruton problems are entitled to separate trial." United States v. Hill, 901 F.2d 880, 883 (10th Cir. 1990). Bruton problems are avoided, however, by severance, but severance is not required. Id., see United States v. Ridley, 814 F. Supp. 992, 1000-1001 (D.Kan.1993) (severance not compelled when confronted with a potential Bruton problem). "Severance is required `only where admission of the statement in its edited form distorts the meaning of the statement or excludes information substantially exculpatory of the declarant.'" U.S. v. Comeaux, 955 F.2d 586, 590 (8th Cir.) (quoting U.S. v. Long, 900 F.2d 1270, 1279 (8th Cir.1990)), cert. denied, 506 U.S. 845, 113 S. Ct. 135, 121 L. Ed. 2d 89 (1992). Bruton problems may be avoided by redaction of the codefendant's statements coupled with the use of limiting instructions. See Richardson v. Marsh, 481 U.S. 200, 211, 107 S. Ct. 1702, 95 L. Ed. 2d 176 (1987); Ridley, 814 F.Supp. at 1000. Moreover, as the defendant has not identified which statements the other codefendant has made that, if introduced into evidence, are potentially violative of his own confrontation clause rights, it is impossible for the court to evaluate the merits of this claim. The court also notes that coconspirator statements made in furtherance of a conspiracy that satisfy the requirements of Fed.R.Evid. 801(d)(2)(E) also satisfy the Confrontation Clause. See United States v. Garcia, 994 F.2d 1499 (10th Cir.1993); United States v. Mayes, 917 F.2d 457, 464 (10th Cir.1990), cert. denied, 498 U.S. 1125, 111 S. Ct. 1087, 112 L. Ed. 2d 1192 (1991). In this case, the defendant has not demonstrated that severance is appropriate. Nothing presented to the court demonstrates that either defendant will be prejudiced in a manner that cannot be addressed by appropriate instructions to the jury. The defendant's motion for severance is denied. Motion to Compel Disclosure of Existence and Substance of Promises of Immunity, Leniency or Preferential Treatment (Dk.25); Memorandum in Support of Defendant Perea-Vivas' Motion to Compel Disclosure of Preferential Treatment (Dk.26); and Motion or (Sic) Disclosure of Plea Agreement (Dk.28). The defendant seeks disclosure of any offers of immunity, leniency or preferential treatment. The defendant also seeks disclosure of any plea agreements made with any other persons. The government responds, indicating that it has not made any such offers at this time. In regard to the defendant's requests about plea agreements with other persons, the government indicates that "defendant's counsel will be notified if any such agreements are made." In light of this response, the defendant's motion is denied as moot. The government is reminded of its constitutional and statutory obligations of disclosure IT IS THEREFORE ORDERED that Villota-Gomez' "Motion and Memorandum in support of Motion to Suppress Evidence" (Dk.33) is denied. IT IS FURTHER ORDERED that Villota-Gomez' "Motion for a Bill of Particulars" (Dk.32) is denied. IT IS FURTHER ORDERED that Villota-Gomez' "Motion for Disclosure of 404(b) Evidence" (Dk.31) is denied as moot. IT IS FURTHER ORDERED that Perea-Vivas' "Motion to Suppress Evidence" (Dk.29) is granted as set forth in the body of this opinion. IT IS FURTHER ORDERED that Perea-Vivas' "Motion for Trial Severance" (Dk.23) is denied. IT IS FURTHER ORDERED that Perea-Vivas' "Motion to Compel Disclosure of Existence and Substance of Promises of Immunity, Leniency or Preferential Treatment" (Dk.25) is denied as moot. NOTES [1] At the hearing, counsel for Perea-Vivas sought to join in Villota-Gomez' motion to suppress. As a passenger of the vehicle, Perea-Vivas has not demonstrated that he has standing to challenge the lawfulness of the search of the vehicle which resulted in the discovery of cocaine. See United States v. McKneely, 6 F.3d 1447, 1452 (10th Cir.1993) (mere passenger does not have standing to challenge the search of the vehicle). However, "standing to challenge a stop presents issues separate and distinct from standing to challenge a search." [United States v.] Erwin, 875 F.2d [268] at 269 [(10th Cir.1989)]. Therefore, "[e]ven if [a] defendant lacks standing to challenge the search of the car, if the initial stop was illegal, the seized contraband is subject to exclusion under the `fruit of the poison tree' doctrine." Id. at 269 n. 2 (citations omitted). McKneely, 6 F.3d at 1450. In this case, the court concludes that the initial stop of the vehicle was not unlawful and therefore Perea-Vivas has not established a basis upon which to exclude the evidence seized during the search as fruit of the poisonous tree. Nor was there any evidence indicating that Perea-Vivas was otherwise unlawfully detained. Although permitted to join in Villota-Gomez' motion, Perea-Vivas' request for suppression of the evidence is denied. [2] The government's "burden is heavier when consent is given after an illegal stop." United States v. Fernandez, 18 F.3d 874, 881 (10th Cir. 1994). "The government must prove that [the defendant's] consent to search is `sufficiently an act of free will to purge the primary taint of the illegal [seizure], [or] it must be suppressed as fruit of the poisonous tree.'" Id. (quoting United States v. Maez, 872 F.2d 1444, 1453 (10th Cir. 1989)). [3] At the hearing, Villota-Gomez' counsel suggested that Trooper Smith's testimony regarding his ability to judge speed based upon his personal observations was not credible as it is difficult for anyone to accurately assess the speed of an approaching vehicle. Contrary to the defendant's suggestion, the court believes that it is possible for Trooper Smith, a member of the Kansas Highway Patrol for over nine years, to make reasonably accurate estimates of speed based upon his personal observations and extensive experience. In Greenway v. Commonwealth, 487 S.E.2d 224 (Va.1997), the Supreme Court of Virginia made these comments about estimates of speed: "An estimate of the speed at which an automobile was moving at a given time is generally viewed as a matter of common observation rather than expert opinion, and it is accordingly well settled that any person of ordinary experience, ability, and intelligence having the means or opportunity of observation, whether an expert or nonexpert, and without proof of further qualification may express an opinion as to how fast an automobile which came under his observation was going at a particular time. The fact that the witness had not owned or operated an automobile does not preclude him from so testifying. Speed of an automobile is not a matter of exclusive knowledge or skill, but anyone with a knowledge of time and distance is a competent witness to give an estimate; the opportunity and extent of observation goes to the weight of the testimony." Id. at 227(quoting Moore v. Lewis, 201 Va. 522, 525, 111 S.E.2d 788, 790 (1960) (citations omitted)). [4] During the consensual search of the vehicle, the videotape ends. Trooper Smith explained that the tape simply ran out. The court accepts that explanation and ascribes no significance to that fact in its review of the tape and other evidence relevant to this case. [5] Although unnecessary to its decision, the court simply notes that even if the encounter between Villota-Gomez and Trooper Smith at the time she consented to the search was not voluntary, Trooper Smith had reasonable suspicion to briefly detain Villota-Gomez and ask her additional questions in light of all the information gleaned during the traffic stop. Villota-Gomez indicated that she was from Cali, Colombia, a well known source of cocaine. Villota-Gomez' uncertain travel plans were suspicious. As the government suggests, one of the hallmarks of a drug courier is the inability to accurately describe his or her travel itinerary. Those facts, combined with the nervousness of the occupants of the vehicle, the smell of "bondo," and the fact that Villota-Gomez did not know the last name of the owner of the car she had just driven from Texas, justified a few more questions. The court expresses no opinion on the government's suggestion that these facts provided probable cause to search the vehicle. [6] In Miranda v. Arizona, 384 U.S. 436, 444, 86 S. Ct. 1602, 16 L. Ed. 2d 694 (1966), the Supreme Court held that "the prosecution may not use statements, whether exculpatory or inculpatory, stemming from custodial interrogation of the defendant unless it demonstrates the use of procedural safeguards effective to secure the privilege against self-incrimination." "[T]wo requirements must be met before Miranda is applicable; the suspect must be in `custody,' and the questioning must meet the legal definition of `interrogation.'" United States v. Ritchie, 35 F.3d 1477, 1485 (10th Cir.1994) (quoting United States v. Perdue, 8 F.3d 1455, 1463 (10th Cir.1993)). For purposes of Miranda, interrogation "refers not only to express questioning, but also to any words or actions on the part of the police (other than those normally attendant to arrest and custody) that the police should know are reasonably likely to elicit an incriminating response from the suspect." Rhode Island v. Innis, 446 U.S. 291, 301, 100 S. Ct. 1682, 64 L. Ed. 2d 297 (1980) (footnotes omitted). "The latter portion of this definition focuses primarily upon the perceptions of the suspect, rather than the intent of the police." Id. "A person is `in custody' for the purposes of Miranda if he has been deprived of his freedom of action in any significant way," Miranda, 384 U.S. at 444, 86 S. Ct. at 1612, "or his freedom of action has been curtailed to a `degree associated with a formal arrest,' California v. Beheler, 463 U.S. 1121, 1125, 103 S. Ct. 3517, 3520, 77 L. Ed. 2d 1275 (1983)(per curiam)." Ritchie, 35 F.3d at 1477. "A person has been taken into police custody whenever he `has been deprived of his freedom of action in any significant way.'" Perdue, 8 F.3d at 1463 (quoting Miranda, 384 U.S. at 444 (1966)). "The only relevant inquiry is `how a reasonable man in the suspect's position would have understood his situation.'" United States v. Robertson, 19 F.3d 1318, 1321 (10th Cir.) (quoting Perdue, 8 F.3d at 1463) (quoting Berkemer v. McCarty, 468 U.S. 420, 442, 104 S. Ct. 3138, 3151, 82 L. Ed. 2d 317 (1984)), cert. denied, 513 U.S. 906, 115 S. Ct. 271, 130 L. Ed. 2d 189 (1994). In Edwards v. Arizona, 451 U.S. 477, 101 S. Ct. 1880, 68 L. Ed. 2d 378 (1981), the Supreme Court established a second layer of prophylaxis for the Miranda right to counsel: Once a suspect asserts the right, not only must the current interrogation cease, but he may not be approached for further interrogation "until counsel has been made available to him," 451 U.S., at 484-485, 101 S.Ct., at 1884-1885 — which means, we have most recently held, that counsel must be present, Minnick v. Mississippi, 498 U.S. 146, 111 S. Ct. 486, 112 L. Ed. 2d 489 (1990). McNeil v. Wisconsin, 501 U.S. 171, 176-77, 111 S. Ct. 2204, 115 L. Ed. 2d 158 (1991). "The Edwards rule, moreover, is not offense specific: Once a suspect invokes the Miranda right to counsel for interrogation regarding one offense, he may not be reapproached regarding any offense unless counsel is present." Id. 501 U.S. at 177 (citing Arizona v. Roberson, 486 U.S. 675, 108 S. Ct. 2093, 100 L. Ed. 2d 704 (1988)). [7] Although Parra is the most applicable precedent from the Tenth Circuit to discuss the issues presented by Perea-Vivas' motion, neither party cites this case. [8] Prior to the December 17, 1997, hearing, the court provided counsel for the government and the defendant with a copy of Parra and Minkowitz. [9] In light of this holding, the court does not believe that the government's failure to identify all possible coconspirators, aiders and abettors in the indictment is per se prejudicial to the defendant as she suggests. See United States v. Hughes, 817 F.2d 268, 272 (5th Cir.1987) (rejecting per se prejudice rule announced in United States v. Rogers, 617 F. Supp. 1024 (D.C.Colo. 1985)), cert. denied, 484 U.S. 858, 108 S. Ct. 170, 98 L. Ed. 2d 124 (1987). [10] The defendant in this case does not argue that he is not properly joined under Rule 8. [11] In Bruton v. United States, 391 U.S. 123, 88 S. Ct. 1620, 20 L. Ed. 2d 476 (1968), the Supreme Court held that a defendant is deprived of his rights under the Confrontation Clause when his codefendant's confession, which incriminates both defendants, is introduced at their joint trial, even if the jury is instructed to consider that confession only against the non-testifying codefendant.

2013-10-30 06:35:56.607133+00

Reid

704 A.2d 1199 (1997) COMMITTEE FOR VOLUNTARY PRAYER, Appellant, v. John W. WIMBERLY, et al., Appellees. No. 96-CV-703. District of Columbia Court of Appeals. Argued October 1, 1997. Decided December 30, 1997. *1200 David W. New, Washington, DC, for appellant. Judith E. Schaeffer, with whom Arthur B. Spitzer, and Elliot M. Mincberg, were on the brief, Washington, DC, for appellees. Harvey L. Reiter, Steve K. Green, and Jonathan D. Schneider, Washington, DC, filed an amici curiae brief on behalf of American Jewish Congress and Americans United for Separation of Church and State. Before STEADMAN, and REID, Associate Judges, and NEWMAN, Senior Judge. REID, Associate Judge: Appellant, the Committee for Voluntary Prayer,[1] appeals from the judgment of the trial court granting appellees, including Rev. John W. Wimberly, Jr.,[2] summary judgment and enjoining the District of Columbia Board of Elections and Ethics from accepting as "a proper subject of initiative" the District of Columbia Public School Voluntary Prayer Initiative ("the proposed prayer initiative"), under D.C.Code § 1-1320(b) (1992). We affirm. FACTUAL SUMMARY On May 16, 1995, the District of Columbia Board of Elections and Ethics, by a vote of 2-1, accepted the proposed prayer initiative as a proper subject of initiative within the meaning of the D.C.Code provision setting forth the process for voter initiated measures which may become law through a voter election. D.C.Code § 1-1320. Sections 2, 3 and 4 of the proposed prayer initiative read as follows: Section 2. On public school, other public [sic], or other property, non-sectarian, non-proselytizing student-initiated voluntary prayer, invocations and/or benedictions, shall be permitted during compulsory or non-compulsory school-related student assemblies, school-related sporting events, school-related graduation or commencement ceremonies, and other school-related events. Section 3. Nothing in this act shall otherwise diminish the right of any student or person to exercise his or her rights of free speech and religion, including prayer, as permitted by the United States Constitution on public school or other public property, or other property, at times or events other than those stated in Section 2. Section 4. The exercise of these rights on public school or on other public property, or on other property for school-related activities, by students or others, shall not be construed to indicate any support, approval, or sanction by the District of Columbia, any political subdivision thereof, municipal corporation, governmental entity of any description, or any agent or employee of any governmental entity of the contents of any such prayer, invocation, benediction, or other activity, or be an unconstitutional use of any public school property or other public property, or be the promotion or establishment of any religion or religious belief. *1201 On June 12, 1995, Rev. Wimberly and others filed suit against the Board, challenging its acceptance of the proposed prayer initiative under D.C.Code § 1-1320(b)(1); the District of Columbia Human Rights Act, D.C.Code § 1-1320(b)(1)(C); and the First Amendment to the United States Constitution. On June 19, 1995, the Committee for Voluntary Prayer filed a motion to intervene in the lawsuit on the side of the Board of Elections and Ethics. The motion was granted on July 31, 1995. The Committee for Voluntary Prayer and Rev. Wimberly, et al., moved for summary judgment. The trial court sought to apply its understanding of this court's "use of the term `patent'" (or patently unconstitutional) in Hessey v. Burden, 615 A.2d 562 (D.C.1992), and concluded that "this case presents one of those few extreme situations which the Hessey court recognized might arise and properly allow the Superior Court to determine that a proposed measure was not a proper subject for initiative" because it is "patently, obviously, and unquestionably unconstitutional." After its analysis, the trial court granted summary judgment in favor of appellees on April 3, 1996. Appellant filed a motion to alter or amend the trial court's judgment and argued, inter alia, that the trial court "could have allowed part of the initiative to go forward, in particular, the graduation prayer portion."[3] On May 1, 1996, the trial court denied the motion to alter or amend, "for the reasons stated in [its] order entered on April 3, 1996." The Committee for Voluntary Prayer filed a timely appeal. ANALYSIS I. We determine first whether the trial court abused its discretion in conducting a pre-election constitutional review of the proposed prayer initiative.[4] In Hessey, supra, we expressed agreement "with the majority of courts which hold that [pre-election constitutional] review [of proposed initiatives] is imprudent." Id. at 574. Further, we said: "[w]e are ... not persuaded that D.C.Code § 1-1320(b) requires that all legislation enacted by initiative be held constitutional by either the Board or the Superior Court before that initiative may be classified as a `proper subject.'" 615 A.2d at 574. However, we recognized that in certain "extreme" cases the trial court, in its discretion, could conduct a pre-election review of a proposed initiative's constitutionality. As we put it: there may be extreme cases in which it would be both appropriate and efficient to decide the constitutionality of a proposed initiative. An initiative proposing to establish an official religion in the District of Columbia, for example, would be patently unconstitutional. If someone proposed such a measure for submission to the voters, the Board and the Superior Court might well decide to classify it as an improper subject before public funds are spent on an election. Id. We cautioned, however, "that the court's jurisdiction should be very sparingly exercised, and that in the great majority of cases the court in its discretion should decline to consider pre-election challenges to the constitutionality or legality of an initiative." Id.[5]*1202 Accordingly we said, "as a matter of trial court discretion, such review should be reserved for the truly extreme case[s]." Id. We conclude that the trial court did not abuse its discretion in identifying the present case as one of the few suitable for a pre-election constitutional review. See Johnson v. United States, 398 A.2d 354 (D.C.1979) for an analysis of the discretion standard. In light of Supreme Court precedent, identified infra, section 2 of the proposed prayer initiative raises constitutional issues on its face. Accordingly, it was appropriate for the trial court to consider whether this matter fell into one of those "extreme cases" permitting pre-election constitutional review, and to conclude that pre-election review was necessary. Thus, the trial court did not abuse its discretion.[6] II. On the record before us, our next task is to determine whether the trial court committed error in granting summary judgment as a matter of law in favor of appellees. Super. Ct. Civ. R. 56(c). The First Amendment to the Constitution of the United States, by which the District of Columbia is bound, conveys complex mediating principles regarding the religion clauses contained in that amendment. One principle insists upon governmental neutrality in matters of religion; another principle offers accommodation of religion under appropriate circumstances. See Everson v. Board of Education, 330 U.S. 1, 67 S. Ct. 504, 91 L. Ed. 711 (1947); Zorach v. Clauson, 343 U.S. 306, 72 S. Ct. 679, 96 L. Ed. 954 (1952). Moreover, the First Amendment guarantees the free exercise of religion for adherents to a variety of religious dogmas, but as Justice Kennedy said in his majority opinion in Lee v. Weisman, 505 U.S. 577, 112 S. Ct. 2649, 120 L. Ed. 2d 467 (1992), "[t]he principle that government may accommodate the free exercise of religion does not supersede the fundamental limitations imposed by the Establishment Clause." Id. at 587, 112 S. Ct. at 2655. We review the trial court's decision that the proposed prayer initiative is not a proper subject of initiative with these fundamental principles in mind. Despite the "saving" language set forth in sections 3 and 4 of the proposed prayer initiative, we agree with the trial court that section 2 clearly conflicts with decisions of the Supreme Court interpreting the establishment and free exercise of religion clauses of the First Amendment to the Constitution. See Lee, supra; School Dist. of Abington Township v. Schempp, 374 U.S. 203, 83 S. Ct. 1560, 10 L. Ed. 2d 844 (1963); Lemon v. Kurtzman, 403 U.S. 602, 91 S. Ct. 2105, 29 L. Ed. 2d 745 (1995); and Wallace v. Jaffree, 472 U.S. 38, 105 S. Ct. 2479, 86 L. Ed. 2d 29 (1985). Section 2 of the proposed prayer initiative specifies that on any property, public school or otherwise, where "compulsory or non-compulsory" school-related functions are held (including assemblies, sporting events, graduation and commencement exercises), "non-sectarian, non-proselytizing student-initiated voluntary prayer, invocations and/or benedictions, shall be permitted." In Lee, supra, a case involving non-sectarian invocations and benedictions at graduation ceremonies, Justice Kennedy, writing for the majority, reiterated that "there are heightened concerns with protecting freedom of conscience from subtle coercive pressure in the elementary and secondary public schools ... [and that] prayer exercises in public schools carry a particular risk of indirect coercion." Id. at 592, 112 S. Ct. at 2658. Moreover, "[w]hat to most believers may seem nothing more than a reasonable request that the nonbeliever respect their religious practices, in a school context may appear to the nonbeliever or dissenter to be an attempt to employ the machinery of the State to enforce a religious orthodoxy." Id. The fact that some of the school-related events covered by the proposed prayer initiative *1203 are compulsory underscores the coercion which may be brought to bear on students who do not share the religious views of students who initiate prayer. Subtle coercion exists even for non-compulsory school-related functions, as Lee recognizes. Id. at 593-96, 112 S. Ct. at 2658-60. Both types of coercion, direct and indirect, are prohibited by Lee. Id. at 599, 112 S. Ct. at 2661-62. Hence, at least with respect to graduation or commencement ceremonies, section 2 of the proposed prayer initiative is unconstitutional under Lee.[7] While Lee stressed the coercive nature of school sanctioned prayers under the establishment clause of the First Amendment, Jaffree emphasized concepts set forth in Lemon, supra and Schempp, supra, in striking down sections of a state statute authorizing teacher-led voluntary prayer and periods of silence for meditation and voluntary prayer. Under these concepts, legislation passes constitutional muster under the establishment clause of the First Amendment only if (1) it has a "secular legislative purpose"; (2) "its principal or primary effect ... neither advances nor inhibits religion"; and (3) it does "not foster `an excessive government entanglement with religion.'" Jaffree, 472 U.S. at 55-56, 105 S. Ct. at 2489 (quoting Lemon, supra, 403 U.S. at 612-13, 91 S. Ct. at 2111) (other citations omitted). See also Schempp, supra, 374 U.S. at 222, 83 S. Ct. at 1571-72. "In addition, Jaffree emphasized yet another concept, endorsement of religion." Id. at 56, 105 S. Ct. at 2489 (quoting Lynch v. Donnelly, 465 U.S. 668, 690, 104 S. Ct. 1355, 1368, 79 L. Ed. 2d 604 (1984) (O'Connor, J., concurring)). Because the teacher-led voluntary prayer "was an effort on the part of the State of Alabama to encourage a religious activity," Jaffree, supra, 472 U.S. at 41, 105 S. Ct. at 2481, and because the periods of silence for meditation and voluntary prayer "convey[ed] a message of endorsement ... of religion", Jaffree, 472 U.S. at 61, 105 S. Ct. at 2492, the Supreme Court invalidated both provisions under the establishment clause of the First Amendment. Here, section 2 of the proposed prayer initiative has the clear purpose of fostering prayer in the public schools. In its brief, the Committee for Voluntary Prayer states that "[t]he purpose of the prayer initiative is to empower the students to make the decision for themselves ... whether they want to pray or not." However, section 2 is addressed only to those students who wish to initiate prayer. It would place the District of Columbia public school teachers and principals, as agents of the District, in the position of endorsing legislation which has the purpose of fostering prayer by students in the public schools, and whose principal and primary effect is to advance the religious views of those students who lead school prayers. We see no distinction between the teacher-led voluntary prayer struck down in Jaffree and the student-led prayer envisioned by the proposed prayer initiative.[8] In both instances, the District would cease to abide by the fundamental principle of neutrality required by the establishment clause. In short, we cannot say that the trial court erred in concluding that Rev. Wimberly and others were entitled to summary judgment as a matter of law.[9] *1204 Accordingly, for the foregoing reasons, we affirm the judgment of the trial court. So ordered. NOTES [1] The District of Columbia Board of Elections was the original defendant in this case, but elected not to file an appeal. The Committee for Voluntary Prayer intervened on the side of the defendant. [2] Other plaintiffs included the American Civil Liberties Union of the National Capital Area, People for the American Way, and several individuals. [3] Appellants maintained that the following language in section 2 of the proposed prayer initiative could have been stricken before the initiative was submitted to the voters: "compulsory or non-compulsory school-related student assemblies, school-related sporting events, ... and other school-related events." Thus, the proposed prayer initiative would have been limited to "non-proselytizing student-initiated voluntary prayer, invocations and/or benedictions ... during school-related graduation or commencement ceremonies." [4] The Committee for Voluntary Prayer urges us to permit the voters of the District to decide whether to approve the proposed prayer initiative. Whatever may be the appeal of this argument, we are bound by the decisions of this court and of the United States Supreme Court which clearly are applicable in the District of Columbia. Moreover, it would be an exercise in futility for the citizens of the District to vote approval of the proposed prayer initiative if it conflicts with the Constitution of the United States and applicable Supreme Court decisions. Eventually the conflict would be resolved against the validity of the initiative. [5] In Watson v. Buck, 313 U.S. 387, 61 S. Ct. 962, 85 L. Ed. 1416 (1941), a case on review from a federal court which involved a state statute, not a proposed initiative, the Supreme Court cautioned against judicial review of the constitutionality of all aspects of a statute "in advance of efforts to apply the separate provisions" because doing so "is analogous to rendering an advisory opinion upon a statute or a declaratory judgment upon a hypothetical case." Id. at 402, 61 S. Ct. at 967. [6] In Hessey, we gave as an example of such an extreme case a statute that was "patently unconstitutional." 615 A.2d at 574. Contrary to the Committee for Voluntary Prayer's argument, however, that was not presented as necessarily the sole standard for pre-election constitutional review of a proposed initiative. Indeed, to adopt such a "hard and fast" rule might leave no choice with the trial court, and thus, might be inconsistent with the notion of discretion. See Johnson v. United States, supra, 398 A.2d at 361. [7] The Committee for Voluntary Prayer urges us to adopt the approach set forth in Jones v. Clear Creek Indep. Sch. Dist., 977 F.2d 963 (5th Cir. 1992), cert. denied, 508 U.S. 967, 113 S. Ct. 2950, 124 L. Ed. 2d 697 (1993) (Jones II), decided after Lee. There, the fifth circuit upheld a school district's resolution "permitting high school seniors to choose student volunteers to deliver non-sectarian, non-proselytizing invocations at their graduation ceremonies", concluding that the resolution did not violate the establishment clause. Id. at 964. Although the Supreme Court had vacated the fifth circuit's decision in Jones v. Clear Creek Indep. Sch. Dist., 930 F.2d 416 (5th Cir.1991) (Jones I) (which also upheld the school district's resolution) after Lee, supra, 505 U.S. 1215, 112 S. Ct. 3020, 120 L. Ed. 2d 892 (1992), the fifth circuit declined to reach a different result in Jones II. We do not adopt Jones II because it is clearly at odds with Lee. Indeed, during oral argument counsel for the Committee for Voluntary Prayer very candidly stated: "Lee v. Weisman is the law of the land except for the fifth circuit." [8] Other jurisdictions have reached the same conclusion when reviewing provisions virtually identical to section 2 of the proposed initiative. See, e.g., Ingebretsen v. Jackson Pub. Sch. Dist., 88 F.3d 274 (5th Cir.) cert. denied, ___ U.S. ___, 117 S. Ct. 388, 136 L. Ed. 2d 304 (1996); Opinions of the Justices to the House of Representatives, 387 Mass. 1201, 440 N.Ed.2d 1159 (1982). [9] Because of our conclusion, we do not reach the argument that the proposed prayer initiative violates D.C.Code § 1-2520(1) (Supp.1997), the section of the District of Columbia Human Rights Act which currently specifies: It is an unlawful discriminatory practice, subject to the exemptions in § 1-2503(b), for an educational institution: (1) To deny, restrict, or to abridge or condition the use of, or access to, any of its facilities and services to any person otherwise qualified, wholly or partially, for a discriminatory reason, based upon the race, color, religion, national origin, sex, age, marital status, personal appearance, sexual orientation, family responsibilities, political affiliation, source of income or disability of any individual.

2013-10-30 06:35:56.622747+00

Jones

994 F. Supp. 726 (1998) BIZMARK, INC., d/b/a Wells Waters & Gases, Plaintiff, v. The KROGER COMPANY, Defendant. Civil No. 96-0219-B. United States District Court, W.D. Virginia, Big Stone Gap Division. February 13, 1998. *727 Gregory Michael Stewart, Stewart Law Office, P.C., Norton, VA, for Plaintiff. John Leslie Brownlee, Woods, Rogers & Hazlegrove, P.L.C., First Union Tower, Roanoke, VA, William B. Poff, Woods, Rogers & Hazlegrove, P.L.C., Roanoke, VA, for Defendant. OPINION AND ORDER JONES, District Judge. In this contract dispute case, Bizmark, Inc. ("Bizmark") has filed a motion in limine to exclude impeachment evidence of prior felony convictions of Roger Wells ("Wells"), president of Bizmark, at an upcoming trial. Bizmark contends that evidence of Wells' convictions is inadmissible under Fed.R.Evid. 609(b). Finding that more than ten years has elapsed since Wells' release from confinement, as measured from the date on which he was placed on probation, and finding that no specific facts or circumstances support a holding that the probative value of the convictions substantially outweighs their prejudicial effect, I grant Bizmark's motion. I. Facts. From October 1994, to May 1995, Bizmark provided Kroger with helium gas and containers. On September 24, 1996, Bizmark filed suit against Kroger, seeking to recover payments and fees Bizmark alleges are due under its contract with Kroger. As president of Bizmark, Wells will testify as one of Bizmark's primary witnesses. Kroger seeks to introduce proof of Wells' prior felony convictions under Fed.R.Evid. 609(a)(1), in order to impeach his credibility. Wells was convicted in a state court on October 8, 1987, of feloniously counseling, hiring, procuring, and commanding another person to steal property having a value of greater than $200, and of conspiring to commit a felony. Immediately thereafter, the court sentenced Wells to serve two consecutive prison terms of twelve months, then suspended both sentences and placed Wells on supervised probation for two years to be followed by two years of unsupervised probation. II. Analysis. Rule 609(a) permits the introduction of evidence that a witness has been convicted of a crime in order to impeach the credibility of the witness. However, introduction of such evidence is not without restriction: Evidence of a conviction under this rule is not admissible if a period of more than ten years has elapsed since the date of the conviction or of the release of the witness from the confinement imposed for that conviction, whichever is the later date, unless the court determines, in the interests of justice, that the probative value of the conviction supported by specific facts and circumstances substantially outweighs its prejudicial effect. Fed.R.Evid. 609(b). Bizmark contends that the ten-year period began to run when Wells was released from confinement by being placed on probation. Accordingly, Bizmark asserts that Wells' dates of conviction and release from confinement are the same and that measured from October 8, 1987, the ten-year period elapsed on October 8, 1997.[1] Kroger argues that Wells' placement on probation does not constitute release from confinement under rule 609(b) and instead asserts that the ten-year period did not commence until October 8, 1991, when his period of probation expired. The question of whether release on probation constitutes release from confinement *728 under rule 609(b) has not been directly addressed by the Fourth Circuit. However, in United States v. Gray, 852 F.2d 136, 139 (4th Cir.1988), the Fourth Circuit held that the 609(b) time limit began to run when the defendant was released on parole. The clear import of Gray is that "release from confinement," for 609(b) purposes means release from actual imprisonment, and therefore, that neither parole nor probation constitutes confinement under the rule. A number of other courts have reached this conclusion. See United States v. Broncho, No. 94-30420, 1995 WL 470868, *2 (9th Cir. Aug.9, 1995) (unpublished); United States v. Daniel, 957 F.2d 162 (5th Cir.1992); THK America, Inc. v. NSK, Ltd., 917 F. Supp. 563, 569 (N.D.Ill. 1996). The only authority to the contrary cited by Kroger is Trindle v.. Sonat Marine, Inc., 697 F. Supp. 879 (E.D.Pa.1988). The Trindle decision relied exclusively on a 1971 letter from Deputy Attorney General Kleindienst to Chief Justice Burger regarding amendments to rule 609 which would have retained earlier 609(b) language which started the ten-year period running from the date of the expiration of a witness's probation or parole. 697 F. Supp. at 881 n. 4. However, as the Fifth Circuit noted in Daniel, the 1972 amendments to rule 609(b) as actually adopted deleted the provision Kleindienst sought to retain and simply provided that a conviction was not admissible if more than ten years had elapsed since a witness's release from "confinement." 957 F.2d at 168. Accordingly, I find that the ten-year time period began to run at the time that Wells was released on probation. Nevertheless, this does not end the inquiry as to the admissibility of Wells' convictions. Rule 609 makes an exception to the prohibition against using convictions more than ten years old where "the probative value of the conviction supported by specific facts and circumstances substantially outweighs its prejudicial effect." Fed.R.Evid. 609(b) (emphasis added). However, departure from the prohibition is permitted "very rarely and only in exceptional circumstances." United States v. Beahm, 664 F.2d 414, 417 (4th Cir.1981). I find nothing to suggest that the probative value of the convictions would outweigh their prejudicial effect. Wells was convicted of conspiracy and of counseling, hiring, procuring and commanding another person to steal, which offenses do not necessarily carry any element of deceit, falsification or untruthfulness.[2] The purpose of impeachment is not to demonstrate that Wells is a "bad" person, "but rather to show background facts which bear directly on whether jurors ought to believe him." United States v. Cavender, 578 F.2d 528, 534 (4th Cir.1978). On the present record, there is nothing which supports a finding that Wells' remote prior offenses would have more than minimal, if any, bearing on the likelihood that he would testify truthfully. Recognizing that rule 609 requires a finding that the probative value of the conviction substantially outweigh its prejudicial effect, Cavender, 578 F.2d at 531, and concluding that I am unable to make such a finding, I grant Bizmark's motion. III. Conclusion. For the reasons set forth above, it is ORDERED that Bizmark's motion in limine (Doc. No. 23) is granted. NOTES [1] The ten-year period had not elapsed prior to the time that Bizmark filed suit against Kroger on September 24, 1996. However, while the parties disagree as to when the 609(b) time period begins, it is clear that the elapsed time is measured to the point at which the witness actually testifies. United States v. Cathey, 591 F.2d 268, 274 n. 13 (5th Cir.1979). [2] See Graham C. Lilly, An Introduction to the Law of Evidence § 8.3 (3d ed.1996). The better view is that it is impermissible to go beyond the face of the conviction in order to determine whether the crime was committed in a deceitful manner. See 2 Stephen A. Saltzburg et al., Federal Rules of Evidence Manual 1029-32 (7th ed.1998).

2013-10-30 06:35:56.646351+00

Holland

704 A.2d 272 (1998) John M. GANNON, Defendant Below, Appellant, v. STATE of Delaware, Plaintiff Below, Appellee. No. 197, 1997. Supreme Court of Delaware. Submitted: December 9, 1997. Decided: January 7, 1998. Edmund N. Hillis, Assistant Public Defender, Wilmington, for appellant. Timothy J. Donovan, Jr., Deputy Attorney General, Wilmington, for appellee. Before VEASEY, C.J., WALSH, and HOLLAND, JJ. *273 HOLLAND, Justice: Following a jury trial in the Superior Court, the defendant-appellant, John Gannon ("Gannon"), was found guilty of five counts of Burglary in the Second Degree, three counts of Theft Felony, and one count of Theft Misdemeanor. Gannon was subsequently declared an habitual offender pursuant to 11 Del.C. § 4214(b) and sentenced to life imprisonment at Level V without the possibility of parole. This is Gannon's direct appeal of his convictions and sentences. At Gannon's trial, a witness for the State was permitted to testify about statements made to him over the telephone by his young daughter, soon after she had heard an intruder in their home. Gannon contends that this testimony was hearsay, and did not qualify under any exception to the hearsay prohibition. Gannon also argues that, by permitting this hearsay testimony, his rights of confrontation under both the Constitution of the United States and the Delaware Constitution were violated. We have concluded that each of Gannon's contentions is without merit. The testimony offered by the witness about his daughter's remarks satisfied the requirements of the "spontaneous declaration" or "excited utterance" exception to the hearsay rule. The admission of those statements did not violate Gannon's right of confrontation under either the Constitution of the United States or the Delaware Constitution. Facts The charges against Gannon arose in connection with five burglaries in the Wilmington area in 1995. On August 7, 1995, residents in the Fairfax neighborhood, north of Wilmington, called the police to report a person knocking on doors in an unusual manner. Upon arrival, the police were directed by a neighbor to the house where the suspicious person was last seen. The police surrounded the house and obtained a key. Police entered the home, conducted a search, and located Gannon hiding in the basement. Subsequent to his arrest, Gannon provided the police with information regarding his involvement in two additional burglaries on Old Point Road and Monticello Road. The police obtained a search warrant to search Gannon's vehicle. Several items were seized from his vehicle, including jewelry, a camcorder, and a black overnight bag. The camcorder and jewelry were identified as having been stolen from an Amherst Drive home. The identification tag on the overnight bag linked Gannon to the burglary of a Waverly Road home. At Gannon's trial, homeowners from each residence testified for the State that Gannon was not authorized to enter their residences or to remove any items. One homeowner began to testify regarding statements made to him over the telephone by his daughter soon after the alleged burglary. Gannon's attorney objected to the testimony. At side bar, the attorneys presented arguments regarding whether the testimony was impermissible hearsay, or fit within either the "excited utterance" or "present sense impression" exceptions to the hearsay prohibition. Gannon's attorney also objected to the hearsay evidence on the basis that it would violate Gannon's constitutional rights of confrontation. The Superior Court overruled the objections. *274 Excited Utterance Hearsay Rule Exception Although hearsay testimony is generally inadmissible as evidence at trial, there are many exceptions to the rule. See D.R.E. 803(1-25) and 804. The first question presented in this appeal is whether the daughter's remarks to her father qualified as a spontaneous declaration under the "excited utterance" exception to the hearsay rule. An "excited utterance" is defined as "[a] statement relating to a startling event or condition made while the declarant was under the stress of excitement caused by the event or condition." D.R.E. § 803(2). There are three foundational requirements which must be met before a statement can be admitted pursuant to the excited utterance exception in Rule 803(2). See Graham C. Lilly, An Introduction to the Law of Evidence § 7.9 (3d ed.1996) (Excited Utterance). See also 2 McCormick on Evidence § 272 (John William Strong, ed., 4th ed.1992). The exception requires: (1) the excitement of the declarant must have been precipitated by an event; (2) the statement being offered as evidence must have been made during the time period while the excitement of the event was continuing; and (3) the statement must be related to the startling event. 6 Wigmore, Evidence § 1750 (Chadbourn rev.1976). A variety of factors have been considered by courts in determining whether the foundational requirements have been met to qualify the statement being offered into evidence as an excited utterance. See Graham C. Lilly, An Introduction to the Law of Evidence § 7.9 (3d ed.1996). In this case, the witness testified about statements his daughter had made to him, over the telephone, about ten to fifteen minutes after she had heard noises in their home. At the time of the telephone call, the witness's daughter was about 12 years old and was home alone. The witness testified that his daughter stated she was sleeping in her upstairs bedroom and heard her dog barking and footsteps on the stairs. He testified that she told him she called out to see if it was her mother, received no reply, and then heard someone descending the stairs. The witness testified that his daughter told him that she waited before leaving her room to investigate the noise, and when she went downstairs, she found the sliding door open. The witness stated that his daughter seemed frightened when she was speaking to him over the telephone. The record reflects the daughter's statements to her father satisfied all three of the foundational requirements to qualify as "excited utterances." D.R.E. 803(2). Therefore, the Superior Court properly admitted the statements made over the telephone to the witness by his daughter. Consequently, the hearsay aspect of Gannon's argument on appeal is without merit. Confrontation Clause United States Constitution Excited Utterance Exception The second question presented by Gannon in this appeal is whether the admission of a spontaneous declaration, that qualified as an "excited utterance," violated his right of confrontation guaranteed by the United States Constitution. The United States Supreme Court has frequently considered the historical origins of the Confrontation Clause and the law of evidence on hearsay that was extant when the Sixth Amendment to the United States Constitution was adopted in 1791. See Mattox v. United States, 156 U.S. 237, 15 S. Ct. 337, 39 L. Ed. 409 (1895); Graham C. Lilly, An Introduction to the Law of Evidence § 7.29 (3d ed.1996) (The Confrontation Clause: Historical Context). In its examination of those subjects, the United States Supreme Court has acknowledged that "hearsay rules and the Confrontation Clause are generally designed to protect similar values." California v. Green, 399 U.S. 149, 155, 90 S. Ct. 1930, 1933, 26 L. Ed. 2d 489 (1970). It has also recognized that both of those principles of jurisprudence "stem from the same roots." Dutton v. Evans, 400 U.S. 74, 86, 91 S. Ct. 210, 218, 27 L. Ed. 2d 213 (1970). The United States Supreme Court has concluded that "[t]he right of confrontation did not originate with the provision in the Sixth *275 Amendment, but was a common-law right having recognized [hearsay] exceptions." Salinger v. United States, 272 U.S. 542, 548, 47 S. Ct. 173, 175, 71 L. Ed. 398 (1926). Consequently, the United States Supreme Court has been careful "not to equate the Confrontation Clause's prohibitions with the general rule prohibiting the admission of hearsay statements." Idaho v. Wright, 497 U.S. 805, 814, 110 S. Ct. 3139, 3146, 111 L. Ed. 2d 638 (1990); White v. Illinois, 502 U.S. 346, 352, 112 S. Ct. 736, 740, 116 L. Ed. 2d 848 (1992). "The historical evidence leaves little doubt, however, that the [Confrontation] Clause was intended to exclude some hearsay." Ohio v. Roberts, 448 U.S. 56, 63, 100 S. Ct. 2531, 2537, 65 L. Ed. 2d 597 (1980). The courts in the United States, as in England, have adopted the general rule that hearsay evidence is inadmissible. White v. Illinois, 502 U.S. at 356, 112 S. Ct. at 742; Graham C. Lilly, An Introduction to the Law of Evidence § 6.1 (3d ed.1996) (General Principle and Rationale). The general preference for live testimony is attributable to the importance of cross-examination, which has been characterized as "the greatest legal engine ever invented for the discovery of truth." California v. Green, 399 U.S. at 158, 90 S. Ct. at 1935. See Graham C. Lilly, An Introduction to the Law of Evidence § 7.30 (3d ed.1996) (Early Construction of the Confrontation Clause). Nevertheless, the United States Supreme Court has concluded that "a statement that qualifies for admission under a `firmly rooted' hearsay exception is so trustworthy that adversarial testing can be expected to add little to its reliability." White v. Illinois, 502 U.S. at 357, 112 S. Ct. at 743. See Graham C. Lilly, An Introduction to the Law of Evidence § 7.31 (3d ed.1996) (Recent Interpretation of the Confrontation Clause). Consequently, the United States Supreme Court has held that "where proffered hearsay has sufficient guarantees of reliability to come within a firmly rooted exception to the hearsay rule, the Confrontation Clause is satisfied." White v. Illinois, 502 U.S. at 356, 112 S. Ct. at 743. Therefore, statements that qualify as a firmly rooted exception to the hearsay rule are admissible into evidence without a demonstration that the declarant is unavailable. Id. at 357, 112 S. Ct. at 743. The hearsay exception for spontaneous declarations, or excited utterances, is "firmly rooted" in Anglo-American jurisprudence. White v. Illinois, 502 U.S. at 355 n. 8, 112 S. Ct. at 743 n. 8. This exception to the general hearsay rule is currently recognized by Federal Rule of Evidence 803(2) and the rules of evidence in almost every state. Id. It was recognized almost three centuries ago in Thompson v. Trevanion, Skinner 402 (1693). 6 Wigmore, Evidence § 1747, at 196 (Chadbourn rev.1976). "[T]he evidentiary rationale for permitting hearsay testimony regarding spontaneous declarations ... is that such out-of-court declarations are made in contexts that provide substantial guarantees of their trustworthiness." White v. Illinois, 502 U.S. at 355, 112 S. Ct. at 742. The United States Supreme Court has held that the Confrontation Clause of the Sixth Amendment does not require that the prosecution either produce the declarant at trial or have the trial court find that the declarant is unavailable, before a trial court may admit testimonial evidence under the "spontaneous declaration" exception to the hearsay rule. White v. Illinois, 502 U.S. at 356-57, 112 S. Ct. at 742-43. The Confrontation Clause in the Sixth Amendment, as construed by the United States Supreme Court, is applicable to state criminal proceedings by virtue of the Due Process Clause in the Fourteenth Amendment. Pointer v. Texas, 380 U.S. 400, 403, 85 S. Ct. 1065, 1067, 13 L. Ed. 2d 923 (1965). See Michael Kent Curtis, No State Shall Abridge: The Fourteenth Amendment and the Bill of Rights (1986). Therefore, Gannon's rights under the Confrontation Clause of the United States Constitution were not violated by the admission into evidence of a spontaneous declaration that properly qualified as an excited utterance. White v. Illinois, 502 U.S. at 357, 112 S. Ct. at 743. Delaware Constitution Confrontation of Witnesses Excited Utterance Exception The final question presented by Gannon in this appeal is whether admitting a statement *276 into evidence under the "excited utterance" exception to the hearsay rule violated his right of confrontation under the state Bill of Rights in Article I of the Delaware Constitution. Prior to the adoption of the Fourteenth Amendment, in a unanimous decision written by Chief Justice John Marshall in 1833, the United States Supreme Court specifically held that the federal Bill of Rights afforded no protection against any state's action. Barron v. Baltimore, 32 U.S. (7 Pet.) 243, 8 L. Ed. 672 (1833). In that opinion, Chief Justice Marshall explained why the entire federal Bill of Rights was intended solely as a limitation on the exercise of power by the government of the United States, and was not applicable to the legislation of the states: Each state established a constitution for itself, and in that constitution provided such limitations and restrictions on the powers of its particular government as its judgment dictated .... In their several constitutions [the states] have imposed such restrictions on their respective governments as their own wisdom suggested; such as they deemed most proper for themselves. It is a subject on which they judge exclusively .... Barron v. Baltimore, 32 U.S. (7 Pet.) at 247-48. From the Declaration of Independence until the Civil War, state constitutional declarations or bills of rights were the primary guarantors of individual liberties against infringement by state governments. In 1925, there was a paradigm shift in the operation of America's state and federal jurisprudence. The United States Supreme Court began applying the Bill of Rights to the states by incorporating the federal Bill of Rights into the Fourteenth Amendment through the Due Process Clause.[1] Thereafter, the United States Supreme Court continued to hold that other selected provisions of the federal Bill of Rights also afforded protection against state action by virtue of the Due Process Clause of the Fourteenth Amendment, by the process now known as the incorporation doctrine.[2] Earlier in this opinion, we noted that the United States Supreme Court has held the Confrontation Clause in the Sixth Amendment is applicable to the states by virtue of the Fourteenth Amendment. Pointer v. Texas, 380 U.S. 400, 403, 85 S. Ct. 1065, 1067, 13 L. Ed. 2d 923 (1965). Federal Constitutional standards, however, set only a minimum level of protection.[3] The declaration of rights or substantive provisions in a state's constitution may, and often do, provide for broader or additional rights. See Jennifer Friesen, State Constitutional Law: Litigating Individual Rights, Claims and Defenses § 1-6 (2d ed.1996 & Supp. 1997). The expansion beyond federally guaranteed individual liberties by a state constitution is attributable to a variety of reasons: differences in textual language, legislative history, pre-existing state law, structural differences, matters of particular concern, and state traditions.[4] *277 In this case, we begin our analysis of Gannon's claim under the Delaware Constitution by examining the history of the right to confrontation in a Delaware criminal proceeding. Delaware enacted a Declaration of Rights and Fundamental Rules on September 11, 1776. Section 14 provided, inter alia, "that in all prosecutions for criminal offenses, every man hath a right ... to be confronted with the accusers or witnesses...." When the 1776 Constitution of the State of Delaware was adopted nine days later, it provided, inter alia, in Article 25, that "the common law of England, as well as so much of the statute law as have been heretofore adopted in practice in this state, shall remain in force, unless they shall be altered by a future law of the Legislature; such parts only excepted as are repugnant to the rights and privileges contained in this constitution and the declaration of rights ... agreed to by this convention." (emphasis added). The common law of England had recognized spontaneous declarations as an exception to the common law right of confrontation since at least 1693. In an action for assault and battery upon the wife of the plaintiff, Lord Holt held that "what the wife said immediately upon the hurt received, and before that she had time to devise or contrive anything for her own advantage, might be given in evidence." 6 Wigmore, Evidence § 1747 (Chadbourn rev.1976) (citing Thompson v. Trevanion, Skinner 402 (1693)). Therefore, the cognizable common law hearsay exception for spontaneous declarations or excited utterances would be consistent with, not repugnant to, the right of confrontation in Delaware's 1776 Declaration of Rights and Fundamental Rules. When Delaware adopted its 1792 Constitution, its text was not identical to Delaware's Constitution of 1776. The Delaware Constitution of 1792 also was not a mirror image of the United States Constitution that had been adopted just a few years earlier. Claudio v. State, Del.Supr., 585 A.2d 1278, 1289 (1991). The Delaware Bill of Rights, in Article I of the Delaware Constitution of 1792, included many of the provisions that had been stated separately in the 1776 Declaration of Rights and Fundamental Rules. The right of confrontation, in particular, as set forth in Article I of the 1792 Delaware Constitution, was not only worded differently than the 1791 Sixth Amendment of the United States Constitution,[5] but it was also different than the analogous right in the 1776 Delaware Declaration of Rights and Fundamental Rules. The Sixth Amendment to the United States Constitution provides, in part, that "[i]n all criminal prosecutions, the accused shall enjoy the right ... to be confronted with the witnesses against him...." Section 14 of the 1776 Delaware Declaration of Rights and Fundamental Rules provided the right "to be confronted with the accusers or witnesses." Article I, Section 7 in Delaware's 1792 Constitution, however, read that the accused had the right to "meet the witnesses in their examination face to face": In all criminal prosecutions, the accused hath a right to be heard by himself and his counsel, to be plainly and fully informed of the nature and cause of the accusation against him, to meet the witnesses in their examination face to face, to have compulsory process in due time, on application by himself, his friends or counsel, for obtaining witnesses in his favour, and a speedy and public trial by an impartial jury: He shall not be compelled to give evidence against himself; nor shall be deprived of life, liberty, or property, unless by the judgment of his peers, or the law of the land. (emphasis added). In this case, we are not called upon to construe the meaning of "face to face". See Jennifer Friesen, State Constitutional Law: Litigating Individual Rights, Claims and Defenses § 12-12 (2d ed.1996 & Supp.1997).[6] *278 The precise question presented in this case is whether the witness who was being met "face to face" by Gannon at trial could give testimony that included hearsay statements. The United States Supreme Court has noted that "the admissibility of hearsay statements raises concerns lying at the periphery of those that the Confrontation Clause is designed to address." White v. Illinois, 502 U.S. 346, 358, 112 S. Ct. 736, 744, 116 L. Ed. 2d 848 (1992); Coy v. Iowa, 487 U.S. 1012, 1016, 108 S. Ct. 2798, 2800, 101 L. Ed. 2d 857 (1988). In that regard, the words "law of the land" at the end of Article I, Section 7 of the 1792 Delaware Constitution are significant. It is now well established that the phrase "nor shall be deprived of life, liberty, or property, unless by ... the law of the land" in Article I, Section 7 of the Delaware Constitution has substantially the same meaning as "nor be deprived of life, liberty, or property, without due process of law" in the Fifth Amendment of the United States Constitution. Opinion of the Justices, Del.Supr., 246 A.2d 90 (1968). The meaning of those phrases was explained by United States Supreme Court Justice Joseph Story: Lord Coke says, that [the words "by the law of the land"] mean by due process of law, that is, without due presentment or indictment, and being brought in to answer thereto by due process of the common law. So that this clause [i.e., the Due Process Clause of the Fifth Amendment] in effect affirms the right of trial according to the process and proceedings of the common law. 3 J. Story, Commentaries on the Constitution of the United States, § 1783 (1833) (citations omitted) (emphasis added). Thus, when Article I, Section 7 of Delaware's 1792 Constitution is read in pari materia, it gave the accused the right "to meet the witnesses in their examination face to face" pursuant to the "law of the land," i.e., a trial in accordance with the contemporary common law rules of evidence. Because the "right to trial according to the process and proceedings of the common law" rules of evidence in 1792 had recognized the "excited utterance" exception to the hearsay prohibition since 1693, it was part of the "law of the land" by which the witnesses would be examined "face to face." Article I, Section 7 of the current Delaware Constitution of 1897 still provides that "[i]n all criminal prosecutions, the accused hath a right ... to meet witnesses in their examination face to face... nor shall he be deprived of life, liberty or property unless by the judgment of his peers or by the law of the land." The "spontaneous declaration" exception to the hearsay rule was part of the evidentiary common "law of the land" when both that phrase and the right of "face to face" confrontation were simultaneously written into the Delaware Constitution of 1792. Therefore, we hold that the admission of a properly qualified excited utterance into evidence at trial does not violate the confrontation rights afforded to an accused in Delaware since 1792 by Article I, Section 7 of the current Delaware Constitution of 1897. Thus, Gannon's challenge under the Delaware Constitution is also without merit. Compare McGriff v. State, Del.Supr., 672 A.2d 1027, 1030 (1996). Conclusion The judgments of the Superior Court are affirmed. NOTES [1] In upholding New York's criminal anarchy statute the United States Supreme Court said, "For present purposes we may and do assume that freedom of speech and of the press — which are protected by the 1st Amendment from abridgment by Congress — are among the fundamental personal rights and `liberties' protected by the due process clause of the 14th Amendment from impairment by the states." Gitlow v. New York, 268 U.S. 652, 666, 45 S. Ct. 625, 630, 69 L. Ed. 1138 (1925). [2] For discussions regarding the incorporation of the federal Bill of Rights into the Due Process Clause of the Fourteenth Amendment, thereby making them applicable to the states, see Louis Henkin, "Selective Incorporation" in the Fourteenth Amendment, 73 Yale L.J. 74 (1963). [3] See William J. Brennan, Jr., The Bill of Rights and the States: The Revival of State Constitutions as Guardians of Individual Rights, 61 N.Y.U.L.Rev. 535 (1986); William J. Brennan, Jr., State Constitutions and the Protection of Individual Rights, 90 Harv.L.Rev. 489 (1977). [4] See Robert F. Williams, In the Glare of the Supreme Court: Continuing Methodology and Legitimacy Problems in Independent State Constitutional Rights Adjudication, 72 Notre Dame L.Rev. 1015 (1997); Robert F. Williams, In the Supreme Court's Shadow: Legitimacy of State Rejection of Supreme Court Reasoning and Result, 35 S.C. L. REV. 353 (1984). See also State v. Williams, 93 N.J. 39, 459 A.2d 641 (1983) (adopting seven factors and adding three more); State v. Hunt, 91 N.J. 338, 450 A.2d 952, 962-69 (1982) (Handler, J., concurring) (suggesting seven factors that would justify higher level of protection than analogous federal right); State v. Gunwall, 106 Wash.2d 54, 720 P.2d 808, 811-13 (1986). [5] "When the Sixth Amendment was submitted for ratification in 1789, exceptions to the hearsay rule were narrowly restricted. Basically, the American common-law rule against hearsay was that extant in England during the same period. At that time, English courts admitted hearsay evidence only in very limited circumstances...." Graham C. Lilly, An Introduction to the Law of Evidence § 7.29, at 359 (3d ed.1996) (footnotes omitted) (The Confrontation Clause: Historical Context). [6] For an interpretation of the phrase "face to face," see Commonwealth v. Ludwig, 527 Pa. 472, 594 A.2d 281 (1991). In 1995, the Pennsylvania Constitution was amended to replace the right to meet the witnesses "face to face" with the right to "confront" the witnesses. Pa.Const. art. I § 9. Compare Maryland v. Craig, 497 U.S. 836, 110 S. Ct. 3157, 111 L. Ed. 2d 666 (1990).

2013-10-30 06:35:56.680086+00

Morse

704 A.2d 778 (1997) STATE of Vermont, v. Helen CREPEAULT. No. 96-523. Supreme Court of Vermont. October 31, 1997. *779 Jan R. Paul, Essex County State's Attorney, St. Johnsbury, for plaintiff-appellee Charles S. Martin of Martin & Associates, Barre, for defendant-appellant Before DOOLEY, MORSE, JOHNSON and SKOGLUND, JJ., and GIBSON, J. (Ret.), Specially Assigned. MORSE, Justice. Defendant Helen Crepeault appeals her conviction by jury of sexually assaulting one of her sons when he was under the age of ten. 13 V.S.A. § 3253(a)(8). She contends her conviction should be reversed for two reasons: (1) her motion for judgment of acquittal was mistakenly denied, and (2) the prosecution failed to disclose a conflict of interest. We reverse. This case began when defendant's son, J.C., revealed that defendant had sexually assaulted him on a regular basis starting when he was four years old and continuing until he was removed from defendant's home at the age of eleven and placed in the custody *780 of the Department of Social and Rehabilitation Services (SRS). He was fifteen at the time of trial. J.C. testified that defendant had repeatedly forced him to put his penis in her vagina, to lick her vagina, and to submit to her sucking on his penis. According to the State, it was J.C.'s learning of defendant's pregnancy with her eighth child, and his concerns for the safety of the baby, that induced him to come forward. J.C.'s older brother, P.C., like his other siblings, had also been removed from defendant's home and placed in SRS custody. Before that time, however, he stated that he had witnessed defendant and J.C. repeatedly engaged in sexual intercourse and oral sex when J.C. was eight or nine years old. Defendant testified on her own behalf, denying that she had ever sexually abused or threatened any of her children. The information charged defendant with four counts of aggravated sexual assault. The first three counts alleged that defendant had committed certain specific sex acts with a minor under the age of ten, contrary to 13 V.S.A. § 3253(a)(8), and further alleged that the victim had been subjected to repeated nonconsensual acts as part of a common scheme and plan, in violation of 13 V.S.A. § 3253(a)(9). The underlying sexual act alleged in the first count consisted of "forcing [the victim] to put his penis in her vagina"; in the second count, of "placing [defendant's] mouth on [the victim's] penis"; and in the third count, of "forcing [the victim] to put his tongue in her vagina." The fourth count, unlike the first three, did not allege a specific sexual act, but rather charged defendant with having generally "committed a sexual act" upon a victim under the age of ten, and further alleged that defendant had threatened to cause imminent serious bodily injury to the victim, contrary to 13 V.S.A. § 3253(a)(6). The theory underlying the information was apparently to convict defendant of aggravated sexual assault for having committed the three specific sexual acts alleged, with separate enhancements based upon the victim's age, the defendant's common scheme and plan, and the threat to cause imminent serious bodily injury. Each of the first three counts contained the age and common-scheme enhancements. The fourth count was apparently included for the purpose of adding the serious bodily injury enhancement, and included a generic charge of aggravated sexual assault to substitute for the specific sexual acts alleged in the first three counts. Special verdicts submitted to the jury attempted to track the information. Each count was subdivided into two parts — "A" and "B" — and a space for the jury to check "Guilty" or "Not Guilty" followed each subpart. Part A of the first three counts alleged the specific sexual acts as set forth in the information, while Part B set forth the aggravating factor of repeated acts pursuant to a common scheme and plan. Part A of the fourth count contained the general aggravated sexual assault allegation, while part B alleged the aggravating factor of serious bodily injury. Thus the jury was essentially asked to make eight separate determinations of guilt or innocence. Defendant specifically declined any lesser-included offense instructions. The jury returned not guilty verdicts on parts A and B of count 1 (sexual intercourse), count 2 (fellatio), and count 3 (cunnilingus), but guilty as to part A of count 4 (general sexual assault upon a victim under ten) and not guilty of Part B (threat to cause serious bodily injury). Following the verdict, defendant moved for judgment of acquittal, arguing that the not guilty verdicts on counts one through three necessarily acquitted her of count four, which was premised upon the specific sexual acts set forth in the earlier counts. The trial court denied the motion. Defendant contends on appeal that this was error. She also asserts, based upon newly discovered evidence, that the judgment must be reversed because of the prosecutor's failure to disclose a conflict of interest which tainted the proceedings. I. We turn first to defendant's contention that the court erred in denying her post-verdict motion for judgment of acquittal. Despite the use of the special-verdict form, it is readily apparent that the general charge of aggravated sexual assault in subpart A of *781 count four was not submitted to the jury as a separate and independent offense. It was based, rather, upon the assumption that defendant might be convicted of one or more of the sexual acts alleged in the first three counts, and was included solely to carry the additional serious-bodily-injury enhancement in count four. Although the State contests this interpretation of the verdict form, the record leaves no room for doubt. As noted, the only sexual acts charged in the information were intercourse, fellatio, and cunnilingus. Defendant was acquitted of all three of these. The affidavit of probable cause in support of the information was consistent with the charging document, describing only the three specific sexual acts set forth in counts one through three.[*] The State's efforts at trial were similarly focused on establishing through the testimony of the victim and witnesses that defendant had repeatedly compelled J.C. to engage in sexual intercourse and oral sex. In her closing argument to the jury, the prosecutor summarized the State's case by referring specifically, and exclusively, to the three sexual acts alleged in counts one through three: [Defendant] forced [the victim] to engage in sexual intercourse. [Defendant] forced [the victim] to engage in oral sex. She forced him to engage in oral sex on her body and she performed oral sex on him. [Defendant] threatened this child that she would kill him or burn down the house unless he did what she wanted him to do. In her rebuttal argument, the prosecutor repeated the essence of the State's allegations, again referring solely to the specific charges in the first three counts: The question remains, how do you explain that [the victim's brother] testified that he saw it all happen. . . . [T]hink about what was happening to [the victim]. He was either being forced to have sexual intercourse with his mother; being forced to perform oral sex or receiving oral sex. . . . And I suggest to you that there is no possible way for these two boys to have gotten together to dream this up. Nowhere in the State's information, affidavit, or argument is there any allegation that defendant committed any prohibited sexual acts within the meaning of 13 V.S.A. § 3251(1) other than those set forth in counts one through three, of which defendant was specifically found to be not guilty. Having thus been acquitted of the only specifically proscribed acts as to which she was charged and tried, it is axiomatic that defendant cannot have been simultaneously convicted of the same acts under the guise of a general charge. Under these circumstances, the guilty verdict on the general charge of aggravated sexual assault was inconsistent with the prior verdicts and must be reversed. See State v. Robar, 157 Vt. 387, 396, 601 A.2d 1376, 1381 (1991) (where trial record is legally insufficient to support guilty verdict, conviction must be reversed and judgment of acquittal entered). We can only assume that the jury's guilty verdict on the generic charge of aggravated sexual assault was in fact a "compromise" verdict, rendered not on the information and evidence actually presented, but on a general feeling that defendant must have been guilty of some wrongdoing. There was certainly substantial evidence that J.C.'s home life was marked by extreme dysfunction, turmoil, and unhappiness, and this may well have led the jury — despite being unconvinced of the truth of the specific allegations of sexual misconduct — to find defendant guilty of something. This was manifestly improper, nevertheless, and cannot be condoned in our system of justice. See Edwards v. State, 33 Ala.App. 386, 34 So. 2d 173, 174 (1948) (guilty verdict on lesser-included offense unsupported by evidence was "a compromise verdict which the law does not approve or contemplate"). The State attempts to uphold the conviction on the theory that count four was actually intended to serve as a "catch-all" count for any sexual act not specifically charged but nevertheless proved at trial. There are three flaws in this reasoning. First, it is belied by the record, which reveals a consistent governmental focus — from charge to *782 verdict — upon the specific sexual acts set forth in counts one through three. Second, it overlooks the fundamental requirement that an information set forth "the essential facts constituting the offense charged." V.R.Cr.P. 7(b). We have adopted a "common sense" approach to the notice requirement, State v. DeLaBruere, 154 Vt. 237, 276, 577 A.2d 254, 275-76 (1990), holding that the information may be read in conjunction with the probable-cause affidavit to determine its sufficiency. State v. Brown, 153 Vt. 263, 272, 571 A.2d 643, 648 (1989). Here, neither the information nor the affidavit of probable cause gave any indication of the State's intent to rely on any sexual acts other than those specifically charged. And finally, even if we were to overlook the notice deficiency, the evidence does not support the State's theory that the jury convicted defendant of uncharged sexual acts. The only evidence cited by the State consists of isolated statements in J.C's testimony to the effect that defendant forced him to "touch her vagina." It is unclear from the context whether the victim actually meant an "intrusion . . . into the genital . . . opening," as the definition of "sexual act" requires. 13 V.S.A. § 3251(1). The act was not charged, and thus neither party was alerted to the necessity to seek clarification. In any event, we are not persuaded that these few remarks, without more, were sufficient to sustain a conviction of aggravated sexual assault. As there was no valid basis for the verdict of guilt, it follows that the conviction must be reversed, and a judgment of acquittal entered. Robar, 157 Vt. at 396, 601 A.2d at 1381. II. Normally our decision to reverse the judgment would render it unnecessary to reach defendant's additional claims. We depart from our usual practice today in order to address an issue of particular concern not only to this Court, but in our view to the fundamental integrity of the bench, the bar, and the administration of justice in Vermont. The material facts are not in dispute. In 1989, Tom Paul, a deputy state's attorney who assisted in this prosecution, represented defendant in a CHINS (child in need of support) proceeding concerning C.C., an older sister of the victim here. Tom Paul represented defendant in the CHINS proceeding from the first hearing in December 1989 through the merits and disposition hearing in January 1990. Tom Paul is the spouse and law partner of Jan Paul, the Essex County State's Attorney and the lead prosecutor in this case. The law firm of Jan and Tom Paul had routinely represented parties in juvenile cases pursuant to a contract with the defender general. The disposition report prepared by SRS in the CHINS matter addressed not only C.C.'s individual problems and behavior, but also discussed family issues affecting defendant's other children. An attached disposition report relating to an earlier SRS intervention in the matter of L.C., another of J.C.'s sisters, provided substantial details concerning the family history, discussed relationships among the parents and children, and referred to allegations of prior sexual assaults against L.C. Defendant was not a suspect in these assaults. According to Tom and Jan Paul, neither of them realized that Tom had previously represented defendant until, in the course of preparing for the criminal trial, Jan came upon Tom's name in defendant's SRS files. She immediately apprised Tom, who claimed that he had no recollection of defendant. Neither of the Pauls disclosed Tom's prior representation of defendant to defense counsel or to the court. Defense counsel did not discover these facts until after trial. The prosecution's failure to disclose the fact of Tom's previous representation casts serious doubt upon the fairness of these proceedings. Indeed, absent other grounds requiring reversal, we might be compelled to reverse the judgment on this basis alone. The ethical precepts that an attorney scrupulously avoid representing conflicting interests and maintain and preserve client confidences apply with equal force to a prosecuting attorney. State v. Miner, 128 Vt. 55, 61-62, 258 A.2d 815, 819 (1969). These principles require that a prosecutor refrain from participating in a criminal case *783 against a former client in a matter involving the former representation. See id. at 62, 258 A.2d at 819 ("Fidelity to these standards prohibits an attorney from engaging in a criminal proceeding against an accused he has formerly represented in the subject matter of the prosecution."). This Court has not had occasion since Miner to explore the subject of a prosecuting attorney's participation in a criminal case against a former client. The issue has been extensively litigated elsewhere, however, and general rules have been developed and widely applied. See generally Annotation, Disqualification of Prosecuting Attorney in State Criminal Case on Account of Relationship with Accused, 42 A.L.R. 5th 581 (1996) (collecting cases); S. Brenner & J. Durham, Towards Resolving Prosecutor Conflicts of Interest, 6 Geo. J. Legal Ethics 415 (1993) (examines evolution of, and current standards governing, conflicts of interest resulting from prosecutor's prior representation of defendants). Most states and federal courts today apply a standard derived from Rule 1.9 of the Model Rules of Professional Conduct. Under that provision, "[a] lawyer who has formerly represented a client shall not thereafter represent another person in the same or a substantially related matter in which that person's interests are materially adverse to the interests of the former client unless the former client consents after consultation." Model Rules of Professional Conduct, Rule 1.9(a) (emphasis added). "`Substantiality is present if the factual contexts of the two representations are similar or related.'" Trust Corp. v. Piper Aircraft, 701 F.2d 85, 87 (9th Cir. 1983) (quoting Trone v. Smith, 621 F.2d 994, 998 (9th Cir.1980)). Thus, "determining whether an attorney's current representation involves a substantially related matter to that of a former client requires an analysis of the facts, circumstances, and legal issues of the two representations." State ex rel. McClanahan v. Hamilton, 189 W.Va. 290, 430 S.E.2d 569, 572-73 (1993). Once a substantial relationship between the matters is found, "the court need not inquire whether the attorney in fact received confidential information, because the receipt of such information is presumed." State v. Jones, 180 Conn. 443, 429 A.2d 936, 939-40 (1980), overruled on other grounds, State v. Powell, 186 Conn. 547, 442 A.2d 939 (1982); see also Smith v. Whatcott, 757 F.2d 1098, 1100 (10th Cir.1985) ("Once a substantial relationship has been found, a presumption arises that a client has indeed revealed facts to the attorney that require his disqualification."); State v. Allen, 539 So. 2d 1232, 1234 (La. 1989) ("So long as the affected party can show that the matters involved in the previous representation are substantially related. . . [t]he aggrieved party need not prove that [the lawyer] actually obtained confidential information. . . ."); McClanahan, 430 S.E.2d at 573 ("Once the former client establishes that the attorney is representing another party in a substantially related matter, the former client need not demonstrate that he divulged confidential information to the attorney."). The purpose of the presumption is to avoid "`put[ting] the former client to the Hobson's choice of either having to disclose his privileged information in order to disqualify his former attorney or having to refrain from the disqualification motion altogether.'" McClanahan, 430 S.E.2d at 574 (quoting Government of India v. Cook Indus., 569 F.2d 737, 740 (2d Cir.1978)); see also Smith, 757 F.2d at 1100 (the presumption "`is intended to prevent proof that would be improper to make'") (quoting In re Corrugated Container Antitrust Litigation, 659 F.2d 1341, 1347 (5th Cir.1981)); Jones, 429 A.2d at 940 ("The court cannot inquire into whether the lawyer did in fact receive confidential information during his previous employment. . . because . . . [that] . . . would destroy the very same confidences which [the rule] protects."). In addition to safeguarding client confidentiality, the presumptive disqualification serves "to avoid any appearance of impropriety." Smith, 757 F.2d at 1100. These principles apply where the prosecutor has previously represented the defendant in a substantially related civil, as well as criminal, action. See, e.g., Jones, 429 A.2d at 940 (prosecutor disqualified from criminal prosecution of defendant whom he had represented twelve years earlier in personal injury *784 action); Allen, 539 So.2d at 1235 (prosecutor's previous representation of defendant in bankruptcy proceeding disqualified him from subsequent prosecution of defendant for arson); Lykins v. State, 288 Md. 71, 415 A.2d 1113, 1115 (1980) (state's attorney disqualified from prosecuting defendant whom he had formerly represented in divorce action); McClanahan, 430 S.E.2d at 574-75 (prosecutor's previous representation of defendant in divorce action disqualified him from participating in criminal prosecution for assault); see generally Annotation, supra, at 641-54 (collecting cases). Applying these principles here, we are confronted with a patent conflict of interest. The subject matter of Tom Paul's prior representation of defendant in the CHINS proceeding concerned defendant's parenting abilities and her relationships with C.C. and her other children. In the course of that representation, Tom could have been privy to any number of client confidences concerning defendant's treatment of the children. Although the immediate focus of the criminal prosecution focused specifically on defendant's alleged sexual abuse of J.C., it also involved underlying questions relating to the nature of her relationships with all of her children and the extremely troubled family dynamics. Indeed, the crux of the defense case was that J.C. had been physically abused by his father and had fabricated tales of sexual abuse by defendant out of resentment at her inability to protect him. The prosecution's tactical ability to assess the credibility of the defense claims, and to decide which of J.C.'s seven siblings to call as witnesses, could have been informed by confidential communications between defendant and her former attorney. The conclusion that the two matters were substantially related, therefore, is self-evident. As such, we need not inquire into what, if any, confidential information in the prosecutor's possession may have worked to defendant's disadvantage, as that is presumed. Jones, 429 A.2d at 939-40. Indeed, it is not our intention to explore the veracity of the prosecutor's representation that he had no independent recollection of the earlier CHINS proceeding. That is not the issue. Our concern is for the integrity of the legal process, which suffers as much from the appearance as the substance of impropriety. See Sharplin v. State, 330 So. 2d 591, 594 (Miss.1976) (rule of presumptive disqualification is based not only on possible erosion of attorney-client privilege, but "draws upon the broader, more exacting ethical obligations. . . to avoid impropriety as well as the appearance thereof"). In a small rural state like Vermont, where multiple ties to a case are apt to occur, we must be especially sensitive to any appearance of conflict or bias. Fair or not, it is not enough that our public prosecutors be ethical in fact. They must be above any suspicion of wrongdoing. We thus conclude that where, as here, the prosecuting attorney becomes aware that she or an associate has previously represented the defendant, there is a duty to disclose these circumstances to the court and defense counsel. See Gray v. State, 469 So. 2d 1252, 1255 (Miss.1985) ("Where a potential issue regarding disqualification exists, the prosecution shares equally with the defendant the duty of bringing the matter to the attention of the trial court."). It is only through such disclosure that the trial court may explore the nature of the potential conflict to determine whether disqualification of the prosecutor or other steps may be necessary to ensure a fair and impartial trial. It is not sufficient, as the State here urges, to disclose materials (the SRS files) containing evidence of the prior representation and assume that it will be discovered. As the State concedes, the SRS files in this matter were voluminous, and it was far from certain that the defense would find counsel's name inconspicuously buried in the reams of reports, notes, and pleadings. A criminal trial is not a game of hide-and-seek. It is in no one's interest, least of all the State's, to withhold such information and put the entire proceeding at risk. Indeed, it is apparent that the prosecutor's conduct here tainted the proceedings and the judgment, possibly beyond repair. We note that other courts have not hesitated to reverse a judgment of conviction where the prosecutor had previously represented the defendant in a substantially related matter. See, e.g., Reaves v. State, 574 So. 2d 105, 107 *785 (Fla.1991) (reversal of murder conviction required where prosecutor had previously represented defendant against grand larceny charges); Whitaker v. Commonwealth, 895 S.W.2d 953, 956 (Ky.1995) (prosecutor's previous representation of defendant required reversal of murder conviction and remand for new trial); Allen, 539 So.2d at 1235 (arson conviction reversed on basis of prosecutor's prior representation of defendant in bankruptcy proceeding); Sharplin, 330 So.2d at 594 (manslaughter conviction reversed on appeal because of prosecutor's previous representation of defendant in divorce proceeding). Because of our decision to reverse on other grounds, we are relieved of the necessity to consider whether reversal is compelled here by the prosecutor's previous representation of defendant in a substantially related matter. We emphasize, nevertheless, our concern that such conflicts pose a substantial risk to the integrity of the bench and bar, a risk that prosecutors in future cases should not ignore, as was done here. Reversed. NOTES [*] Although the affidavit further alleged that defendant had "played with [the victim's] penis until it became erect," this does not fall within the definition of "sexual act" for purposes of the sexual assault statute, and was not charged as such. See 13 V.S.A. § 3251(1).

2013-10-30 06:35:56.695217+00

Todd

491 S.W.2d 370 (1972) Mrs. Gladys LOFTIS and Howell Loftis, Plaintiffs-Appellants, v. Lelan G. FINCH and Jerry L. Jones, Defendants-Appellees. Court of Appeals of Tennessee, Middle Section. December 1, 1972. Certiorari Denied March 5, 1973. *372 Roy A. Miles, Jr., Nashville, for plaintiffs-appellants. Douglas Fisher, Nashville, for Finch. Harold E. Collins, Nashville, for Jones. Certiorari Denied by Supreme Court March 5, 1973. OPINION TODD, Judge. These consolidated suits arise out of the injury of Mrs. Gladys Loftis while she was a passenger in a vehicle owned by H.B. Jones and operated by his son, Jerry L. Jones. Said vehicle was struck by a vehicle owned by Mrs. Lula Finch and operated by her son, Lelan G. Finch. Mrs. Loftis sued for personal injuries, medical expenses, lost personal property, and lost earnings. Mr. Howell Loftis, her husband, sued for loss of services of Mrs. Loftis. The defendants, Lula Finch and H.B. Jones, were dismissed by directed verdicts. No appeal was taken from these actions, hence these two defendants are not before this Court on this appeal. The jury dismissed Jerry Jones and awarded verdicts against Lelan G. Finch in favor of Mrs. Loftis for $1,500.00 and in favor of Mr. Loftis for $100.00. The plaintiffs have appealed as to the verdicts in favor of Jerry Jones and as to the amount of the verdicts against Lelan *373 G. Finch. Defendant, Lelan G. Finch, did not appeal. There are four assignments of error, of which the second and fourth are as follows: II "The trial Court erred in failing to grant Appellant's motion for a new trial on the grounds that the verdict of the jury was contrary to the weight and preponderance of the evidence. ...... IV "The trial Court erred in failing to grant Appellant's motion for a new trial on the grounds that the jury found in favor of the defendant, Jerry L. Jones, contrary to the greater weight of evidence which proved him to be concurrently negligent in placing his automobile in a mechanically hazardous condition and failing to keep it in proper repair." An assignment of error that the verdict and judgment are against the weight of the evidence is insufficient in law, since the appellate courts have no power to weigh the evidence in a civil case tried to a jury. McBee v. Williams, 56 Tenn. App. 232, 405 S.W.2d 668 (1966) and authorities cited therein. The entire argument of appellants attacking the dismissal of the defendant, Jones, is as follows: "The jury found in favor of the defendant Jones, against the greater weight and preponderance of the evidence. The uncontroverted proof shows that Jones bought the special wheels and installed them on his automobile himself. (B/E p. A-43). By coincidence defendant Finch also had the same type wheels on his automobile and testified that the lugs had loosened and backed off the studs on his car twice. (B/E p. 14 & 15). Jones brought his car to a panic stop, or near stop, in the passing or high-speed lane of traffic, and not on the shoulder or median. (B/E p. A-45 — A-49). Jones drove his automobile in the left-hand lane of the interstate highway in violation of T.C.A. 59-852 (Tr. p. 4)." Even though there might be evidence to support a verdict against defendant Jones, it cannot be said that, as a matter of law, he was guilty of negligence which directly and proximately caused plaintiffs' injuries and damages. Therefore, the question of the negligence, if any, of Jones and its causal relationship to the injuries of plaintiffs was peculiarly within the fact-finding province of the jury. Generally, negligence contributory negligence and proximate cause are issues to be decided by the jury, and can be withdrawn and decided by the Trial Judge only in those cases in which the facts are established by evidence free from conflict and the inferences from said facts are so certain that all reasonable men, in the exercise of free and impartial judgment, must agree upon them. Kandrach v. Chrisman, Tenn. App., 473 S.W.2d 193 (1971). Neither the assignments of error, nor the argument, nor the record, present any ground for setting aside the verdict of the jury in favor of the defendant, Jones. The second and fourth assignments of error are respectfully overruled. The first assignment of error is as follows: I "The trial Court erred in failing to grant her motion to increase the damages awarded her by the jury, they being inadequate to compensate her for her medical expenses and loss of earnings, and allowing nothing for pain and suffering." *374 The first assignment of error is predicated upon 20-1330, T.C.A., which is as follows: "20-1330. Inadequate verdict — Suggestion of additur — Granting new trial — Appeal — In cases where, in the opinion of the trial judge a jury verdict is not adequate to compensate the plaintiff or plaintiffs in compensatory damages or punitive damages, the trial judge may suggest an additur in such amount or amounts as he deems proper to the compensatory or punitive damages awarded by the jury, or both such classes of damages, and if such additur is accepted by the defense, it shall then be ordered by the trial judge and become the verdict, and if not accepted, the trial judge shall grant the plaintiff's motion for a new trial because of the inadequacy of the verdict upon proper motion being made by the plaintiff. "In all jury trials had in civil actions, after the verdict has been rendered, and on motion for a new trial, when the trial judge is of the opinion that the verdict in favor of a party should be increased, and an additur is suggested by him on that account, with the proviso that in case the party against whom the verdict has been rendered refuses to make the additur a new trial will be awarded, the party against whom such verdict has been rendered may make such additur under protest, and appeal from the action of the trial judge to the Court of Appeals; and if, the Court of Appeals is of the opinion that the verdict of the jury should not have been increased or that the amount of the additur is improper, but that the judgment of the trial court is correct in all other respects, the case shall be reversed to that extent, and the Court of Appeals may order remitted all or any part of the additur. [Acts 1969, ch. 137, § 1; 1970 (Adj. S), ch. 90, § 1.]" (Emphasis supplied.) Where the trial judge has suggested an additur, the foregoing statute authorizes the Court of Appeals to suggest remittitur of all or part of such additur. However, where the trial judge has declined to suggest an additur, the Court of Appeals is not authorized to initiate an additur for the first time on appeal. In this respect, the additur statute differs from the remittitur statutes (§§ 27-118, 119, T.C.A.) which recognize the authority of the Court of Appeals to initiate remittiturs for the first time on appeal. The trial judge may set aside a verdict on two general grounds; viz., (a) The judge may disagree with the jury as to the weight of the evidence as to liability or amount of damages, or (b) There may be errors of law or other grounds for invalidating the verdict. Except for the statutory power to suggest remittiturs, the Court of Appeals is limited to the consideration of errors of law or other grounds for invalidating the verdict and has no authority to review the action of the trial judge in upholding or setting aside a verdict upon the weight of the evidence. Accordingly, the Court of Appeals has no authority to review the action of a trial judge in refusing to suggest an additur. The first assignment of error is respectfully overruled. The third assignment of error is as follows: III "The trial Court erred in failing to grant Appellant's motion for a new trial on the grounds that the jury's verdict was such as to evince extreme passion, prejudice, caprice, partiality or corruption on the part of the jury against the plaintiff." Plaintiffs insist that the amounts awarded are so disproportionate to the proved damages as to show passion, prejudice, or unaccountable caprice sufficient to invalidate *375 the verdicts. This insistence requires a review of the evidence of damages. There is uncontradicted evidence of the following: On October 30, 1969, at about 4:30 P.M., the plaintiff, Mrs. Loftis, was riding as a passenger in a vehicle operated by Jerry L. Jones when said vehicle experienced mechanical difficulties and was braked to a stop or very slow speed. The vehicle of the defendant, Finch, overtook and collided violently with the rear end of the Jones vehicle, inflicting extensive damage thereon and causing it to burst into flames. Mrs. Loftis was unconscious for a brief period after which she found herself trapped in the burning vehicle, being unable to open either door. Another motorist, at great risk to himself, broke the glass in the door and pulled plaintiff to safety. Her shoes had become dislodged from her feet which were cut by broken glass as she was removed from danger. Plaintiff's hair was burning, but was extinguished after her removal from the vehicle. The uncontroverted evidence also shows that plaintiff was transported to a hospital where she was treated for multiple cuts and bruises, and burns on an arm, and was released to her home; that, on November 1, 1969, plaintiff returned to the hospital for X-Rays; that, on November 2, 1969, plaintiff entered a hospital for treatment of intense pain in the back, neck and head; remained in the hospital for five days; that she returned to her home for bed-rest and, for a considerable time, wore a surgical collar as treatment for neck pain. There is no direct contradiction of plaintiff's testimony that, prior to her injury, she was employed as a secretary at $375.00 per month; that she has been unable to resume said employment because of pain and nervousness; that her present earnings average twenty or twenty-five dollars per week; that her expenses for treatment and replacement of burned and lost property amount to a total of $1,204.96; that her pain and discomfort continued to the day of trial, requiring medication. Plaintiff's physician testified that she was totally disabled for a period of two months, and retained a permanent partial disability of five percent. Defendant offered no medical witnesses, but relied only upon the cross examination of plaintiff's physicians, one of whom attributed part of plaintiff's continued complaints to "functional overlay," which expression was explained by the witness who used it as follows: "A functional overlay is something that is very real to the patient, but is a manifestation on which true organic basis, that is, true pathology, does not bear out the degree, frequently, of the complaints." The above $1,204.96 medical expenses and property losses, together with two months lost wages of $750.00, make a total of $1,954.96 about which there can be little controversy. Defendant insists that some of the medical expense may have been unnecessary, however there is no direct evidence to impeach the claimed expenses, or to separate that part which is challenged. A plaintiff should not recover for medical expenses which are clearly unnecessary. However, much injustice lurks in the practice of indiscriminately discounting medical expenses because the finder-of-fact "doubts their necessity," or "feels they were unnecessary." In addition to the special damages, supra, of $1,954.96, there are other elements of damage which were apparently ignored by the jury. The horrible ordeal of being trapped in a burning vehicle with clothing and hair ablaze, of being dragged through broken glass, of waiting for an ambulance near a burning automobile, all constitute a frightening experience naturally and necessarily producing mental and emotional distress which merits serious consideration in the estimation of just *376 compensation. Also deserving of serious consideration is the pain which inevitably accompanies burns, cuts and bruises. The subsequent pain in back, neck and head, the permanent scars on arm from burns, the five percent permanent disability, all were apparently disregarded by the jury. It is true that the jury is authorized to observe and, to some degree, be guided by its own impressions of the seriousness of the plaintiff's complaints. However, this discretion must be exercised within reasonable bounds. Where the plaintiff testifies unequivocally of protracted and intense pain, her family testify to circumstances corroborating her complaint, and her physician sees fit to hospitalize her for it, the jury is hardly authorized to disallow some arbitrary part of the hospital expenses because clinical grounds were not found for part of the complaints. Doctors and the courts are constantly faced with complaints which cannot be fully substantiated by medical science in its present state of advancement. The degree of such complaints may be discounted by doctors and the courts, but it is unreasonable and capricious to completely disregard such complaints where the patient has not been otherwise impeached and substantial origin of the complaint (i.e., severe trauma) is shown by uncontradicted evidence. In the present case, the extreme severity of the collision together with plaintiff's other uncontradicted injuries, furnishes sound causal corroboration of her complaints of pain in back, neck and head. As stated, the duration of said pain may be found to be somewhat less than urged by plaintiff, but it is unrealistic and capricious to refuse to recognize and compensate for pain of some severity and duration as a result of the experience and injuries of plaintiff. Defendant relies upon Transports, Inc., v. Perry, 220 Tenn. 57, 414 S.W.2d 1 (1967); however, in that case there was substantial evidence that at least some of plaintiff's complaints predated the collision from which she claimed damages; and exploratory surgery demonstrated that the cause of her principal complaint was "a hard bulging mass" which "is known to take a long time to form." Furthermore, the husband of the injured party was awarded $3,000.00 medical expenses, and the injured party was awarded $1,000.00. The cited case is clearly distinguishable from the present case on the facts. Defendant also cites Finks v. Gillum, 38 Tenn. App. 304, 273 S.W.2d 722 (1954), wherein the defendant appealed, alleging excessiveness of the verdict. The expressions in the opinion in that case can hardly be of much assistance in the present case wherein the plaintiffs appeal because of the inadequacy of the verdict. In the cited case, the plaintiff was awarded $6,750.00 for injuries in a "rear end collision." Defendant cites Wood v. Craig, 57 Tenn. App. 685, 424 S.W.2d 561 (1967) wherein plaintiff was awarded $1,500.00 damages. Her claimed medical expenses were $1,033.13. There was no direct evidence of "short term" wage loss, as in the present case, but "long term" wage loss was claimed because of a difference in total annual earnings. There was evidence of previous injuries which would account for plaintiff's complaints. Defendant cites Meeks v. Yancey, 43 Tenn. App. 667, 311 S.W.2d 329 (1957), however said case was remanded for retrial because of an error in the charge in regard to pre-existing diseased condition. There was no appreciable damage to either of the vehicles in the collision. Finally, defendant cites Crutcher v. Davenport, 55 Tenn. App. 413, 401 S.W.2d 786 (1965) wherein this Court states: "* * * All four of the occupants of the automobile driven by Earnest Crutcher claimed to have sustained whiplash injuries or sacroiliac injuries, of which injuries there were little or no objective symptoms. * * * *377 * * * * * * "* * * The jury returned a verdict in favor of Earnest Crutcher for $107.00, for Carrie Pollard in the amount of $174.00, and for Marshall Watkins and Mary Watkins, his wife, a total of $313.00, said sums being the exact total of medical bills of said plaintiffs. * * * * * * * * * "[3] We are aware that the appellate courts of this state have in some instances granted reversals and new trials because of inadequacy of verdicts. Among such cases are: Kent v. Freeman, 48 Tenn. App. 218, 345 S.W.2d 252; Flexer v. Crawley, 37 Tenn. App. 639, 269 S.W.2d 598; Board of Mayor and Aldermen of Covington v. Moore, 33 Tenn. App. 561, 232 S.W.2d 410; and W.T. Grant Co. v. Tanner, 170 Tenn. 451, 95 S.W.2d 926; 20 A.L.R. 2d 276. The facts of the instant case are however, different from all of those cases in which such reversals were granted. After a careful reading of the record in the instant case, we have reached the conclusion that the jury must have decided that the plaintiffs were injured only slightly, if at all, and that verdicts for the defendants might have been returned but for the concession of liability. * * *" 55 Tenn. App., pp. 415, 417, 401 S.W.2d p. 787. In determining if a verdict is within reasonable bounds, it is necessary to consider the nature and extent of the injuries, suffering, expenses, diminution of earning capacity, inflation, high cost of living, age, expectancy of life, and the amounts awarded in similar cases. Luallen v. Booher, Tenn. App., 460 S.W.2d 24 (1970), Monday v. Millsaps, 37 Tenn. App. 371, 264 S.W.2d 6 (1953) and authorities cited therein. However, the correctness of the amount of damages must, in each case, to a large extent, stand on the facts of the case and be governed thereby. Finks v. Gillum, supra. The appellate courts have the authority and duty to set aside inadequate verdicts in proper cases. Jenkins v. Hankins 98 Tenn. 545, 41 S.W. 1028 (1897); Chesapeake, O & S.W.R. Co. v. Higgins, 85 Tenn. 620, 4 S.W. 47 (1887); Burckell v. Memphis St. Ry. Co., 2 Tenn. CCA (Higgins) 576 (1911). Whether it be said that there is no evidence to support the verdict, or that the jury overlooked or ignored uncontroverted evidence, or that the jury acted upon a misconception of the evidence or the law, or that the verdict is so inconsistent or inadequate or both as to indicate the various forms of improper consideration by the jury, this Court is satisfied that justice was not done, and that the verdicts are not consonant with facts shown by the uncontroverted evidence and the law applicable thereto. The verdict of $1,500.00 in favor of Mrs. Loftis is less than her proven actual damages and ignores substantial mental and physical suffering necessarily and naturally incident to her proven injuries. As to the verdict of $100.00 in favor of Mr. Loftis, it is undisputed that his wife was severely disabled for at least two months and that her residual disability continued to interfere with her domestic activities for some time thereafter. If only the case of Mr. Loftis were before this Court, it would be more difficult to justify a reversal and remand. However, the verdict of the jury in respect to Mrs. Loftis supports the conclusion that its actions were equally misguided in the case of Mr. Loftis. Furthermore, the remand of both cases will entail little if any more time, effort and expenses than the remand of only one. The liability of the defendant Lelan G. Finch has been heretofore conclusively adjudged by the jury verdict and said defendant has not appealed therefrom. There is no suggestion of contributory negligence, either proximate or remote. Hence, there is no reason to re-litigate the issue of the liability of Lelan G. Finch. *378 The verdicts and judgments dismissing the defendant, Jerry L. Jones, are affirmed. The verdicts and judgments in favor of Mrs. Gladys Loftis and Howell Loftis and against Lelan G. Finch are affirmed as to the finding of liability, but reversed as to amount of damages, only; and said causes will be remanded to the Trial Court for trial anew only upon the issues of the amounts of damages to be awarded to the respective plaintiffs. See Gulf Refining Co. v. Frazier, 19 Tenn. App. 76; 83 S.W.2d 285 (1934) and authorities cited therein. One half of the costs of this appeal will be taxed against the plaintiffs, Mrs. Gladys Loftis and Howell Loftis; and one half of the costs of this appeal will be taxed against the defendant, Lelan G. Finch. Affirmed in part. Reversed in part. Remanded. SHRIVER, P.J., and PURYEAR, J., concur.

2013-10-30 06:35:56.713432+00

Roberts

704 A.2d 318 (1997) 1997 ME 204 PEOPLES HERITAGE SAVINGS BANK v. Pamela A. WHITE. Supreme Judicial Court of Maine. Submitted on Briefs September 19, 1997. Decided October 20, 1997. *319 Edward S. MacColl, F. Jay Meyer, Thompson, McNaboe, Ashley & Bull, L.L.C., P.A., Portland, for plaintiff. Daniel L. Cummings, Norman, Hanson & DeTroy, Portland, for defendant. Before WATHEN, C.J., and ROBERTS, CLIFFORD, RUDMAN, DANA, and LIPEZ, JJ. ROBERTS, Justice. [¶ 1] Pamela A. White appeals from the judgment of the Superior Court (Cumberland County, Mills, J.) denying her motion pursuant to M.R. Civ. P. 60(b) for relief from the default judgment in favor of Peoples Heritage Savings Bank on its complaint for foreclosure of the mortgage executed by White and her husband, Philip. White contends that the default judgment is void for a lack of personal jurisdiction because she was not properly served with the Bank's complaint. We affirm the judgment. [¶ 2] In November 1994 the Bank filed its complaint seeking to foreclose the mortgage and recover the debt owed by the Whites. Neither of the Whites responded to the complaint, and the court entered a default judgment against them. After unsuccessful negotiations concerning the details of the foreclosure sale and the repayment of the debt, the mortgaged premises were sold in August 1995. In September 1996 Pamela White filed a motion for relief from the judgment, accompanied by affidavits by her husband and a deputy sheriff to show that her copy of the complaint and summons were handed to her husband at their place of business and he did not give them to her. White contended that the judgment was void for lack of personal jurisdiction and that she was entitled to relief pursuant to M.R. Civ. P. 60(b)(4). [¶ 3] The court acknowledged that "the service [of process] was insufficient based on a technical noncompliance with [M.R. Civ. P. 4(b)(1) ]." The court stated, however, that technical noncompliance does not render the judgment void "[w]ithout a sufficient showing by [White] that she lacked notice of the action or that she did not participate in the action." We need not decide whether White had the burden of proving that she did not have actual notice of the action because the court also found that she had waived the insufficiency in the service of process by participating in the action. [¶ 4] Moreover, the court's finding is not clearly erroneous. In opposition to White's Rule 60(b) motion, the Bank submitted an affidavit of its attorney. The affidavit recites that White's first attorney engaged in out-of-court settlement negotiations with the Bank that ultimately were unsuccessful. Thereafter, White's second attorney appeared at an in-chambers conference with the court concerning the Bank's emergency motion for the appointment of a receiver. During the conference, the court encouraged the attorneys to draft an agreed order, and the order entered by the court recited that it was based on "the consent of the parties." We express no opinion as to the effect of out-of-court negotiations, but we conclude White failed to preserve her claim of lack of personal jurisdiction by appearing at a conference with the court without raising any issues concerning the initial service of process. See Key Bank of Maine v. Walton, 673 A.2d 701, *320 703 (Me.1996). White's argument in her reply brief that the Bank's affidavit included inadmissible hearsay is raised too late to be considered on appeal. See Machias Sav. Bank v. Longfellow, 662 A.2d 235, 238 n. 5 (Me.1995). The entry is: Judgment affirmed.

2013-10-30 06:35:56.724064+00

Onion

491 S.W.2d 115 (1973) Sandra Ann SPRUELL, Appellant, v. The STATE of Texas, Appellee. No. 46615. Court of Criminal Appeals of Texas. March 7, 1973. David F. Farris, Fort Worth, for appellant. Tim Curry, Criminal Dist. Atty., J. J. Heinemann and R. W. Crampton, Asst. Dist. Attys., Fort Worth, Jim D. Vollers, *116 State's Atty. and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION ONION, Presiding Judge. This appeal results from a conviction for felony theft wherein the punishment was assessed at 10 years. On April 4, 1972, appellant entered a plea of guilty before the court to the indictment after waiving trial by jury. The sole contention on appeal is that the evidence is insufficient in light of Article 1.15, Vernon's Ann.C.C.P., to support the conviction. We do not agree. After being sworn, the appellant took the stand and testified she had heard the indictment read. Then she was asked: "Q. Was each and every allegation contained in that indictment true and correct? "A. Yes, sir." In Alvarez v. State, 374 S.W.2d 890 (Tex.Cr.App.1964), this same or similar catch-all question was asked the defendant while he was on the stand, and this court held that the same constituted a judicial confession and needed no corroboration to support the conviction. See also Rodriquez v. State, 375 S.W.2d 289 (Tex.Cr. App.1964); Sexton v. State, 476 S.W.2d 320 (Tex.Cr.App.1972). Appellant does not dispute the fact there was a judicial confession, but relies upon the prosecutor's subsequent questions when he attempted to track the indictment where he used the name Jim Reed rather than Bill Reed alleged in the indictment as the owner. The record reflects the following: "Q. Then, you are the same Sandra Ann Spruell who on the 30th day of November, 1971, did unlawfully and fraudulently take from the possession of Jim Reed one man's suit over the value of fifty dollars, the same being the corporal (sic) personal property and belonging to the said Mr. Reed without his consent and with the intent then and there on your part to deprive Mr. Reed of that property and to appropriate it to your own use and benefit? "A. Yes, sir. "Q. This did occur here in Fort Worth, Tarrant County, Texas? "A. Yes, sir." We hold that mistaken reference to the complaining witness's first name was not sufficient to undo the judicial confession previously made. We find the evidence is sufficient to support the judgment entered upon a plea of guilty. The judgment is affirmed.

2013-10-30 06:35:56.74394+00

Wathen

704 A.2d 335 (1997) 1997 ME 213 STATE of Maine v. Donald CHRISTEN. Supreme Judicial Court of Maine. Argued October 8, 1997. Decided November 4, 1997. *336 Andrew Ketterer, Attorney General, James M. Cameron, Asst. Atty. Gen. (orally), Augusta, David W. Crook, District Attorney, William Baghdoyan, Asst. Dist. Atty., Skowhegan, for State. Nancy Lord (orally), Las Vegas, NV, Patricia A. Danisinka-Wasburn, Skowhegan, for defendant. Before WATHEN, C.J., and ROBERTS, RUDMAN, DANA, and LIPEZ, JJ. WATHEN, Chief Justice. [¶ 1] Defendant Donald Christen appeals from the judgment entered in the Superior Court (Somerset County, Marden, J.) following a jury verdict finding him guilty of unlawfully furnishing marijuana in violation of 17-A M.R.S.A. § 1106 (1983 & Supp 1996).[1] On appeal, defendant contends that the court erred by failing to instruct the jury on the defense of competing harms.[2] Defendant also argues that the second sentence of the statutory formulation of the competing harms defense constitutes a content based restriction on speech that violates the First Amendment. Finding no error, we affirm the judgment. [¶ 2] The relevant facts presented at trial may be summarized as follows: On April 19, 1993, defendant organized and participated in a public demonstration on the steps of the Somerset County courthouse. Members of the press, police officers and approximately 150 other people attended. During the demonstration, defendant made a speech advocating the legalization of marijuana and then invited anyone with a medical illness who needed marijuana to come forward and receive brownies laced with marijuana. Six or seven people came forward. Three of those people addressed the crowd and described their medical conditions. Defendant, stating that "he was going to take the people's word that they medically needed the marijuana" offered the brownies to them. Six participants ate the brownies. Defendant invited the police to take the remaining brownies as evidence. The brownies were seized and defendant was issued a summons for furnishing scheduled drugs. [¶ 3] In support of the competing harms defense, defendant presented the testimony of two of the six participants who received *337 marijuana from him.[3] Carol Hurley testified that she has glaucoma, that she believes she could go blind at any moment, and that she believes marijuana assists her in maintaining her sight. She also testified that she used marijuana for recreational purposes and that she had eaten marijuana earlier on the day of the demonstration to accommodate her medical needs. Although she believes that marijuana is helpful in reducing pain and possibly alleviating her symptoms of glaucoma, she stated that her purpose in eating the brownies at the demonstration was to "get a little high." Carl Cummings, who suffers from ankylosing spondylitis (an inflammation of the vertebrae), testified about his need for marijuana to avoid pain: Q: What happens if you don't take your medicine? A: I'm just engulfed with pain. I can't stand it. I believe that if I didn't have marijuana I would probably commit suicide. I don't believe that I would want to go on. Q: Are you in danger of this happening again if you don't get your hemp? A: Every minute—while I'm sitting right here I could have a muscle spasm. Anything could happen at any time. At the close of the evidence, defendant requested a jury instruction on the competing harms defense. The court denied defendant's request, stating that: [U]nder the circumstances the reasonable hypothesis that would have to be before the jury to decide is that on the basis of necessity under reasonable standards of desirability and urgency the defendant, after forecasting and publicizing and inviting the media and all other persons to attend, placed himself on the steps of the court-house and furnished the marijuana to others, with a specific supply to law enforcement as evidence, and that he did do so to avoid imminent physical harm. [¶ 4] "Whether a jury should be instructed on a particular defense in a criminal case almost always depends on whether the evidence presented at trial generates the defense." State v. Moore, 577 A.2d 348, 350 (Me.1990). The court must view the evidence in the light most favorable to the defendant. State v. Sullivan, 1997 ME 71, ¶ 6, 695 A.2d 115, 117. "A defense is `in issue' ... if the evidence is sufficient to make the existence of all facts constituting the defense a reasonable hypothesis for the fact finder to entertain." State v. Case, 672 A.2d 586, 589 (Me.1996) (quoting State v. Begin, 652 A.2d 102, 106 (Me.1995)). [¶ 5] The competing harms defense applies to "conduct which the actor believes to be necessary to avoid imminent physical harm to himself or another...." 17-A M.R.S.A. § 103(1) (1983). Such conduct is justified if the "desirability and urgency of avoiding such harms outweigh, according to ordinary standards of reasonableness, the harm sought to be prevented by the statute defining the crime charged." Id; see also State v. Moore, 577 A.2d 348, 350 (1990). The evidence must demonstrate that the "defendant's conduct was necessary because of a specific and imminent threat of injury to the defendant or another leaving no reasonable alternative other than violating the law." Id. [¶ 6] Initially, we note that in the present case the State brought a single count of furnishing scheduled drugs. Defendant could have been convicted on the basis of furnishing marijuana to any one or more of the six participants. Accordingly, defendant needed to demonstrate a necessity to furnish marijuana to each of the six participants in order to avoid conviction. Although defendant presented evidence concerning the two participants who testified at trial, he failed to present any evidence with respect to the other four participants. In such circumstances, any failure to instruct is harmless. [¶ 7] Even if we were to focus on the evidence of the threat to the two witnesses who testified, the defense was not generated. Although the symptoms of their chronic illnesses may be eased by the ingestion of marijuana, neither witness testified to an imminent *338 threat of injury present at the time of the demonstration that could reasonably serve as the basis for defendant violating the law. [¶ 8] Finally, defendant argues that the competing harms defense, as defined in section 103(1), limits his right to free speech on the basis of content in violation of the First Amendment. Because the competing harms defense was not generated, we need not address the constitutional issue. See State v. Bassford, 440 A.2d 1059, 1061 (Me.1982) (a "fundamental rule of appellate procedure [is] that a court should avoid expressing opinion on constitutional law whenever a nonconstitutional resolution of the issues renders a constitutional ruling unnecessary") (citation omitted). The entry is: Judgment affirmed. NOTES [1] The statute provides in pertinent part: 1. A person is guilty of unlawfully furnishing scheduled drugs if he intentionally or knowingly furnishes what he knows or believes to be a scheduled drug, and which is, in fact, a scheduled drug. 17-A M.R.S.A. § 1106 (1983 & Supp.1996). [2] The defense is defined as follows: 1. Conduct which the actor believes to be necessary to avoid imminent physical harm to himself or another is justifiable if the desirability and urgency of avoiding such harm outweigh, according to ordinary standards of reasonableness, the harm sought to be prevented by the statute defining the crime charged. The desirability and urgency of such conduct may not rest upon considerations pertaining to the morality and advisability of such statute. 17-A M.R.S.A. § 103 (1983). [3] Ralph Holt spoke at the rally and testified at the trial about his glaucoma and his need for marijuana for medicinal purposes. He testified, however, that he did not eat any marijuana-laced brownies at the rally because "children are in school—I have to think of my reputation."

2013-10-30 06:35:56.812962+00

Trager

994 F. Supp. 406 (1998) Joseph RIVERA, Harriet Rivera, and Wanda Rivera, Plaintiffs, v. UNITED STATES of America, Defendant. No. Civ.A. 96-CIV-2074 (DGT). United States District Court, E.D. New York. January 29, 1998. Moskowitz, Passman & Edelman, New York City, for plaintiffs. Zachary W. Carter, United States Attorney, Brooklyn, NY, for defendant. MEMORANDUM AND ORDER TRAGER, District Judge. At the conclusion of a bench trial which took place on October 7, 21, and 29, 1997, the court found that the defendant, the United States of America, was negligent, and that the plaintiff, Joseph Rivera, was not contributorily negligent concerning an automobile accident which occurred on January 11, 1993 in Brooklyn, New York between a car driven by agents of the Federal Bureau of Investigation and one driven by the plaintiff. The court further found that as a result of this accident, the plaintiff suffered injuries which caused him to be incapacitated for a period of at least ninety days immediately following the accident. The court awarded damages for the plaintiff in the amount of $40,000. Defendant moves for a directed verdict on the basis that the plaintiff failed to establish a serious injury as defined by New York's no-fault insurance law and that he, therefore, is not entitled to recover for non-economic losses arising from the, accident. See N.Y.Ins.Law §§ 5102(d), 5104 (McKinney 1985). At trial, the court credited the plaintiff's testimony which established that he suffered injuries to his head, neck, and back, as well as residual attention deficits and cognitive disabilities affecting his memory which were of at least temporary duration; that these impairments prevented him from performing substantially all of his customary daily activities; and that this incapacity lasted for at least ninety out of the first one hundred-eighty days immediately following the injury. The United States argues that plaintiff's injury does not meet the requirements for a "medically determined" injury within the meaning of § 5102(d) of New York's no-fault insurance statute because no objective medical evidence was presented at trial to support his claims of injuries. See Trial Transcript ("Tr.") of 10/29/97 at 370-389. There appear to exist a few New York cases which seem to support the defendant's position that proof of a medically determined injury cannot rest solely on the plaintiff's subjective complaints, but rather must be supported by objective medical evidence. *407 See Eldred v. Stoddard, 217 A.D.2d 952, 953, 630 N.Y.S.2d 171, 172 (4th Dept.1995) ("The opinion of plaintiff's physician that plaintiff suffers from chronic pain syndrome is based upon plaintiff's subjective complaints of pain and is unsupported by any objective medical evidence."); Short v. Shawn, 188 A.D.2d 815, 817-18, 590 N.Y.S.2d 943, 945 (3d Dept.1992) ("[T]he [physician's] medical determination of plaintiff's injuries ... appears to have been based solely on plaintiff's subjective impressions. ... [W]hile [the physician] diligently reports plaintiff's complaints of discomfort in his medical records, he does not describe any objective evidence thereof...."); Lowe v. Bennett, 122 A.D.2d 728, 730, 511 N.Y.S.2d 603, 605 (1st Dept.1986), aff'd, 69 N.Y.2d 700, 512 N.Y.S.2d 364, 504 N.E.2d 691 (1986) ("The conclusory allegations in [the doctor's] affirmations, based on subjective findings and plaintiffs' complaints, fail to establish a prima facie case of `serious injury.'"). Several New York cases, however, do not specifically require objective evidence of injury, but nonetheless affirm that to constitute a "serious injury" under § 5102(d), an injury must be supported by "competent" or "credible" medical evidence. See Costa v. Billingsley, 127 A.D.2d 990, 991, 512 N.Y.S.2d 947, 948 (4th Dept.1987) ("[P]laintiff's complaints are entirely subjective and are unsupported by any competent medical evidence.... The subjective complaints of the plaintiff without medical foundation are insufficient to establish a prima facie case of serious injury. ..."); Lanuto v. Constantine, 192 A.D.2d 989, 991, 596 N.Y.S.2d 944, 945 (3d Dept. 1993) ("[P]laintiff ... failed to present credible medical evidence that an injury or impairment was sustained."); Stossel v. Fleyshmahker, 117 Misc. 2d 454, 456, 458 N.Y.S.2d 484, 456-57 (N.Y.Civ.Ct.1983) ("The only substantiation of plaintiff's claim is her own diagnosis ... that the injury caused her incapacitation .... [T]here is no competent medical evidence that the ... injury caused [plaintiff's] condition."). One New York Court of Appeals case, although not specifically setting forth a requirement of objective medical evidence, would appear to indicate that the subjective complaints of a plaintiff are not sufficient to establish a serious injury under § 5102(d). In Licari v. Elliott, 57 N.Y.2d 230, 238-39, 455 N.Y.S.2d 570, 574, 441 N.E.2d 1088 (1982), the New York Court of Appeals stated: [P]laintiff's subjective complaints of occasional, transitory headaches hardly fulfill the definition of serious injury. Plaintiff offered no proof that his headaches in any way incapacitated him or interfered with his ability to work or engage in activities at home.... We do not believe the subjective quality of an ordinary headache falls within the objective verbal definition of serious injury as contemplated by the No-Fault Law. It is evident that Licari did not squarely address the issue of whether a serious injury must be demonstrated through objective medical evidence. Rather, the case can be fairly read as standing for a middle position that a plaintiff's subjective complaints alone, in the absence of some independent validation by a competent medical authority, however rendered, will not establish a serious injury under § 5102(d). Furthermore, the case is readily limited to its facts. The Licari Court seemed to rest its holding on the relatively minor nature of the effects the plaintiff claimed to have suffered as a result of the accident, noting that there existed no proof that his commonplace headaches, which by the plaintiff's own admission were relieved by aspirin, in any way interfered with his ability to work or conduct his ordinary activities at home. See id. Contradicting the government's position is D'Avolio v. Dictaphone Corp., 822 F.2d 5 (2d Cir.1987), a federal case interpreting New York law, which appears to hold that no objective proof of injury is required. Addressing the alternative methods of establishing a "serious injury" within the meaning of § 5102(d), the Second Circuit observed: Plaintiff may also demonstrate a "serious injury" if she establishes that: (a) there was a medically determined injury, (b) the impairment prevented the injured person from performing substantially all of the material acts of the person's customary daily activities, and (c) the incapacity lasted for at least 90 out of the first 180 days immediately following the injury. While *408 defendants correctly point out that the injury suffered must be "medically determined" to satisfy the last category of serious injuries listed in § 5102(d), they cite no case — and we have found none — requiring that elements (b) and (c) must be shown by medical testimony or that element (a) must be proven by an expert medical witness. New York courts considering elements (b) and (c) have focused on the credibility of the plaintiff's testimony. 822 F.2d at 6 (citations omitted). Nothing within D'Avolio indicates that a claim of injury must be supported by objective medical evidence in order to be "medically determined" within the meaning of § 5102(d). In fact, the opinion appears to suggest that no such requirement exists. Although the Second Circuit did not specifically define the term "medically determined," in setting forth the requirements for a serious injury under the 90/180 prong of § 5102(d), the court cited Stossel v. Fleyshmahker, 117 Misc. 2d 454, 456, 458 N.Y.S.2d 484, 485 (1983), which stated that to be "medically determined" within the meaning of the statute, "it is not sufficient that a competent medical authority find that an injury was sustained. It must be `medically determined' that the pain and suffering for which compensation is sought was caused by the injury." See D'Avolio, 822 F.2d at 6-7. Thus, under D'Avolio, while it would appear that proof of an existing injury, as well as its causal relationship to the accident, must be corroborated by competent medical authority, it does not appear that such corroboration must rest on objective medical evidence. It is, therefore, apparent that state and Second Circuit case law interpreting New York's no-fault insurance statute differ somewhat regarding the criteria for a serious injury under § 5102(d) of the statute. It is well-established that where state substantive law is to be applied, a federal court is bound by the interpretation of a state's statute by the state's highest court. See Missouri v. Hunter, 459 U.S. 359, 366-68, 103 S. Ct. 673, 74 L. Ed. 2d 535 (1983); O'Brien v. Skinner, 414 U.S. 524, 531, 94 S. Ct. 740, 38 L. Ed. 2d 702 (1974). See also O'Neill v. City of Auburn, 23 F.3d 685, 689 (2d Cir.1994), cert. denied, ___ U.S. ___, 117 S. Ct. 766, 136 L. Ed. 2d 712 (1997); McCarthy v. Olin Corp., 119 F.3d 148, 153 (2d Cir.1997). Additionally, where a state's court of last resort "has not ruled on the precise issue" before the federal court, the latter has the responsibility "to predict how the state's highest court would rule on [the] issue." O'Neill, 23 F.3d at 689-90 (citing In Re Brooklyn Navy Yard Asbestos Litig., 971 F.2d 831, 850 (2d Cir. 1992)). See also Jacobson v. Fireman's Fund Ins. Co., 111 F.3d 261, 267 (2d Cir. 1997); McCarthy v. Olin Corp., 119 F.3d 148, 153 (2d Cir.1997); Travelers Ins. Co. v. 633 Third Assocs., 14 F.3d 114, 119 (2d Cir.1994). The conjectural inquiry to be conducted by a federal court in such situations requires an examination of the state's lower court case law. See In Re Brooklyn Navy Yard Asbestos Litig., 971 F.2d at 850 ("[W]here the high court has not spoken, the best indicators of how it would decide are often the decisions of lower [New York] courts."). As previously mentioned, it appears that the New York Court of Appeals has not directly answered the question of whether objective medical evidence is specifically required to establish a serious injury under § 5102(d). Furthermore, it is difficult to predict with any degree of confidence how the court of appeals would rule if presented with this question. This is so for two reasons. First, as earlier noted, a fair reading of Licari indicates that the New York Court of Appeals adopted an intermediary position, one requiring something more than subjective complaints by the plaintiff, yet less than objective medical evidence of injury. Second, a survey of lower court cases demonstrates a certain amount of inconsistency concerning the nature of the proof required for a serious injury under New York's no-fault statute. For these reasons, this court declines to predict how the New York Court of Appeals would resolve the question of whether objective medical evidence must be presented to establish a serious injury under § 5102(d). However, inasmuch as this question lies at the very core of the government's motion for a directed verdict, the court will accept the government's contention for purposes of this analysis. *409 Even assuming that objective medical evidence of injury is required to demonstrate a serious injury under § 5102(d), the plaintiff's cognitive disabilities do appear to have independent, objective support in the trial testimony of Dr. Elkhonon Goldberg, a neuropsychologist who examined the plaintiff in January and February of 1993, and who testified that his evaluation of the plaintiff revealed a deficit in cognitive function which was causally related to the accident. See Tr. of 10/21/97 at 286, 289-290. Specifically, Dr. Goldberg testified that the plaintiff had a lateralized (right-sided) deficit in sequential motor organization, an abnormal finding that strongly indicates damage to the opposite side of the brain: There was impairment in the right hand and that was evidenced in several tests which we employed to measure motor function. And I say that the discrepancy was noted so that the motor functions in the right hand which is the dominant hand, exceeding those in the left hand, were weaker than in the left hand which is an abnormal finding and ... strongly indicative of damage of the opposite side of the brain.... And it is extremely inconceivable that such a lateralized abnormality would be part and parcel of one's life long make up. These lateralized abnormalities are usually significant to an acquired brain damage. Id. at 290. Dr. Goldberg's testimony is significant because the point of impact during the accident was the left side of the plaintiff's head, and the diagnosis of a lateralized motor deficiency on the plaintiff's right side appears consistent with a trauma-induced injury to the left side of his brain. Dr. Goldberg further stated at trial that he made a similar finding of lateralized deficiency with respect to the plaintiff's "visual attention." The tests Dr. Goldberg conducted revealed that the plaintiff suffered from right visual hemiinattention, a finding which Dr. Goldberg stated "again points to something abnormal in the left hemisphere." Id. Summarizing the results of these findings, Dr. Goldberg stated: [W]hen you [look at] the two things, motor findings ... in the right hand and the right visual hemiinattention, that amounts to convergent evidence, several times, pointing in the same direction and indicating the same location of the brain as the culprit. This pattern indicates powerful evidence of acquired brain damage .... these ... things ... in my opinion are particularly unequivocal linking these findings with an acquired brain damage. Id. Thus, it is evident that at least one of the plaintiff's injuries, the one relating to his cognitive capabilities, is independently corroborated by expert medical testimony, and that the diagnosis confirming this injury rests upon objective medical evidence, namely, diagnostic tests revealing cognitive disfunction. The United States cites an unreported opinion, Cooper v. United States, No. 85-CV-370, 1987 WL 11618, at *4 (N.D.N.Y. May 13, 1987), for the proposition that a psychologist's conclusion that a patient suffered cognitive injuries attributable to an accident cannot be accepted where the patient's pre-accident mental and cognitive abilities have not been sufficiently established. The court finds this case to be inapposite. In Cooper, the doctor's examination presumably did not point to any compelling link between the plaintiff's loss of cognitive ability and the accident which she claimed caused this loss. This is to be contrasted with the case before the court, where Dr. Goldberg's diagnostic testing of the plaintiff revealed the existence of what he believed to be injury to the left hemisphere of the brain. The court finds Dr. Goldberg's conclusion that plaintiff's lateralized deficits in both motor skills and visual attention are attributable to a trauma-induced injury to the left side of his brain to be credible. The medical testimony offered in support of plaintiff's other injuries, i.e., those to his back and neck, does in fact appear to rest largely, if not solely, on his subjective complaints, but none of the medical findings are inconsistent with the veracity of plaintiff's testimony about these complaints. In any case, the government has cited no cases to support the contention that every claim need be corroborated by objective medical evidence and it is therefore sufficient that at least a portion of the claims be corroborated. *410 Furthermore, there is little doubt that the one claim that was corroborated by objective medical evidence, and thus unequivocally satisfies the criteria for a medically determined injury even under the interpretation of New York's no-fault insurance statute advanced by the government, contributed to plaintiff's inability to work for at least ninety days following his injury. For the reasons discussed above, the court finds judgment for the plaintiff in the amount of $40,000. The clerk of the court is directed to enter judgment accordingly and close the case.

2013-10-30 06:35:56.818411+00

Seiler

491 S.W.2d 244 (1973) STATE of Missouri, Respondent, v. Wendell KLEEN, Appellant. No. 56934. Supreme Court of Missouri, Division No. 1. March 12, 1973. John C. Danforth, Atty. Gen., Preston Dean, Asst. Atty. Gen., Jefferson City, for respondent. Lynn M. Ewing, Jr. and Gerald D. McBeth, Ewing, Ewing, Carter, Wight & Woodfill, Nevada, for appellant. SEILER, Judge. This is an appeal from conviction on an insufficient funds check charge, Sec. 561. 460, R.S.Mo.1969, V.A.M.S. Since this appeal *245 was pending here on January 1, 1972, the effective date of the 1970 amendment to the judicial article, the appeal comes within our exclusive jurisdiction as set by Art. V, Sec. 3, Mo.Const.1945, V.A.M.S., as it existed prior to the amendment. Defendant, a resident of Nevada, Missouri, was in the business of buying and selling truck loads of grain and meal. He signed a check on Citizens State Bank of Nevada, dated February 17, 1970, and gave it to his truck driver. The check bore the words "For loads only", and was incomplete and in blank as to payee and amount. The driver usually had more than one such load check when he would leave Nevada. It would not be known for what or where the check would be used until the driver purchased a load with it. In the instance before us, either defendant or his secretary told the driver to go to Memphis, Tennessee. There the driver purchased a load of cottonseed meal at a plant or warehouse, where Herring Sales Company, a dealer in feed ingredients, had arranged, through its own advance purchase, for delivery and sale of meal in certain months. Sales to customers at the Memphis warehouse were by the ton at the pickup point. The weight of the load being purchased and the amount due were determined after the truck was loaded. The sale was considered a cash sale and no delivery or sale was made unless the driver paid in cash or delivered a check in full. Someone at the Memphis plant filled in the name of the seller, Herring Sales Company, on the check before us, together with the amount due for the load sold, $1,909.00, and added the words "cottonseed meal." It is undisputed the check was delivered in Memphis. The check was then sent from Memphis to the Herring Sales Company office in Kansas City, Missouri,[1] where it was deposited and in due course returned unpaid because of insufficient funds in defendant's account in the bank at Nevada. The evidence showed that at no time between February 16 and February 26 did defendant have sufficient funds in or credit with the bank to pay the check. The banker at Nevada testified the check was presented and dishonored on "approximately February 24th". On March 16, 1970, Herring Sales gave defendant written notice, per Sec. 561.470, R.S.Mo.1969, V.A.M.S., of the dishonor of the check, but the check was not paid. There was evidence defendant had in the past bought grain from Herring Sales and one of their men from the Kansas City office had known defendant about three years, but there was no evidence of any advance knowledge, arrangements, or negotiations between Herring Sales and defendant with respect to the Memphis purchase. Defendant raises several questions on appeal, but the initial question is whether on the above facts defendant can be found guilty in Missouri of violation of Sec. 561.460, supra, the insufficient funds check statute. We hold not, because the evidence fails to show that "the constituent facts of the offense, the occurrence of which must be alleged and proved by the state in order to sustain a conviction", State v. Hook, 433 S.W.2d 41, 46 (Mo. App.1968), took place in Missouri, and the Missouri courts have no jurisdiction to prosecute for an offense which occurs in another state, State v. Shaeffer, 89 Mo. 271, 1 S.W. 293 (1886). In this case the state proved that defendant signed the check in question, in Nevada, but it was not at that time actually a check, because it did not contain a promise to pay a sum certain, as it was blank as to amount, nor was it payable to *246 order or bearer, as it was also blank in this respect. It therefore was not legally a check at that point. Sec. 400.3-104, R.S. Mo.1969, V.A.M.S. The piece of paper was still in that condition when defendant gave it to his truck driver in Nevada and when the truck driver crossed into Tennessee with it. Had all action stopped right there, it could not be contended that defendant had violated any law. Later, his agent, the truck driver, used the check to purchase a load of cottonseed meal for defendant, but this took place in Memphis, Tennessee. At that time, the amount to be paid for the load was determined by weighing it and computing the price at so much per ton. Someone at the warehouse in Memphis inserted the correct amount in the check and the name of the payee. The check was then physically delivered in payment for the cottonseed meal. Had all this occurred in Missouri, defendant would have been in violation of Sec. 561.460, because he would have been guilty of procuring a load of meal by means of having made and delivered with intent to defraud a check, knowing that he did not have sufficient funds in or credit with the bank for payment of the check upon presentation. As it was, however, the check was not made until it was completed in Memphis and it was not delivered in the sense of being passed or uttered until it was handed over at Memphis to the seller of the meal in payment therefor, taking the word "delivery" in its usual and ordinary meaning, State v. Athans, 490 S.W. 25, decided by this court February 12, 1973. The check must be used "to procure", to induce the party defrauded to part with his property, State v. Garner, 432 S.W.2d 259 (Mo.1968). Defendant did not offer this check in the sense of getting something by an insufficient funds check until it was delivered to the seller in Memphis. Then and there is where the required intent to defraud by misrepresentation of an existing fact occurred—the obtaining of the meal by completion and delivery of the check knowing at the time there were not sufficient funds or credit for payment in full on presentation. It is true the check could not have been completed and delivered in Memphis if it had not been prepared in part and started on its way by defendant at Nevada, Missouri. But the acts necessary to complete the offense occurred in Tennessee. The situation is similar to State v. Hall, 114 N.C. 909, 19 S.E. 602 (1894), where the defendants, while standing within the boundaries of the state of North Carolina, pulled the trigger and started the bullet on its way toward the deceased, who was then in Tennessee, where he was wounded and died. The defendants were prosecuted in North Carolina and convicted of murder. On appeal the question was presented whether they committed the offense of murder within the jurisdiction of North Carolina. The North Carolina court reversed the conviction, saying at 19 S.E. 602: "It is a general principle of universal acceptation that one state or sovereignty cannot enforce the penal or criminal laws of another, or punish crimes or offenses committed in and against another state or sovereignty . . .." The court went on to conclude: "In view of the foregoing authorities, it cannot be doubted that the place of the assault or stroke in the present case was in Tennessee; and it is also clear that the offense of murder at common law was committed within the jurisdiction of that state. If this be so, it must follow that unless we have some statute expressly conferring jurisdiction upon the courts of this state, or making the act of shooting under the circumstances a substantive murder, the offense with which the prisoners are charged can only be tried by the tribunals of Tennessee . . .." So it is here and the judgment accordingly must be reversed. All of the Judges concur. NOTES [1] The record is silent as to what person or firm did the mailing of the check. The fair inference is that it was done by the warehouse as agent for the seller because there was testimony from the Herring Sales representative that the check was accompanied by "our invoice".

2013-10-30 06:35:56.858215+00

Odom

491 S.W.2d 928 (1973) Prescott Allen MARTIN, Appellant, v. The STATE of Texas, Appellee. No. 45708. Court of Criminal Appeals of Texas. February 21, 1973. Rehearing Denied April 11, 1973. Robert B. Maloney and David L. Loving, III, Dallas, for appellant. *929 Henry Wade, Dist. Atty., W. T. Westmoreland, Jr., Asst. Dist. Atty., Dallas, Jim D. Vollers, State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION ODOM, Judge. This is an appeal from a conviction for the offense of assault with intent to murder without malice. The jury assessed punishment at three years. Appellant's sole contention is that the trial court erred in overruling his motion for mistrial in that the state improperly impeached a defense witness with evidence inadmissible under Article 38.29, Vernon's Ann.C.C.P. Mary Tyler testified that she went to Joan Martin's house, intending to spend the night, and that she took with her a .38 caliber pistol which she stated was inoperative. She testified that she watched television in Miss Martin's bedroom for a period of time, heard a knock at the front door, and upon answering found appellant. Appellant had a pistol tucked in his belt and a can of beer in his hand. She and appellant went upstairs to Miss Martin's bedroom. As appellant, Miss Tyler and Miss Martin were seated on the bed, a "tussle" began between appellant and Miss Tyler. Miss Tyler was able to free herself from appellant's grasp, but was knocked to the floor in the process. She testified that appellant kicked her as she lay on the floor and then fired his pistol, wounding her in the neck. She further testified that appellant asked her to say the shooting was an accident. She was taken to the hospital by appellant and others. G. A. Thompson, a detective with the Homicide Division of the Dallas Police Department, testified that he talked to Joan Martin, and she told him appellant and Miss Tyler were in a "scuffle" when Miss Tyler was shot. Defense witnesses were Fannie Thomas, Joan Martin and Thomas Tunson. Fannie Thomas testified that she saw Miss Tyler at the hospital the morning after the shooting; that Miss Tyler first said she did not know who had shot her, then said the shooting was an accident, and then said appellant told her to say it was an accident. Joan Martin testified that she and Miss Tyler were drinking beer at a friend's house; that later that night she had a fight with her boyfriend, Thomas Tunson, during which Miss Tyler was present; and that the shooting of Miss Tyler was the result of the "tussle" between appellant, herself and Miss Tyler. She testified that the gun discharged as Miss Tyler slid off the bed, and when appellant reached for the gun that made it discharge, wounding Miss Tyler. Thomas Tunson testified that he knew Mary Tyler carried a pistol, that she had one in her possession on the afternoon of October 2, 1970, and "pulled" it on him that afternoon at Joan Martin's house during an argument he was having with Joan Martin. The defense rested its case and Tunson was then recalled by the state. At this juncture, the state impeached Tunson's testimony in the following manner: "Q. Are you also one and the same Thomas Jewell Tunson who on October the 18th, 1960 in Dallas County, in the cause of D-1653-I, for the criminal offense of robbery, was duly, lawfully and finally convicted on October the 18th, 1960? A. I got a provation (sic) and I lived it out. Q. Are you one and the same who was convicted? A. Yes, sir. MR. MALONEY: Objection, Your Honor. At this time I'm going to move *930 the Court for a mistrial, if there was a probated sentence that was lived out; such was improper impeachment and bad faith on the part of the prosecutor. THE COURT: Well, I'll overrule your objection at this time." The state then, without objection, impeached Tunson's testimony by showing his conviction for the offenses of child desertion and misdemeanor theft. Tunson was then questioned by appellant, outside the presence of the jury, for the purpose of perfecting his bill of exception. The witness testified that his five-year sentence for robbery was probated on October 18, 1960; and that he served out his probation period without a revocation. James Rolfe, Assistant District Attorney, testified that he was assigned with Jim Johnson in the prosecution of this case; that after Tunson had testified, he checked the records at the District Attorney's office and found that Tunson had been convicted of robbery, received five years, and that the records he checked did not show that the sentence had been probated. He testified that he acted in good faith when he told the prosecutor at trial to use the robbery conviction for impeachment. However, he also stated that the defense attorney told him, prior to the use of the conviction, that the sentence had been probated, and that he did not check the clerk's office. The records of the clerk's office, indicating that probation had been granted, that the period of probation had expired and the conviction had been set aside, were shown to the trial judge. The judge then announced that he would instruct the jury not to consider the robbery conviction for any purpose. Appellant's motion for a mistrial was overruled. The jury was returned to the jury box and instructed not to consider the robbery conviction for any purpose. The state was permitted to further question the witness with regard to the conviction for the misdemeanor offense of theft and of child desertion. Any complaint that appellant may have had to the impeachment by use of the child desertion conviction was waived by not timely objecting to the same. Coleman v. State, Tex.Cr.App., 481 S.W.2d 872. The use of the conviction for the offense of misdemeanor theft was proper as it is an offense involving moral turpitude. Article 38.29, V.A.C.C.P. Appellant's complaint concerning the use of the robbery conviction to impeach his witness' testimony presents a different problem. Article 38.29, supra, reads as follows: "The fact that a defendant in a criminal case, or a witness in a criminal case, is or has been, charged by indictment, information or complaint, with the commission of an offense against the criminal laws of this State, of the United States, or any other State shall not be admissible in evidence on the trial of any criminal case for the purpose of impeaching any person as a witness unless on trial under such indictment, information or complaint a final conviction has resulted, or a suspended sentence has been given and has not been set aside, or such person has been placed on probation and the period of probation has not expired. In trials of defendants under Article 36.09, it may be shown that the witness is presently charged with the same offense as the defendant at whose trial he appears as a witness." (Emphasis supplied.) Referring to Article 38.29, supra, this court, in Goad v. State, Tex.Cr.App., 464 S.W.2d 129, at 133, stated: "... The foregoing statute prohibits the use of a criminal charge unless the same has resulted in a final conviction except where a suspended sentence has been given and not set aside or probation granted and the period of probation has not expired. Rayford v. State, *931 Tex.Cr.App., 423 S.W.2d 300. Certainly a prosecutor cannot in good faith inquire about a prior conviction for impeachment purposes if he knows that probation has been granted and the period of probation has expired. There is nothing in this record, however, to show the period of probation, or the fact that it had expired or that the prosecutor was aware of such expiration." In Parker v. State, Tex.Cr.App., 384 S.W.2d 712, the question was raised as to whether the accused was properly impeached by the use of a burglary conviction for which he had been placed on probation, where the probationary period had expired, and the court had set aside his conviction and dismissed the case pursuant to the provisions of Article 781d, Sec. 7, V.A.C.C.P. (Now Article 42.12, Sec. 7, V.A.C.C.P.)[1] Quoting Article 732a, V.A. C.C.P. (Now Article 38.29)[2] and emphasizing the phrase, "or such person has been placed on probation and the period of probation has not expired," the court stated: "We are in accord with the view that evidence as to the burglary conviction which had been set aside after the term of probation had expired was not admissible to impeach the appellant. This is especially so where, as here, the court has granted a new trial, set aside the conviction and dismissed the case pursuant to the provisions of Art. 781d, V. A.C.C.P., Sec. 7." 384 S.W.2d 714. Although the contention that the improper impeachment required a reversal was overruled because the defendant moved for a mistrial without stating any reason therefor, the court cautioned: "A different question would be raised had the appellant directed the trial court's attention to his motion praying that the district attorney be instructed not to bring before the jury the fact that he had been previously convicted in the cause in which he was granted probation, the term of which had expired and the conviction set aside." 384 S.W.2d 714. Thus it was improper for the state to impeach the witness' testimony by proof of a felony conviction where the probationary term had expired and the conviction had been set aside. Article 38.29, V.A.C.C.P.; Article 42.12, V.A.C.C.P.; Goad v. State, supra; Parker v. State, supra. Compare, Valdez v. State, Tex.Cr.App., 462 S.W.2d 24; Smith v. State, Tex.Cr.App., 455 S.W.2d 282; Rayford v. State, Tex.Cr.App., 423 S.W.2d 300. Nevertheless, under the *932 circumstances of this case, the error does not call for a reversal. This court has held that the improper impeachment of a witness who has given testimony of no materiality will not constitute grounds for a reversal. Davis v. State, 149 Tex. Crim. 98, 191 S.W.2d 733; Le Fors v. State, 130 Tex. Crim. 426, 94 S.W.2d 738; Miller v. State, 67 Tex. Crim. 654, 150 S.W. 635. Compare, Holland v. State, 60 Tex. Crim. 117, 131 S.W. 563. The gist of witness Tunson's testimony was that Mary Tyler carried a pistol, that she had one in her possession on the afternoon of October 2, 1970, and that she "pulled" it on him that afternoon at Joan Martin's house. Appellant maintained that the shooting was an accident, the inadvertent result of the "tussle." It was Miss Tyler's position that appellant intentionally shot her. A charge on the defense of accident was submitted to the jury. A charge on self-defense was not submitted to the jury nor in fact raised by the evidence. Tunson's testimony was not material to the defense of accident and since Miss Tyler admitted possession of the pistol, his testimony did not affect her credibility. Since the material character of Tunson's testimony was tenuous at best, the harm that resulted from the error in allowing the improper impeachment is not such that would require a reversal. This is especially so in light of the trial court's action withdrawing the impeachment evidence, sustaining appellant's objection and instructing the jury to disregard such evidence. See, Thompson v. State, Tex.Cr. App., 486 S.W.2d 343; Evans v. State, Tex.Cr.App., 477 S.W.2d 455; O'Dell v. State, Tex.Cr.App., 467 S.W.2d 444. See also, Cazares v. State, Tex.Cr.App., 488 S.W.2d 110. No reversible error having been shown, the judgment is affirmed. NOTES [1] The suspended sentence law (Articles 776-781) was repealed in 1965 and replaced by Article 42.12, V.A.C.C.P. However, Section 7 of Article 42.12, supra, is the same as Section 7 of the old Article 781d and provides: "... Upon the satisfactory fulfillment of the conditions of probation, and the expiration of the period of probation, the court, by order duly entered, shall amend or modify the original sentence imposed, if necessary, to conform to the probation period and shall discharge the defendant. In case the defendant has been convicted or has entered a plea of guilty or a plea of nolo contendere, and the court has discharged the defendant hereunder, such court may set aside the verdict or permit the defendant to withdraw his plea, and shall dismiss the accusation, complaint, information or indictment against such defendant, who shall thereafter be released from all penalties and disabilities resulting from the offense or crime of which he has been convicted or to which he has pleaded guilty, except that proof of his said conviction or plea of guilty shall be made known to the court should the defendant again be convicted of any criminal offense." [2] Article 38.29, V.A.C.C.P. is the same as old Article 732a, V.A.C.C.P. except that the following sentence was added in 1965: "In trials of defendants under Article 36.09, it may be shown that the witness is presently charged with the same offense as the defendant at whose trial he appears as a witness."

2013-10-30 06:35:56.867398+00

Terry

704 A.2d 851 (1997) In re John J. LIPARI, Respondent. A Member of the Bar of the District of Columbia Court of Appeals. No. 92-BG-831. District of Columbia Court of Appeals. Submitted September 24, 1996. Decided October 30, 1997. John J. Lipari, pro se. Leonard H. Becker, Bar Counsel, and Traci M. Tait, Assistant Bar Counsel, entered appearances for petitioner, the Office of Bar Counsel. Before TERRY, STEADMAN and RUIZ, Associate Judges. TERRY, Associate Judge: Respondent Lipari, a member of the Bars of the District of Columbia and New Jersey, was disbarred in New Jersey in March 1992. Mr. Lipari had been an attorney for First Atlantic Savings and Loan Association, a federally insured thrift institution in New Jersey which was declared insolvent in 1990 by the Resolution Trust Corporation. On February 7, 1992, in the United States District Court for the District of New Jersey, he pleaded guilty to a two-count information which charged him with conspiracy to commit an offense against the United States and to defraud the United States (count 1)[1] and knowing and willful tax evasion (count 2).[2] The conspiracy count alleged that Mr. Lipari and two officers of First Atlantic had conspired to defraud the United States and to violate three federal criminal statutes: 18 U.S.C. § 215(a), which prohibits the payment of "commissions or gifts"—kickbacks—to bank officers for procuring loans; 18 U.S.C. § 657, which prohibits embezzling funds from a federally insured financial institution; and 18 U.S.C. § 1956(a)(1)(B)(i), which prohibits money laundering. He was later sentenced to concurrent prison terms of nine months on each count, followed by three years of supervised *852 release, and was ordered to make restitution "in an amount equal to his personal gain, approximately $400,000," payable in monthly installments.[3] Upon learning of his guilty plea, this court suspended Mr. Lipari and directed the Board on Professional Responsibility ("the Board") to begin a formal disciplinary proceeding in the District of Columbia. We asked the Board to determine whether the crimes of which he was convicted involved moral turpitude, as that term is used in D.C.Code § 11-2503(a) (1995).[4] The Board ruled that Mr. Lipari's conviction of conspiracy under 18 U.S.C. § 371 involved moral turpitude per se and therefore recommended that he be disbarred. We agree and order his disbarment under D.C.Code § 11-2503(a). Mr. Lipari was convicted of two offenses: conspiracy and tax evasion. This court has held that willful tax evasion, in violation of 26 U.S.C. § 7201, is not a crime of moral turpitude per se. In re Shorter, 570 A.2d 760, 766 (D.C.1990). In light of this holding, we undertook in Shorter to examine the facts underlying the conviction and concluded that they did not establish moral turpitude. Id. at 767. If tax evasion were the only crime of which Mr. Lipari was convicted, we would follow the same course here; i.e., we would consider whether the underlying facts established moral turpitude, as we did, for example, in In re Casalino, 697 A.2d 11, 13 (D.C. 1997). In this case, however, we need not do so, because we are satisfied that the other crime of which Mr. Lipari was convicted inherently involved moral turpitude and therefore requires his disbarment under D.C.Code § 11-2503(a). See In re McGough, 605 A.2d 605 (D.C.1992) (when there are multiple convictions, only one crime involving moral turpitude need be found for disbarment under section 11-2503(a)). The first count of the information to which Mr. Lipari pleaded guilty charged him with conspiracy to defraud the United States and to violate three federal criminal statutes: 18 U.S.C. §§ 215(a), 657, and 1956(a)(1)(B)(i). Because a conspiracy conviction does not necessarily involve moral turpitude per se, we must look to the offense that was the object of the conspiracy in order to determine whether moral turpitude is involved. See In re Meisnere, 471 A.2d 269, 270 (D.C.1984). We agree with the Board, however, that if that offense is one of moral turpitude per se, then the conspiracy is also a crime of moral turpitude per se. This court has held that conspiracy to defraud the United States is a crime of moral turpitude per se. In re Hirschfeld, 622 A.2d 688, 691 (D.C. 1993); In re Meisnere, supra. We have also held that a violation of 18 U.S.C. § 657 involves moral turpitude per se. In re Reggie, 666 A.2d 69 (D.C.1995). From these precedents it logically follows that the conspiracy of which Mr. Lipari was convicted was a crime inherently involving moral turpitude. If the conspiracy conviction were based on a jury verdict, rather than a guilty plea, our inquiry might have to go further. As the Board observes in its report: If a defendant is convicted of a conspiracy with multiple objectives—some of which involve moral turpitude per se but some of which do not—it may not be possible to determine precisely what the jury convicted the defendant of conspiring to do. A jury is instructed that in order to convict it need find only that the defendant committed conspiracy to commit one of multiple objectives. It therefore may not be possible to determine from a general verdict of guilty whether the jury convicted the defendant of conspiracy with an objective that inherently involves moral turpitude or one that does not. Similarly, in In re Shorter, supra, the indictment alleged three affirmative acts of tax *853 evasion, and the jury had to find that Mr. Shorter had committed only one such act, without specifying which one it was, in order to find him guilty. Since at least one of the three acts charged did not involve moral turpitude per se, we held that we could sanction him only "to the extent minimally necessary to sustain the underlying convictions." Shorter, 570 A.2d at 766-767 (footnote omitted). In this case, however, because Mr. Lipari pleaded guilty to the entire conspiracy count, and because he has never asserted, either before the Board or before this court, that he was not guilty of any act alleged in that count,[5] we hold that he may be presumed to have admitted everything in the information, specifically including conspiracy to defraud the United States and conspiracy to violate 18 U.S.C. § 657. Since both of those offenses inherently involve moral turpitude, we need not consider whether a conspiracy to violate either 18 U.S.C. § 215(a) or 18 U.S.C. § 1956(a)(1)(B)(i) is also a crime of moral turpitude. See In re McGough, supra. It is therefore ORDERED that respondent, John J. Lipari, is hereby disbarred from the practice of law in the District of Columbia pursuant to D.C.Code § 11-2503(a), effective immediately. The parallel reciprocal disciplinary proceeding is dismissed as moot. We direct Mr. Lipari's attention to D.C. Bar Rule XI, § 14(g), requiring the filing of an affidavit containing certain information, and to Rule XI, § 16(c), setting forth the consequences of a failure to file the affidavit within the time prescribed by section 14(g). NOTES [1] Under 18 U.S.C. § 371 (1994), it is a felony to conspire "either to commit any offense against the United States, or to defraud the United States, or any agency thereof in any manner or for any purpose...." [2] 26 U.S.C. § 7201 (1994) provides that "[a]ny person who willfully attempts in any manner to evade or defeat any tax imposed by this title or the payment thereof shall ... be guilty of a felony...." [3] After his release from prison, his sentence was modified by eliminating the last fifteen months of supervised release and allowing him to make a lump-sum restitution payment in lieu of the last fifteen monthly installments. [4] Section 11-2503(a) requires this court to disbar any member of its bar who is "convicted of an offense involving moral turpitude...." "Once moral turpitude is established, the statute leaves the court no discretion to impose a lesser sanction." In re Sneed, 673 A.2d 591, 594 (D.C. 1996) (citation omitted). [5] Cf. In re Goldsborough, 654 A.2d 1285, 1288 (D.C.1995) (this court's usual deference to the recommendation of the Board "becomes even more deferential where, as here, the attorney has failed to contest the proposed sanction").

2013-10-30 06:35:56.902086+00

Irenas

994 F. Supp. 253 (1998) Dolores AMATUZIO, et al., Plaintiffs, v. GANDALF SYSTEMS CORPORATION, et al., Defendants. William CHAMBERS, et al., Plaintiffs, v. GANDALF SYSTEMS CORPORATION, et al., Defendants. Civil Action Nos. 95-4808(JEI), 96-621(JEI). United States District Court, D. New Jersey. February 4, 1998. *254 *255 *256 Mattioni, Mattioni & Mattioni, LLP by Joseph F. Bouvier, Westmont, NJ, for plaintiffs. Obermayer, Rebmann, Maxwell & Hippel by Stephen D. Schrier, James M. Penny, Jr., Marjorie H. Gordon, Haddonfield, NJ, for defendants. AMENDED OPINION IRENAS, District Judge. This matter comes before this Court on defendants Gandalf Systems Corp. and Gandalf Technologies, Inc.'s motion for summary judgment as to all claims in this action, and plaintiffs' cross-motion for summary judgment as to all claims. The disputes in this action arise out of a severance pay plan covered by the Employee Retirement Income Security Act ("ERISA"), and defendants' obligation under the Worker Adjustment and Retraining Notification Act ("WARN"), to give affected employees notice of a mass layoff and/or plant closing. This Court has jurisdiction under 28 U.S.C. § 1331. For the reasons that follow, this Court will: (1) find that Class One and Class Two plaintiffs have standing under ERISA, but that Class One Subclass "A" plaintiffs lack standing; (2) deny both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to plaintiffs' claim that they are entitled to vested benefits; (3) deny both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to all plaintiffs' equitable estoppel claims; (4) grant defendants' motion for summary judgment as to plaintiffs' claims that the severance plan modification is void because plaintiffs were not timely noticed of the severance plan modification and were not timely given a summary plan benefits description, and deny plaintiffs' cross-motion for summary judgment as to these claims; (5) deny both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to plaintiffs' claim that the severance plan modification was invalid because defendants did not follow the plan's amendment *257 procedure; (6) deny defendants' motion for summary judgment as to Class Two plaintiffs' WARN claim, and grant plaintiffs' cross-motion for summary judgment as to Class Two plaintiffs' WARN claim; and, (7) deny both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to Class Three plaintiffs' WARN claim. I. BACKGROUND A. Procedural History Plaintiffs Dolores Amatuzio et al. commenced this action by filing by the Complaint in Civil Action No. 95-4808 on September 19, 1995. On February 20, 1996, plaintiffs William F. Chambers et al. (Chambers) filed the Complaint in Civil Action No. 96-621. Chambers filed the Amended Complaint in No. 96-621 on April 25, 1996. By Order dated June 4, 1996, this Court ordered the consolidation for all purposes of Civil Action Nos. 95-4808 and 96-621 under the lead case number of 95-4808. By Consent Order Concerning Class Certification dated June 17, 1996, the Magistrate Judge certified the three classes of plaintiffs described below in Part I.B. By Order dated October 18, 1996, the Magistrate Judge granted Chambers leave to file a second amended complaint. Chambers filed the Second Amended Complaint in No. 96-621 on October 21, 1996, carving out the subclass of plaintiffs as described below in Part I.B. On June 7, 1996, defendants Gandalf Systems Corp. and Gandalf Technologies, Inc. ("defendants") filed a motion to dismiss and to strike. By Order dated July 5, 1996, this Court denied the motion to dismiss the First Count of the Complaint in No. 95-4808 and the First Count of the Amended Complaint in No. 96-621. By the same Order this Court granted defendants' motion to dismiss those portions of the Second Count of the Complaint in No. 95-4808 and the Second Count of the Second Amended Complaint in No. 96-621 that were brought pursuant to the Employment Retirement Income Security Act § 510, 29 U.S.C.A. § 1140. Defendants filed the instant motion for summary judgment as to all remaining counts and claims in this consolidated action on October 24, 1997. On the same date plaintiffs filed the instant cross-motion for summary judgment as to all remaining counts and claims. B. Parties, Plaintiff Classes and Claims Defendant Gandalf Systems Corp. ("GSC") is a New Jersey-based company engaged in the design, marketing and sale of telecommunications products and services. Defendant Gandalf Technologies, Inc. ("GTI"), a Canadian corporation, is GSC's parent company. GSC was created in 1991 when Gandalf Data, Inc. ("GDI") merged with Infotron Systems Corporation ("Infotron"). At all times relevant to this action GSC was headquartered in a Cherry Hill, New Jersey, facility formerly occupied by Infotron. The majority of GSC's Cherry Hill employees were former Infotron employees who had remained with GSC following the 1991 Infotron/GDI merger. Plaintiffs are former employees of GSC who worked in Cherry Hill and who ceased to be employed by GSC at various times between January 14, 1994, and August 31, 1994. Plaintiffs are divided into three classes and one subclass. Eight named plaintiffs ("the individual plaintiffs") — also members of Class One and Class Two — bring individual claims. Class One plaintiffs are former GSC employees who received notice from GSC on February 22, 1994, that they would be laid off on or after April 25, 1994, and WARN[1] notice of a plant closing scheduled to take place on or after April 25, 1994. Class One Subclass "A" ("Subclass `A'") plaintiffs are seventeen former GSC employees who resigned between January and July of 1994. Class Two plaintiffs are former GSC employees who were laid off on or about February 22, 1994, and who were not given WARN notice. Class Three consists of former GSC employees who were laid off on or about January 14, 1994, and who were not given WARN notice. Class One and Class Two plaintiffs claim they are entitled to vested severance pay earned pursuant to a severance plan initially *258 established by Infotron ("the Manual plan"), as set forth in an Infotron managers' personnel manual, and maintained by GSC until February 17, 1994, when GSC announced a modified severance pay plan. Specifically, Subclass "A" plaintiffs received no severance pay. They maintain they are entitled to severance pay according to the terms of the Manual policy because their resignations were involuntary. The rest of the Class One and all Class Two plaintiffs received severance pay according to the terms of the modified plan. They claim they are entitled to severance pay according to the terms of the Manual plan. Class One and Class Two plaintiffs also seek to void GSC's severance plan modification, claiming it was implemented improperly. The individual plaintiffs, and all plaintiffs in Civil Action No. 95-4808, have brought claims of equitable estoppel based on alleged false representations made to them to the effect that the Manual plan would not be changed. Class Two and Class Three plaintiffs also allege that defendants violated the Worker Adjustment and Retraining Notification Act, 29 U.S.C.A. §§ 2101-2107 ("WARN"), by terminating their employment without providing sixty-days' notice. C. Factual History In or around 1984, Infotron developed a personnel policy and procedures manual entitled "Personnel Guidelines for the Manager" ("the Manual"). The Manual was kept in Infotron's Human Resources Department and was distributed to Infotron management employees for reference in handling day to day employee issues and questions. The introduction to the Manual states in pertinent part: This manual is designed to be an overall guide for supervisory personnel in their day-to-day administration. Additions, revisions and deletions will be issued from time to time.... Provisions of these guidelines are not to be considered policies binding on Infotron. They may be changed at any time as management deems appropriate. They are not intended to and do not constitute expressed or implied contractual obligations to anyone. Section 2, Guideline 2-5 of the Manual — entitled "Termination" — sets forth in desultory fashion a policy on resignation, discharge and severance pay. The Manual provides in pertinent part: 1.3.1 Voluntary Resignation Voluntary resignation is initiated by the employee. Employees other than managers and directors are expected to give at least two weeks' notice of resignation; .... Severance pay is not given in cases of voluntary resignation. 1.3.2 Involuntary Resignation ... if the resignation is requested by the company for other than misconduct or cause: — non-exempt = one week's pay for each full year of employment — exempt = two weeks' pay for each full year of employment — officers = three weeks' pay for each full year of employment ... 1.3.3 Discharge Discharge is initiated by the Company.... 1.3.4 Severance Allowance The purpose of severance allowance is to provide an employee with income during a period of financial adjustment precipitated by the Company's termination of his/her employment. Under no circumstances will severance allowance be paid in cases of discharge for misconduct (i.e., insubordination, embezzlement, misappropriation of funds, misrepresentation, etc.). It is undisputed that rank and file employees were generally familiar with the Manual plan, though they were not given copies of the Manual. How they came to be familiar with the Manual plan, whether they knew it was housed in written form in the Manual or elsewhere, and to what extent, if at all, they understood the Plan's details and were aware of the Manual's contractual disclaimer and reservation of rights clause, are all much foggier matters. The evidence suggests some employees may have known of the Manual plan qua Manual plan, while other employees' acquaintance with the Manual plan seems to have been formed exclusively *259 through their observations of how laid off employees were treated (in layoffs prior to and after the 1991 merger), their discussions with co-workers, and their informal and formal meetings with managerial/supervisory personnel. Whether all of GSC's managerial personnel were familiar with the Manual's contractual disclaimer and reservation of rights clause also is unclear. During the late Spring and Summer of 1991, when the Infotron/GDI merger was in the works, Infotron and GTI officers conducted informational meetings with Infotron employees in Cherry Hill. Des Cunningham, then Chairman of the Board of GTI, stated at one such meeting that the merger would not result in either company's severance pay policy being changed, at least not for the worse.[2] Subsequent to the merger, in August, 1991, and continuing through 1993, GSC conducted a number of layoffs. Affected employees apparently received severance pay pursuant to the Manual plan. Remaining employees became increasingly anxious about layoffs and about whether GSC would continue to provide the severance pay previously laid-off employees had received. They were told in the aftermath of layoffs — particularly in mid-January of 1994 — that severance benefits were the same and/or that severance benefits were not going to change and/or that there were no plans to change severance benefits.[3] GSC was expecting weak third quarter financial results in late 1993, and, as early as December, 1993, defendants' objective was to develop a restructuring plan which would entail layoffs. On January 6, 1994, GTI Director of Human Resources Jeffrey Singer ("Singer") and GTI President and Chief Executive Officer Brian Hedges ("Hedges") traveled to Cherry Hill to prepare a layoff plan. At a January 7, 1994, meeting, GSC Director of Human Resources Vincent Messina ("Messina") showed the Manual containing the Manual plan to Singer and Hedges after having been asked either whether there was such a plan or whether he had a copy of Infotron's plan that he could show to them. (Messina Dep. at 118, 122). Hedges then spoke to the issue of severance pay, saying that "it was too rich" and expressing "surprise." (Id. at 123). Singer told Messina that he first was made aware of the Manual plan in a January, 1994, meeting. (Id. at 117). Singer turned a copy of the Manual over to GSC's legal counsel in late January, 1994, for review and for advice regarding the law governing severance plans. Singer knew at this time that workforce reductions and layoffs above and beyond those taking place in January, 1994, would be necessary. (Singer Dep. at 78). On January 13, 1994, at a meeting of the GTI Board of Directors ("the Board"), Hedges directed GTI management to evaluate options for stemming the decline in revenue and profits, and to present their recommendations at the February 10, 1994, Board meeting. The Board understood as of the January 13, 1994, meeting that restructuring measures stronger than the planned January 14, 1997 layoffs would be required. On January 24 and 25, 1994, at meetings of the GTI Operations Committee, GTI and GSC managers were made aware of poor third-quarter results for both GTI and GSC. (Plaintiffs' Exh. 67 at 1). Defendants claim, although the evidence on this point is vague, that these third-quarter results were considerably worse than had been anticipated. Hedges requested that the Operations Committee *260 prepare an acceptable business case scenario for presentation at the scheduled February 10, 1994 Board meeting; he stressed the importance of downsizing without causing further revenue erosion. (Id. at 3). Some time between January 21, 1994, and January 25, 1994, defendants formed an intent to modify the Manual plan. (Singer Dep. at 73, 75). The actual decision to modify the Manual plan was made by Hedges. (Id. at 75). Prior to February 8, 1994, Singer prepared materials concerning possible changes in severance benefits for presentation to the operating committee. (Id. at 135-38). On February 8, 1994, GSC issued a memorandum and attachment to all GSC employees concerning their benefits. This release consisted of a reissuance of an existing list of benefits — which list did not include any mention of severance pay — with a statement that GSC could amend, modify or terminate any benefits — whether listed or not listed — at any time, within the discretion of the President and CEO (then Frank Jerd). (Plaintiffs' Exh. 34). Between February 16 and 21, Singer was provided with a plan for the February 22, 1994, layoffs so that he could run a cost analysis. (Singer Dep. at 168). On February 17, 1994, GSC announced the modified severance plan pursuant to which laid off employees would receive one week's pay for each full year of employment to a maximum of six weeks or $10,000, whichever was less. (Plaintiffs' Exh. 47). According to defendants, on January 14, 1994, GSC laid off thirty-eight full-time employees from the engineering and manufacturing groups at Cherry Hill, converted two of those employees — Michael Boyle and Patrick Countey — to contractor status, and laid off one part-time temporary employee — Amy Sinka. (Aff. of Procida at ¶ 5 & Exh. B). Plaintiffs contend that on January 14, 1997, or shortly thereafter, GSC laid off forty full-time employees, plus two part-time temporary employees — John Hembrough ("Hembrough") and Amy Sinka. (See Plaintiffs' Statement of Facts at ¶ 39). It is undisputed that these employees received severance pay pursuant to the Manual plan terms. According to defendants, on or about February 22, 1994, twenty-two employees were laid off immediately from the Cherry Hill facility. Hembrough and Jerd were terminated on February 4, 1994, and February 24, 1994, respectively. Part-time employee Christine Gorenstein was terminated on February 18, 1994. (Aff. of Procida at ¶ 7 & Exh. B). Plaintiffs contend that twenty-four full-time employees and one part-time employee were laid off on or after February 22, 1994. (See Plaintiffs' Statement of Facts at ¶ 50). On February 18, 1994, sixty-two employees were given letters providing notice of future layoffs at various dates on or after April 25, 1994. These employees also received notice of an anticipated plant closing to take place on or after April 25, 1994. On March 2, 1994, six employees received notices of layoff on May 2, 1994. Employees Patricia O'Hara and Michael Dombrosky were laid off without notice on March 7, 1994, and March 31, 1994, respectively. GSC terminated Denise Fidura and Stephen Egerton without notice on July 12, 1994, and July 18, 1994, respectively. Sandra LeFevre was laid off by GSC on June 3, 1994. All employees laid off after February 17, 1994, received severance pay pursuant to the modified plan.[4] Between January 1, 1994, and August 31, 1994, thirty-eight GSC employees — including the seventeen Subclass "A" plaintiffs — at Cherry Hill resigned their employment at GSC. Only three of the Subclass "A" plaintiffs had received layoff notices prior to tendering their resignations. All Subclass "A" plaintiffs had engaged in job searches and obtained job offers from new employers prior to resigning from GSC, and none experienced any period of involuntary unemployment. II. SUMMARY JUDGMENT STANDARD Under Federal Rule of Civil Procedure 56(c), "summary judgment is proper `if the pleadings, depositions, answers to interrogatories, and admissions on file, together with *261 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.'" Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986). In deciding a motion for summary judgment, the Court must construe the facts and inferences in a light most favorable to the non-moving party. Pollock v. American Tel. & Tel. Long Lines, 794 F.2d 860, 864 (3d Cir.1986). The role of the court is not "to weigh the evidence and determine the truth of the matter, but to determine whether there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). The substantive law governing the dispute will determine which facts are material, and only disputes over those facts "that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Id. at 248. Where the moving party has carried its initial burden of demonstrating the absence of a genuine issue of material fact, "its opponent must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Idus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S. Ct. 1348, 89 L. Ed. 2d 538 (1986). A genuine issue for trial does not exist "unless the party opposing the motion can adduce evidence which, when considered in light of that party's burden of proof at trial, could be the basis for a jury finding in that party's favor." J.E. Mamiye & Sons, Inc. v. Fidelity Bank, 813 F.2d 610, 618 (3d Cir.1987) (Becker, J., concurring). If the non-moving party's evidence is merely colorable, or is not significantly probative, summary judgment may be granted. See Bixler v. Central Pa. Teamsters Health & Welfare Fund, 12 F.3d 1292 (3d Cir.1993); Trap Rock Indus., Inc. v. Local 825, Int'l Union of Operating Eng'rs, 982 F.2d 884, 890-91 (3d Cir.1992). III. DISCUSSION A. Standing Defendants argue that Class One plaintiffs and Class Two plaintiffs lack standing to bring this action under the Employee Retirement Income Security Act ("ERISA"). "ERISA is a comprehensive statute enacted to promote the interests of employees and their beneficiaries in employee benefit plans, ... and to protect contractually defined benefits[] ...." In re Unisys Corp. Retiree Medical Benefit "ERISA" Lit., 58 F.3d 896, 901 (3d Cir.1995) (internal quotes and citations omitted). The statute covers two types of employee benefit plans: pension plans and welfare plans. 29 U.S.C.A. § 1002(3) (West 1985). ERISA provides that a civil action may be brought by a participant or beneficiary to recover benefits due to him under the terms of a plan, to enforce his rights under a plan, or to clarify his rights to future benefits under a plan. Id. § 1132(a). ERISA defines "participant" as: any employee or former employee of an employer, or any member or former member of an employee organization, who is or may become eligible to receive a benefit of any type from an employee benefit plan which covers employees of such employer or members of such organization, or whose beneficiaries may be eligible to receive any such benefit. Id. § 1002(7). The Supreme Court has construed "participant" as it is defined in ERISA: [T]he term "participant" is naturally read to mean either "employees in, or reasonably expected to be in, currently covered employment," ... or former employees who "have ... a reasonable expectation of returning to covered employment" or who have "a colorable claim" to vested benefits[.] In order to establish that he or she "may become eligible" for benefits, a claimant must have a colorable claim that (1) he or she will prevail in a suit for benefits, or that (2) eligibility requirements will be fulfilled in the future. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 117-18, 109 S. Ct. 948, 103 L. Ed. 2d 80 (1989) (citations omitted) (second alteration in original); see Shawley v. Bethlehem Steel Corp., 989 F.2d 652, 655-56 (3d Cir. 1993). Whether plaintiffs are plan participants is determined as of the time they file the lawsuit. Curtis v. Nevada Bonding *262 Corp., 53 F.3d 1023, 1027 (9th Cir.1995); Raymond v. Mobil Oil Corp., 983 F.2d 1528, 1534-35 (10th Cir.), cert. denied, 510 U.S. 822, 114 S. Ct. 81, 126 L. Ed. 2d 49 (1993). Because plaintiffs are not former employees with a reasonable expectation of returning to covered employment, they cannot be deemed "participants" entitled to maintain this action unless they have a colorable claim to vested benefits. "The requirement of a colorable claim is not a stringent one.... [O]nly if `any claim ... must be frivolous is jurisdiction lacking.'" Panaras v. Liquid Carbonic Indus. Corp., 74 F.3d 786, 790 (7th Cir.1996) (quoting Kennedy v. Connecticut General Life Ins. Co., 924 F.2d 698, 700 (7th Cir.1991)) (second alteration in original); see Abraham v. Exxon Corp., 85 F.3d 1126, 1129 (5th Cir.1996) (test is not actual entitlement to benefits, it is whether plaintiff has colorable claim that she will prevail). "Firestone did not `reduce the standing question to a straightforward formula applicable to all cases.'" Shawley, 989 F.2d at 658 (quoting Christopher v. Mobil Oil Corp., 950 F.2d 1209, 1221 (5th Cir.), cert. denied, 506 U.S. 820, 113 S. Ct. 68, 121 L. Ed. 2d 35 (1992)). Rather, the definition of "participant" `must be read in the context of traditional concepts of standing, not in the context of adjudicating the ultimate issue of the merits of plaintiffs' claim that they are not receiving the full extent of the benefits to which they are entitled .... Standing focuses on a person's effort to get his complaint before a court and not on the issue he wishes to have adjudicated.' Astor v. International Bus. Machines Corp., 7 F.3d 533, 538 (6th Cir.1993) (quoting Hughes v. General Motors Corp., 852 F.2d 568, 1988 WL 72742 (6th Cir.1988), cert. denied, 489 U.S. 1081, 109 S. Ct. 1535, 103 L. Ed. 2d 839 (1989), (unpublished)) (citations omitted). With respect to Class One plaintiffs and Class Two plaintiffs, defendants' argument that plaintiffs lack standing simply is without merit. These plaintiffs claim defendants abrogated vested rights they obtained through contract and/or by estoppel. They also challenge the validity of the severance plan modification used to deny them benefits to which they claim they had vested rights. Their federal common law unilateral contract and estoppel theories have been recognized in Third Circuit ERISA cases. (See infra, Part III.B., C.). Their claims are neither frivolous nor patently implausible. These plaintiffs have colorable claims to vested benefits and therefore have standing. Subclass "A" plaintiffs, however, are in a different position because they resigned. GSC's severance plan, whether — for purposes of this analysis — located in the Manual or in oral representations, extended severance benefits only to those workers whose terminations were involuntary. Subclass "A" plaintiffs can have no colorable claim to vested benefits unless they resigned involuntarily or were discharged for reasons other than misconduct. Subclass "A" plaintiffs contend they were constructively discharged and that their resignations therefore were involuntary.[5] This Court does not agree. To some extent the parties have characterized the dispute as whether the doctrine of constructive discharge should operate here. This characterization is slightly misleading. The doctrine first appeared in actions arising under the National Labor Relations Act where plaintiffs seek to show that they were discharged because of union membership or union activities. Goss v. Exxon Office Sys. Co., 747 F.2d 885, 887 (3d Cir.1984) (citing cases). It was exported to Title VII cases where plaintiffs endeavor to establish that they were discharged because of their membership in a protected class. Id. at 887-88. The doctrine has been applied in ERISA cases where plaintiffs claim that they were discharged because they sought to exercise their rights under a covered plan in violation of ERISA. See, e.g., Berger v. Edgewater Steel Co., 911 F.2d 911, 923 (3d Cir.1990), cert. denied, 499 U.S. 920, 111 S. Ct. 1310, 113 L. Ed. 2d 244 (1991); Gehin-Scott v. Newson, *263 Inc., 848 F. Supp. 585, 588 & n. 2 (E.D.Pa.), aff'd, 40 F.3d 1240 (3d Cir.1994). In each of these contexts the issue is whether an employer has done indirectly what she may not do directly by knowingly permitting conditions in employment "`so intolerable that a reasonable person subject to them would resign.'" Berger, 911 F.2d at 923 (quoting Goss, 747 F.2d at 888); see Clowes v. Allegheny Valley Hosp., 991 F.2d 1159, 1161 (3d Cir.), cert. denied, 510 U.S. 964, 114 S. Ct. 441, 126 L. Ed. 2d 374 (1993); Gray v. York Newspapers, Inc., 957 F.2d 1070, 1079 (3d Cir.1992); Schafer v. Board of Pub. Educ., 903 F.2d 243, 248-49 (3d Cir.1990); Gehin-Scott, 848 F.Supp. at 588 & n. 2. Subclass "A" plaintiffs do not claim they were constructively discharged in violation of § 510 of ERISA, 29 U.S.C.A. § 1140.[6] That is, they do not allege that defendants constructively discharged them in order to avoid having to give them severance allowances. They simply claim that their resignations were "involuntary" within the meaning of the terms of the severance plan. After reviewing the evidence, this Court is satisfied there is no dispute that Subclass "A" plaintiffs understood that severance was reserved for those who were laid off or otherwise involuntarily terminated. As an initial matter, it should be noted that the fact of Subclass "A" plaintiffs experiencing no period of unemployment does not doom their claim. Employees may be entitled to severance benefits notwithstanding they did not experience a period of unemployment; eligibility depends upon the plan terms. See, e.g., Weir v. Federal Asset Disposition Ass'n, 123 F.3d 281, 287 (5th Cir. 1997); Bellino v. Schlumberger Tech., Inc., 944 F.2d 26, 31 (1st Cir.1991). This Court finds no requirement, expressed in either written or oral representations concerning the severance plan, that a terminated employee must experience a period of unemployment in order to be entitled to severance pay. What does doom plaintiffs' claim is that it is neither reasonable, credible nor sound policy to read severance plans such as defendants' as dictating that employees are "constructively discharged" when a company experiencing difficult financial times cuts back personnel benefits (e.g., severance pay) which it believes it has the right to scale back. The only reasonable interpretation of the plan is that GSC was promising severance pay to employees who left employment when GSC wanted them to leave, that is, who left on GSC's terms. This Court does agree with the parties that if GSC knowingly permitted employment conditions to exist which no reasonable employee could have been expected to tolerate, then GSC fairly could be said constructively to have forced employees to leave on its terms, and plaintiffs' claim might survive. But GSC did not knowingly permit such conditions to exist. The employment conditions faced by Subclass "A" plaintiffs varied. One Subclass "A" plaintiff resigned on January 14, 1994, without having received a layoff notice and prior to GSC's announcement that benefits could change. Thirteen Subclass "A" plaintiffs resigned after the severance plan modification was announced but prior to receiving layoff notices. Three Subclass "A" plaintiffs resigned after the Manual plan was modified and after receiving notice of future layoffs. This Court need not parse the qualitative differences between the working conditions these various Subclass "A" plaintiffs faced because even the worst of these conditions would not, and in fact did not, induce all reasonable plan participants to resign. Indeed, all but one of the Subclass "A" plaintiffs continued working for weeks beyond: (1) the January 14, 1994, layoffs; (2) the February 8 memorandum stating that GSC could amend its benefits plan; (3) the February 17 announcement of the reduction in severance pay; (4) the February 22 layoffs; (5) the February 22 layoff notices; (6) the February 22 plant closing announcement; and (7) the March 2 layoff notices. In sum, it is an unreasonable interpretation of the Manual plan to say that a severance pay cutback (even if it proves to have *264 been unlawful), in tandem with the imminence of layoffs, should be regarded as forcing all reasonable employee to resign or otherwise constructively terminating their employment.[7] Subclass "A" plaintiffs' own testimony is substantially in accord with this Court's analysis and conclusion. Their contemporaneous understandings were that they were leaving voluntarily and were not entitled to severance pay under GSC policy and practice.[8] Subclass "A" plaintiffs left on their own terms, not on GSC's. They chose thereby to forego severance pay. They do not have a colorable claim to benefits and are not plan "participants." Therefore, they lack standing. Cf. Sallee v. Rexnord Corp., 985 F.2d 927, 928-29 (7th Cir.1993) (no colorable claim where plaintiffs elected to resign and policy provided that employees would get severance only if they stayed until actual termination date); Bartman v. Allis-Chalmers Corp., 799 F.2d 311, 314-15 (7th Cir.1986), cert. denied, 479 U.S. 1092, 107 S. Ct. 1304, 94 L. Ed. 2d 160 (1987), (employees who resigned for fear of having no pension benefits if they resigned during window of time between expiration of old contract and signing of new one were not constructively discharged absent showing that employer delayed contract process in order to induce retirements).[9] Accordingly, Subclass "A" plaintiffs' complaint will be dismissed.[10] B. Vested Severance Benefits Claim Class One and Class Two plaintiffs claim they are entitled to vested severance pay. Defendants deny that any plaintiffs earned vested severance pay. "ERISA's coverage extends broadly to include all employee benefit plans." In re New Valley Corp., 89 F.3d 143, 148 (3d Cir. 1996), cert. denied, ___ U.S. ___, 117 S. Ct. 947, 136 L. Ed. 2d 835 (1997). An employee benefits plan may be either an "employee welfare benefit plan" or an "employee pension benefit plan." 29 U.S.C.A. § 1002(3) (1985).[11] Almost all severance policies are *265 ERISA-covered welfare benefit plans as they are included by reference in ERISA's definition of "employee welfare benefit plan." See generally Massachusetts v. Morash, 490 U.S. 107, 116, 109 S. Ct. 1668, 104 L. Ed. 2d 98 (1989); Schonholz v. Long Island Jewish Medical Center, 87 F.3d 72, 75 (2d Cir.), cert. denied, ___ U.S. ___, 117 S. Ct. 511, 136 L. Ed. 2d 401 (1996); Mark Daniels, The Regulation of Severance Plans Under ERISA, 12 Indus. Rel. L.J. 340, 343 (1990). This Court has no difficulty finding that the severance plan here is an ERISA-covered welfare benefit plan. While pension plans are subject to ERISA's detailed participation, vesting and minimum funding requirements, welfare plans explicitly are exempted from these substantive requirements. 29 U.S.C.A. §§ 1051, 1081; see Curtiss-Wright Corp. v. Schoonejongen, 514 U.S. 73, 78, 115 S. Ct. 1223, 131 L. Ed. 2d 94 (1995); In re Unisys Corp. Retiree Med. Benefit "ERISA" Lit., 58 F.3d 896, 901 (3d Cir.1995); Hozier v. Midwest Fasteners, Inc., 908 F.2d 1155, 1160 (3d Cir.1990). Thus, "ERISA does not require automatic vesting of welfare benefit plans." Unisys, 58 F.3d at 901. As Judge Easterbrook recently stated the matter: "[p]ensions vest by law" while "welfare benefits are left to contract." Bidlack v. Wheelabrator Corp., 993 F.2d 603, 616 (7th Cir.) (en banc) (Easterbrook, J., dissenting), cert. denied, 510 U.S. 909, 114 S. Ct. 291, 126 L. Ed. 2d 240 (1993). As a general rule, welfare plans such as severance plans may be freely amended or canceled at any time. See, e.g., Curtiss-Wright, 514 U.S. at 78. Plaintiffs do not disagree that GSC's plan could be freely modified or canceled at any time. Nor do they argue that the right to modify or cancel the plan was required to be reserved explicitly by defendants. Plaintiffs' claim is that GSC employees earned vested contractual rights to receive 1-3 weeks' pay as severance for each year they worked prior to defendants' February 17, 1994, modification of the Manual plan. They allege that GSC offered to give its employees — in the event their employment was terminated for reasons other than misconduct — 1-3 weeks' pay for each year of work they performed in exchange for employees' continued work at GSC. A contract was formed when employees accepted the alleged offer by continuing to work for GSC. Because employees accepted GSC's offer by performance instead of by return promise, the contract formed was a unilateral contract. Plaintiffs argue that GSC's duty to perform — that is, its duty to pay employees 1-3 weeks' pay for each year of work completed — would be (and was) triggered when employees were laid off. It is well-settled that nothing in ERISA prevents an employer from providing vested employee welfare benefits by contract. See Inter-Modal Rail Employees Ass'n v. Atchison, Topeka and Santa Fe Ry. Co., 520 U.S. 510, ___, 117 S. Ct. 1513, 1516, 137 L. Ed. 2d 763 (1997) (recognizing that employer may "contractually cede[] its freedom" to adopt, modify or terminate benefits plan); Schonholz, 87 F.3d at 77 (employer may contract to vest benefits); Unisys, 58 F.3d at 902 ("welfare plan may provide a vested benefit" if employer intended vesting); Bidlack, 993 F.2d at 604 (same); id. at 616 (Easterbrook, J., dissenting); Anderson v. John Morrell & Co., 830 F.2d 872, 876-77 (8th Cir.1987) (parties may set out by agreement whether benefits vest); In re White Farm Equip. Co., 788 F.2d 1186, 1193 (6th Cir. 1986) (same). In the Third Circuit, employees have relied successfully on such unilateral contract principles to show that they had vested benefits in cases involving ERISA plans. As far as this Court is aware, however, plaintiffs are the first litigants to invoke such principles in a case involving an ERISA-covered severance plan. This Court begins by considering the basic question of whether severance plans can be unilateral contracts and concludes without difficulty that they can. In Kemmerer v. ICI Americas Inc., 70 F.3d 281 (3rd Cir.1995), cert. denied, 517 *266 U.S. 1209, 116 S. Ct. 1826, 134 L. Ed. 2d 931 (1996), the Third Circuit explained: As we pointed out in [Barrowclough v. Kidder, Peabody & Co., 752 F.2d 923 (3d Cir.1985)], "this court has repeatedly considered claims for benefits by participants ... that are based on the terms of or rights under a plan" even though such claims are based not on fiduciary duties but on "breach[es] of contract of an employee benefit plan." Id. at 935-36. Thus, in such instances, breach of contract principles, applied as a matter of federal common law, govern disputes arising out of the plan documents. 70 F.3d at 287. The Third Circuit has had no difficulty recognizing pension plans and Top Hat plans[12] as unilateral contracts in cases where plan participants allege that their employer breached such contracts. See In re New Valley, 89 F.3d 143 (3d Cir.1996); Kemmerer, 70 F.3d 281. The Third Circuit held in Kemmerer that while a unilateral contract such as a Top Hat plan may be canceled at any time — such that going forward an employee no longer will be earning deferred income — the employer legally cannot refuse to perform under the terms of the Top Hat plan prior to its cancellation once an employee has performed. 70 F.3d at 287-88. The court's reasoning can be captured in a simple illustration. If an employee is promised $10 per hour effective Monday, and told that her wage can be reduced at any time, and on Wednesday her wage is cut to $5 effective Thursday, her employer cannot refuse on pay day to give her $10 per hour for her work on Monday through Wednesday. Far from requiring that the employer express an explicit intent to pay $10 per hour for Monday through Wednesday's work notwithstanding the employer's freedom to reduce wages at any time, the Third Circuit held that what would have to be preserved explicitly would be an employer's right to apply the reduced wage retroactively to Monday through Wednesday's work. See Kemmerer, 70 F.3d at 287 ("[E]ven when a plan reserves to the sponsor an explicit right to terminate the plan, acceptance by performance closes that door under unilateral contract principles (unless an explicit right to terminate or amend after the participants' performance is reserved."). A contrary rule would lack any basis in contract law and would render the employer's promise under the unilateral contract wholly illusory.) Id. at 287-88; accord Kulins v. Malco, a Microdot Company, Inc., 121 Ill.App.3d 520, 76 Ill. Dec. 903, 459 N.E.2d 1038 (1984) (severance pay). In re New Valley, 89 F.3d 143 (3d Cir. 1996), added to the law in this area by holding that, because Top Hat plans are not required by ERISA to be in writing, where Top Hat plan participants claim rights to vested benefits pursuant to a unilateral contract despite contrary plan language, the rule that the four corners of the written plan document(s) must control does not apply, and normal federal common law rules of contract interpretation are to be employed. 89 F.3d at 153. This Court sees no reason why severance plans may not be recognized as being unilateral contracts in ERISA cases. Severance plans adopted to encourage employees to stay with their employer, and severance plans awarding severance based on length of service, are unilateral contracts, regardless of whether they are the product of negotiations between employer and employees. Taylor v. Continental Group Change in Control Severance Pay Plan, 933 F.2d 1227, 1232 (3d Cir.1991) (ERISA case); Bruch v. Firestone Tire and Rubber Co., 828 F.2d 134, 147 (3d Cir.1987), aff'd in part, rev'd in part on other grounds, 489 U.S. 101, 109 S. Ct. 948, 103 L. Ed. 2d 80 (1989) (same); see also Taylor, 933 F.2d at 1232 ("Severance plans are often similar to employment contracts, whose interpretation requires determining the intent of both contracting parties."). There are differences between pension plans and severance plans. The key differences between (most) severance policies and pension plans or Top Hat plans is that severance *267 pay is not really deferred compensation and an employee's right to receive it is contingent upon her being terminated (that is, it does not flow simply from retirement or resignation). But these differences are not material here. During the life of a unilateral severance pay contract such as the one alleged to exist here, an employee earns the right to receive one week's pay per year worked in the event she is terminated. Her rights to receive severance pay under this formula vest as she works. If the severance contract is canceled by her employer pursuant to a reservation of rights clause, then the employee ceases earning rights to one week's pay per year worked (subsequent to that contract cancellation) in the event she is terminated. But if she is terminated, her employer's duty to perform (i.e., its duty to pay her one week's pay per year worked prior to the contract's cancellation) is triggered and its failure to do so is a breach of contract. Of course to say that there can be unilateral contracts for severance pay and to explain how they operate is not to say that there was one here. Indeed, defendants' claim is that there was no such unilateral contract here. In their view, the written Manual plan represents not a unilateral severance pay contract, but a gratuitous promise to pay severance enforceable under ERISA as long as the promise is in effect, a reservation of the right to revoke or modify the promise, along with a description of how severance will be calculated in the event that the promise has not been revoked or modified.[13] This Court will not attempt to iron out the conceptual complexity of ERISA's relationship with contract principles that lurks beneath the parties' dispute in this case. It suffices to say this Court is satisfied that if plaintiffs entered into a unilateral contract with defendants of the type they describe, then they are entitled to receive the severance pay they earned under that contract. As in any other type of contractual dispute, however, in order to survive summary judgment plaintiffs must show there is a genuine issue of fact as to the existence of the contract they allege. Defendants, in turn, in order to survive the cross-motion for summary judgment, similarly must show there is a genuine issue of fact. The crucial antecedent issue of law that must be resolved concerns where the parties can and/or must look for evidence as they endeavor to carry their burdens at the summary judgment stage. Defendants contend that the relevant search in this case — whether it be styled a search for a unilateral *268 contract or a search for vested severance benefits — must look to and be confined by the written plan documents. They rely on the rule that "extra-ERISA commitments ... must be found in the plan documents and stated in clear and express language." Unisys, 58 F.3d at 902; see Schonholz, 87 F.3d at 78 ("Courts that have allowed contractual vesting have required, at a minimum, that the employer's intent to vest the benefits be contained in a written document."). This rule flows from the rule that "[ERISA] plan documents control and cannot be modified or superseded by the employer's oral undertakings." Unisys, 58 F.3d at 902; see In re New Valley, 89 F.3d at 149; Hozier v. Midwest Fasteners, Inc., 908 F.2d 1155, 1164 (3d Cir.1990); see also In re Unisys, 58 F.3d at 906 n. 16 (referencing "Congress' intent that plan documents and SPDs exclusively govern an employer's obligations with respect to an ERISA plan"). As the Third Circuit recently stated: "Like any common law integration clause, § 1102(a)(1) makes the plan document the entire agreement of the parties and bars the introduction of parol evidence to vary or contradict the written terms." In re New Valley, 89 F.3d at 149. At first glance, in light of the rule that the terms in the written plan documents must control, defendants appear to have an open and shut case. Besides reserving to defendants the right to change Manual provisions at any time as they deem appropriate, the written Manual policy explicitly states that "[p]rovisions of these guidelines are not to be considered policies binding on Infotron ... They are not intended to and do not constitute expressed or implied contractual obligations to anyone." It is "Contracts I" that there can be no contract where one allegedly contracting party overtly manifests an intent not to be bound. The evidence in this case, however, is that few plaintiffs, if any, ever were shown the actual written Manual plan or informed of its existence. Plaintiffs were made aware of defendants' severance plan not by a plan document or summary plan documents, but rather by observation of defendants' practice and word of mouth, and, later, by defendants' statements at the time of layoffs to the effect that indeed there was such a plan. It is to these sources plaintiffs point in alleging defendants offered to enter into unilateral contracts with them. To this Court's knowledge, the rule requiring that any intent to create contractually vested rights be contained in plan documents has not been applied in a case where an employer never disclosed such documents to plan participants or even advised them that such documents existed. See Schonholz, 87 F.3d at 78 ("In each case cited by [defendant] for the proposition that vesting must be included in formal plan documents, the employer had created such documents and distributed summary plan descriptions to its employees."); cf. In re Unisys, 58 F.3d at 900 (summary plan description booklet containing reservation of rights clause was distributed to all employees). Applying the rule in cases like the instant one would have the effect of permitting employers to enter into contracts for vested benefits with employees and only to repudiate them later by coming forth with previously undisclosed plan documents disclaiming contractual intent on the employers' part. This Court simply cannot accept that a statute "enacted `to protect contractually defined benefits,'" Firestone Tire and Rubber Co. v. Bruch, 489 U.S. 101, 113, 109 S. Ct. 948, 103 L. Ed. 2d 80 (1989) (quoting Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 148, 105 S. Ct. 3085, 87 L. Ed. 2d 96 (1985)), must produce such an anomalous result. Driving the rule that any contract for vested welfare benefits must be found in the plan document itself is the recognition of ERISA's writing requirement designed "to ensure that `every employee may, on examining the plan documents, determine exactly what his rights and obligations are under the plan.'" Hozier, 908 F.2d at 1163 (quoting H. Rep. 93-1280, 2d Sess. 297, reprinted in U.S.C.C.A.N. 5038, 5077-78). "`Congress ... did not intend that participants in employee benefit plans should be left to the uncertainties of oral communications in finding out precisely what rights they were given under their plan.'" Id. at 1164 (quoting Musto v. American Gen. Corp., 861 F.2d 897, 909-10 (6th Cir.1988), cert. denied, 490 U.S. 1020, 109 *269 S.Ct. 1745, 104 L. Ed. 2d 182 (1989)). Implicitly, then, the rule derives from ERISA's requirements that participants be furnished summary plan descriptions, 29 U.S.C.A. § 1021(a)(1) (West 1985), and that these descriptions "be sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan," id. § 1022(a)(1). The policy purposes generally served by the rule that written plan documents control would be thwarted if employers were allowed, as a matter of law, to wriggle out of contractual commitments by failing to disclose plan documents. Further, on the level of basic contract law, allowing the written plan document to come into play here would make little sense. The search is for objective manifestations of contractual intent. To allow undisclosed disclaimers of intent to trump outward signs of intent, again under a statute designed to protect contractually defined benefits, would be absurd. It makes no sense to guarantee plan participants' rights to bring actions for breach of contract under ERISA, see Kemmerer, 70 F.3d at 287, while at the same time making such rights worthless in cases where employers violate ERISA's disclosure rules. This Court concludes, therefore, that the rule requiring this Court to look for contractual intent in the written plan documents — and only there — does not control a case in which the employer never discloses, in violation of the law, the existence of a written plan document containing a disclaimer. It is not the fact of violation qua violation which prompts this decision, it is the fact of nondisclosure. The effect of this Court's approach is to advise employees that if they know a written plan exists, then it is incumbent upon them to ascertain their rights under that plan and per se unreasonable to rely on any oral representations at odds with its written terms. But if employees do not know that a written plan document exists, and they negotiate for contractually vested benefits, then the employer will not be able to repudiate the contract later by bringing to light a previously undisclosed contractual disclaimer. Indirect support for this Court's approach is found in New Valley where the Third Circuit explained that since a Top Hat plan need not be in writing it is appropriate to look beyond its written terms to determine whether parties bargained for vested benefits and not just a gratuitous promise. While it is true that ERISA requires welfare benefit plans to be in writing, it is also well-settled that unwritten severance practices can be ERISA plans. See Smith v. Hartford Ins. Group, 6 F.3d 131, 136 (3d Cir.1993); Payments to Departing Employees: Inadvertent Creation of an ERISA-Governed Severance Plan, 3 No. 9 Emp. L. Strategist 1, 1 (1996). Here, as far as defendants represented to plaintiffs, the severance plan was constituted not by a written document, but by defendants' practice and oral representations. This Court finds it appropriate, as it was in New Valley, to look beyond written plan terms to extrinsic evidence of defendants' intent. Cf. Schonholz, 87 F.3d at 78 ("[A]ny agreement to vest [plaintiff's] benefits would only have to be memorialized at the same level of formality that [defendant] chose in promulgating the Severance Plan in the first place."). This Court's approach also finds support in the Third Circuit's recognition of an equitable estoppel action under ERISA. Recognition of such an action must depend on a recognition that in some cases a reservation of rights clause and/or contractual disclaimer will not avail an employer where such benefit-qualifying language is never revealed to employees. If the rules requiring that contractual obligations be housed in plan documents and preventing oral modifications of written plan terms do not foreclose an equitable estoppel claim, it is unclear why in all instances they should foreclose a contract claim. The result in either case is that written disclaimers will not control participants' rights where such disclaimers are undisclosed. The approach taken here violates none of ERISA's statutory provisions and, far from doing violence to some policy goal of ERISA, is consistent with ERISA's core aspiration of protecting contractually defined benefits. Further, it leaves undisturbed the *270 general proposition in welfare plan cases that where a plan document actually apprises employees of their employer's lack of intent to create vested rights, any contractual expectations they come to harbor in the face of such a written appraisal are per se unreasonable. Finally, it provides employers with an incentive to comply with ERISA's procedural and fiduciary provisions where they have reservation of rights clauses since, if they fail to comply and represent an intent to be bound, they may find they have ceded contractually their right to amend or terminate a plan. Nothing in this Court's approach should be taken to suggest plaintiffs will have an easy time showing that defendants intended to provide contractually vested severance benefits. An employer does not, merely by telling employees they will receive a severance award and that it will be based on the number of years they worked, stumble into a binding unilateral contract under which rights vest. The discussion in Anderson v. John Morrell & Co., 830 F.2d 872 (8th Cir. 1987), is illuminating. In Anderson, an employee who was promised orally that his fringe benefits would always be as good as those of employees in a bargaining unit argued that this offered promise resulted in a contract when he accepted it by working. The Eighth Circuit had this to say: The gist of Anderson's claim is that the employer's oral statement to individual employees of its "policy" became a contract to maintain and improve the plan when the employees thereafter performed service. Yet if that be so, it would equally follow that an employer's announcement of any plan to pay welfare benefits would become a contract to maintain the plan indefinitely upon the performance of service by employees. Congress did not intend that result. Doubtless it is consistent with the intent of Congress for an employer to undertake such an obligation if it elects to do so. We conclude, however, that to accomplish that result, there must be a specific, if not written, expression of the employer's intent to be bound. Id. at 877. Plaintiffs here will be required to demonstrate some "specific, if not written" expression of defendants' intent to be bound. This Court concludes, then, that the defendants' inclusion of a contractual disclaimer and reservation of rights clause in the Manual does not entitle them to judgment as a matter of law on the First Count's unilateral contract claim. This Court also finds that genuine issues of material fact exist preventing this Court from granting either the motion or cross-motion for summary judgment. Drawing justifiable inferences from the evidence presented, a fact finder reasonably could conclude either: (1) there was a meeting of the minds between plaintiffs and defendants that if plaintiffs worked for GSC until they were terminated, then they would receive 1-3 weeks' pay as severance unless discharged for cause; or (2) there was merely a gratuitous promise made by defendants to provide terminated employees with a severance allowance in amounts based on employees' tenure. Of course the recovery to which various plaintiffs may be entitled in the event they prevail on their contract claims may vary.[14]*271 Hearings may be necessary to determine individual plaintiffs' circumstances. Specifically, while some plaintiffs may have had representations made to them which a fact finder reasonably could find manifested an intent to contract on the part of defendants, others may not. Additionally, some plaintiffs may have been aware of the written contractual disclaimer, or understood from the outset of their relationship with defendants that the latter's offer of severance was merely a retractable promise to pay severance with an explanation of how it would be computed. The record before this Court at present simply is not developed sufficiently to reach conclusions on these issues. For these reasons, both defendants' motion for summary judgment on the First Count and plaintiffs' cross-motion will be denied. C. Equitable Estoppel Claim Plaintiffs allege that at the time of the 1991 merger between Infotron and GTI, and at various times afterwards, defendants represented to them that the severance benefits previously afforded to terminated employees would be continued. Plaintiffs allege these representations were untrue and constituted a breach of defendants' fiduciary duty under ERISA. By these intentional misrepresentations defendants induced these plaintiffs to stay at their jobs and caused them to suffer damages when they were terminated and given less severance than they had earned.[15] Defendants concede that some plaintiffs allege that statements were made at the time of the 1991 Infotron/GDI merger and at various times following layoffs to the effect that the severance plan was not going to be changed. They contend, however, that plaintiffs were not told that the plan would never change or that it could not be changed. Further, defendants maintain that there is no evidence of a legally material statement or of detrimental reliance. The parties have treated the plaintiffs' allegations as squarely stating equitable estoppel claims and this Court will do the same.[16] An ERISA participant may recover benefits under an equitable estoppel theory upon establishing a material misrepresentation, reasonable and detrimental reliance upon the misrepresentation, and extraordinary circumstances. In re New Valley Corp., 89 F.3d 143, 153 (3d Cir.1996); In re Unisys Corp. Retiree Med. Benefit "ERISA" Lit., 58 F.3d 896, 907 (3d Cir.1995); Curcio v. John Hancock Mut. Life Ins. Co., 33 F.3d 226, 235 (3d Cir.1994); Smith v. Hartford Ins. Group, 6 F.3d 131, 137 (3d Cir.1993). There is undisputed evidence that in 1991, at the time the Infotron/GDI merger was being effected, then Chairman of GTI Des Cunningham represented to Infotron employees that Infotron's existing severance policy would not be changed, at least not for the worse.[17] There also is substantial evidence *272 that at various times following layoffs and continuing through January or February of 1994, GSC supervisory and managerial personnel assured anxious employees that the severance plan was not being changed and/or that it would stay the same.[18] Drawing all justifiable inferences from this evidence in favor of the respective nonmoving parties, this Court concludes that a fact finder reasonably could find either: (1) defendants misrepresented to plaintiffs that severance pay calculated under the Manual plan was guaranteed to them in the event of upcoming layoffs; or (2) defendants represented to plaintiffs simply that, as of the date of the representations, the Manual plan formula was in place and no formal changes had been made or initiated. Therefore, there is a genuine issue of material fact for the fact finder as to the existence of material misrepresentations. A finding that reliance on defendants' representations was reasonable — at least in the case of most plaintiffs — is supported though not required by the evidence. Plaintiffs had witnessed several prior layoffs in which those laid off received 1-3 weeks' pay per year worked as severance. They were told that financial conditions at the company were looking up and, in the event more layoffs were needed, the severance package would be the same. Of crucial importantly is that plaintiffs never had seen the Manual which contained the reservation of rights clause. Thus, this case is not one in which a claim of reasonable reliance is undercut by knowledge of the employer's right to amend or terminate the severance plan. Cf. In re Unisys, 58 F.3d at 907-08. At the same time, however, plaintiffs by and large expected severance cuts in light of the generous terms of the Manual plan and defendants' declining financial condition. Drawing justifiable inferences from this evidence — and from various plaintiffs' deposition testimony that they knew severance "could" change — in favor of defendants, this Court concludes that a fact finder reasonably could conclude that plaintiffs' reliance on any misrepresentations was unreasonable. There is, therefore, a genuine issue of fact as to the reasonableness of plaintiffs' reliance. As to detrimental reliance, plaintiffs contend that as a result of defendants' representations they abandoned plans of looking elsewhere for employment where job security *273 was stronger. It is undisputed that plaintiffs pressing the equitable estoppel claim continued to work for GSC after layoffs were conducted and after post-layoff representations were made to the effect that the severance policy had not changed and would remain the same. While the preference is for testimony or affidavits supporting a claim of detrimental reliance, see generally Alexander v. Primerica Holdings, Inc., 967 F.2d 90, 96 (3d Cir.1992); Pane v. RCA Corp., 868 F.2d 631, 638 (3d Cir.1989), a factfinder reasonably could find from the circumstances that plaintiffs were induced to remain with GSC instead of seeking alternative employment or otherwise taking steps to achieve the type of financial security they wrongly believed they had by virtue of defendants' severance policy. The amounts of money at stake in the expected severance awards were substantial and represented — de facto if not by design — a key component of the remaining employees' compensation packages and incentives for remaining at GSC. Therefore, this Court is satisfied that under the circumstances the fact of continued employment is sufficient to allow plaintiffs to survive summary judgment on their equitable estoppel claim. It is not sufficient to allow them to prevail on their cross-motion however. Genuine issues of material fact remain with respect to when detrimental reliance, if any, was induced, and what harm various plaintiffs suffered. As defendants point out, plaintiffs' harm cannot be simply the difference between the severance pay plaintiffs would have received under the Manual plan and the amount they actually received under the modified plan, as there is no direct connection between the alleged misrepresentations and that loss; plaintiffs' harm will be the harm which flowed from actions they took or forbore from taking in reliance on defendants' representations. As to extraordinary circumstances, this Court has little difficulty finding that they obtained in light of the number and scope of layoffs occurring in the relevant time period and the obvious need for plaintiffs to have accurate and complete information about their severance packages as they faced prospective unemployment. For these reasons both defendants' motion for summary judgment as to plaintiffs' equitable estoppel claims and plaintiffs' cross-motion for summary judgment as to these claims will be denied. This Court notes that, with respect to the factual issues in dispute, ultimate resolution likely will require individualized hearings as to each plaintiff's circumstances. Additionally, hearings may be required to ascertain which plaintiffs were shown, or otherwise made aware of by defendants, the reservation of rights clause, since knowledge of the retained rights and contractual disclaimer would make reliance on the alleged misrepresentations per se unreasonable. Hein v. Federal Deposit Ins. Corp., 88 F.3d 210, 222 (3d Cir.1996), cert. denied, ___ U.S. ___, 117 S. Ct. 683, 136 L. Ed. 2d 608 (1997); In re Unisys, 58 F.3d at 908. D. Procedural Violation Claims The Third Count of the Second Amended Complaint alleges: (1) defendants failed to provide plaintiffs with prompt notice of the purported modification to the benefits plan; (2) defendants failed to properly modify the benefits plan; and (3) defendants failed to furnish plaintiffs promptly with the applicable benefits summary. By these actions, it is claimed, defendants violated the procedural requirements of ERISA. Plaintiffs seek to have the February 17, 1994, severance plan modification declared void because GSC committed these alleged violations. Defendants deny any defects in the notice and disclosure of the severance amendment. They argue that any technical procedural violations of ERISA cannot give rise to substantive remedies here. 1. Timeliness of Notice of Modification The timing of the notice of amendment did not violate ERISA's procedural requirements. Notice of a plan modification or change must be provided to plan participants not later than 210 days after the end of the plan year in which the change is adopted. 29 U.S.C.A. § 1024(b)(1) (1985). Whatever the exact date of the severance amendment's adoption, defendants clearly satisfied § 1024(b)(1). Insofar as plaintiffs have stated a claim that the severance plan modification *274 is void because of the timing of defendants' notice of the modification, defendants are entitled to summary judgment on that claim. 2. Adherence to Modification Procedure By memorandum dated February 8, 1994, defendants advised plaintiffs that GSC "reserve[d] the option to amend, modify or terminate benefits." The attached summary benefits description went further, indicating that GSC reserved the right to terminate, modify, suspend or amend any employee benefits, at any time for any reasons within the discretion of the President and Chief Executive Officer (then Frank Jerd). It stated that "[a]ny such changes will be implemented by written resolution of the President & Chief Executive Officer." By memorandum dated February 17, 1994, defendants noticed plaintiffs of the new severance pay formula and cap. Neither defendants nor plaintiffs are entitled to prevail on their motions for summary judgment on the claim that defendants' severance plan was modified improperly. ERISA requires that benefit plans contain "a procedure for amending such plans and for identifying the persons who have the authority to amend the plan." 29 U.S.C.A. § 1102(b)(3) (West 1985); see Curtiss-Wright Corp. v. Schoonejongen, 514 U.S. 73, 75, 115 S. Ct. 1223, 131 L. Ed. 2d 94 (1995). Adherence to the formal amendment procedure is required in order for a plan amendment to be valid. Inter-Modal Rail Employees Ass'n v. Atchison, Topeka and Santa Fe Ry. Co., 520 U.S. 510, ___, 117 S. Ct. 1513, 1516, 137 L. Ed. 2d 763 (1997); Curtiss-Wright Corp., 514 U.S. at 84-85; Ackerman v. Warnaco, Inc., 55 F.3d 117, 125 (3d Cir.1995); In re Unisys Corp. Long-Term Disability Plan Erisa, MDL No. 938, 1997 WL 137370 at *2 (E.D.Pa. Mar.25, 1997); see also Brewer v. Protexall, Inc., 50 F.3d 453, 457 (7th Cir.1995); Singer v. Black & Decker Corp., 964 F.2d 1449, 1454 (4th Cir.1992) (Wilkinson, J., concurring); Washington Nat. Ins. Co. v. Hendricks, 855 F. Supp. 1542, 1557 (W.D.Wis.1994). Standing alone, a provision stating that the Company may amend, modify or terminate plan benefits is sufficient to satisfy ERISA's amendment procedure requirements. Curtiss-Wright, 514 U.S. at 78-84. But, on one reading, the benefits description here appears to go further, requiring that changes be made at the discretion of the President and Chief Executive Officer of GSC. On this reasonable reading, Jerd's participation in, or at least his ratification of, any amendment action was indispensable.[19] Plaintiffs present evidence that the February 17, 1994, modification notice was not written or reviewed by Jerd. Thomas Aiken, GSC's Chief Financial Officer, has stated that it was not customary or normal for a memorandum to lack a signature, that he believed the memorandum was issued by Vincent Messina, that he did not believe Jerd had been involved in issuing the memorandum because it lacked his signature, and that he believed the memorandum was dictated for issuance under Jerd's signature. (Aiken Dep. at 93). Vincent Messina has testified as to his recollection that the amendment was sent to GSC's Human Resources department by Jeff Singer who worked in Canada. (Messina Dep. at 82-83). Singer testified that Hedges made the actual decision to amend the severance plan. (Singer Dep. at 75). However, Jerd did attend portions of GTI Board meetings in the relevant time period. He was present at a January 24-25, 1994, Operations Committee meeting during which Hedges instructed those present to prepare business case scenarios involving downsizing for presentation at the February 10, 1994, Board meeting. Finally, the February 17 memorandum did bear Jerd's name. This evidence is sufficient to permit a fact finder reasonably to conclude that Jerd exercised discretion either in the decision to modify the plan or at least in ratifying that decision, but it also is sufficient to support *275 the opposite conclusions. There is, in short, on one reading of the amendment procedure which defendants have not discredited, a genuine issue of material fact as to whether the severance modification involved an exercise of discretion on Jerd's part. For this reason, this Court will deny both defendants' motion for summary judgment and plaintiffs' cross-motion as to the improper modification claim.[20] 3. Provision of Summary Plan Description Although the severance plan was in effect at least as early as 1984, there appears to be no evidence that plaintiffs received a summary plan description (SPD) from GSC prior to February, 1994, at least not one which addressed severance pay. As mentioned above, ERISA requires in the way of plan disclosure, inter alia, that participants be given SPDs. 29 U.S.C.A. § 1021(a)(1). Violations of ERISA's procedural requirements give rise to substantive relief such as a rescission of a plan amendment only in egregious circumstances involving, for example, bad faith and active concealment of plan terms. See Ackerman v. Warnaco, Inc., 55 F.3d 117, 124 (3d Cir.1995). Plaintiffs have done no more than allege a failure to provide a timely SPD. This Court will not develop for plaintiffs an argument that procedural violations here were sufficient to warrant substantive relief. Insofar as plaintiffs have stated a claim that defendants' failure to provide an SPD on a timely basis must result in the severance plan modification being declared void, defendants are entitled to summary judgment on that claim.[21] E. WARN Claims Class Two and Class Three plaintiffs allege that defendants violated the Worker Adjustment and Retraining Notification Act ("WARN"), 29 U.S.C.A. § 2101 et seq., by terminating their employment without providing sixty days' notice.[22] WARN provides that "[a]n employer shall not order a plant closing or mass layoff until the end of a sixty-day period after the employer serves written notice of such an order ... [to each affected employee]." 29 U.S.C.A. § 2102(a) (West Supp.1997). "Plant closing" is defined as "the permanent or temporary shutdown of a single site of employment, or one or more facilities or operating units within a single site of employment, if the shutdown results in an employment loss at the single site of employment during any 30-day period for 50 or more employees excluding any part-time employees." Id. § 2101(a)(2). The term "affected employees" is defined as "employees who may reasonably be expected to experience an employment loss as a consequence of a proposed plant closing or mass layoff by their employer." Id. § 2101(a)(5). The term "employment loss" is defined, in pertinent part, as "an employment termination, other than a discharge *276 for cause, voluntary departure, or retirement." Id. § 2101(a)(6)(A). The operation of WARN is straightforward. First a determination is made as to whether there was a "plant closing" as defined by WARN. The court then looks to see which employees were employees "affected" by the plant closing.[23] Finally, the court finds whether or not the plant closing was ordered without affected employees having been given sixty-days' notice. It is known that management decided to shut down the Cherry Hill facility prior to February 22, 1994, the date on which actual notice of the closing was given. Thereafter, GSC terminated thirty-four employees on April 25, fourteen employees on April 29, and six employees on May 2.[24] Thus, in less than thirty days, fifty-four GSC employees "experienced an employment loss as a consequence of a proposed plant closing." Id. § 2101(a)(5). Therefore, there was a "plant closing" as defined by WARN. See id. § 2101(a)(2). By definition, all employees at GSC as of February 22, 1994, were "affected employees" to whom GSC was required to give sixty-days' notice, because they all reasonably could be expected to experience an employment loss as a result of the planned plant closing. See id. § 2101(a)(5). Summary judgment will be granted to all Class Two plaintiffs who did not receive the sixty-days' WARN notice of the plant closing, including those employees laid off on February 22, 1994, and defendants are obligated to award such employees back pay pursuant to 29 U.S.C.A. § 2104(a). Defendants attempt to avoid this result by arguing that WARN's plant closing provisions do not have "retroactive application." That is, defendants assert that only those plaintiffs scheduled to be laid off on or after April 25, 1994 — when there were plans to shut down the Cherry Hill facility — can be said to have experienced "employment loss" which "resulted from" a plant shutdown. Apart from ignoring the plain language of the statute, defendants overlook the fundamentally forward-looking orientation of WARN's definition of "affected employees" — those employees "who may reasonably be expected to experience an employment loss as a consequence of a proposed plant closing...." Id. § 2101(a)(5). Their argument produces an absurd result. Under defendants' argument, an employer is free to plan a Wednesday plant closing on Monday, lay off all of its employees on Tuesday, and then claim that there are no employees "affected" by Wednesday's closing because — as all employees were laid off on Tuesday — there could not be any employees on Wednesday to experience an employment loss as a result of the closing. The circumstances of Class Three plaintiffs are more difficult to determine. This Court concludes that neither Class Three plaintiffs nor defendants are entitled to summary judgment on Class Three plaintiffs' WARN claim. Again this Court's analysis begins with the undisputed fact that there was a plant closing in April of 1994. If GSC had at some time prior to January 14, 1994, already determined to close the Cherry Hill facility, then the Class Three plaintiffs were "affected" employees who did not receive a proper WARN notice. This Court is satisfied that there is a genuine dispute of fact concerning whether or not prior to January 14, 1994, defendants were planning to close GSC's Cherry Hill facility. A fact finder reasonably could infer from the circumstances and timing of the *277 layoffs that the employees terminated on January 14, 1994, were terminated as part of a multi-staged plant closing. At the same time, a fact finder reasonably could infer from defendants' evidence that as of January 14, 1994, defendants were not planning or proposing a plant closing. That is, a fact finder could find that the decision to terminate Class Three plaintiffs on January 14, 1994, predated any plans or proposals to close the plant, and that therefore these plaintiffs could not be reasonably expected to suffer employment losses as a consequence of the April plant closing. Defendants will bear the burden of proving that Class Three plaintiffs (i.e., those terminated on January 14, 1994) were not "affected employees" under WARN, a burden requiring them to show that Class Three plaintiffs' terminations were planned prior to any serious proposal or decision being made to close GSC's Cherry Hill plant. This burden-shift flows from: (1) the existence an undisputed plant closing in April of 1994; and (2) WARN's provision that employment losses within a ninety-day period may be grouped together for purposes of showing a plant closing unless the employer can show that such losses resulted from "separate and distinct actions and causes and are not an attempt by the employer to evade the requirements" of WARN. See id. § 2102(d).[25] Had plaintiff been required to rely on the January 14, 1994, layoffs to establish a plant closing under the expanded ninety-day window provided by § 2102(d), defendants would have borne the burden of proving that these layoffs were not causally related to the plant closing. It is undisputed that those laid off on January 14 suffered an employment loss. Id. § 2101(a)(6). If that date is included within any number of possible ninety-day periods, more than fifty employees would have suffered an employment loss during such periods. To avoid a finding of a "plant closing" defendants would have been required to bear the burden of proving that such employment losses were "the result of separate and distinct action and causes and are not an attempt by the employer to evade the requirements of this chapter." Id. Defendants should not be able to escape this burden because a staged lay off satisfied the basic plant closing definition found in § 2101(a)(2). In conclusion, defendants' motion for summary judgment as to Class Two plaintiffs' WARN claim will be denied. Plaintiffs' cross-motion for summary judgment as to Class Two plaintiffs' WARN claim will be granted. Defendants' motion for summary judgment as to Class Three plaintiffs' WARN claim will be denied. Plaintiffs' cross-motion for summary judgment as to Class Three plaintiffs' WARN claim also will be denied. IV. Conclusion For the foregoing reasons, this Court finds Subclass "A" plaintiffs lack standing to pursue claims under ERISA and their Complaint must be dismissed. Both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to plaintiffs' claim that they are entitled to vested benefits will be denied. Both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to all plaintiffs' equitable estoppel claims will be denied. Defendants' motion for summary judgment as to plaintiffs' claims that the severance plan modification must be declared void because plaintiffs were not timely noticed of the severance policy modification and were not timely given a summary plan benefits description will be granted, and plaintiffs' cross-motion for summary judgment as to these claims will be denied. Both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to plaintiffs' claim that the severance policy modification was invalid will be denied. Defendants' motion for summary judgment as to Class Two plaintiffs' WARN claim will be denied, and plaintiffs' cross-motion for summary judgment as to this claim will be granted. Both defendants' motion for summary *278 judgment and plaintiffs' cross-motion for summary judgment as to Class Three plaintiffs' WARN claim will be denied. This Court will enter an appropriate order. NOTES [1] The Worker Adjustment and Retraining Notification Act ("WARN") is discussed below at III.E. [2] See Axelrod Dep. at 20-21; Barbato Dep. at 36; Booth Dep. at 9; Bracalante Dep. at 55; Egerton Dep. at 15-17; Evans Dep. at 11; Ford Dep. at 11; Frietter Dep. at 9; Gildersleeve Dep. at 12; Hannigan Dep. at 23-24; Karch Dep. at 30; LeFevre Dep. at 45; Nguyen Dep. at 18-20; O'Hara Dep. at 17; Patel Dep. at 29; Perrone Dep. at 40; Rollo Dep. at 57; Scassero Dep. at 12-13; Szumowski Dep. at 13-14. [3] See Axelrod Dep. at 33; Booth Dep. at 14; DeMarco Dep. at 10; Egerton Dep. at 22; Evans Dep. at 14-15; Feizet Dep. at 27; Gildersleeve Dep. at 22-23; Harbaugh Dep. at 29; Kennedy Dep. at 11-13; LeFevre Dep. at 45-46; Luong Dep. at 16-17; Merlino Dep. at 13; Nguyen Dep. at 20-22; Patel Dep. at 13-14; Petrick Dep. at 12; Probasco Dep. at 27-29; Rollo Dep. at 55; Rose Dep. at 31-34; Roselli, Dep. at 30-31; Scassero Dep. at 17-20; Szumowski Dep. at 15-17. According to plaintiffs' deposition testimony, employees were not told, as defendants would have it, simply that the managers were not aware of any such plans. [4] A schedule showing the dates and numbers of layoffs is attached at the end of this Opinion as "Appendix A." An additional schedule, annotated to clarify the parties' factual disagreements, is attached as "Appendix B." [5] Plaintiffs employ the terms "constructive discharge" and "involuntary resignation" interchangeably. (See Second Amended Complaint (No. 96-0621(JEI)) at ¶¶ 14, 16, 48, 49; Plaintiffs' Mem. In Opp. to Defendants' Motion for Summary Judgment and in Support of Plaintiff's Cross-Motion at 25-29). [6] This section provides in pertinent part that "[i]t shall be unlawful for any person to discharge ... a participant ... for the purpose of interfering with the attainment of any right to which such participant may become entitled under the plan ...." [7] Subclass "A" plaintiffs make much of the fact that some members of GSC management anticipated that some employees would leave rather than wait for their layoffs and their reduced severance pay. This fact tends to show that sub-class "A" plaintiffs' decisions were reasonable, not that no reasonable persons could be expected to tolerate the working conditions at GSC. Only one case cited by subclass "A" plaintiffs tends to provide any support for their position. In Anthony v. Jersey Central Power & Light Co., 51 N.J.Super. 139, 143 A.2d 762 (1958), an employee was told that he could stay with the defendant employer only if he accepted a serious demotion in position and salary. The court reasoned that the employee's refusal of this offer could not be regarded as resignation within the fair meaning of a severance pay provision that denied such pay to those who resigned. Id. 143 A.2d at 767. Anthony supports the proposition that where an employee's job is eliminated and he refuses to accept an offer of a new job, he might be said to have been discharged constructively. That proposition does nothing for plaintiffs here. [8] See Barbarito Dep. at 25-26; Bentzley Dep. at 68; Bracalente Dep. at 16-17; Brown Dep. at 24; Carey Dep. at 55-56; DiMatteo Dep. at 36; Hannigan Dep. at 18; Hughes Dep. at 34; Kennedy Dep. at 10; Nicolazzo Dep. at 50-51; Nolte Dep. at 42-43; Ramsell Dep. at 30, 32; Trautwein Dep. at 44; Traynor Dep. at 52. [9] In some circumstances former employees may have standing because but-for their employer's violation of ERISA they would have been plan participants. See Swinney v. General Motors Corp., 46 F.3d 512 (6th Cir.1995); Shawley v. Bethlehem Steel Corp., 989 F.2d 652 (3d Cir. 1993); Berger v. Edgewater Steel Co., 911 F.2d 911 (3d Cir.1990), cert. denied, 499 U.S. 920, 111 S. Ct. 1310, 113 L. Ed. 2d 244 (1991); Christopher v. Mobil Oil Corp., 950 F.2d 1209 (5th Cir.1992). But see Raymond v. Mobil Oil Corp., 983 F.2d 1528 (10th Cir.), cert. denied, 510 U.S. 822, 114 S. Ct. 81, 126 L. Ed. 2d 49 (1993); Stanton v. Gulf Oil Corp., 792 F.2d 432 (4th Cir.1986). Plaintiffs do not advance this claim. They probably would not prevail if they did. A showing of standing on the but-for theory here would be a showing of involuntary resignation or constructive discharge. Since there is no such resignation or discharge here, the but-for doctrine would not apply. See Berger, 911 F.2d at 922. [10] Subclass "A" plaintiffs have not asserted a WARN claim. Therefore, dismissal of their ERISA claims results in their dismissal from this action altogether. [11] "Employee welfare benefit plan" is defined as any plan, fund or program which was heretofore or is hereafter established or maintained by an employer ... to the extent that such plan, fund or program was established or is maintained for the purpose of providing for its participants ... (A) ... benefits in the event of ... unemployment ... or (B) any benefit described in [29 U.S.C.A.] section 186(c) of [the Labor Management Relations Act of 1947] 29 U.S.C.A. § 1002(1). An "employee pension benefit plan," in contrast, is any plan, fund, or program which was heretofore or is hereafter established or maintained by an employer ... to the extent that by its express terms ... such plan ... (i) provides retirement income to employees .... 29 U.S.C.A. § 1002(2). [12] "A top hat plan is a plan which is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly trained employees." In re New Valley, 89 F.3d at 148. [13] It is hard to see why, under defendants' view of the policy, GSC was not free to cancel its severance policy and deny severance pay even after terminating employees. After all, the policy contains a disclaimer of contractual intent and reserves to GSC the right to terminate it "at any time." Thus, under defendants' view, the benefits promised to be delivered upon termination cannot be "vested." If the policy is not a contract at all, but rather is just a gratuitous promise, and ERISA protects "contractually defined benefits," it is not clear why ERISA ever could be invoked to enforce the promise on contractual grounds. Instead, it would appear that plaintiffs would be limited to an estoppel theory under which they would argue that — the disclaimer notwithstanding — it was reasonable to believe they would get severance pay if the policy had not been changed before they were terminated. Their damages, however, for reasons mentioned below, would be limited to the detrimental harm caused by their reliance, and might fall far short of what they were expecting to receive as severance. Perhaps defendants would say plaintiffs would be able to recover the withheld benefits because the benefits would be "due ... under the terms of [the] plan," 29 U.S.C.A. § 1132(a)(1)(B). Apart from begging the question, this approach would raise another problem. For as s defendants have pointed out with vigor, ERISA's enforcement provision allows plan participants to bring an enforcement action for benefits due only if they have a colorable claim to "vested benefits." One might be tempted to argue that a court would not construe the plan in such a way as to allow defendants to withhold severance upon an employee's termination even though the plan was still in place because to do so would suggest that the plan contained an illusory promise. But, as defendants argue implicitly throughout their submissions, ERISA does not proscribe illusory promises. Finally, one might argue that the plan should not be interpreted as making only an illusory promise because no reasonable party in the employees' position would bargain for an illusory promise. Under defendants view, of course, that objection must collapse upon itself because the point of departure for the inquiry is precisely the claim that no bargaining, let alone contracting, ever took place. [14] For example, the nature of any recover by plaintiffs will depend upon the exact theory of benefit accrual posited by plaintiffs. Plaintiffs contract claim can be read in at least two ways. One reading is that, upon accepting defendants' alleged offer to contract, plaintiffs began to accrue one week's pay per year of service completed from the time of contracting. Thus a plaintiff who began "performing" in response to defendants' alleged offer on January 1, 1991, for example, would have accrued three weeks' severance pay as of January 1, 1994, and would not be entitled to one week's pay as severance for each year of work prior to January 1, 1991. Under this reading the time at which various plaintiffs' entries into unilateral contracts would control their recoveries. Another reading is that, upon accepting defendants' alleged offer, plaintiffs' became entitled to one week's pay as severance for all of the previous years they had worked and any years they went on to work. Thus a plaintiff who began working on January 1, 1978, and who accepted defendants' alleged offer on January 1, 1991, for example, would be entitled to sixteen weeks' pay as severance as of that date. Plaintiffs' method of calculating the monies owing them suggests that this latter reading is the one they endorse. Under this reading it follows that if: (1) prior to January 1, 1994, defendants had no severance policy; (2) plaintiffs threatened to resign on January 2, 1994; (3) defendants' promised on January 3, 1994, to give plaintiffs one week's pay per year worked as severance if they would stay; (4) on January 10, 1994, plaintiffs were terminated; and (5) plaintiffs had worked since January 1, 1978; then, (6) defendants would owe plaintiffs sixteen weeks' pay as severance even though they had worked under the terms of the unilateral contract for only seven days. The oddness of this result appears to be one obstacle plaintiffs will have to overcome in their bid to convince the fact finder that defendants intended to be bound in the manner plaintiffs suggest. [15] Plaintiffs' claim that by this conduct defendants discriminated against them in violation of 29 U.S.C.A. § 1140 was dismissed pursuant to this Court's Order dated July 5, 1996. [16] The Second Count of the Second Amended Complaint indicates that the 8 individual plaintiffs are the only plaintiffs seeking to recover on the estoppel claim. However, the Second Count of the Complaint in the original Civil Action No. 95-4808 states the equitable estoppel claim on behalf of the 26 plaintiffs in the original unconsolidated action. Plaintiffs have indicated that they still are pressing the equitable estoppel claim for both groups of plaintiffs. While defendants' instant motion for summary judgment is addressed only to the 8 individual plaintiffs' estoppel claim, their legal argument applies with equal force to the other plaintiffs' estoppel claim as well. Because there appears to be no prejudice to either party in treating defendants' motion for summary judgment as to the Second Count of the Second Amended Complaint as also being addressed to the Second Count of the Complaint in No. 95-4808, this Court will so treat defendants' motion. Plaintiffs appear no longer to be pursuing any breach of fiduciary duty claim. [17] This representation apparently was reduced to written form by defendants in a series of "Merger Letters." (See Plaintiffs' Exh. 2). Defendants dispute the authenticity of the Merger Letters. At this juncture this Court perceives no reason to address the admissibility of these writings as evidence. [18] See, e.g., Axelrod Dep. at 9 (after every layoff there was meeting where questions were asked about severance "and we were always reassured the severance package would stay the same"); Booth Dep. at 14 (Ron Volkman said that as far as he knew benefits were going to stay the same but that a meeting was being held in Canada; Jerry Gainer said in January, 1994, that separation pay formula would not change); Chambers Dep. at 69 (heard through grapevine that employees were told there would not be change in severance policy); DeMarco Dep. at 10 (at post-layoff meeting Ron Volkman would assure employees that severance package was not going to change); Egerton Dep. at 22 (Matt Hottel said in meetings that benefits packages would stay the same and assured that nothing would change); Feizet Dep. at 27 (prior to February, 1994, Jerry Gainer said severance package would continue); Ford Dep. at 33 (following January, 1994, layoff GSC personnel said severance formula would not change); Fritter Dep. at 9 (from May 1991 to February, 1994, after every layoff representations were made that severance package was still intact); Gildersleeve Dep. at 23 (employees were assured at meeting that if they were laid off they would have severance); Harbaugh Dep. at 22 (following January, 1994, layoffs Ron Volkman said severance pay formula would stay the same); Kennedy Dep. at 13 (shortly after January 14 Ron Volkman said "severance would stay the same"); Luong Dep. at 17 (following January, 1994, layoffs Ron Volkman said there was no change in benefits); Maser Dep. at 18 ("all along when we asked [Ron Volkman], he assured us that everything would remain the same"); Merlino Dep. at 13 (at post-layoff meetings employees were reassured that talk of changed benefits was just rumors); Nguyen Dep. at 21 (following January, 1994, layoffs Jerry Gainer said nothing would change); Patel Dep. at 14 (after January, 1994, layoffs Ron Volkman denied rumor of severance cuts for those staying until April); Petrick Dep. at 12 (meetings with various officers would assure us severance pay formula was not going to change); Probasco Dep. at 28-29 (in approximately early February, 1994, Sandy LeFevre, Tom Aiken and Mike Rennie said benefits would stay the same and severance policy was not changing); Roselli Dep. at 30 (managers indicated that severance would stay the same); Scassero Dep. at 19 (following January, 1994, layoffs Volkman said to his knowledge there would be no change); Szumowski Dep. at 16 (following January, 1994, layoffs Tom Aiken said benefits and severance would remain same). [19] This Court does not believe that this reading is the only reasonable reading. Given the record and the lack of briefing on this point, the Court finds ambiguity. For purposes of disposing of defendants' motion for summary judgment, however, this Court utilizes this reading since, insofar as defendants are the moving party and have not carried their initial burden of showing the absence of a genuine issue of material fact in this regard. See Fed.R.Civ.P. 56. [20] Defendants are correct that procedural ERISA violations ordinarily will not create substantive rights not provided in a plan. See Ackerman v. Warnaco, Inc., 55 F.3d 117, 124 (3d Cir.1995); Berger v. Edgewater Steel Co., 911 F.2d 911, 921 (3d Cir.1990), cert. denied, 499 U.S. 920, 111 S. Ct. 1310, 113 L. Ed. 2d 244 (1991). This case, however, is not one in which the finding of a violation of an ERISA procedural requirement might operate to give plan participants a substantive right not contained in the plan. If the amendment procedure required Jerd's involvement, and this procedure was not followed, then the severance policy modification is without force. In that scenario substantive rights under the plan would not be created, they simply would be retained. Put differently, the point is that the instant claim involves an alleged violation of the terms of the severance plan, not a violation of ERISA's procedural requirements. [21] It is important to make clear that this decision and the decision in III.D.1 — to the effect that technical violations of ERISA here do not result in the severance plan modification being void — are not at all inconsistent with this Court's decision that plaintiffs may have a right to vested severance benefits. The decisions in III.D.1 and III.D.3 simply establish that the plan modification was not void ab initio because of technical violations, while the discussion and decision in III.B. is addressed to the effect that the plan modification has on plaintiffs' benefits. That is, III.B. established that the plan modification — assumed to be valid — may not have the effect on plaintiffs' benefits that defendants believe it does, because plaintiffs' benefits may have been vested and irrevocable. [22] Class Two plaintiffs were laid off on or about February 22, 1994. Class Three plaintiffs were laid off on or about January 14, 1994. [23] There is nothing in the statute to suggest any limitation on which employees may be counted to make up the required fifty or more "affected" employees, who can include those who received a proper WARN notice, those who did not receive such notice, those laid off before notice of the proposed closing was given, or those laid off after the closing was announced. The only legal requirement is that there be a causal link between the employee's termination and the plant closing. Neither does WARN limit "affected" employees to those included in the fifty or more employees used to define a "plant closing." Once that definition is satisfied, any employee may qualify as an "affected" employee, whether or not included in the group of employees used to define a "plant closing." [24] A schedule showing the dates and numbers of layoffs is attached at the end of this Opinion as "Appendix A." An additional schedule, annotated to clarify the parties' factual disagreements, is attached as "Appendix B." [25] Because of the manner in which this Court disposes of the WARN plant closing claims, it will not consider plaintiffs' alternative WARN "mass layoff" claims. This Court is satisfied from the evidence that Class Three plaintiffs can prevail on their WARN claim only if they were employees "affected" by the WARN plant closing which this Court has found did in fact occur.

2013-10-30 06:35:56.907962+00

Votolato

431 B.R. 51 (2010) In re IDC CLAMBAKES, INC. Debtor. BK No. 05-12267. United States Bankruptcy Court, D. Rhode Island. June 9, 2010. *54 William P. Devereaux, Esq., Pannone Lopes & Devereaux LLC, W. Mark Russo, Esq., Ferrucci Russo PC, Providence, RI, Attorney for Debtor. William R. Grimm, Esq., Hinckley, Allen & Snyder LLP, Charles D. Blackman, Esq. Providence, RI, Attorney for the Creditors. DECISION AND ORDER ON REMAND ARTHUR N. VOTOLATO, Bankruptcy Judge. This matter is before the Court on remand from the United States District Court, with instructions to: (1) "ensure that any disposition of the issue of whether [IDC Clambakes, Inc.] trespassed on Association property comport with due process requirements"; (2) "carefully adhere to the elements of trespass under Rhode Island law"; and if a trespass is found (3) "reconsider whether the Association's claim for trespass damages is precluded by either Am. Condo. Ass'n, Inc. v. IDC, Inc., 844 A.2d 117 (R.I.2004) (`America I') or Am. Condo. Ass'n, Inc. v. IDC, Inc., 870 A.2d 434 (R.I.2005) (`America II')." Goat Island S. Condo. Ass'n, Inc. v. IDC Clambakes, Inc., 382 B.R. 178, 179 (D.R.I.2008). Following the remand, this Court held a nine day trial on the merits of the proofs of claim litigation, which included the testimony of 7 witnesses, 765 transcript pages, and 137 exhibits. Both parties submitted detailed post-trial memoranda, as well as reply and sur-reply briefs. This Court is satisfied that all due process requirements have been met. PROCEDURAL BACKGROUND This particular litigation arises out of the Debtor Clambakes' objection to proofs of claim filed by America Condominium Association Inc., Capella South Condominium Association, Inc., Harbor Houses Condominium Association, Inc., and Goat Island South Condominium Association, Inc. (collectively, the "Associations") [Claim Nos. 16, 17, 18 and 19], in the aggregate amount of $3,507,290, for damages arising out of Clambakes' alleged seven year trespass on a specific parcel of condominium property, the Reserved Area. Thomas R. Roos ("Roos"), Clambakes' sole shareholder, joined in the Debtor's objection. This dispute was first presented in this Court on Clambake's Motion for Summary Judgment on September 27, 2006. While the matter was under advisement, both sides filed numerous additional memoranda, and on January 24, 2007, I issued my initial ruling(s) disallowing the Associations' claims for damages for trespass. That decision was appealed to the U.S. District Court, and on February 8, 2008, Judge William E. Smith issued his rulings and remand order as described above. FACTUAL BACKGROUND The trespass claim discussed herein involves a number of disputes between the Associations, and Thomas Roos and several of his wholly owned enterprises, IDC, Inc.,[1] and IDC Properties, Inc. ("Properties") dating back to the early 1990's, which have been litigated in various actions and appeals in the Rhode Island state courts. All of that litigation was finally concluded in April 2005. See Am. Condo. Ass'n, Inc. v. IDC, Inc., 844 A.2d 117 (R.I.2004) ("America I") and Am. Condo. Ass'n, Inc. v. IDC, Inc., 870 A.2d 434 (R.I.2005) ("America II"). Clambakes was not a party to any of the Roos/Associations litigation. *55 This decision will not attempt to rehash the troubled history between the Associations, IDC, Inc., Properties, and Roos, which is set forth in detail in America I and II, 844 A.2d 117 and 870 A.2d 434, but will concentrate on the facts central to the Associations' trespass claim against Clambakes. IDC, Inc. and Properties are the successors in interest to Globe Manufacturing Co., the declarant of a Newport, Rhode Island, condominium complex situated on Goat Island, consisting of approximately twenty-three acres. The master declaration reserved to the declarant the right to convert, inter alia, the Reserved Area (also referred to as the North Unit) to a master unit and to construct improvements thereon, until December 31, 1994. For reasons not known to the Court, nor relevant at this time, Properties failed to timely exercise said development rights, but instead attempted to extend the development rights deadline through a series of amendments to the master declaration. Between 1996 and 1998, meetings, discussions, and negotiations took place between IDC, Inc., Properties, Roos, and the Associations and their attorneys concerning, inter alia, the validity of the amendments, fee assessments and voting schemes. On January 5, 1998, the Associations, Properties, IDC, Inc., and Roos, entered into a Tolling Agreement which preserved the Associations' claims relative to the amendments, development rights, the Rhode Island Condominium Act, construction, repair and improvements, and the allocation of common element expenses. This agreement was extended several times and remained in effect through May 31, 1999. Clambakes was not a party to the original Tolling Agreement, nor to any of its extensions. Clambakes did not come into existence until April 18, 1996, as a new Rhode Island corporation, IDC Clambakes, Inc., for the purpose of "engag[ing] in the business of conducting social events, receptions, weddings, clambakes, cookouts, parties."[2] It is agreed that Clambakes is a separate and distinct corporation with separate assets and liabilities, and that Roos is the sole shareholder and President of both Clambakes and Properties. In late 1997 and throughout 1998, while the Tolling Agreement was in effect, Properties made plans and preparations to construct an opulent banquet facility on the Reserved Area. Prior to the start of construction, in October 1997, the America Condominium Association raised concerns with the City of Newport Zoning Officer about the issue of parking on Goat Island to handle the proposed Clambakes operation. The Zoning Officer's response was "that the proposal is allowed under the zoning code of the City of Newport." See Debtor's Exhibit 21. Approximately four months later, upon the filing of the building permit for the construction of the facility, the America Condominium Association again raised the parking issue with the Newport Building Inspector. "It's our understanding that a permit application has been filed with your Office for the purpose of constructing a bldg. [sic] that would, among other uses, be used for clambakes. While we don't have a particular objection as to the land use with respect to the building itself, we do have a substantial problem with the parking requirements for *56 that bldg., [sic] as well as for other commercial parking on and around that site." Debtor's Exhibit 63 (emphasis added). On March 1, 1998, while the facility was still under construction, Properties entered into a twenty year lease with Clambakes, doing business as The Newport Regatta Club ("Regatta Club"), for the period May 1, 1998 through May 1, 2018, with a base annual rent of $180,000.00 plus six (6) percent of the lessee's gross annual revenue. In July 1998, an application was filed with the Board of License Commissioners to transfer the liquor license of Dorell, Inc. to IDC Clambakes, Inc., d/b/a/ The Newport Regatta Club. The issuance of the liquor license was delayed for several months at the request of, and pending the America Condominium's Zoning Board appeal, but the liquor license was ultimately approved. There is no evidence that any of the individual unit owners or the plaintiff Associations opposed the liquor license transfer to Clambakes. See Debtor Exhibits 66, 67. The only question raised by the Associations during the construction of the facility concerned the adequacy and/or logistics of parking. On December 16, 1998, the Regatta Club's use and occupancy certificate was issued,[3] and wedding reception and banquet operations began. Thereafter, from mid-December 1998 until April 8, 2005, Clambakes operated the Regatta Club and paid rent to Properties pursuant to the terms of their lease. During this seven year period the Associations made no protest nor took any action to enjoin Clambakes' operation of its business or to express objection—overtly or otherwise—to Clambakes' possession and/or operation of the Regatta Club. Approximately six months after Clambakes began operating the Regatta Club, on May 28, 1999—three days before the expiration of the Tolling Agreement, the Associations filed a state court action against IDC, Inc., Properties and Roos individually, alleging, inter alia, violations of the Rhode Island Condominium Act, R.I. Gen. Laws § 34-36.1-1.01, et seq. (1956), and that the voting scheme used in amending and extending the development rights in the Reserved Area was contrary to law and was therefore ineffective. Again, omitted from this lawsuit was Clambakes, despite its continuous occupation and well known operation of the Regatta Club at all relevant times, and Clambakes was never added as a party during the entire six year period that the America litigation wound its way through the Rhode Island Superior and Supreme Courts. It should not be overlooked, that although the Associations were suing Clambakes' lessor, they never contested Clambakes' right to possess and operate, nor ever objected to its operation, as lessee, of the Regatta Club. To the contrary, during the entire time in question, unit owners contracted with Clambakes to host private events at the Regatta Club under standard business terms and rates, and the Harbor Houses Condominium Association similarly used the Regatta Club to conduct its annual meetings. At no time did any unit *57 owners, or the Harbor Houses Association, or the Associations notify Clambakes that it was operating without the consent of the owner, or assert any claims of trespass or unauthorized occupancy against it. Instead, they used and enjoyed the Club for seven years. On October 15, 1999, nearly one year after Clambakes took possession of and began operating the Regatta Club, the Associations recorded a Notice of Lis Pendens in the land records for the City of Newport against "IDC Properties, Inc., the present declarant and the record owner of the North Development Unit, the West Development Unit, and the South Development Unit," referencing the state court complaint seeking declaratory relief and money damages, see Plaintiff Exhibit E, again with no mention of Clambakes. Soon after the Supreme Court's decision in America II in April 2005, holding that "title [to the Reserved Area and its structures] rested with the unit owners in common ownership from the creation of the condominium," 870 A.2d at 443, the Associations filed an Application for Writ of Execution for Possession and Writ of Ejectment, seeking for the first time to evict Properties, IDC, Inc., and Thomas Roos, see Debtor's Post Trial Memorandum, Composite Exhibit GG, but with still no mention of Clambakes in any of the papers. On June 16, 2005, Clambakes filed the instant Chapter 11 case, initially trying to relitigate in this Court many of the same issues already decided against IDC, Properties and Roos in the state courts. When that strategy failed, Clambakes began in earnest to address its Debtor in Possession responsibilities, i.e., a plan was promptly confirmed, all other creditors and fees were paid, and sufficient funds were placed in escrow to pay the Associations in full, if their claims are allowed. That fund remains intact. On July 11, 2005, a Chapter 11 trustee was appointed, and shortly thereafter, in order to allow the Debtor to complete its substantial summer event bookings scheduled from July 28, 2005 through October 31, 2005, filed an emergency motion requesting that he be authorized to operate the Regatta Club in the ordinary course and to make adequate protection payments to the Associations for its use and occupancy during the Debtor's busy season. Initially, the Associations objected on the grounds, inter alia, that "the unit owners' property is being used without their consent and against the ruling of the Rhode Island Supreme Court," and also alleging insufficient adequate protection payments and failure of the trustee to agree to a peaceable turnover of the property upon the conclusion of the requested use period. See Doc. No. 66. The Associations further asserted that "[a]bsent privity or consent of the owner, the Trustee is merely a trespasser, and at this time, GIS [the Associations] requests the return of the Premises." Id. at 8 (emphasis added). Negotiations followed, and on August 25, 2005, the Court approved a Consent Order settling the trustee's emergency motion, wherein the parties agreed that the trustee should continue to operate the Debtor's business in the ordinary course through November 5, 2005, in consideration of the payment of $450,000 as adequate protection for the use and occupancy of the premises for the period April 8, 2005 (the date of the Supreme Court decision declaring title in the unit owners), through November 5, 2005 (the date of the last permitted event booking). LEGAL ISSUES and DISCUSSION I. Under Rhode Island Law, did Clambakes trespass on Association Property? The resolution of property rights through an action in trespass is determined *58 according to state law, Taggart v. Weinacker's Inc., 397 U.S. 223, 227, 90 S. Ct. 876, 25 L. Ed. 2d 240 (1970) (Burger, C.J., concurring). The Rhode Island Supreme Court has defined a trespasser as "`[o]ne who intentionally and without consent or privilege enters another's property.'" Bennett v. Napolitano, 746 A.2d 138, 141 (R.I.2000) (quoting Ferreira v. Strack, 652 A.2d 965, 969 (R.I.1995)); see, Min v. Pariseau, No. 03-1033, 2008 WL 5325583, 2008 R.I.Super. LEXIS 151, *17 (R.I.Super.Ct. Dec. 9, 2008); Ludwig v. O'Connell, Nos.XXXX-XXXX, XXXX-XXXX, 2006 WL 2062133, *6-7, 2006 R.I.Super. LEXIS 89, *23 (R.I.Super.Ct. July 19, 2006). To recover for trespass in Rhode Island, a party "must show: `(1) the adverse party intentionally entered onto the owner's property; and (2) plaintiff had rightful possession of such property.'" Goat Island S. Condo. Ass'n, 382 B.R. at 179 (quoting Smith v. Hart, No. 99-109, 2005 WL 374350, *5 (R.I.Super.Mar.1, 2005)); see State v. Verrecchia, 766 A.2d 377 (R.I.2001); Berberian v. Avery, 99 R.I. 77, 81, 205 A.2d 579, 581 (1964). In addition, one who has consent or privilege and enters another's property is not a trespasser. Nye v. Brousseau, No. 06-726, 2008 R.I.Super. LEXIS 123, *13-14 (R.I.Super.Ct. Sept. 23, 2008) (citing Ferreira, 652 A.2d at 969), aff'd in part and vacated in part, 992 A.2d 1002 (R.I.2010). An intentional entry is a voluntary act, as opposed to one that is unintended or accidental, and an alleged trespasser "`... is liable for an intentional entry although he has acted in good faith, under the mistaken belief, however reasonable, that he is committing no wrong ... he is a trespasser although he believes the land is his own.'" Smith, No. 99-109, 2005 WL 374350, *5 (quoting William L. Prosser, The Law of Torts, at 74 (4th ed.)). Here, it is undisputed that Clambakes entered the Reserved Area and took possession of the Regatta Club from 1998 until April 2005 under a lease with Properties. Therefore, the first element of intentional entry has been established. The Associations have also satisfied the second element of the trespass test, that they had rightful possession of the property. The Rhode Island Supreme Court determined the status of the Reserved Area in its America II opinion, specifically, that the disputed parcels "always were common elements, subject to the exercise of ... development rights, and title rested with the unit owners in common ownership from the creation of the condominium." America II, 870 A.2d at 443. Moreover, due to Properties' construction of the Regatta Club in the face of known claims, the Supreme Court further held that: In reviewing defendants' assertions that plaintiffs should not benefit from defendants' development of the Newport Regatta Club, we observe that defendants commenced such development with full knowledge of plaintiffs' claims and after they voluntarily entered into the tolling agreement. Considering that they developed the Reserved Area at a time when they were on notice that their right to do so was in dispute, we conclude that they constructed the parcel at their peril and cannot now contend that equity should prevent plaintiffs from prevailing because of their expenditures. However, with respect to the defendants' payments of common expenses on the disputed parcels after the declarant's development rights had expired, we concur that to permit the plaintiffs to enjoy the benefits of such expenditures would constitute an inequitable windfall. America I, 844 A.2d at 135. Based upon the Supreme Court's ruling that title to the Reserved Area rested with *59 the unit owners in common ownership, both the Associations and Properties as unit owners enjoyed a common right to possession, including legal title to the property, thus fulfilling the second element of trespass. See St. Jean Place Condo. Ass'n v. DeLeo, 745 A.2d 738, 741-42 (R.I. 2000), and R.I. Gen. Laws §§ 34-36.1-3.12, 34-36.1-2.07(e)(1956).[4] A. Consent or Privilege Having satisfied the first two elements of trespass—an intentional entry and a right to possession, we next address the issue of apparent consent or privileged occupancy. Specifically, "[c]onduct which would otherwise constitute a trespass is not a trespass if it is privileged. Such a privilege may be derived from the consent of the possessor ..., or may be given by law because of the purpose for which the actor acts or refrains from acting...." Restatement (Second) of Torts, § 158, cmt. e (1965).[5] In their post-trial memoranda and surreply briefs, both parties addressed the existence, vel non, of consent for "Clambakes" to operate the Regatta Club. See Doc. Nos. 670, 671, 672, and 673. Specifically, in their post-trial memorandum's "Proposed Conclusions of Law," the Associations argued that "[d]ebtor's possession of the Reserved Area was adverse and `hostile' to the interests of the unit owners and not by their express or implied consent." Doc. No. 670, at 11. Clambakes argued that "[t]he Associations and other unit owners consented and acquiesced to Clambakes' possession and use of the Reserved Area," Doc. No. 671, at 14, and that "IDC Properties, and Clambakes, exercised acts of dominion over the North Unit and made ordinary use of it consistent with their actual possession...." Doc. No. 673, at 3. Clambakes occupied the Regatta Club pursuant to a lease entered into in 1998 with Properties, at which time, Properties was in possession of the Reserved Area and believed itself to be the owner. "Consent is willingness in fact for conduct to occur. It may be manifested by action or inaction and need not be communicated to the actor." Restatement (Second) of Torts § 892 (1979). "If words or conduct are reasonably understood by another to be intended as consent, they constitute apparent consent and are as effective as consent in fact." Id. Apparent consent exists: "[e]ven when the person concerned does not in fact agree to the conduct of the other, his words or acts or even his inaction may manifest a consent that will justify the other in acting in reliance upon them. This is true when the words or acts or silence and inaction, would be understood by a reasonable person as *60 intended to indicate consent and they are in fact so understood by the other. This conduct is not merely evidence that consent in fact exists, to be weighed against denial. It is a manifestation of apparent consent, which justifies the other in acting on the assumption that consent is given and is as effective to prevent liability in tort as if there were consent in fact. On the other hand, if a reasonable person would not understand from the words or conduct that consent is given, the other is not justified in acting upon the assumption that consent is given even though he honestly so believes; and there is then no apparent consent." Id. at § 892, cmt. c. In the case at bar, the evidence shows consistently that throughout the seven year term of Clambakes' management and operation of the Regatta Club, the Associations manifested numerous actions (and inactions) signaling apparent consent to Clambakes' possession and operation of the Regatta Club. From the outset, Clambakes was never included as a party to the January 5, 1998 Tolling Agreement, which was created to preserve the Associations' and Properties' rights to potential claims concerning the condominium property. During the construction of the Regatta Club and even after it commenced operations, Clambakes still was not added as a party to the Tolling Agreement, despite numerous extensions (the last occurring on April 28, 1999). Throughout 1998, while the facility was under construction and Clambakes was obtaining its required licenses and approvals, the Associations' only issue was their concern over parking. "While we don't have a particular objection as to the land use with respect to the building itself, we do have a substantial problem with the parking requirements for that bldg., [sic] as well as for other commercial parking on and around that site." Debtor's Exhibit 63. Further, there were no objections raised to the City's transfer of the liquor license for Clambakes' use at the Regatta Club. As previously noted, on May 28, 1999, approximately six months after Clambakes commenced full wedding and event operations, the Associations filed suit against IDC, Inc., Properties and Roos, alleging that the voting procedure used to extend development rights on certain common property violated the Master Declaration and the Rhode Island Condominium Act, R.I. Gen. Laws § 34-36.1-1.01, et. seq. (1956), and requesting declaratory judgment and injunctive relief as to the disputed parcels. Clambakes was not a party in this litigation, and while Clambakes is charged with knowledge of its existence, given that its sole shareholder was a named defendant, the Associations gave no indication of their intent to withdraw their apparent consent for Clambakes to continue operating the Regatta Club pending the outcome of the suit against its lessor, Properties. Quite to the contrary, one of the Associations, Harbor Houses, and various individual unit owners contracted directly with the Regatta Club to host private events on normal business terms. This conduct demonstrates a continuing unequivocal expression of consent for Clambakes to conduct business at the Regatta Club, upon which Clambakes reasonably relied. This apparently consensual relationship between Clambakes and the Associations continued for more than seven years, with no written or verbal notice, signage, or any other type of claim made against Clambakes to quit the premises. Surprisingly, upon careful reexamination, it is clear that the Associations and the Roos entities have fought over and litigated every conceivable issue except Clambakes' occupancy and operation of the Regatta Club for the period in question, and *61 as to that single issue, there was unmistakable apparent consent until the Supreme Court's second opinion, in America II, in April 2005. In recent trespass cases where ownership between the parties was unknown and/or in question, the Rhode Island courts have found trespass to be actionable only when clear evidence of ownership was presented to the adverse party. For instance, in Smith v. Hart, No. 99-109, 2005 WL 374350, *5 (R.I.Super.Ct. Mar. 1, 2005), the court noted that the Smiths had the Harts' consent on almost all occasions, but that "[i]t was not until Mr. Smith presented the survey to Mr. Hart and asked him to adhere to the tree line when the trespass became both obvious, intentional, without license, consent or privilege. When the Smiths continued to mow some of the disputed parcel, the trespass became actionable." So too, in Nye v. Brousseau, No. 06-726, 2008 R.I.Super. LEXIS 123, *13, the court found that "[a]t no time did he assert ownership or direct Mr. Brousseau to go no further. Until they were surprised with the complaint, Mr. and Mrs. Brousseau knew of no adverse claim of ownership. All that had been done through that time was consensual." Thereafter, when "Mr. Brousseau knew he was passing onto property which was clearly owned by Mr. Nye," the trespass became actionable. Id. at *14; see also, Dellagrotta v. Dellagrotta, 873 A.2d 101, 113 (R.I.2005) (trespass damages arise from the point that plaintiffs demanded possession). Accordingly, in the present case, and based upon the numerous expressions of consent (and consent by inaction, i.e., failure to add, or to even reference Clambakes in any of the litigation involving ownership) over the course of seven years, I find as a fact and conclude as a matter of law that the Associations plainly and continuously manifested apparent consent for Clambakes to operate the Regatta Club on the Reserved Area from March 1, 1998 until April 8, 2005. The instant dispute is between the Claimant Associations and the Debtor Clambakes, separate and distinct corporate entities, with no evidence of fraud in the record, nor alleged by any party, and there is no equitable reason visible to this Court, why the traditional principle of separation of corporate entities should not be observed between these parties. However, after the April 8, 2005 Rhode Island Supreme Court America II opinion, ownership of the Reserved Area and the Regatta Club was no longer in question. 870 A.2d at 442-43 ("[T]itle [to the Reserved Area] rested with the unit owners in common ownership from the creation of the condominium."). Two months after America II, the Associations filed an Application for Writ of Execution for Possession and Writ of Ejectment to evict IDC, Inc., Properties, and Roos from the Reserved Area, see Debtor's Post Trial Memorandum Table of Composite Exhibits FF and GG, with the Associations still not referencing Clambakes as a trespasser, or one who is occupying without consent. At that point, however, even without argument on the issue, the conclusion is mandatory that, as of April 8, 2005, the Associations' apparent consent ended, that, by operation of law Clambakes became a trespasser upon the Reserved Area, and that said trespass continued until Clambakes vacated the premises on November 5, 2005. II. Are the Associations' claims for trespass damages precluded by either America I or America II? The America I and II litigation addressed and determined, inter alia, claims relating to the validity of condominium *62 declaration amendments, a representative voting scheme, the ownership of disputed parcels, and control of the Goat Island South Condominium Association, against three defendants—IDC, Inc., Properties and Roos. As discussed supra, Clambakes was never a party to any of this unrelated litigation, notwithstanding its obvious possession and operation of the Regatta Club. Since none of the aforementioned litigation was for trespass or damages resulting therefrom, this Court is not precluded from considering the Associations' claims for trespass and/or damages against Clambakes. See Cronan v. Iwon, 972 A.2d 172, 174-75 (R.I.2009) (mem.). III. Since a trespass has been found against Clambakes, what are the appropriate damages for this tort? The Associations contend that they are entitled to be paid for the use and occupancy of the Regatta Club from 1998 to 2005, for an amount within the range of $2.6 to $3.2 million dollars, based upon the testimony of its appraiser (Proofs of Claim 16-19). I disagree. Where, as here, the trespasser encroached upon the owner's property by building something on it, "injunctive relief normally is available against the unlawful placement of a structure on property." Renaissance Dev. Corp. v. Universal Properties Group, Inc., 821 A.2d 233, 237 (R.I.2003). And, in cases where structures are wrongfully placed on property, the customary relief is for the issuance of a mandatory injunction for the removal of the structure and/or a request for equitable relief by the party erecting the structure.[6]See Santilli v. Morelli, 102 R.I. 333, 338, 230 A.2d 860, 863 (1967); see also Renaissance Dev. Corp., 821 A.2d at 238; Raposa v. Guay, 84 R.I. 436, 444, 125 A.2d 113, 117 (1956). Here, in the exercise of unquestionably astute business judgment, the Associations do not request such injunctive relief, but wisely are putting their newly acquired property to its obvious highest and best use—as a cash cow with a virtually unlimited life expectancy. The Associations and the Chapter 11 trustee quickly reached an arm's length, and Court approved, agreement resolving the trustee's emergency motion for an order authorizing the trustee to conduct business in the ordinary course and to make adequate protection payments establishing the amount due for Clambakes' use and occupancy of the Regatta Club for the period April 8, 2005 to November 5, 2005. See Doc. No. 93. In assessing the value of the Associations' claim, I find that the appropriate measure of damages is the amount the Associations consensually accepted for use and occupancy from the trustee for the period of the Clambakes' trespass. Considering the facts and the nature of the trespass in question, I also find that fair and adequate damages and compensation have already been paid to the Associations for Clambakes' use of the property, i.e., in light of the Rhode Island case law and supporting legal authorities, the damages to which the Associations are entitled is the $450,000 already paid by the Chapter 11 trustee to the Associations for occupying the Regatta Club from April 8, 2005 to November 5, 2005. IV. The Claim for Plumbing Expenses With respect to the Associations' claim in the amount of $7,250 for plumbing *63 expenses required to fix a clogged common sewer, the evidence is clear that the Debtor caused the drainage malfunction, and is responsible for the reasonable cost to remedy that problem. See Kinder testimony, Trial Tr., at 36, 37, Aug. 5, 2008: ... Obviously, the—you know, the only establishments using those things that were going into that sewer line were those that were being operated by IDC. We asked IDC and were assured that they would pay the costs, repeatedly. They never paid anything, and so we are asking that that get covered. ... Q. What is Exhibit "Z?" A. Exhibit "Z" is the bill that was received by D[o]novan[] and Sons, in which the condominium association paid. Q. This relates to this plumbing issue? A. It does. Q. And what was the total amount of the bill caused by the blockage? A. $7,290. And we paid it promptly. Q. And the bill reflects exactly what the plumbers discovered, as the blockage? Correct? Mr. Devereaux: I'm not going to cross-examine the plumber, Judge. The Debtor has offered no evidence or argument in opposition to this claim, and it is ALLOWED as filed. CONCLUSION Based upon the record before this Court, and in accordance with the foregoing discussion, arguments, and authorities referenced herein, (1) the Associations' request for a finding of trespass against Clambakes is GRANTED IN PART, i.e., for the period April 8, 2005 to November 5, 2005; (2) the Associations' claim for damages is not precluded by America I or II, but is limited to the amount already received by the Associations in the form of adequate protection payments from the Chapter 11 trustee for Clambakes' use and occupancy of the property during the trespass period; and (3) the Associations' claim for reimbursement for plumbing expenses is ALLOWED as filed. The Associations' claim for as much as $3.5 million for a seven year trespass period, is DISALLOWED for the reasons discussed and stated herein. NOTES [1] Not to be confused with IDC Clambakes, Inc. [2] State of Rhode Island and Providence Plantations Office of the Secretary of State, Division of Business Services Corporate Database, IDC Clambakes, Inc. Summary Screen, Identification Number 89242, http://ucc.state.ri.us/ CorpSearch/CorpSearchInput.asp (Search by entity Name "IDC Clambakes, Inc." then follow "IDC Clambakes, Inc."); see Fed.R.Evid. 201. [3] Nearly one year later, on October 20, 1999, America Condominium appealed the Newport building inspector's issuance of the building permit and certificate of occupancy on the grounds that it was in violation of a special use permit on the property, which appeal was subsequently denied. Am. Condo. Ass'n., Inc. v. Benson, No. 99-180, 2000 WL 33159156 (R.I.Super. May 19, 2000). The appeal did not raise any allegations of trespass against either Properties or Clambakes. Thereafter, America Condominium filed a lawsuit in Superior Court seeking a remand of the action to the zoning board, which request was likewise denied. Am. Condo. Ass'n. v. Benson, No. 99-180, 2001 WL 1452781 (R.I.Super. Nov. 2, 2001). Clambakes was not a party to any of that litigation. [4] It was during this part of our original analysis in drafting this opinion that I felt a trespass had occurred as alleged by the Associations. In a post trial Chamber's conference, I announced my thinking on the trespass issue, and also informally advised the parties that it was my intention to certify the question of damages to the Rhode Island Supreme Court pursuant to Rule 6 of the Rhode Island Supreme Court Rules of Appellate Procedure. While considering the logistics of the Rule 6 certification procedure, I looked again at the issue of apparent consent or privilege, and have since concluded that based on the facts in this proceeding, a period of apparent consent and/or privilege did occur during a portion of the time Clambakes occupied the Reserved Area. As the damages issue will be discussed infra, the certification question (now abandoned) is no longer a consideration. [5] The Rhode Island Supreme Court has adopted the Restatement of Torts in analyzing trespass claims, see Mesolella v. City of Providence, 508 A.2d 661, 667 n. 8 (R.I. 1986). [6] In such circumstances, the courts look to whether restitution should be awarded based upon a mistaken claim of title. See Eastern Motor Inns, Inc. v. Ricci, 565 A.2d 1265 (R.I. 1989); Raposa v. Guay, 84 R.I. 436, 125 A.2d 113 (1956).

2023-08-23 14:18:48.423334+00

Finch

FINCH, Chief Justice. Plaintiff contractor brought suit to enforce a mechanic’s lien for labor and materials furnished pursuant to a written contract for reconstruction of the Sigma Alpha Epsilon fraternity house at Columbia, Missouri. Plaintiff’s position was that the contract between the parties was an unambiguous contract whereby the contractor was to be paid cost of labor, materials and other construction expenses (with certain specified exceptions) plus 6% of the cost of construction. Plaintiff’s total claim was for $413,276.97. It had received payments of $269,692.98 and sought a lien for an additional $143,583.99. On the theory that the contract was ambiguous and to support a counterclaim seeking reformation of the contract, defendant Sigma Alpha Epsilon (SAE) offered, and the trial court admitted, evidence to show that the maximum guaranteed cost of the job was $300,000.00 plus a fee of 6% thereof, or a total of $318,000.-00. The trial court made findings wherein he held that the contract provided for a maximum of $318,000.00 and entered judgment establishing a lien for $48,307.02, the difference between $318,000.00 and payments previously made. Plaintiff then appealed. We reverse and remand with directions. We have jurisdiction on the basis of the amount involved, this appeal having been lodged here prior to January 1, 1972. Mo. Const. Art. V, § 31. An opinion was written in division affirming the judgment of the trial court, but a dissenting opinion was filed and the case was transferred to the court en banc. Following reargument, the divisional opinion was not adopted and the case was reassigned. The basic issue for decision is whether or not the written contract was an unambiguous cost plus fee contract. The applicable rules of law are stated in Kalen v. *264Steele, 341 S.W.2d 343, 346 (Mo.App.1960): “The cardinal rule in the interpretation of a contract is to ascertain the intention of the parties and to give effect to that intention. Where there is no ambiguity in the contract the intention of the parties is to be gathered from it and it alone, and it becomes the duty of the court and not the jury to state its clear meaning. McFarland v. Gillioz, 327 Mo. 690, 37 S. W.2d 911; National Corporation v. Allan, Mo.App., 280 S.W.2d 428(3). A court will not resort to construction where the intent of the parties is expressed in clear and unambiguous language for there is nothing to construe. Mickelberry’s Food Products Co. v. Haeussermann, Mo.Sup., 247 S.W.2d 731(5). It is only where the contract is ambiguous and not clear that resort to extrinsic evidence is proper to resolve the ambiguity. See 17 C.J.S. Contracts § 321, p. 749; 12 Am.Jur., Contracts, Section 229, page 753. “A contract is not rendered ambiguous by the fact that the parties do not agree upon the proper construction to be given it. Mickelberry’s Food Products Co. v. Haeussermann, supra, 247 S.W.2d 731(6). A contract is ambiguous only when it is reasonably susceptible of different constructions. In determining whether or not there is such an ambiguity as calls for construction, the whole instrument must be considered. Writings made a part of the contract by annexation or reference are to be considered in determining whether or not it is ambiguous. “Presumptively, the intent of the parties to a contract is expressed by the natural and ordinary meaning of the language referable to it. Even seeming contradictions must be harmonized away if that be reasonably possible. State Mutual Life Assur. Co. of Worchester v. Dischinger, Mo.Sup., 263 S.W.2d 394(5); Mathews v. Modern Woodmen of America, 236 Mo. 326,139 S.W. 151,155.” On February 14, 1965, the fraternity house was heavily damaged by fire, a portion of the building having been totally destroyed. SAE immediately hired plaintiff to do the demolition, salvage and clearing. Shortly thereafter it employed the architectural firm of Marshall & Brown to prepare plans and specifications for rebuilding the house and without taking bids arranged with plaintiff to do the reconstruction work. SAE proceeded at once with actual reconstruction, even though final plans and specifications and a contract had not been prepared, because it wanted to reoccupy the house as quickly as possible. Plans and drawings were prepared and submitted throughout the period of construction. Ultimately, in November, 1965 a written contract (dated April 1, 1965) was prepared by the architect and presented by SAE to plaintiff for signature. The job was completed in August, 1966. The contract was on a printed form which recited at the outset that it was issued by the American Institute of Architects (AIA) “for use when the cost of the work plus a fee forms the basis of payment.” It provided that the contractor was to provide all labor and materials and to do all things necessary to complete construction of the house according to plans, specifications and changes listed. Article 2 authorized the owner to make changes, issue additional instructions, require additional work or omission of work previously ordered, and contained the additional provision that “Maximum cost of the work will be adjusted in accordance with changes ordered.” Article 3 specified the contractor’s duties and imposed the obligation on it to complete the work “in the most expeditious and economical manner consistent with the interests of the Owner.” Article 3A was typed in the contract as an additional Article, and subparagraph (a) thereof provided as follows: “Estimated maximum cost of this work is Three *265Hundred Thousand Dollars and no cents ($300,000.00).” Article 4 provided that in consideration for its performance, contractor was to be paid “6% of cost of construction.” Under Article 5 the owner agreed “to reimburse the Contractor in current funds all costs necessarily incurred for the proper execution of the work and paid by the Contractor, such costs to include the following items, and to be at rates not higher than the standard paid in the locality of the work except with prior consent of the Owner:” The Article then spelled out in considerable detail items included, consisting of such items as labor, certain salaries, materials, permit fees, losses and expenses not compensated by insurance which were not due to fault or neglect of the contractor, sub-contracts, premiums on bonds and insurance, rentals of certain equipment, including transportation thereof, cost of hand tools consumed in the prosecution of the work, and certain other expenses. Article 6 listed certain costs for which the contractor was not to be reimbursed Subsequent Articles contained various provisions not pertinent to the issue here presented. It is abundantly clear that the printed provisions in the AIA form provided for an unambiguous contract wherein the contractor would receive reimbursement of costs of construction plus a fee for its services. The heading of the printed contract and the words “Agreement between Contractor and Owner Cost Plus Fee Basis,” appearing at the bottom of each page, so indicate. Article 5 details specific types of costs for which the contractor is entitled to reimbursement, and in said Article the owner agrees to reimburse the contractor for all costs of specified kinds necessarily incurred in execution of the work. The types of expenses for which there is not to be reimbursement are specified in Article 6. The contractor’s compensation for performing the work is covered in Article 4 wherein it is provided that the contractor is to be paid a fee of 6% of construction costs. None of these printed provisions disclose any ambiguity as to the kind of contract created by the execution of such form or the basis on which the contractor was to be paid. SAE makes no contrary claim as to these printed provisions. Rather, it says only that the contract is ambiguous by reason of the addition of Article 3A, which was typed on the second page of the contract, and by the addition of a typed sentence at the end of Article 2. SAE’s brief states its position as follows: “The provision that creates the confusion is found in Article 3A which reads as follows: ‘Article 3A. (a) Estimated maximum cost of this work is Three Hundred Thousand Dollars and no cents ($300,-000.00). (b) It is hereby mutually agreed that the Contractor shall complete all work so that the Owner can have useful occupancy for housing and feeding of fraternity members on or before January 15, 1966.’ In addition, Article 2. Changes in the Work provides in part: ‘Maximum cost of the work will be adjusted in accordance with changes ordered.’ ” The foregoing additions, it is argued by SAE, make the whole contract ambiguous. The key words in Article 3A are “Estimated maximum cost.” Webster’s Third New International Dictionary defines “estimate” as “a statement of the often approximate amount for which certain work will be done by one who undertakes it.” It also includes the definition, “to arrive at an often accurate but usu. only approximate statement of the cost of (a job to be done) (2) : to arrive at a sometimes only tentative price for which one is willing to undertake (a job to be done).” *266The term “estimate” has been considered in decisions in this state. For example, in Gratz v. City of Kirkwood, 165 Mo.App. 196, 145 S.W. 870, 874 (1912), the court said: “ * * * An estimate does not pretend to be based on absolute calculations but is exactly what the word means, an estimate. To make an estimate, ordinarily means ‘to calculate roughly, or to form an opinion as to amount from imperfect data.’ Louisville, H. & St. L. Ry. Co. v. Chandler’s Adm’r (Ky. Court of Appeals) 72 S. W. 805. Webster’s New International Dictionary (Ed. 1910) defines the word ‘estimate’ as meaning ‘to fix the worth, value, size, extent, etc., of, especially roughly or in a general way.’ The use of the word estimate ‘precludes accuracy. * * * Monthly estimates are understood to be mere approximations.’ Shipman v. State, 43 Wis. 381, loe. cit. 389, citing 1 Redfield on Railways, 436.” In Beeler v. Miller, 254 S.W.2d 986, 990 (Mo.App.1953), the court quotes with approval from Gratz v. City of Kirkwood, supra, and recognizes that an estimate is an approximation. In Klein v. Puritan Fashions, Inc., 439 S.W.2d 229, 232 (Mo. App.1969), the court had this to say: “First, the words ‘estimate’ and ‘estimated’ are inconsistent with a promise to do specific work for an exact sum. The word ‘estimate’ negates certainty; it means ‘to calculate roughly, or to form an opinion as to amount from imperfect data.’ (Beeler v. Miller, Mo.App., 254 S.W.2d 986 [4-6].)” We agree with these statements as to the meaning of “estimate” or “estimated.” It is not an ambiguous term. The fact that the word “estimated” was used in conjunction with the words “maximum cost” does not change the meaning of “estimated” or make it or the phrase ambiguous. Together they simply indicate an approximation or rough calculation of the maximum cost of labor, material and other construction costs likely to be required. The phrase is not an expression of a guaranteed maximum, as SAE contends. If that had been the intention, the parties would have stated that the maximum was guaranteed or that $318,000.-00 was the most that the owner would have had to pay as reimbursement for labor and material, or some other such expression. The parties would not have used a word which by generally accepted definition and usage means only an approximation or rough calculation. In the case of Kalen v. Steele, supra, 341 S.W.2d 1. c. 346, the Court of Appeals considered a contract written on this same AIA cost plus printed form. In that instance, Article 4 was completed to provide as follows: “4. Owners agree to pay the Contractor the sum of ten percent of construction cost estimated to be $15,999.30, Contractor’s fixed fee being, $1,599.93, payable as follows(after which a schedule for payment of this fixed fee was established). The court held that the fee to be paid the contractor was a fixed specific amount, namely, $1,599.93, that being the amount specified in the contract. However, even though Article 4 also referred to the construction cost being estimated to be $15,999.30 and even though a cost sheet showing an estimate of labor and material was attached, the court nevertheless held that the contract was not ambiguous and that it clearly was a contract for reimbursement on a cost plus fixed fee basis. The use of the term “estimated” construction cost did not make the contract ambiguous. The court’s conclusion in that case is persuasive here. Nor is the situation changed by the addition to Article 2 of the words “Maximum cost of the work will be adjusted in accordance with changes ordered.” The parties recognized in Article 2 that the owner had the right to require additional work not included in plans and specifications or to omit work therein called for. By the typed sentence they simply agreed that the maximum cost would be adjusted accordingly to compensate for the addition or deletion of work. That sentence is not sufficient either to convert the contract to *267a fixed maximum contract or to make the contract, considered as a whole, ambiguous. Such construction harmonizes Article 2 with the rest of the contract in accordance with the principles expressed in Kalen v. Steele, supra. In view of our conclusion that the contract was unambiguous and that it was what it purported to be — a cost plus fee contract, it follows that extrinsic evidence to supplement or change the meaning of provisions cannot be considered to alter the meaning of the unambiguous contract, and the trial court erred in considering such evidence for that purpose. In addition to its answer, SAE filed a counterclaim in which it alleged that at the time of the making of the contract it was understood by the parties that the contractor was to receive the cost of construction plus 6% of such costs, but that under no circumstances was the owner to be liable to pay more than a maximum of $318,000.00 regardless of the costs of construction. SAE alleged that by mutual mistake of fact the written contract did not fully and truly express this intention and meaning of the parties. The mutual mistake, according to the counterclaim, consisted of using the words “Estimated maximun cost of this work is Three Hundred Thousand Dollars * * * ” instead of “The guaranteed and agreed maximum costs of construction for which Sigma Alpha Epsilon Club of Columbia, Missouri will be liable is Three Hundred Thousand Dollars ($300,000.00), regardless of whether the actual costs of construction exceed said sum. Sigma Alpha Epsilon Club of Columbia, Missouri shall in no event and under no circumstances be liable under this contract for an amount in excess of Three Hundred Eighteen Thousand Dollars ($318,000.00).” On such basis, SAE asked the court to reform the contract to fully and truly express such intention and meaning. In its findings and judgment the trial court made no specific reference to SAE’s counterclaim and did not state explicitly that it was acting on the counterclaim. However, in paragraph numbered 2, the court found as follows: “2. That under the terms of the written agreement the plaintiff, J. E. Hathman, Inc. agreed to complete the reconstruction of defendant’s fraternity house for the cost of labor and material plus a contractor’s fee of 6% of the items of cost with a maximum contract price in the amount of $300,000.00 for cost plus a contractor’s fee of 6% of cost or a maximum contract price of $318,000.00 including both cost and. contractor’s fee.” As noted, the court does not clearly state whether it is finding the contract ambiguous and on the basis of extrinsic testimony is then declaring its meaning; or whether it is finding that the contract is to be reformed so as to provide as specified in said findings. Whichever the court meant, the result necessarily would have been the same because in either event SAE would be liable only for the difference between $318,000.00 and payments previously made. In oral argument counsel were asked by the court whether this appeal was premature on the basis that SAE’s counterclaim remained undisposed of. Counsel for SAE took the position that the trial court by implication did rule on the counterclaim, indicating by his findings that he would reform the contract and limit plaintiff to recovery based on a maximum liability of the defendant for $318,000.00. The finding can be so interpreted. Consequently, the court has concluded to treat the judgment as constituting a ruling on the counterclaim as well as on plaintiff’s petition so that the judgment appealed from was in fact a final judgment. This, of course, avoids reversing and remanding for a specific ruling on the counterclaim and the attendant delay. We have concluded from examination of the record that a reformation of the contract on the basis of mutual mistake *268of fact was not justified. In Allan v. Allan, 364 S.W.2d 578, 581 (Mo.1963), this court said: “‘[A] mistake affording ground for the relief of reformation must be mutual and common to' both parties to the instrument. It must appear that both have done what neither intended * * * [A]nd that mutual mistake, in order to justify granting the relief of reformation, must be established by clear and convincing evidence.’ ” Applying the foregoing rule to this case, the evidence did not show a mutual mistake of fact. Both Mr. Trice and Mr. Lucas, who represented the owner in these transactions, testified that when the contract was being prepared, Mr. Cassity, of plaintiff construction company, requested that the contract use the words “estimated maximum cost” rather than “guaranteed maximum cost,” and that both of them knew that the words “estimated maximum cost” were in the contract when they signed it on behalf of SAE. Mr. Cassity did not remember this conversation, but SAE’s own evidence shows that the authorized representatives of SAE knew that the use of the words “estimated maximum cost” had been requested and that such words had in fact been used in the contract which they were then executing. The evidence will not justify a finding that inclusion of the phrase “estimated maximum cost” was the result of a mutual mistake of fact. In its brief discussing this point, SAE makes some reference to a claim of fraud or deceit on the part of plaintiff. However, this claim cannot be sustained for two reasons. In the first place, we find no evidence in the record to sustain a claim of fraud or deceit, and secondly, SAE’s counterclaim made no allegation whatsoever of fraud or deceit. It was based solely on a claim of mutual mistake of fact; hence there is no issue as to fraud or deceit present. For the above reasons, we conclude that the court’s action in reforming the contract on the basis of mutual mistake of fact was error and cannot stand, and that the action of the trial court must be reversed. There is no contention by SAE that the amount claimed by the plaintiff as the cost of construction is incorrect or that the labor, material and other costs claimed were not actually incorporated into the work. In oral argument, in answer to a question by the court, counsel for SAE recognized that either the trial court’s judgment should stand or if the contract was not ambiguous and was not to be reformed, the plaintiff would be entitled to a judgment for $143,583.99 plus interest. Accordingly, the judgment of the trial court is reversed and the cause remanded with instructions to enter a judgment for plaintiff in the amount of $143,583.99 plus interest at 6% per annum from August 25, 1966, and that the same be declared a lien on the premises superior to the lien of the deed of trust of the St. Louis Federal Savings and Loan Association. SEILER, HOLMAN and BARDGETT, JJ-, concur. DONNELLY, J., dissents in separate dissenting opinion filed. HENLEY, J., dissents and concurs in separate dissenting opinion of DONNELLY, J. MORGAN, J., not participating.

2013-10-30 06:35:58.452302+00

King

994 F. Supp. 1454 (1998) MICHAEL CARUSO & CO, INC., Plaintiff, v. ESTEFAN ENTERPRISES, INC. and Bongos Cuban Cafe, Inc., Defendants. No. 97-2993-CIV-KING. United States District Court, S.D. Florida. February 12, 1998. *1455 *1456 Wilfredo A. Rodriguez, Holland & Knight, Miami, FL, Leslie S. Spitalney, Holland & Knight, Washington, DC, Gary S. Phillips, Beverly Hills, CA, David K. Friedland, Coral Gables, FL. ORDER DENYING MOTION FOR PRELIMINARY INJUNCTION JAMES LAWRENCE KING, District Judge. THIS CAUSE comes before the Court upon Plaintiff's Motion for Preliminary Injunction, *1457 filed October 1, 1997. Plaintiff filed a response on December 10, 1997, and the Court held a hearing on the motions on January 8, 9, and 12, 1998. Factual Background Plaintiff is an eighty-six person company that designs and manufactures retail clothing under the brand name "Bongo." Defendants own and operate a "theme" restaurant/bar, specializing in Cuban cuisine, named "Bongos Cuban Cafe." Plaintiff received its first trademark for "Bongo" in 1985. The trademark applied to clothing, primarily jeans, skirts, pants, shirts, jackets, vests, jump suits, and blouses. Since then, Plaintiff has received several other trademarks for the display of "Bongo" on different kinds of retail apparel. Plaintiff's signature product is a classic American blue jean, which it offers in a variety of designs and colors. Plaintiff's clothing is sold throughout the United States, as well as in some foreign countries. The vast majority of Plaintiff's products are marketed and sold to young women (also known as "juniors"). Plaintiff sells its products through department stores such as Sears, J.C. Penney, and Macy's and through smaller retail clothing stores such as Denim Works, Denim World, and Jeans Warehouse. Plaintiff advertises primarily through print advertisements in women's and teen fashion magazines and some television advertisements on the MTV music television network. Plaintiff's products display the word "Bongo" in a variety of type faces, often accompanied by the words "Jeans" and "Authentic" and the slogans "Always American Made," "Fine American Jeans," "Authentic American," and "An American Classic." Since the company's inception, Plaintiff has sold a total of approximately $1.5 billion in retail sales. Defendants' 500 seat Cuban-theme restaurant opened for business on September 14, 1997, in Downtown Disney, Orlando. Downtown Disney is an entertainment-oriented complex of the Walt Disney World Resort, consisting of various "theme" restaurants and bars, a multiplex movie theater, gift and specialty stores, and other entertainment establishments. There are no other "Bongos Cuban Cafes" in existence. Defendants market their restaurant as a uniquely Cuban entity. This Cuban theme is emphasized by the restaurant's design, including the display of bongo drums on the furniture and decor, and the restaurant's menu, which is comprised of exclusively Cuban cuisine. In addition to cuisine, Defendants sell souvenir merchandise, including clothing (i.e. T-shirts, sweatshirts, and hats), in a gift shop adjoining the main dining area. Defendants also sell an array of non-clothing souvenir merchandise like mugs, black beans, cigars, ash trays, and drinking glasses. As of November 30, 1997, Defendants experienced total sales of $2,462,849.24. Of that amount, $167,640.00 (6.8% of total sales) is attributable to the sale of souvenir clothing items. Defendants' merchandise products display the word "Bongos" in large type in connection with three logos: (1) a man dressed in Cuban-style clothing playing bongo drums, (2) a woman dressed in Cuban-style clothing dancing and playing maracas, and (3) the silhouette of hands superimposed over both "O"s in BONGOS to convey the impression of hands playing bongo drums. The words "Cuban Cafe" appear on all the merchandise in smaller type directly under "Bongos." Plaintiff filed suit in this Court on September 17, 1997, alleging: (1) trademark infringement in violation of the United States Trademark Act of 1946 (also known as the Lanham Act), 15 U.S.C. §§ 1051-1127 ("Lanham Act"); (2) unfair competition in violation of section 1125(a) of the Lanham Act, 15 U.S.C. § 1125(a); (3) trademark dilution in violation of both section § 1125(c) of the Lanham Act, 15 U.S.C. § 1125(c) ("Federal Dilution Act"), and Fla.Stat. § 495.151 ("Florida Dilution Act"); and (4) common law unfair competition. Plaintiff now seeks to enjoin Defendants from using in any manner the mark "Bongos Cuban Cafe." Legal Standard To prevail on a motion for preliminary injunction, the plaintiff must establish that: (1) there is a substantial likelihood of success on the merits of the claims; (2) he will suffer irreparable harm in the absence of injunctive relief; (3) the threatened injury to the plaintiff outweighs any potential harm to the defendant as a result of the injunction; and (4) granting the injunction would not be *1458 adverse to the public interest. See Haitian Refugee Center, Inc. v. Nelson, 872 F.2d 1555, 1561-62 (11th Cir.1989), aff'd sub nom. McNary v. Haitian Refugee Center, 498 U.S. 479, 111 S. Ct. 888, 112 L. Ed. 2d 1005 (1991). Because a preliminary injunction is a "drastic remedy," the plaintiff bears the burden to "clearly establish" each of the four elements. Cafe 207 v. St. Johns County, 989 F.2d 1136, 1137 (11th Cir.1993); see also Anheuser-Busch, Inc. v. A-B Distribs., Inc., 910 F. Supp. 587, 589 (M.D.Fla.1995). As this Court has previously stated, a preliminary injunction "is an extraordinary remedy, not available unless the plaintiff carries his burden of persuasion as to all of the four prerequisites. The primary justification for granting a preliminary injunction is to preserve the court's ability to render a meaningful decision after a trial on the merits." Tefel v. Reno, 972 F. Supp. 623, 633 (S.D.Fla.1997) (King, J.). Analysis At the outset, the Court observes that Plaintiff has requested truly far-reaching relief: the prohibition of Defendants' use in any manner of the mark "Bongos Cuban Cafe." Even if the Court were to find that the use of the mark "Bongos Cuban Cafe" in connection with Defendants' souvenir clothing and even non-clothing merchandise infringes upon Plaintiff's trademark, such a finding would not justify the clearly over broad remedy of enjoining Defendants from using the mark in any context. See Lever Bros. Co. v. United States, 981 F.2d 1330 (D.C.Cir.1993) (vacating injunction on grounds of overbreadth). Nonetheless, the Court will determine whether preliminary injunction of any scope is warranted by applying the four-part preliminary injunction test to the facts of this case. I. SUBSTANTIAL LIKELIHOOD OF SUCCESS ON THE MERITS A. Trademark Infringement and Unfair Competition In order to show substantial likelihood of success on the merits of its trademark infringement and unfair competition claims under the Lanham Act and common law, Plaintiff must present compelling evidence that there is a likelihood that consumers will be confused about the relationship or affiliation between Plaintiff's products and Defendants' restaurant and merchandise. "Likelihood of confusion" means probable confusion rather than mere possible confusion. Shatel Corp. v. Mao Ta Lumber & Yacht Corp., 697 F.2d 1352, 1356 n. 2 (11th Cir.1983). The Eleventh Circuit has developed a seven factor test to determine whether there is a likelihood of confusion between two trademarks. The reviewing court must evaluate: (1) the strength of the plaintiff's mark, (2) the similarity of the parties' marks; (3) the similarity of the products or services the marks identify; (4) the similarity of the parties' retail outlets and purchasers; (5) the similarity of advertising media used; (6) the existence of actual confusion; and (7) the defendant's intent. See Dieter v. B & H Indus. of Southwest Fla., Inc., 880 F.2d 322 (11th Cir.1989); Freedom Sav. & Loan Ass'n v. Way, 757 F.2d 1176 (11th Cir.1987); Jellibeans, Inc. v. Skating Clubs of Ga., Inc., 716 F.2d 833 (11th Cir.1983). The Court will consider each factor in turn. 1. Strength of Plaintiff's Mark "The primary indicator of trademark strength measures the logical correlation between a name and a product. If a seller of a product or service would naturally use a particular name, it is weakly protected." Freedom Sav. & Loan Ass'n v. Way, 757 F.2d 1176, 1182 (11th Cir.1985). The Court first observes that Plaintiff's mark is a common English word. The word "bongo" most commonly means "one of a pair of connected tuned drums that are played by beating with the hands." The American Heritage Dictionary 158 (2d. College ed.1985). A mark incorporating a common English word is inherently weaker than a mark consisting of fanciful and fictitious terms. See Dieter, 880 F.2d at 327 ("Generic terms represent the weaker end of the [trademark] spectrum, and arbitrary terms represent the stronger."); Sun Banks of Fla. v. Sun Fed. Sav. & Loan, 651 F.2d 311, 316 (5th Cir.1981)[1] (common English term is a *1459 weak mark); Alpha Indus., Inc. v. Alpha Tube & Shapes, Inc., 616 F.2d 440, 445-46 (9th Cir.1980) ("A `weak' mark is a mark that is a meaningful word in common usage or is merely a suggestive or descriptive trademark. A strong mark is entitled to a greater degree of protection than is a weak one, because of its unique usage."). The rationale underlying this principle is that courts should not grant the holder of a mark that consists of a common English word a monopoly on that term outside the user's field. See Major League Baseball Props., Inc. v. Sed Non Olet Denarius, Ltd., 817 F. Supp. 1103, 1119 (S.D.N.Y.1993). Defendants respond that the fact that the term "bongo" is arbitrarily applied to retail clothing makes the mark stronger. Courts in this Circuit have held, however, that even arbitrarily applied common terms are of weaker trademark significance. In Amstar Corp. v. Domino's Pizza, Inc., 615 F.2d 252, 260 (5th Cir.1980), the court observed that although a common term's "application ... may be arbitrary, it is still not to be accorded the same degree of protection given such coined and fanciful terms as `Kodak' or `Xerox.'" See also Sun Banks, 651 F.2d at 315 (arbitrariness "alone, however, does not precipitate absolute protection"); Major League Baseball, 817 F.Supp. at 1119 ("common English words, even if used arbitrarily in application to a user's services, are of weak trademark significance outside their field of operations") (citing Sun Banks, 651 F.2d at 316). Plaintiff also contends that the fact that two of his marks are now "incontestable"[2] makes them inherently strong marks and cites the Eleventh Circuit's holding in Dieter for this proposition. 880 F.2d at 328-29. In Dieter, the Court held that "[o]nce a mark has achieved `incontestable' status, its validity cannot be challenged on the grounds that it is merely descriptive." Id. at 328. In the instant case, Defendants are not contending that "bongo" is a descriptive mark but rather that its common usage renders it weak. Moreover, the Eleventh Circuit concluded that a mark's "incontestable status is a factor to be taken into consideration in likelihood of confusion analysis," but not that incontestable status alone is dispositive of a mark's strength. Id. at 329. Indeed, many courts have held that while incontestability precludes a defendant from arguing that a mark is merely descriptive, incontestability does not render a mark strong. For example, in Lone Star Steakhouse & Saloon, Inc. v. Alpha of Va., Inc., the Fourth Circuit observed that although "the alleged infringement of an incontestable trademark cannot be defended on the ground that the trademark is merely descriptive ... incontestability alone does not establish that the trademark is strong and therefore likely to cause the consumer confusion necessary for a finding of trademark infringement." (citations omitted). 43 F.3d 922, 934 (4th Cir.1995); see also Miss World (U.K.) Ltd. v. Mrs. America Pageants, Inc., 856 F.2d 1445, 1448-49 (9th Cir.1988) ("incontestable status does not alone establish a strong mark"); Oreck Corp. v. U.S. Floor Sys., Inc., 803 F.2d 166, 171 (5th Cir.1986) (incontestable status does not preclude defendant from arguing that mark is weak), cert. denied, 481 U.S. 1069, 107 S. Ct. 2462, 95 L. Ed. 2d 871 (1987); Majorica S.A. v. Majorca Int'l, Ltd., 687 F. Supp. 92, 97 (S.D.N.Y.1988) (incontestability does not relieve registrant of requirement of proving likelihood of confusion). Plaintiff's mark is further weakened by extensive third party use of the term "bongo." See Sun Banks, 651 F.2d at 315-16 (finding term "sun" a weak mark in light of extensive third party use); Amstar Corp., 615 F.2d at 260 (finding term "domino" of weak trademark significance because of third party use); Armstrong Cork Co. v. World Carpets, Inc., 597 F.2d 496, 505 (5th Cir. 1979) (holding that wide use of mark "World" resulted in little likelihood of confusion); El Chico, Inc. v. El Chico Cafe, 214 F.2d 721, 725 (5th Cir.1954) (holding that 27 trademark registrations of `El Chico,' made term weak trade name deserving limited protection). *1460 Defendants' evidence reveals that at least seventy-five businesses other than Plaintiff's throughout the United States have incorporated "bongo" or "bongos" into their marks. There are presently a total of seventeen state and federal registrations and two pending registrations, not including Plaintiff's registrations, for marks incorporating the terms. Before Plaintiff began using the "Bongo" mark, there were seven prior federal registrations incorporating the term. Defendants' evidence also shows that twenty-two of the third party marks were or are used in connection with restaurant or nightclub services and 12 were or are used in connection with clothing products. Three of the restaurants, "Bongo Burger" in California, "Bongo Java" in Tennessee, and "Bongo's Beach Bar & Grill" in Florida, sell souvenir merchandise, including T-shirts. After examination of all the evidence, the Court concludes that Plaintiff's use of a common English term combined with the extensive third party use of the term renders it unlikely that Plaintiff's mark will be found to have strong trademark significance. 2. Similarity of the Parties' Marks In determining whether the parties' marks are similar, the Court must compare the marks' appearances, sounds, and meanings, as well as the manner in which the marks are used. Amstar, 615 F.2d at 260. The marks are examined in their entirety, rather than simply by comparison of the similar terms or dominant features. See Little Caesar Enterprises, Inc. v. Pizza Caesar, Inc., 834 F.2d 568, 571 (6th Cir.1987); In re National Data Corp., 753 F.2d 1056, 1058 (Fed.Cir.1985). "[L]ikelihood of confusion cannot be predicated on dissection of a mark, that is, on only part of a mark." National Data Corp., 753 F.2d at 1058; see also Franklin Mint Corp. v. Master Mfg. Co., 667 F.2d 1005, 1007 (CCPA 1981) ("It is axiomatic that a mark should not be dissected and considered piecemeal; rather, it must be considered as a whole in determining likelihood of confusion."). The mere fact that both marks incorporate a form of the common word "bongo" does not render the marks similar. See, e.g., Freedom Sav. & Loan Ass'n, 757 F.2d at 1183 ("Freedom Savings and Loan" and "Freedom Realty" marks "lack ... confusing similarity"); Sun Banks, 651 F.2d at 316 ("Sun Federal and Savings Loan Association" not confusingly similar to "Sun Banks"); Amstar, 615 F.2d at 260 ("Domino's Pizza" not similar to "Domino sugar"); Bell Laboratories, Inc. v. Colonial Prods., Inc., 644 F. Supp. 542, 547 (S.D.Fla.1986) ("Final flip" and "Flip" marks for same product are "ultimately different and different sounding"); In re Hearst Corp., 982 F.2d 493, 494 (Fed.Cir.1992) ("Varga girl" and "Vargas" are "sufficiently different in sound, appearance, connotation, and commercial impression, to negate likelihood of confusion"); Mr. Hero Sandwich Sys., Inc. v. Roman Meal Co., 781 F.2d 884, 888 (Fed.Cir. 1986) ("Romanburger" and "Roman" marks for food products "are not similar in appearance"); Little Caesar Enterprises, 834 F.2d 568, 571 ("Pizza Caesar U.S.A." not similar to "Little Caesar's"); Conde Nast Pubs., Inc. v. Miss. Quality, Inc., 507 F.2d 1404, 1407 (CCPA 1975) ("Country Vogues" and "Vogue" publications "do not look or sound alike"); Pacquin-Lester Co. v. Charmaceuticals, Inc., 484 F.2d 1384 (CCPA 1973) ("Silk `n' Satin" beauty and bath lotion and oil not similar to "Silk" face cream). "Bongo" and "Bongos Cuban Cafe" have distinct appearances and sounds. Plaintiff's "bongo" mark is displayed on clothing in advertising accompanied by slogans conveying the impression that the clothing is classically American or quality American-made. Defendants' mark, by contrast, is displayed with pictures that convey a uniquely Cuban impression. The decor of Defendants' establishment, the food served, and much of the souvenir merchandise are uniquely Cuban. Moreover, while Plaintiff's use of "bongo" is simply, as Plaintiff states, "a catchy name under which to market the jeans" with no independent association, (Pl.'s Mem. at 6), Defendants' use of "Bongos" conjures up images of the musical instrument and the Cuban music associated with it. Moreover, Defendants' incorporation of the terms "Cuban Cafe" explicitly indicate to the viewer that the associated business is a Cuban restaurant rather than an all-American clothing company. The parties' marks clearly convey different commercial impressions. See Amstar, 615 F.2d at 260 ("Domino's Pizza" created *1461 uniquely Italian impression substantially different from impression created by "Domino" standing alone). 3. Similarity of Goods and Services There can be no doubt that a Cuban cafe provides materially different goods and services from a retail clothing company. Plaintiff points out, however, that overlap occurs because Defendants' gift shop sells souvenir clothing items. The mere fact that Defendants sell some clothing items and Plaintiff specializes in retail apparel does not establish proximity of the goods for the purposes of likelihood of confusion. See W.W.W. Pharm. Co., Inc. v. Gillette Co., 984 F.2d 567, 572 (2d Cir.1993) (fact that products are both personal care products "does not make them proximate"); McGraw-Edison Co. v. Walt Disney Prod., 225 U.S.P.Q. 512, 515, 1984 WL 1394 (N.D.Ill.1985) (fact that both products involve electronics does not establish similarity). In order to establish similarity, consumers must be likely to think that Defendants' goods come from the same source as Plaintiff's goods or are sponsored or approved by Plaintiff. See E. Remy Martin & Co. v. Shaw-Ross Int'l Imports, Inc., 756 F.2d 1525, 1530 (11th Cir.1985). Defendants assert that because their clothing items are only marketed in the gift shop immediately adjoining the restaurant, there is no way a customer would mistake their clothing items for Plaintiff's clothing items. Plaintiff counters that there is a likelihood that post consumers, i.e. people later viewing Defendants' merchandise, will be likely to confuse the merchandise for Plaintiff's merchandise. See Levi Strauss & Co. v. Blue Bell, Inc., 632 F.2d 817 (9th Cir.1980). The Court finds, however, that it is unlikely that the products will be confused at the post consumer stage. The words "Cuban Cafe" clearly delineate that Defendants' clothing products are souvenirs from a restaurant. As Defendants' evidence imparts, people are accustomed to clothing items that refer to services and establishments. Consumers are able to establish the difference between clothing with brand labels on them (i.e. "Guess?" jeans) and clothing sold as souvenirs from commercial establishments (i.e. "Planet Hollywood" T-shirts). The Court agrees with defense counsel's assertion at the preliminary injunction hearing that "if we were to see a person on the street or at a mall wearing a T-shirt saying ... Lee's Hungarian Cafe, we would understand that the T-shirt is promoting a restaurant. We would not be at all likely to assume that the T-shirt was made by the company that makes Lee Jeans." Moreover, Defendants' clothing merchandise only comprises 6.8% of Defendants' business. Thus, the vast majority of Defendants' business is extremely dissimilar from Plaintiff's business. Finally, Plaintiff concedes that it does not have evidence that Defendants' products have been confused for its products. Thus, because Plaintiff has not shown that it is likely that the consumer public will mistake Defendants' products for Plaintiff's merchandise, Plaintiff has not shown that the goods and services are similar. 4. Similarity of Retail Outlets and Customers Plaintiff is unlikely to prove that the parties' retail outlets and customers are similar. Defendants only sell their clothing merchandise in a shop adjoining their one restaurant in Downtown Disney, Orlando. Plaintiff sells its products in shopping centers and smaller retail clothing stores all over the country. Plaintiff's customers are primarily females who wear junior apparel, while Defendants' customers are primarily tourists visiting the Walt Disney World Resort. Although Defendants' clientele may include members of Plaintiff's clientele and vice versa, the two customer classes are not one and the same. 5. Similarity of Advertising Media Plaintiff contends that the advertising media employed by the parties are "substantially similar," while Defendants contend that they are "entirely distinct." Plaintiff's principal advertisements are glossy color print advertisements in fashion and teen magazines such as Seventeen, Glamour, Teen, Elle, and Cosmopolitan, as well as some television advertisements on MTV. Plaintiff points out that its Latin American distributors also advertise in Spanish-language *1462 magazines. Defendants, on the other hand, advertise their restaurant/bar through radio advertisements, print advertisements in newspapers such as The Orlando Sentinel, The Tampa Tribune, and The Miami Herald, and travel and locality-related magazines such as Travel Host and South Florida Magazine. Defendants also advertise on Spanish-language radio and in Spanish-language newspapers. The fact that some of Plaintiff's Latin American distributors and Florida distributors might advertise in some of the same magazines and newspapers as Defendants may prevent the parties' advertising media from being "entirely distinct." The Court, however, finds absolutely no evidence that the parties' advertising media are "substantially similar." Rather, it is clear that the parties' advertising media are substantially different, although there is the slight potential for overlap in certain areas. Moreover, none of Defendants' advertising refers to the merchandise sold in Defendants' gift shop. All advertising refers exclusively to the restaurant/bar. 6. Actual Confusion Plaintiff has presented no competent evidence[3] that actual confusion of the parties' products has occurred. In fact, Plaintiff admits that it is "presently unaware of any instances of actual confusion." (Pl.'s. Mem. at 9). Although, as Plaintiff points out, "[t]he law is well settled in this circuit that evidence of actual confusion between trademarks is not necessary to a finding of likelihood of confusion," E. Remy Martin, 756 F.2d at 1529, actual confusion is "the best such evidence" of likelihood of confusion, id. In this case, actual confusion is simply lacking.[4] 7. Defendants' Intent Plaintiff has not presented evidence that Defendants acted in bad faith by naming their restaurant "Bongos Cuban Cafe." To determine whether a defendant has acted in bad faith, a court must examine "whether the defendant adopted its mark with the intention of capitalizing on plaintiff's reputation and goodwill and any confusion between his and the senior user's product." The Sports Authority, Inc. v. Prime Hospitality Corp., 89 F.3d 955, 964 (2d Cir.1996) (quoting Lang v. Retirement Living Pub. Co., Inc., 949 F.2d 576, 583 (2d Cir.1991)). Defendants present evidence that the origin of the name is completely unrelated to Plaintiff's company. Testimony indicates that Defendants chose the to incorporate the term "Bongos" because it referred to the drums popular in Cuban music and was the name of one of the owner's deceased pets. Plaintiff contends that Defendants acted in bad faith because they knew about Plaintiff's trademarks. However, "prior knowledge of a senior user's trade mark does not necessarily give rise to an inference of bad faith and may be consistent with good faith." Arrow Fastener Co., Inc. v. Stanley Works, 59 F.3d 384, 397 (2d Cir.1995). In addition, Defendants present evidence that they consulted legal counsel, researched all potential names to see if there were prior users, and chose a name that they believed did not infringe upon anyone's mark, including Plaintiff's. "Good faith can be found if a defendant has selected a mark which reflects the product's characteristics, has requested a trademark search or has relied on the advice of counsel." W.W.W. Pharmaceutical Co., Inc., 984 F.2d at 575. The Court finds no evidence that Defendants acted in bad faith. Consequently, after careful examination of the seven factors in the likelihood of confusion test, the Court concludes that Plaintiff has not made an adequate showing that there is a likelihood that consumers will confuse its products with Defendants' products. As a *1463 result, Plaintiff does not have a substantial likelihood of succeeding on its trademark infringement or unfair competition claims. B. Trademark Dilution The trademark dilution remedy allows an owner of a uniquely famous trademark to prevent subsequent use of the mark even where there is no likelihood of confusion, as in cases involving completely different products. See J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 24:68, at 24-112 (4th ed.1997). Congress has provided examples of marks constituting trade dilution: "Dupont shoes," "Buick aspirin," "Kodak pianos." H.R .Rep. No. 374 (1995), 1995 U.S.C.C.A.N. 1029, 1031. To warrant protection from dilution, a trademark must be especially famous and distinctive. See McCarthy, supra § 24:92, at 24-144. The Federal Dilution Act provides: In determining whether a mark is distinctive and famous, a court may consider factors such as, but not limited to — (A) the degree of inherent or acquired distinctiveness of the mark; (B) the duration and extent of use of the mark in connection with the goods or services with which the mark is used; (C) the duration and extent of advertising and publicity of the mark; (D) the geographical extent of the trading area in which the mark is used; (E) the channels of trade for the goods or services with which the mark is used; (F) the degree of recognition of the mark in the trading areas and channels of trade used by the mark's owner and the person against whom the injunction is sought; (G) the nature and extent of use of the same or similar marks by third parties; and (H) whether the mark was registered.... 15 U.S.C. § 1125(c)(1). While the Court recognizes that Plaintiff has registered his mark and that Plaintiff extensively advertises his mark in certain markets, namely the junior women's apparel market, the Court finds that Plaintiff's mark is not so inherently distinctive and famous as to rise to the level of "Buick" or "Dupont." To be inherently distinctive, a mark must "clearly be more than just distinctive in a trademark sense," King of the Mountain Sports, Inc. v. Chrysler Corp., 968 F. Supp. 568, 578 (D.Colo.1997), and must rise to the level of "Buick" or "Kodak," see McCarthy, supra § 24:92 at 24-144. Even if a mark is distinctive in its particular market, it does not render it inherently distinctive so as to engender immediate recognition in the general public of a particular product. See King of the Mountain, 968 F.Supp. at 578 (fact that mark was distinctive in narrow market did not render mark famous because "persons outside plaintiff's niche market would not associate the phrase `King of the Mountain' with Plaintiff"); Golden Bear Intern., Inc. v. Bear U.S.A., Inc., 969 F. Supp. 742, 749 (N.D.Ga.1996) (although "Golden Bear" mark is distinctive in particular market, it "certainly does not rise to the level of marks such as Exxon, Kodak, and Coca-Cola which have been found to be generally famous"). Thus, while "Bongo" may be a distinctive mark in the junior women's apparel market, it is not a generally famous mark like "Exxon" and "Kodak." Moreover, the duration of Plaintiff's use of the mark contradicts the contention that the mark is uniquely famous. Plaintiff has used the mark "Bongo" for fifteen years, which has been generally held an insufficient amount of time for a mark to become famous. See, e.g., Star Markets, Ltd. v. Texaco, Inc., 950 F. Supp. 1030, 1034 (D.Haw.1996) (mark used for forty-six years not famous); Genovese Drug Stores, Inc. v. TGC Stores, Inc., 939 F. Supp. 340, 349 (D.N.J.1996) (mark used for nine years not famous). Finally, extensive third party use of the word "bongo" undermines the inherent distinctiveness of Plaintiff's mark. See Trustees of Columbia Univ. v. Columbia/HCA Healthcare Corp., 964 F. Supp. 733, 750 (S.D.N.Y.1997) (any claim of distinctiveness for dilution purposes is "seriously undermined by third party use of the same or similar marks"); Sports Authority, Inc. v. Abercrombie & Fitch, Inc., 965 F. Supp. 925, 941 (E.D.Mich.1997) ("Sports Authority" mark held not famous because of extensive third party use of term "authority"). In addition, even if the Court were to assume, arguendo, that Plaintiff's mark is famous, Plaintiff does not have evidence that dilution is likely to occur. Courts employ a six factor test to determine likelihood of dilution: *1464 (1) similarity of the marks; (2) similarity of the products; (3) sophistication of customers; (4) predatory intent; (5) renown of senior mark, and (6) renown of junior mark. See, e.g., Ringling Brothers-Barnum & Bailey Combined Shows, Inc. v. B.E. Windows Corp., 937 F. Supp. 204, 211 (S.D.N.Y.1996). For dilution to occur, the marks "must be `very' or `substantially' similar and ... absent such similarity, there can be no viable claim of dilution." Id. at 211-12. The Court already has addressed the majority of these factors under the likelihood of confusion test and has determined, inter alia, that Plaintiff has not shown that the marks are substantially similar, that the products are substantially similar, that customers will likely confuse the products, or that Defendants acted in bad faith. Consequently, Because Plaintiff's mark is not famous and dilution is not likely to occur, Plaintiff is not substantially likely to succeed on the merits of its federal trade dilution claim. The Florida Dilution Act permits a court to enjoin the user of the "same or similar mark ... if it appears to the court that there exists a likelihood of injury to business reputation or of dilution of the distinctive quality of the mark." Fla.Stat. § 495.151. In addition to the statutory requirement that the marks be similar, Florida courts require the prior user's mark to be distinctive. See, e.g., Great Southern Bank v. First Southern Bank, 625 So. 2d 463, 470-71 (Fla.1993) (mark must be "highly distinctive"). In Glen Raven Mills, Inc. v. Ramada Int'l, Inc., 852 F. Supp. 1544, 1554 (M.D.Fla.1994), the Court, interpreting the Florida Dilution Act, observed: A trademark is sufficiently distinctive to be diluted by a nonconfusing use if the mark retains its source significance when encountered outside the context of the goods or services with which it is used by the trademark owner. For example, the trademark KODAK evokes an association with the cameras sold under that mark whether the word is displayed with the cameras or used in the abstract. Because the Florida Dilution Act, like the Federal Dilution Act, requires distinctiveness and similarity, Plaintiff's claim under the Florida Dilution Act must also fail for reasons set forth above. Plaintiff's failure to show a substantial likelihood of success on the merits of his substantive causes of action is alone sufficient ground for the denial of the preliminary injunction.[5]See Swatch Watch, S.A. v. Taxor, Inc., 785 F.2d 956, 959 (11th Cir.1986). Nonetheless, the Court will briefly address the remaining elements necessary for injunctive relief. II. IRREPARABLE HARM TO PLAINTIFF IN ABSENCE OF INJUNCTION Plaintiff contends that it will suffer irreparable harm if the Court does not enjoin Defendants' use of the name "Bongos Cuban Cafe." Plaintiff argues that irreparable harm is presumed when there is a strong showing of likelihood of confusion, while Defendants assert that courts do not presume irreparable harm. Indeed, there is a split among courts in this Circuit as to whether irreparable harm is presumed from a finding of likelihood of confusion. Compare E. Remy Martin & Co. v. Shaw-Ross Int'l Imports, Inc., *1465 756 F.2d 1525, 1530 (11th Cir.1985) ("a sufficiently strong showing of likelihood of confusion may by itself constitute a showing of substantial likelihood of prevailing on the merits and/or a substantial threat of irreparable harm"); with Solar Cosmetics Labs, Inc. v. Sun-Fun Prods., Inc., 941 F. Supp. 1185, 1189 (M.D.Fla.1996) ("it is clear that irreparable harm does not automatically follow from a substantial showing of likelihood of confusion"). The Court need not resolve this conflict of opinions, however, because Plaintiff has not shown likelihood of confusion. Moreover, Defendants have presented evidence of extensive third party use, which has not caused irreparable damage to Plaintiff. This seriously undermines Plaintiff's contention that irreparable harm will occur if Defendants' use continues. Finally, Plaintiff has not demonstrated how confusion between its products and Defendants' products would harm Plaintiff's reputation. Id. at 1188 ("potential injury to one's reputation is the gravamen of trademark infringement"). Because Plaintiff has not shown that consumer confusion is likely or that Defendants' use of the term "Bongos" will actually cause irreparable harm to Plaintiff's reputation, the Court finds that Plaintiff has not shown that irreparable injury would occur in the absence of an injunction. III. POTENTIAL HARM TO DEFENDANTS Plaintiff has asked for the broad relief that this Court enjoin Defendants from using the name "Bongos Cuban Cafe" in any manner. Evidence presented to the Court reveals that the name "Bongos Cuban Cafe" is incorporated into virtually every aspect of Defendants' restaurant. Enjoining the use of "Bongos Cuban Cafe" would not only make Defendants' merchandise worthless, but it would also require Defendants to reconstruct a restaurant that took 2 years and $5 million to build. Plaintiff asserts that any harm to Defendants is justified by "Defendants' tortious and malicious conduct." (Pl.'s Mem. at 15). Even assuming that tortious and malicious conduct by a defendant relieves the Court of the need to analyze harm to the defendant, the Court has found Defendants' conduct to be neither tortious nor malicious. As a result, the great harm posed to Defendants by such an injunction is not justified. IV. PUBLIC INTEREST Plaintiff contends that the public interest is served when a Court prevents consumers from being confused by deceptive products. Again, the Court has already found that Plaintiff has not shown that a likelihood of consumer confusion exists. The Court recognizes the public's ability to distinguish the "Bongos Cuban Cafe" theme restaurant and related souvenir products from "Bongo" retail juniors apparel. Consequently, the public interest will not be served by preventing public consumption of "Bongos Cuban Cafe" food and goods. Conclusion Plaintiff has not established the requisite elements for a preliminary injunction. Because the Court finds that immediate equitable relief is not warranted, it declines to grant Plaintiff the "extraordinary remedy" of a preliminary injunction. See Tefel v. Reno, 972 F. Supp. 623, 633 (S.D.Fla.1997). Accordingly, after careful review of the record, and the Court being otherwise fully advised, it is ORDERED and ADJUDGED that the Plaintiff's Motion for Preliminary Injunction be, and the same is hereby, DENIED. DONE AND ORDERED in chambers at the James Lawrence King Federal Justice Building and United States Courthouse, Miami, Florida, this 12th day of February, 1998. NOTES [1] In Bonner v. City of Prichard, 661 F.2d 1206 (11th Cir.1981) (en banc), the Eleventh Circuit adopted as binding precedent all decisions of the former Fifth Circuit issued before October 1, 1981. [2] Five years after registering a mark, the holder may file an affidavit under § 1065 of the Lanham Act and have its mark declared "incontestable." 15 U.S.C. § 1065(3). [3] Plaintiff presents a memorandum that indicates that a caller mistook. Plaintiff's offices for Defendants' restaurant. This memorandum is inadmissible hearsay and thus of no evidentiary value. See Ocean Bio-Chem, Inc. v. Turner Network Television, Inc., 741 F. Supp. 1546, 1559 n. 7 (S.D.Fla.1990) (finding affidavit of employee testifying to misdirected phone call constitutes double hearsay and is inadmissible as evidence of actual confusion). [4] Defendants offers a survey to show that no actual confusion has occurred. Plaintiff contends that the introduction of the survey violates the parties' agreement to abstain from investigating actual confusion. The Court need not resolve this dispute, however, because it did not rely on the survey in concluding that actual confusion is lacking. Rather, the Court reached its conclusion based on the lack of any competent evidence of actual confusion. [5] On January 20, 1998, after the preliminary injunction hearing, Plaintiff filed a Supplemental Memorandum setting forth an additional cause of action for "reverse confusion." "Reverse confusion occurs when a large junior user saturates the market with a trademark similar or identical to that of a smaller, senior user.... [T]he senior user is injured because the public comes to assume that the senior user's products are really the junior user's or that the former has become somehow connected to the latter." Sands, Taylor & Wood Co. v. Quaker Oats Co., 978 F.2d 947, 957 (7th Cir.1992). The substance of Plaintiff's reverse confusion claim consists of the allegation that a Ft. Lauderdale radio station, Y-100, urged its listeners to ban "Bongo" jeans to prove the point that customers could distinguish "lunch from jeans." (Pl.'s Supp.Mem. at 2). Plaintiff's evidence of this allegation consists solely of hearsay statements. Even if this claim were properly before the Court and supported by admissible evidence, it would still fail on the merits. It would be a stretch of logic and law, indeed, to hold that the public's backlash against what it perceives to be a frivolous law suit constitutes reverse confusion. If anything, it constitutes just the opposite. Y-100 listeners think that confusion, reverse or otherwise, is so unlikely that they desire to protest against Plaintiff's law suit.

2013-10-30 06:35:58.499081+00

Stair

72 B.R. 447 (1987) In re Jacob F. BUTCHER, a/k/a Jake F. Butcher, Jake Butcher, and JFB Petroleum & Land Company, Inc., Debtor. John H. BAILEY, III, Trustee, Plaintiff, v. METZGER, SHADYAC & SCHWARZ, a partnership, and Maguire, Voorhis & Wells, P.A., Defendants. METZGER, SHADYAC & SCHWARZ, Cross-Claimant, v. MAGUIRE, VOORHIS & WELLS, P.A., Cross-Defendant and Third-Party Plaintiff, v. LACY & WINCHESTER; Daniel, Claiborne & Lewallen; Troutman, Sanders, Lockerman & Ashmore, Third-Party Defendants. Bankruptcy No. 3-83-01036, Adv. No. 3-85-1221. United States Bankruptcy Court, E.D. Tennessee. April 15, 1987. *448 Bass, Berry & Sims, Wallace W. Dietz, Nashville, Tenn., for plaintiff. Metzger, Shadyac & Schwarz, Richard C. Shadyac, Sr., Joseph H. Lahoud, Jr., Richard C. Shadyac, Jr., Charles R. Corbin, Jr., Washington, D.C., pro se. Jules S. Cohen, P.A., Jules S. Cohen, Orlando, Fla., Arnett, Draper & Hagood, Jack B. Draper, Knoxville, Tenn., for Maguire, Voorhis & Wells, P.A. Claiborne, Davis, Buuck & Hurley, David L. Buuck, D. Scott Hurley, Knoxville, Tenn., for Daniel, Claiborne & Lewallen. Lacy & Winchester, J. Michael Winchester, Knoxville, Tenn., pro se. Troutman, Sanders, Lockerman & Ashmore, Ezra H. Cohen, Mary Grace Diehl, Atlanta, Ga., David L. Buuck, Knoxville, Tenn., for Troutman, Sanders, Lockerman & Ashmore. RICHARD STAIR, JR., Bankruptcy Judge. At issue is whether an agreement to render future legal services for the debtor's wife and children in exchange for a $50,000.00 prepetition transfer by the debtor constitutes value in the context of 11 U.S.C.A. § 548 (West 1979) (Fraudulent transfers and obligations). Seeking to avoid the transfer, the plaintiff trustee contends a promise to perform future services is not within the scope of "value" as defined in 11 U.S.C.A. § 548(d)(2)(A) (West 1979). Defendant law firms insist the debtor's duty of support includes an obligation to pay his wife's legal fees and that the debtor did receive value in exchange for the challenged transfer. This is a core proceeding. 28 U.S.C.A. § 157(b)(2)(E) and (H) (West Supp.1987). I On June 29, 1983, an involuntary petition was filed against Jacob F. Butcher a/k/a Jake Butcher (the debtor). An order for relief under Chapter 7 was entered on August 22, 1983. The election of John H. Bailey, III, as trustee was approved by the court on September 30, 1983. Of significance to this proceeding, on March 7, 1985, after finding that JFB Petroleum & Land Company, Inc. (JFB) was merely an alter ego of the debtor, this court entered Order No. 103 providing for the amendment of the caption and the administration of the assets and liabilities of JFB as part of the debtor's case. On September 27, 1985, the trustee filed his complaint naming two law firms, Metzger, Shadyac & Schwarz (Metzger) and Maguire, Voorhis & Wells, P.A. (Maguire), as defendants.[1] The trustee alleges that on March 3, 1983, the debtor wire transferred $50,000.00 to Metzger from a JFB account at City & County Bank of Union County; that Metzger wire transferred $25,000.00 on August 23, 1983, and $15,000.00 on September 13, 1983, to Maguire; that the $40,000.00 transferred by Metzger to Maguire represents a portion of the $50,000.00 transferred to Metzger by the debtor; and that the $40,000.00 transferred to Maguire was used to pay legal expenses incurred by the debtor's wife, Sonya Butcher, also a Chapter 7 debtor.[2] The trustee asserts he is entitled to avoid the $50,000.00 transfer to Metzger as a fraudulent transfer, 11 U.S.C.A. § 548(a)(1) and (2) (West 1979). Alternatively, the trustee maintains Metzger knew, or should have known, an involuntary petition had been filed against the debtor and thus Metzger must turn over and account to the trustee the sum of $50,000.00, pursuant to 11 U.S.C.A. § 542(a) (West 1979). Additionally, the trustee contends 11 U.S.C.A. § 550(a) (West 1979) entitles him to judgment in the amount of $40,000.00 against Maguire. II On July 18, 1986, the trustee filed his motion for summary judgment against Metzger, contending he is entitled to avoid *449 the $50,000.00 transfer pursuant to § 548(a)(2),[3] which enacts in part: Fraudulent transfers and obligations (a) The trustee may avoid any transfer of an interest of the debtor in property, or any obligation incurred by the debtor, that was made or incurred on or within one year before the date of the filing of the petition, if the debtor — . . . . . (2)(A) received less than a reasonably equivalent value in exchange for such transfer or obligation; and (B)(i) was insolvent on the date that such transfer was made or such obligation was incurred, or became insolvent as a result of such transfer or obligation; . . . . . 11 U.S.C.A. § 548(a) (West 1979). Both Metzger and Maguire oppose the trustee's motion for summary judgment.[4] To avoid the $50,000.00 transfer to Metzger pursuant to § 548(a)(2) the trustee must establish four elements: (1) a transfer of property of the debtor; (2) an exchange for less than reasonably equivalent value; (3) the debtor must have been insolvent on the date the transfer was made or rendered insolvent as a result of the transfer; and (4) the transfer occurred within one year preceding the petition date. Undisputedly, the $50,000.00 transfer occurred within the one-year time period preceding the debtor's bankruptcy. Also, there is no dispute that the debtor was insolvent at the time of the transfer. The trustee's affidavit averring that as of the transfer date (March 3, 1983) the debtor had a negative net worth of nearly $44,000,000.00, excluding contingent liabilities, is unchallenged. Metzger and Maguire do contend that the $50,000.00 transferred to Metzger represented joint funds of the debtor and Sonya Butcher. According to the debtor's deposition testimony, he considered the $50,000.00 to be property owned jointly with his wife Sonya. However, the debtor further testified: "I always considered ever since I have been married, anything I had was half hers."[5] Sonya Butcher has no personal knowledge of the $50,000.00 transfer to Metzger; she does not know whether the funds were hers or the source of the funds. A debit memo from City & County Bank of Union County reflects a $50,000.00 wire transfer to account # XXXXXXXX at Virginia National Bank-Norfolk on March 3, 1983. Metzger admits its account at Virginia National Bank was so credited.[6] The debit is against an account of JFB at City & County Bank of Union County. As JFB was the debtor's alter ego, the monies in the JFB account were the sole property of the debtor.[7] The only remaining element — an exchange for less than reasonably equivalent value — is strenuously disputed. Asserting that the debtor received value, Metzger and Maguire maintain legal services are a necessity and that a husband's duty to support his wife and children includes an obligation to pay their legal fees. The trustee insists the debtor's intervening bankruptcy *450 petition prevents the debtor from using prepetition assets to pay future obligations. Section 548 of the Bankruptcy Code contains a specific definition of "value": "[V]alue" means property, or satisfaction or securing of a present or antecedent debt of the debtor, but does not include an unperformed promise to furnish support to the debtor or to a relative of the debtor. . . . 11 U.S.C.A. § 548(d)(2)(A) (West 1979). Under this definition, value "excludes future considerations, at least to the extent not actually performed." 4 Collier On Bankruptcy, ¶ 548.07 at 548-73 (15th ed. 1987). Metzger's agreement to perform future legal services on behalf of the debtor's family is outside the scope of "value" as defined in § 548. Metzger did bill the debtor $1,266.15 and $1,614.29 for professional services and expenses during March and May 1983. Additionally, Metzger drew $7,000.00 from the $50,000.00 retainer. However, Metzger cannot describe the services performed on behalf of the debtor.[8] Taking into account the $40,000.00 transferred to Maguire, the balance of the $50,000.00 retainer held by Metzger is only $119.56. In ruling on the trustee's motion for summary judgment, the court is not persuaded that the debtor did not receive value in exchange for the $9,880.44 Metzger drew against the $50,000.00 retainer. On the other hand, the court also is not persuaded that the debtor did receive reasonably equivalent value. The $40,000.00 forwarded to Maguire in two transfers is a different matter. Although Metzger insists it transferred the $40,000.00 to Maguire at its client's instruction, the fact remains the debtor's estate received nothing in exchange for the transfers, both of which occurred after entry of the order for relief, and many weeks after the filing of the involuntary petition, against the debtor. Metzger received $50,000.00 from the debtor; Metzger did not give reasonably equivalent value for at least $40,119.56 of that amount. Accordingly, the trustee is entitled to summary judgment against Metzger for that amount, plus pre-judgment interest at the rate of ten (10) percent per annum. See Tenn. Code Ann. § 47-14-123 (1984). NOTES [1] Metzger's offices are in Washington, D.C.; Maguire's offices are located in Orlando, Florida. [2] An involuntary petition was filed against Sonya Butcher on September 9, 1983, in this court. An order for relief under Chapter 7 was entered on March 28, 1984. See Case No. 3-83-01422. [3] Alternatively, the trustee requests summary judgment pursuant to § 542(a), contending that Metzger should have turned over any monies received from the debtor. The court need not address the trustee's alternative contention. [4] Maguire opposes the motion because § 550(a) provides that to the extent a transfer is avoided under § 548 the trustee may recover the property transferred, or the value of such property, from (1) the initial transferee [Metzger] or (2) any immediate or mediate transferee of such initial transferee. While Maguire admits receiving $40,000.00 from Metzger, Maguire denies any liability under § 550(a), insisting it took for value, in good faith, and without knowledge of the voidability, if any, of the $50,000.00 transfer from the debtor to Metzger. See 11 U.S.C.A. § 550(b) (West 1979). On July 18, 1986, asserting § 550(b) as a defense, Maguire filed a motion for summary judgment against the trustee. Because a pre-trial order entered August 28, 1986, continues indefinitely the response time to Maguire's motion, pending resolution of the trustee's motion, the court defers decision on Maguire's motion. A response time will be fixed. [5] Deposition of Jake F. Butcher at 32. [6] See Deposition of Richard C. Shadyac at 9. [7] To her knowledge Sonya Butcher never had any interest in JFB. See Deposition of Sonya Butcher at 12. [8] Ralph B. Long, the attorney at the Metzger firm with whom the debtor dealt, is deceased.

2013-10-30 06:35:58.504179+00

Douglas

491 S.W.2d 122 (1973) Ex parte Gene Everett McKENZIE. No. 46641. Court of Criminal Appeals of Texas. March 7, 1973. *123 Herbert Green, Jr., Dallas, for relator. Jim D. Vollers, State's Atty. and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION DOUGLAS, Judge. This is a post conviction habeas corpus proceeding. The complaint is that applicant was denied a speedy trial. McKenzie was convicted in 1968 for an offense committed in 1964. When this contention was raised on appeal in McKenzie v. State, 450 S.W.2d 67, the record then showed a motion for speedy trial was filed in June, 1968. The trial was held in September of 1968. This Court held under that record that he was not denied a speedy trial. In 1972, the applicant was taken from the Texas Department of Corrections, where he was serving other sentences, to Dallas for a hearing on the application for a writ of habeas corpus. A hearing was conducted by the Honorable Jerome Chamberlain, Judge of the Criminal District Court of Dallas County. After the hearing, Judge Chamberlain found that the applicant had written letters and made requests for a speedy trial and concluded that the applicant "was, to his prejudice, denied a speedy trial." The indictment returned on November 4, 1964, in the present case recites that McKenzie committed the offense of robbery on or about the 13th day of October, 1964. Evidence was introduced at the habeas corpus hearing that witnesses who could have testified that McKenzie was in Alabama on that date had died and were unavailable at the trial. Copies of letters and a motion showing the applicant had requested a speedy trial were introduced. One was dated December 1, 1967. A copy of a motion for speedy trial prepared while the applicant was incarcerated in Mississippi, dated May 9, 1967, was introduced. It recited that in 1965 detainers or warrants for him were issued in Dallas County. He requested that a speedy trial be afforded him or that charges be dismissed. It is not shown what happened to this motion, but on December 1, 1967, the applicant, who was then in the correctional institution in Mississippi, received a letter from a student deputy counsel for a legal clinic at Southern Methodist University reciting that he had talked to the district attorney and that the district attorney refused to extradite the applicant. The letter also recited that the letters of the applicant and his mother had been received and answered by the district attorney's office. Without reciting everything that was introduced at the hearing, suffice it to say, there was sufficient evidence for the hearing judge to conclude, as he did, that the applicant had been prejudiced by the denial of a speedy trial. The Sixth and Fourteenth Amendments to the United States Constitution and Article 1, Section 10 of the Constitution of the State of Texas, Vernon's Annotated Statutes, guarantee the right of a speedy trial. In Courtney v. State, Tex. Cr.App., 472 S.W.2d 151, this Court discussed the four factors to be considered in an alleged violation of an accused's right to a speedy trial. They are the length of delay, reason for delay, waiver of the right and prejudice to the accused. Cases from other jurisdictions and the different approaches were also discussed. There we adopted the test that if an accused made a prima facie showing of prejudice, the State "must carry the obligation of proving that the accused suffered no serious prejudice beyond that which ensued from the ordinary and inevitable delay." See also Barker v. Wingo, 407 U.S. 514, 92 S. Ct. 2182, *124 33 L. Ed. 2d 101 (1972); Perkins v. State, Tex.Cr.App., 485 S.W.2d 792, McKinney v. State, Tex.Cr.App., 491 S.W.2d 404 (1973). In the present case, the applicant has made at least a prima facie showing of prejudice which has not been rebutted. For the reasons stated, the applicant is entitled to be released in Cause No. E-8202-JH in the Criminal District Court of Dallas County. Since the denial of a speedy trial has prejudiced his right to a fair trial, the prosecution should be dismissed. It is so ordered.

2013-10-30 06:35:58.508644+00

Joyner

994 F. Supp. 308 (1998) THE PRUDENTIAL INSURANCE COMPANY OF AMERICA v. Thomas M. STELLA. Civil Action No. 97-4163. United States District Court, E.D. Pennsylvania. February 10, 1998. *309 Nathaniel H. Akerman, Seyfarth, Shaw, Fairweather & Geraldson, New York City, Sara A. Begley, Reed, Smith, Shaw & McClay, L.L.P., Philadelphia, PA, for Plaintiff. *310 Michael G. Trachtman, Powell, Trachtman, Logan, Carrle, Bowman & Lombardo, P.C., King of Prussia, PA, for Defendant. DECISION JOYNER, District Judge. This case has been brought before the Court by motion of the plaintiff, Prudential Insurance Company for the issuance of a preliminary injunction against Thomas M. Stella, a former Prudential sales agent. Following a hearing on September 2, 1997 and the parties' submissions of briefs and proposed factual findings and legal conclusions, we now make the following: FINDINGS OF FACT 1. Plaintiff Prudential Insurance Company of America is a corporation organized under the laws of the State of New Jersey with its principal place of business in Newark, New Jersey. Plaintiff has offices in Langhorne, Pennsylvania and is in the business of selling life insurance, annuities, mutual funds, and property and casualty insurance, among other products. (Pl's Complaint and Def's Answer thereto, at ¶ 1). 2. Defendant Thomas M. Stella is an adult individual residing in Pipersville, Pennsylvania. (Pl's Complaint and Def's Answer thereto, at ¶ 2). 3. Thomas Stella began working as a sales representative and agent for Prudential on April 30, 1990 out of Prudential's Pennypack District offices primarily on Castor Avenue in Northeast Philadelphia and in Langhorne, Pennsylvania. Prior to his employment with Prudential, Stella had not had any experience in the insurance industry or in servicing insurance customers. (N.T. 4-5, 14, 18, 63-65, 112-113, 206, 210, 216, 235-236; Exhibit P-1). 4. As a Prudential sales agent, Stella sold and serviced Prudential property, casualty and life insurance. (N.T. 5). 5. Although Prudential's internal procedures dictated that new sales agents execute and return an "Agent's Agreement" by the date that they begin work for an assigned agency, Stella was not presented with and did not sign an Agent's Agreement until May 22, 1990, nearly one month after he commenced his employment with Prudential. Subsequent to his execution of the Agent's Agreement, plaintiff's rate of compensation remained the same and there were no changes in any of the terms and conditions of Defendant's employment with Plaintiff until September, 1991. (N.T. 89, 103-108, 114-116, 210-212; Exhibits P-1, D-1). 6. The Agent's Agreement which Defendant Stella signed on May 22, 1990 identifies his appointment "as an Agent of the Prudential Insurance Company of America" as the consideration for the agreement. Additional consideration in support of the agreement exists by virtue of the individual agent's pay and employee benefits provided pursuant to Article Four of the Collective Bargaining Agreement between Prudential and the United Food and Commercial Workers International Union (AFL-CIO & CLC). (N.T. 87, 97-98; P-1, P-2, P-3, P-4, P-5). 7. Prior to May 22, 1990 when he signed it, Defendant had neither seen the Agent's Agreement, nor had he discussed it with anyone. (N.T. 211). 8. The United Food & Commercial Workers International Union (AFL-CIO & CLC) is the exclusive representative for purposes of collective bargaining in respect to rates of pay, wages, hours of employment or other conditions of employment of all Prudential district agents in the Commonwealth of Pennsylvania, among other states. At the time Stella became employed as an agent with Prudential, the collective bargaining agreement dated September 25, 1989 was in full force and effect. (N.T. 85, 92, 95-96; Article I, Exhibits P-2 through P-5). 9. Although Defendant had no knowledge that the collective bargaining agreement existed and had no knowledge that there was a union until six months after he was hired by Prudential, he thereafter became a union member and accepted the benefits of and became subject to the collective bargaining agreement(s), as amended from time to time. (N.T. 92-101, 105-109, 116-120, 212-214; Exhibit P-117). 10. The collective bargaining agreement was re-negotiated on September 30, 1991, *311 September 27, 1993 and September 25, 1995. Each agreement was effective for approximately two years each. (P-2, P-3, P-4 and P-5). 11. The Agent's Agreement which Stella executed on May 22, 1990 is an employment contract with Prudential. (N.T. 87). 12. Section 6 of the Agent's Agreement executed by Stella on May 22, 1990 provides, in pertinent part: (b) That all books, records, documents and supplies, and all contractholder or product information of any kind whether furnished by the Company or obtained or prepared by me while employed by the Company shall be deemed exclusively Company property; and upon termination of this Agreement by either party, I will promptly deliver all such property, including all copies thereof to a proper representative of the Company. (c) That all information which either identifies or concerns contractholders of the Company or its subsidiaries, including, but not limited to, contract values and beneficiary information is confidential and of special value to the Company; and therefore, I shall not provide to any person not in the Company's employ any information which may be used to solicit for sales on behalf of some other company or organization. (N.T. 3-4; Exhibit P-1). 13. In addition, Section 14 of the Agent's Agreement states: That for a period of two years from the termination date of this Agreement, I shall not directly or indirectly: (1) Solicit, cause or induce any contractholder of the Company or its subsidiaries who became known to me during my employment with the Company to purchase services or products which compete, directly or indirectly, with those sold by the Company or its subsidiaries. (2) Do anything to cause, persuade or encourage anyone to reduce, discontinue, or terminate any Company or subsidiary policy, contract, service, or product of any kind. (3) Do anything to cause, persuade or encourage any Company or subsidiary employee to either: a. terminate his/her employment with the Company for any reason; or b. sell or solicit services or products on behalf of any other company which are in any way similar to those sold by the company or its subsidiaries. (N.T. 3-4; Exhibit P-1). 14. Under the "Effect of Agreement" Article of the collective bargaining agreements, individual agent's agreements remain in full force and effect and are modified by the collective bargaining agreements only insofar as any of the agent's agreements' terms are specifically superseded or modified by the collective bargaining agreement(s). (N.T. 92-99; Exhibits P-2, P-3, P-4, P-5). 15. The language contained in Sections 6 and 14 of the Agent's Agreement which Defendant executed on May 22, 1990 was modified slightly in the collective bargaining agreements of September 25, 1989, September 30, 1991, September 27, 1993 and September 25, 1995. Those collective bargaining agreements, however, reflected changes to the foregoing provisions of the agent's agreements and stated, in relevant part: "...Section 7 of the Agent's Agreement (all editions prior to 1984) is hereby modified to read as follows: 7.(a) That upon termination of this Agreement either by myself or the Company, or at any other time upon request by the Company, I will immediately submit said books and records for an inspection and accounting, to be made in accordance with the rules of the Company then in force. (b) That all books, records, documents, software, supplies and contractholder or production information of any kind, whether furnished to the Prudential Representative by the Company or obtained or prepared by the Prudential Representative while employed by the Company, shall be deemed exclusively Company property; and upon termination of my Agreement by either party, the Prudential Representative will promptly deliver all such property, *312 including all copies thereof to a proper representative of the Company......" (c) That all information entrusted to the Prudential Representative which either identifies or concerns contractholders of the Company or its subsidiaries including, but not limited to contract values and beneficiary information is confidential and is of special value to the Company; and, therefore, the Prudential Representative shall not provide to any person not in the Company's employ any information which may be used to solicit for sales on behalf of some other company or organization. "...Section 13 of the Agent's Agreement is hereby modified as follows: 13. (a) That the appointment as Prudential Representative and this Agreement may be terminated either by the Prudential Representative or the Company at any time. (b) That for a period of two years from the termination date of this Agreement, the Prudential Representative shall not directly or indirectly: 1. Do anything to cause, persuade or encourage anyone to reduce, discontinue or terminate any Company or subsidiary policy, contract, service, or product of any kind. 2. Do anything to cause, persuade or encourage any Company or subsidiary employee to either: (a) terminate his or her employment with the Company for any reason; or (b) sell or solicit services or products on behalf of any other company which are in any way similar to those sold by the Company or its subsidiaries. (N.T. 93-94; Exhibits P-2, P-3, P-4, P-5). 16. Thomas Stella resigned his position with Prudential, effective August 16, 1996, after having given two weeks notice of his intention to do so and began working for the Intieri Agency selling Allstate Insurance products on September 1, 1996. (N.T. 6, 11, 16, 25-27, 126). 17. When Defendant was employed with Prudential, he sold an average of 200 to 250 insurance policies, including life, property and casualty, per year. (N.T. 236-238). At the time Stella left Prudential, 624 policies of life, property and casualty insurance policies which he had sold remained in force with annualized premiums of $686,389. (N.T. 5-6, 135-141; Exhibit P-103). 18. Shortly after Defendant's resignation from Prudential, Prudential sent a letter to Stella's clients advising them that Stella had left his employment with the Prudential. (N.T. 136-137, 214-215). 19. In Stella's first year of employment with Allstate, he has sold approximately 250 policies of property and casualty insurance, one-quarter to one-third of which were sold to former Prudential clients. (N.T. 237-238). 20. Defendant, along with two other Prudential sales agents signed the lease, paid the rent and purchased much of the office equipment and supplies for the Castor Avenue office, including a computer. Defendant paid rent on and had a key to the Castor Avenue office at least through September, 1996. Following Defendant's resignation, a new Prudential sales agent, Fred Beck, assumed Defendant's share of the rent on the Castor Avenue office through the balance of the lease term. (N.T. 18-20, 63-65). 21. At the time of Stella's resignation from Prudential, Ari Horowitz, the then-general manager of Prudential's Pennypack Agency, asked Defendant to return to him his Prudential client record cards and files (OPSRs and PSRs). (N.T. 13-14, 125-126). 22. Approximately one week after he resigned, Defendant received a letter dated August 23, 1996 from Prudential Regional Vice President Daniel Danese advising him that the Prudential Rate Book, all OPSRs, DOPSRs, PSRs, client files, cash surrender, dividend withdrawal and loan forms and computer prepared illustrations to which he had access while with the Company were the property of Prudential and were to be returned, along with any copies of those documents. That letter further advised Defendant that Prudential had a property interest in each of its life insurance policies and that the Company believed that when a former representative replaces a life insurance policy that he sold or serviced, that representative has deprived Prudential of its property *313 interest and that the company would take appropriate action to protect its interests. Defendant did not receive any letter from Prudential cautioning him not to do business with property and casualty insurance customers. (N.T. 16-18, 232-234; Exhibit P-90). 23. Despite his conversations with Horowitz and the letter from Danese, Stella returned some but not all of the client cards and customer files in his possession and control to Prudential. (N.T. 11-18, 127-129; Exhibits P-91 through P-102). 24. After this lawsuit and Plaintiff's motion for preliminary injunction were filed, Defendant returned to Prudential every Prudential document in his possession, custody or control which he has been able to locate. With the exception of one occasion on which defendant reviewed documents to locate a client file in response to a request for information from Prudential Agent Colleen Sweeney, defendant did not look at, review or otherwise make use of any of the client files or cards between the time that he resigned from Prudential and the date on which he returned the documents to the Company. (N.T. 58-62; 127-129, 132-134). 25. On or around November 1, 1996, using a key which he still had to the premises, Defendant entered the Castor Avenue office and removed a computer which he had purchased, along with the other Prudential agents with whom he then shared the office. (N.T. 20-25, 64-65). 26. The computer contained Prudential rate information and quotes, information on specific Prudential customers and was loaded with Relay Gold software which would enable the computer user to access Prudential's mainframe computer through a modem if that user possessed a valid password. (N.T. 23-27). 27. Defendant Stella's password to Prudential's mainframe was inactivated on August 16, 1996. Without a valid password, the Relay Gold software could not be used to access the Prudential mainframe. (N.T. 66). 28. After taking the computer from the Castor Avenue office, Defendant did not use it but eventually gave it to a friend, who cleaned it up and subsequently sold it to an unidentified third party. (N.T. 24, 65-67, 225-226). 29. Generally, Prudential client files and cards are marked as "confidential" and "privileged" such that the information contained therein is to be used to develop a program of benefits for the client and his/her family. The files and cards contain information and facts generally provided by and regarding the client personally, such as the client's annual income, insurance goals and needs, payment history, and key dates as to when policies, certificates of deposit, annuities, etc. are due to renew. Much of this information is also contained in the company's computer system. (N.T. 7-9, 56-60, 129-134, 148-153, 224-225; Exhibits P-102, P-103). 30. Other than marking the client files and cards as "confidential" and "privileged," there is no evidence that Prudential did anything else to prevent the information contained in the client files and cards from ever being released to anyone or any entity outside the company's employ. (N.T. 60-64, 129-130, 148-158, 185-190). 31. There is no evidence that Defendant utilized any of Prudential's client files, cards or computer-stored data after he left Prudential's employ on August 16, 1996. (N.T. 65-67, 224-226). 32. After Defendant left Prudential, the client accounts and "book of business" which had been Defendant's was first re-assigned shortly thereafter to one Michael Gates. As Mr. Gates resumed a management position with the company sometime after late October, 1996, in January, 1997 Mr. Stella's former book of Prudential business was reassigned to Joseph Doyle. (136-137, 144-147, 240-242). With the addition of Defendant's accounts to his own, Mr. Doyle's book of business essentially doubled. (N.T. 243-244). 33. Although there is no evidence that Defendant initiated contact with any of his former Prudential clients after he left Prudential for the purpose of trying to sell them Allstate property and/or casualty insurance, approximately 20% of Stella's Prudential clients called him in the months immediately following his resignation and requested rate quotes and information on Allstate Insurance. *314 In the one-year following Defendant's departure from Prudential, he wrote 77 Allstate property and casualty insurance policies for former Prudential customers. (N.T. 28-57, 67-70, 162-168, 171-173, 183-186, 214-224; Exhibits P-6 through P-83). 34. The insurance industry is highly competitive and is driven more by price or rate than by service. In the case of most customers, regardless of how good an agent's service is, if the price or rate which he quotes to the customer is higher than that of another insurer, the customer will more often than not give his or her business to the agent with the lower rate. (N.T. 68-70, 138, 211-222, 245-249). 35. The rates which are quoted to a customer are not set by the individual agent, but are determined by the insurance company itself. Individual agents do not have the ability to cut or reduce or otherwise negotiate a rate for a customer or potential customer to coerce a customer to purchase insurance. Thus, a customer could contact any Allstate or Prudential agent and receive the same rate quote. (N.T. 69-70, 222, 245-249, 254-255). 36. Since May, 1997, Stella has not written any policy of insurance for anyone who was a former customer of his when he was affiliated with Prudential. (N.T. 192-193, 244-245). 37. Approximately 17% of the book of business which Stella serviced at Prudential was expected to dissipate in the course of normal attrition, without any relation to any of Defendant's actions or inactions following his departure from Prudential. (N.T. 141-142, 175-176). 38. Stella has not sold any Allstate life insurance policies to any of his former Prudential life insurance clients. (N.T. 226-227; Exhibits P-6 through P-83). DISCUSSION Prudential's five-count complaint seeks relief under the theories of breach of contract, conversion, breach of fiduciary duty, tortious interference with contractual relations and for misappropriation of trade secrets and unfair competition. As this court's jurisdiction is premised upon the diverse citizenship of the parties, Pennsylvania substantive law applies to each of these claims. See: Erie R.R. v. Tompkins, 304 U.S. 64, 58 S. Ct. 817, 82 L. Ed. 1188 (1938); Griggs v. BIC Corp., 981 F.2d 1429, 1431 (3rd Cir.1992). While it does not dispute that Pennsylvania common law applies generally, however, plaintiff argues that because the restrictive covenants in defendant's agent's agreement are part of the collective bargaining agreement, it is Federal law and not that of Pennsylvania which should be applied to determine the issue of whether the restrictive covenants are supported by adequate consideration and are thus enforceable.[1] It is to this issue that we first turn. 1. Enforceability of Restrictive Covenants If the resolution of a state-law claim substantially depends upon the meaning and analysis of a collective bargaining agreement, the application of state law (which might lead to inconsistent results since there could be as many state-law principles as there are states) is pre-empted and federal labor law principles — necessarily uniform throughout the Nation — must be employed to resolve the dispute. Lingle v. Norge Div. of Magic Chef, Inc., 486 U.S. 399, 406, 108 S. Ct. 1877, 1881, 100 L. Ed. 2d 410 (1988); Allis-Chalmers *315 Corp. v. Lueck, 471 U.S. 202, 215, 105 S. Ct. 1904, 1913, 85 L. Ed. 2d 206 (1985). See Also: International Brotherhood of Elec. Workers v. Hechler, 481 U.S. 851, 107 S. Ct. 2161, 95 L. Ed. 2d 791 (1987).[2] However, the Supreme Court has made it clear that "not every dispute concerning employment, or tangentially involving a provision of a collective bargaining agreement, is pre-empted by § 301." Berda v. CBS, Inc., 881 F.2d 20, 23 (3rd Cir.1989), quoting Allis Chalmers v. Lueck, 471 U.S. at 211, 105 S. Ct. at 1911. Individual employment contracts are not necessarily superseded by a subsequent collective bargaining agreement covering an individual employee and claims based upon them may still arise and be maintained under state law. Caterpillar, Inc. v. Williams, 482 U.S. 386, 396, 107 S. Ct. 2425, 2431, 96 L. Ed. 2d 318 (1987). A plaintiff covered by a collective bargaining agreement is permitted to assert legal rights independent of that agreement, including state law contract rights, so long as the contract relied upon is not a collective bargaining agreement. Id. Hence, resolution of a state law claim could depend upon both the interpretation of the collective bargaining agreement and a separate state law analysis that does not turn on the agreement. Antol v. Esposto, 100 F.3d 1111, 1116 (3rd Cir. 1996). See Also: Livadas v. Bradshaw, 512 U.S. 107, 114 S. Ct. 2068, 2077-2078, 129 L. Ed. 2d 93 (1994). It should further be noted that, unlike a standard commercial contract, a collective bargaining agreement binds both those members within a bargaining unit at the time the agreement is reached as well as those who later enter the unit. Gvozdenovic v. United Air Lines, Inc., 933 F.2d 1100, 1105 (2nd Cir.1991) citing J.I. Case Co. v. NLRB, 321 U.S. 332, 335-336, 64 S. Ct. 576, 579-580, 88 L. Ed. 762 (1944). An individual also need not be a union member to be a member of the bargaining unit for whose benefit the collective bargaining agreement was created as unions are obligated under § 9(a) of the National Labor Relations Act, 29 U.S.C. § 159(a) to represent the interests of all employees in collective bargaining, including nonmembers. Quesnel v. Prudential Ins. Co., 66 F.3d 8, 11 (1st Cir.1995). Thus, an individual employee will be bound by the terms of a collective bargaining agreement even if not a union member. Id., citing Saunders v. Amoco Pipeline Co., 927 F.2d 1154, 1156 (10th Cir.1991). In this case, plaintiff bases its claims for preliminary injunctive relief against defendant upon Sections 6(b), 6(c) and 14 of the Agent's Agreement which he signed on May 22, 1990, and upon the amendments made thereto by Article 26 of the collective bargaining agreement. (Pl's Complaint, ¶ s 6, 7, 8, 10, 11, 32-35). It is clear that Stella is a member of the bargaining unit for whose benefit the collective bargaining agreement was created and that he is therefore bound by the terms of the collective bargaining agreement between Prudential and the AFL-CIO & CLC. Accordingly, because the collective bargaining agreement amended the language of the restrictive covenants such that the amended language superseded that in the agent's agreement, it is evident that in order to resolve plaintiff's claims we must interpret and analyze the collective bargaining agreement. We are thus constrained to find that this claim is pre-empted and that federal common law must be applied. As to the substantive content of this federal common law, while traditional rules of contract interpretation provide a plenteous resource, they should be mined only when compatible with federal labor policy. Luden's Inc. v. Local Union No.6, 28 F.3d 347, *316 354 (3rd Cir.1994), citing John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543, 548, 84 S. Ct. 909, 914, 11 L. Ed. 2d 898 (1964); Local 174, Teamsters v. Lucas Flour Co., 369 U.S. 95, 102-104, 82 S. Ct. 571, 576-577, 7 L. Ed. 2d 593 (1962). In exhaustively reviewing those cases cited by the parties and following further independent research, however, this Court has been unable to unearth any authority outlining how restrictive covenants in collective bargaining agreements are to be analyzed with the exception of John Hancock Mutual Life Ins. Co. v. Austin, 916 F. Supp. 158 (N.D.N.Y.1996). In that case, after likewise concluding that no federal common law on the enforceability and construction of restrictive covenants in collective bargaining agreements has yet been formulated, the district court undertook to formulate such common law by looking to the relevant common law in the New York state courts. In so doing, the Austin court applied the same "reasonableness" test (in terms of duration, scope and geography) of the restrictive covenant as applied to the facts of the case being considered. Id., at 163-164. The Austin court unfortunately was not confronted with and did not address the question of whether federal common law requires that the consideration to support a restrictive covenant must be provided contemporaneously with the execution or adoption of the agreement which contains it. In the field of labor relations, however, the technical rules of contract law do not determine the existence or enforceability of an agreement. Mack Trucks, Inc. v. International Union, UAW, 856 F.2d 579, 591-592 (3rd Cir.1988); Bobbie Brooks, Inc. v. International Ladies' Garment Workers Union, 835 F.2d 1164, 1168 (6th Cir.1987). See Also: Ivaldi v. N.L.R.B., 48 F.3d 444, 448 (9th Cir.1995). Indeed, in order for a collective bargaining agreement to be found, all that is required is conduct manifesting an intention to be bound by the terms of an agreement. Mack Trucks, at 592; Empire Excavating v. American Arbitration Association, 693 F. Supp. 1557, 1562 (M.D.Pa.1988), aff'd. w/o opinion, 866 F.2d 1409 (3rd Cir.1988). Thus, using these basic labor principles as a guide, we reject defendant's argument pursuant to Pennsylvania law that to be enforceable, the restrictive covenants had to have been executed contemporaneously with the commencement of his employment with Prudential. We next address plaintiff's entitlement to injunctive relief. 2. Plaintiff's Entitlement to Injunctive Relief As the party seeking injunctive relief, the plaintiff bears the burden of proof. Mettler-Toledo, Inc. v. Acker, 908 F. Supp. 240, 245 (M.D.Pa.1995). The grant of injunctive relief is an extraordinary remedy which should be granted only in limited circumstances. Instant Air Freight Co. v. C.F. Air Freight, Inc., 882 F.2d 797, 800 (3rd Cir. 1989); Frank's GMC Truck Center, Inc. v. General Motors Corp., 847 F.2d 100, 102 (3rd Cir.1988). At the trial level, the party seeking a preliminary injunction bears the burden of convincing the court that: (1) the movant has shown a reasonable probability of success on the merits; (2) the movant will be irreparably injured by denial of relief; (3) granting preliminary relief will not result in even greater harm to the other party; and (4) granting preliminary relief will be in the public interest. ECRI v. McGraw-Hill, Inc., 809 F.2d 223, 226 (3rd Cir.1987). See Also: Campbell Soup Co. v. ConAgra, Inc., 977 F.2d 86, 90-91 (3rd Cir.1992); S & R Corp. v. Jiffy Lube International, Inc., 968 F.2d 371, 374 (3rd Cir.1992). It should be noted that a showing of a mere risk of irreparable harm is not enough. A plaintiff has the burden of making a "clear showing of immediate irreparable (not merely serious or substantial) injury of a peculiar nature so that compensation in money cannot atone for it." Campbell Soup, at 91-92. Indeed, a showing of irreparable harm is insufficient if the harm will occur only in the indefinite future. Id.; Opticians Ass'n of America v. Independent Opticians of America, 920 F.2d 187, 195 (3rd Cir.1990); ECRI, 809 F.2d at 226. Furthermore, the preliminary injunction must be the only way of protecting the plaintiff from harm. Instant Air Freight Co. v. C.F. Air Freight, Inc., supra, 882 F.2d at 801. Finally, the basic purpose behind the *317 task of balancing the hardships to the respective parties is to ensure that the issuance of an injunction would not harm the infringer more than a denial would harm the party seeking the injunction. Opticians, 920 F.2d at 196. By way of its motion for preliminary injunctive relief in this case, Prudential is seeking to enforce sections 6 and 14 of the Agent's Agreement, as amended (and renumbered) by the collective bargaining agreement. Those sections concern (1) the loan of the Prudential books, records, documents, software, supplies and contractholder information (client files) and (2) a covenant not to compete following termination of defendant's employment with the company. After carefully reviewing the evidence presented at the hearing on September 2, 1997, we cannot find that plaintiff has made the necessary showing that defendant's actions caused it and/or continue to threaten it with serious, irreparable harm such as is required for a preliminary injunction to issue. Indeed, as the evidence at the hearing makes clear, at the time he left Prudential, Stella was responsible for overseeing a "book" of business which consisted of 624 property, casualty and life insurance policies and in the one-year period following his departure from Prudential, Stella wrote 77 Allstate property and casualty insurance policies for former Prudential clients or about 12-13% of his former Prudential clientele. (N.T. 28-57, 67-70, 135-141, 162-168, 171-173, 183-186, 214-238; Exhibits P-6 through P-83, P-103). Other than Mr. Sanfratello's suspicion that Stella was soliciting his former customers, there is also no evidence that defendant initiated contact with any of his former Prudential customers after he left Prudential to sell them insurance, although a number of them did contact him and asked for information on Allstate rates and products. (N.T. 28-57, 67-70, 162-168, 171-173, 178-186, 214-224). In any event, Stella has not sold any life insurance to any of his former life insurance customers nor has he sold any property, casualty or other insurance to anyone who was a former Prudential client since May, 1997. (N.T. 192-193, 226-227, 244-245; Exhibits P-6 through P-83). Moreover, by the testimony of Prudential's own employees, approximately 17% of the book of business which Stella serviced at Prudential was expected to dissipate in the course of normal attrition, unrelated to any of Stella's actions after leaving the company. (N.T. 139-142, 175-176). Again, the evidence was clear that the insurance industry is an extremely competitive one, driven primarily by price — not service and price is set not by the individual agents but by the companies themselves such that a customer could contact any Allstate or Prudential agent and receive the same information provided by defendant. (N.T. 68-70, 138, 211-222, 245-249, 254-255). Finally, while defendant admitted that he failed to return all of the client files (OPSR's, PSR's, etc.), cards and records which he had in his possession to Prudential until after Prudential filed this lawsuit and motion for preliminary injunction, Prudential has produced absolutely no evidence that Stella used any of these records or the computer after the date of his resignation on August 16, 1996. To be sure, the only evidence on this issue came from defendant, who repeatedly gave unrebutted testimony that he did not use any of these records or the computer after he left Prudential. (N.T. 11-18, 24, 58-62, 65-67, 127-129, 132-136, 160-164, 172-174, 225-226; Exhibits P-91 through P-102). As Prudential's own witness, John Sanfratello, testified, he is unaware of any benefit which would inure to Prudential as the result of a court order prohibiting Stella from dealing with his former clients. (N.T. 192-193). As all of this evidence demonstrates that the harm which Prudential has suffered, if any, by Stella's actions does not rise to the level of irreparability required for injunctive relief nor has there been any showing that an award of money damages would not be adequate to compensate it for the harm suffered. Plaintiff's motion for preliminary injunction shall therefore be denied in accordance with the following legal conclusions and attached order.[3] *318 CONCLUSIONS OF LAW 1. This Court has jurisdiction over the subject matter and the parties to this action pursuant to 28 U.S.C. § 1332. 2. Plaintiff has failed to prove to this Court that Defendant has used Prudential confidential customer information to divert former Prudential customers to Allstate for his own benefit. 3. Plaintiff has failed to prove to this Court that defendant has solicited his former Prudential customers to convert their Prudential insurance policies to Allstate. 4. Plaintiff has failed to prove that it is likely to suffer immediate, irreparable harm if the Defendant is not enjoined from using Prudential's customer files, cards and other information and soliciting and diverting Prudential customers. 5. The plaintiff has failed to prove that no adequate legal remedy is available to remedy the injury which it has suffered as a result of defendant's actions. 6. An award of preliminary injunctive relief to Plaintiff is not warranted based on the evidence presented. An appropriate order follows. ORDER AND NOW, this 10th day of February, 1998, upon consideration of Plaintiff's Motion for Preliminary Injunction and the evidence and arguments presented, it is hereby ORDERED that the Motion is DENIED. NOTES [1] The requirements for a valid restrictive covenant in Pennsylvania are as follows: (1) the covenant must relate to a contract of employment (i.e., must be ancillary to an employment contract); (2) the covenant must be supported by adequate consideration; (3) the covenant must be reasonably limited in time and geographic territory; and, (4) the covenant must be necessary to protect the employer. National Risk Management, Inc. v. Bramwell, 819 F. Supp. 417, 429 (E.D.Pa.1993); Gagliardi Bros., Inc. v. Caputo, 538 F. Supp. 525, 527 (E.D.Pa.1982). When an employee enters into an employment contract containing a covenant not to compete subsequent to employment, however, the covenant must be supported by new consideration which could be in the form of a corresponding benefit to the employee or a beneficial change in his employment status. Davis & Warde v. Tripodi, 420 Pa.Super. 450, 455, 616 A.2d 1384, 1387 (1992), citing, inter alia, George W. Kistler, Inc. v. O'Brien, 464 Pa. 475, 347 A.2d 311 (1975) and Maintenance Specialties, Inc. v. Gottus, 455 Pa. 327, 314 A.2d 279 (1974). [2] The statute under which this principle has developed is Section 301(a) of the Labor Management Relations Act, 29 U.S.C. § 185(a), which reads: Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without respect to the citizenship of the parties. § 301 has been held to apply to suits against individuals as well as against labor organizations where the suit is for breach by an individual of a collective bargaining agreement. See: John Hancock Mutual Life Ins. Co. v. Schwertmann, 627 F. Supp. 143, 144 (E.D.Mo.1985). [3] Insofar as this Court finds that the threshold element for an award of injunctive relief has not been satisfied, we see no need to analyze the remaining elements of the preliminary injunction test.

2023-08-23 14:19:58.60219+00

Reavley

REAVLEY, Justice. The problem here is the effect of an Industrial Accident Board award against multiple parties after one of those parties files a suit to set the award aside. Specifically, does the filing of a suit against the injured employee by one insurer vacate the entire award of the Board and, in particular, that part of the award in favor of the employee against a second insurer? After a suit had been filed by the first insurer, the case at hand was initiated by the employee to recover on the Board’s award against the second insurer. The trial court entered summary judgment for the employee. The Court of Civil Appeals reversed that judgment and dismissed the case for the reason that the filing of the prior suit by the first insurer vacated the Board’s award and brought into the prior suit all matters and parties previously before the Board. 478 S.W.2d 226. Upon analysis of the inconsistent precedents, we state and apply a rule that results in restoration of the judgment of the trial court. Jan Latham filed a claim for compensation with the Industrial Accident Board because of an injury to her back sustained in Houston County on August 11, 1970; the Board entered its award in her favor on December 2, 1970. She thereby received total and permanent benefits in a lump sum against Security Insurance Company of Hartford, the insurer of Crockett Nursing Homes, Inc., and against Connecticut Indemnity Company, insurer of Convalescent Nursing Centers of America, Inc., jointly and severally. Both Security Insurance Company and Connecticut Indemnity Company filed with the Board on December 21, 1970, their separate notices of refusal to abide by the award. Connecticut Indemnity Company then filed its suit on January 7, 1971, in Houston County to set aside the award. Security Insurance Company did not file suit within twenty days following its notice of intention to do so, nor was Security Insurance Company mentioned or made a party in the Houston County suit either by the original pleading of Connecticut Indemnity Company or by the cross-action filed therein by Latham. Security Insurance Company did *102seek to intervene in that suit on February 17, 1971. On February 2, 1971, Latham filed the present suit against Security Insurance Company to enforce the Board’s award under Section Sa, Art. 8307, Vernon’s Ann. Civ.St. The trial court overruled pleas to the jurisdiction and in abatement, and summary judgment was entered for Latham against Security Insurance Company which awarded her $17,760.74 plus the statutory 12% penalty. The Court of Civil Appeals based its reversal in favor of Security Insurance Company upon these three cases: Maryland Casualty Co. v. Baker, 277 S.W. 204 (Tex. Civ.App.1925, writ ref’d); Southern Casualty Co. v. Fulkerson, 45 S.W.2d 152 (Tex.Comm.App. 1932) ; The Travelers Ins. Co. v. Fox, 364 S.W.2d 859 (Tex.Civ.App. 1963, writ ref’d, n. r. e.). The rule stated in these cases supports the decision of the Court of Civil Appeals. That rule would give the same effect to the filing of a suit to set aside an Industrial Accident Board award as is given to the appeal from a Justice of the Peace Court to County Court. The filing of the lawsuit by one party to the award would operate to set aside the award in its entirety as to all parties, including parties not named in the pleadings of the lawsuit as well as issues not mentioned therein. Maryland Casualty Co. v. Baker and the case at hand present the same factual cast. Mrs. Baker obtained a joint and several Board award against two insurance carriers. Only one of the carriers gave notice and filed suit within the period as required by the statute. The attempt by Mrs. Baker to enforce the Board’s award against the second carrier was defeated on the ground that the award had been completely wiped out by the filing of the lawsuit, and it no longer had any effect even as to the second insurance carrier which was not a party to the lawsuit. Although the Supreme Court allowed this result to stand, the opinion itself is not to be given the force of an opinion of the Supreme Court; the writ notation “refused” did not carry that effect until June 14, 1927. In Southern Casualty Co. v. Fulkerson, the Board’s award was in favor of the workman against the first insurance carrier, but the workman’s claim was denied as to the second carrier. The first carrier gave proper notice and brought suit against both the workman and the second carrier. The cross-action by the workman was levied against both carriers. The defense of the secpnd carrier was that the award was final as to it and that the workman was not entitled to complain after having failed to give notice and file suit within twenty days. The Commission of Appeals held against that contention on the ground that the award had been vacated by the filing of the lawsuit by the first insurance carrier which invoked the jurisdiction of the trial court over everything and everybody previously before the Industrial Accident Board. The rationale of Maryland Casualty Co. v. Baker was expressly approved. Only the judgment recommended by the Commission of Appeals was adopted by the Supreme Court. And it should be noted that all parties to the Board’s award were before the court in that case. In Travelers Ins. Co. v. Fox two claimants sought benefits because of the death of the workman, and the insurance carrier agreed that it owed those benefits to one of them. The Board awarded the benefits to Fox. Lewis objected and brought suit against the carrier. Neither Lewis nor the carrier brought Fox into that suit. Then Fox brought her own suit to mature the Board’s award in her favor. The court ruled against the suit by Fox and sent her to plead her cause in the lawsuit filed by Lewis against the carrier. That court ably presented the precedents, including those of Maryland Casualty Co. v. Baker and Southern Casualty Co. v. Fulkerson. *103The pertinent part of the statute, Section 5 of Art. 8307, Vernon’s Ann.Civ.St, provides : All questions arising under this law, if not settled by agreement of the parties interested therein and within the provisions of this law, shall, except as otherwise provided, be determined by the Board. Any interested party who is not willing and does not consent to abide by the final ruling and decision of said Board shall, within twenty (20) days after the rendition of said final ruling and decision by said Board, file with said Board notice that he will not abide by said final ruling and decision. And he shall within twenty (20) days after giving such notice bring suit in the county where the injury occurred to set aside said final ruling and decision, and said Board shall proceed no further toward the adjustment of such claim, other than hereinafter provided. . Whenever such suit is brought, the rights and liability of the parties thereto shall be determined by the provisions of this law, and the suit of the injured employee or person suing on account of the death of such employee shall be against the Association, if the employer of such injured or deceased employee at the time of such injury or death was a subscriber as defined in this law. If the final order of the Board is against the Association, then the Association and not the employer shall bring suit to set aside said final ruling and decision of the Board, if it so desires, and the court shall in either event determine the issues in such cause, instead of the Board, upon trial de novo, and the burden [of] proof shall be upon the party claiming compensation. In case of recovery, the same shall not exceed the maximum compensation allowed under the provisions of this law. If any party to such final ruling and decision of the Board, after having given notice as above provided, fails within said twenty (20) days to institute and prosecute a suit to set the same aside, then said final ruling and decision shall be binding upon all parties thereto; and, if the same is against the Association, it shall at once comply with such final ruling and decision; . . . It is observed that any interested party shall within twenty days following the award file notice that he will not abide by it. And he shall within twenty days after the notice bring suit to set aside the Board’s decision. “Whenever such suit is brought, the rights and liability of the parties thereto shall be determined by the provisions of this law. . . . ” In that suit, regardless of whether the employee or the insurance carrier has brought it, the court shall “determine the issues in such cause” . . . “upon trial de novo.” This language leaves us a problem where there are multiple parties to the Board’s award. It does speak of the rights and liability of the parties to the lawsuit without providing expressly for the rights and liability of parties to the award who are not parties to the suit. The court is directed to determine the issues “in the cause” without it being said that the court should determine all of the issues that were before the Board. We have the question of the significance to be given the directive that the determination of the issues should be upon trial de novo. It is given more effect than to require the trial court to make its own determination of the issues. In the application for writ of error to this court by Mrs. Baker against Maryland Casualty Company, it was argued that the lawsuit was not comparable to an appeal from a Justice of the Peace Court but was a direct proceeding to set aside an award of the Board, and that therefore the full award of the Board should stand until judgment was entered by a court which affirmed or corrected it. The conclusion of the writer of Huson’s Workmens Compensation (Gam-mel ed. 1923) was cited to this effect. This contention was rejected by the refusal *104of the application, and there is no doubt about this proposition in the law today. The filing of the lawsuit vacates the Board’s award at least as to the parties to the lawsuit. Zurich General Accident & Liability Ins. Co. v. Rodgers, 128 Tex. 313, 97 S.W.2d 674 (1936); Texas Reciprocal Ins. Ass’n. v. Leger, 128 Tex. 319, 97 S. W.2d 677 (1936). The same rule is applied in this respect as applies to appeals from Justice of the Peace Courts (Harter v. Curry, 101 Tex. 187, 105 S.W. 988 [1907]) and under other statutory provisions for appeals from administrative agencies (State Bd. of Medical Examiners v. Mann, 413 S.W.2d 382 [Tex.1967]; State Bd. of Morticians v. Cortez, 160 Tex. 532, 333 S.W.2d 839 [I960]). However, the “trial de novo” language of the statute does not necessarily carry with it all aspects of an appeal from Justice of the Peace Court. Jones v. March, 148 Tex. 362, 224 S.W.2d 198 (1949) ; Fire Department of City of Fort Worth v. City of Fort Worth, 147 Tex. 505, 217 S.W.2d 664 (1949). It has been held that the appeal from Justice of the Peace Court is not a true analogy for the appeal from an award of the Industrial Accident Board. Booth v. Texas Employers’ Ins. Ass’n., 132 Tex. 237, 123 S.W.2d 322 (1938). We conclude that it is not necessary to construe the statutory language to the effect that the award is vacated as to those who are not parties to the lawsuit. There is precedent to the effect that the entire award is not so vacated. In Richards v. Consolidated Underwriters, 411 S.W.2d 436 (Tex.Civ.App.1967, writ ref’d), the workman had claims against two insurance carriers, and the Board’s award denied the claims as to each. The workman gave notice and filed suit against one of the insurance carriers hut did not join the second carrier in the suit until four months later. A summary judgment for the second carrier was upheld on the ground that the statutory period of twenty days was a limitation against the workman raising any issue as to the second carrier. The briefs of the petitioner Richards in this court argued that the filing of the lawsuit vacated the Board’s award and enabled the parties there to reach all issues and parties before the Board, citing the authority of Maryland Casualty Co. v. Baker and Southern Casualty Co. v. Fulkerson. However the writ of error was noted “refused.” Another writ refused opinion contains language consistent with the position of Latham here. Southern Underwriters v. Alvidrez, 140 S.W.2d 355 (Tex.Civ.App. 1940, writ ref’d) grew out of the claim of a widow and several children for death benefits. The Board’s award denied the claims of three children but favored the widow and one daughter. The insurance carrier filed suit against the widow and daughter. The court wrote: “The other claimants mentioned in the claim before the Board not being made defendants nor having appealed in their own right, the action of the Board as to them has become final.” 140 S.W.2d 356. The latest case dealing with this problem presents facts which display the danger of vacating the Board’s award as to parties not present in the lawsuit. It is Mosqueda v. The Home Indemnity Co., 443 S.W.2d 901 (Tex.Civ.App.1969, writ ref’d, n. r. e.). The son of the deceased workman was awarded full death benefits by the Board. The Board also awarded funeral expenses up to $500 to another party. The insurance carrier filed suit against the party obtaining the funeral expenses, and this suit was pursued to a judgment which set aside the Board’s award and ordered payment of the funeral expenses. When the son sued to enforce his award for full death benefits, the insurance company argued that the award had been set aside and there was no longer any jurisdiction for a court to enforce the award. This argument did not prevail. The Court of Civil Appeals wrote that the son was a necessary party in any suit to set aside the award as to him and that the award had not been vacated. *105It is desirable to allow all parties to a lawsuit brought to set aside the Board’s award to present any issues that were before the Board. However, those who are not made parties to the suit should not suffer a loss of their position under the award of the Board without their knowledge or without their control. Our consideration of these objectives, the statute, and the precedents carries us to the statement of the following rules: 1. All parties to a suit brought by any party to set aside the Board’s award are before the court for all purposes previously presented to the Board. So far as any claim between those parties goes, the Board’s award is vacated. Zurich General Accident & Liability Co. v. Rodgers, 128 Tex. 313, 97 S.W.2d 674 (1936) ; New Amsterdam Casualty Co. v. Merrifield, 74 S.W.2d 185 (Tex.Civ.App.1934, no writ). Since all the parties were before the court, the result reached was correct in Southern Casualty Co. v. Fulkerson, 45 S.W.2d 152 (Tex.Comm. App. 1932). 2. It is not given to the party filing the lawsuit to determine who shall and who shall not be parties thereto. A party to the Board’s award may be willing to accept that award, but if he is brought to court by one of the other parties he may require the presence of third parties. For example, under the facts of Travelers Ins. Co. v. Fox, 364 S.W.2d 859 (Tex.Civ.App. 1963, writ ref’d, n. r. e.), in order to protect against a double recovery, the insurance carrier must be permitted to make Fox a party in the lawsuit filed by Lewis to set aside the award. Hereafter, if the carrier fails to do so, he will risk a double recovery, since the holding in that case is now disapproved. Defendants in a lawsuit to set aside an award of the Board shall have until their appearance date to join other parties who have been before the Board. 3. Those parties to the Board’s award who do not become parties to the suit to set it aside are entitled to stand on that award. Richards v. Consolidated Underwriters, 411 S.W.2d 436 (Tex.Civ.App. 1967, writ ref’d), is reaffirmed. Mosqueda v. Richards v. Consolidated Underwriters, 411 S.W.2d 436 (Tex.Civ.App. 1967, writ ref’d), is reaffirmed. Mosqueda v. Home Indemnity Co., 443 S.W.2d 901 (Tex.Civ.App.1969, writ ref’d, n. r. e.) is approved. We disapprove the following: Maryland Casualty Co. v. Baker, 277 S.W. 204 (Tex.Civ.App.1925, writ ref’d) ; Texas Employers Ins. Ass’n. v. Nitcholas, 328 S. W.2d 338 (Tex.Civ.App.1959, no writ); Industrial Accident Board v. Texas Employers Ins. Ass’n., 342 S.W.2d 213 (Tex. Civ.App.1961, writ ref’d, n. r. e.). Applying these rules to the case before us, the Board’s award in favor of La-tham against Security Insurance Company of Hartford became final. The latter did not file suit to set it aside and did not seek to intervene in the suit filed by Connecticut Indemnity Company within the statutory period, nor was that company named a party to the suit filed by Connecticut Indemnity Company by either plaintiff or the defendant. It follows that this suit by Jan Latham to enforce the award against Security Insurance Company was a proper one and that she was entitled to judgment. The judgment of the Court of Civil Appeals is reversed and the judgment of the trial court is affirmed.

2023-08-23 14:18:48.428161+00

Donnelly

DONNELLY, Judge (dissenting). I respectfully suggest that the principal opinion decides this case by answering the wrong question. It is not important here whether the words “Estimated maximum cost” are ambiguous. The determinative *269question is whether the insertion of all of Article 3A renders the contract ambiguous as to what the parties intended the cost of construction should be. I believe it does. If it were not there, Article 5 would stand uncontradicted and the contract would be certain as to cost. The mere presence of Article 3A in the contract makes the contract ambiguous as to cost. The principal opinion’s reliance upon the case of Kalen v. Steele, Mo.App., 341 S. W.2d 343 (1960), is misplaced. In Kalen, the homeowners sought to rely on a “cost sheet” attached to the contract in support of their contention that there was an agreement to pay a fixed price for costs of construction. The Kansas City Court of Appeals disagreed, holding the contract unambiguous as to costs of construction because the “cost sheet” related only to the contractor’s fixed fee. The Court said (341 S.W.2d 343, 347): “The cost sheet obviously is the contractor’s estimate of what the cost of the listed items of material and labor to be used in constructing the house will be. It is the basis for the figure used in the contract in Section 4 for the determination of a fixed fee of the contractor for his services. It does not contradict, modify, change or make uncertain the clear, unequivocal provisions of Section 5 which provide, in addition to the fixed contractor’s fee contained in paragraph 4, for the contractor to be reimbursed all his necessary expenses for material, labor, etc., in constructing the house.” In my opinion, Article 3A contradicts, modifies, changes and makes uncertain the provisions of Article 5. The insertion of Article 3A in the contract renders the contract ambiguous as to cost. The trial court did not err in considering extrinsic evidence to ascertain the intention of the parties. I would affirm the judgment. I dissent.

2013-10-30 06:35:57.206898+00

Green

491 S.W.2d 139 (1973) Jimmy Ray HANCOCK, Appellant, v. The STATE of Texas, Appellee. No. 46560. Court of Criminal Appeals of Texas. March 7, 1973. *140 Guy McNeely, Wichita Falls, for appellant. Jim Phagan, Dist. Atty., Z. D. Allen, Asst. Dist. Atty., Wichita Falls, Jim D. Vollers, State's Atty., and Robert A. Huttash, Asst. State's Atty., Austin, for the State. OPINION GREEN, Commissioner. This is an appeal from an order revoking probation. Appellant was convicted of the offense of felony theft on June 4, 1969; his punishment was assessed at six (6) years, and he was placed on probation. Condition No. 1 of the probation order reads: "Shall commit no offense against the penal laws of this State or of any other State or the United States and shall not be convicted of any offense in violation of any of the penal laws of this State or of any other State or the United States, and shall violate no penal ordinances of any political subdivision of this State or any other State and shall not be convicted of any offense in violation of any penal ordinances of any political subdivision of this State or any other State." A motion was filed by the State to revoke the probation, alleging that appellant did "on the 7th day of June, 1971, commit a crime against the State of Texas, to-wit: Assault with intent to kill, committed on one Terry S. Owens." Said motion was heard on May 31, 1972, and the court after such hearing found that appellant violated the terms of his probation by committing the offense alleged in State's motion, and duly sentenced appellant. Appellant by ground of error raises the contention that because the condition as set forth in the court's order of probation and copied in the motion to revoke *141 uses the word "and" between the phrase "shall commit no offense against the penal laws of this State or of any other State or the United States" and "shall not be convicted ...", etc., the burden was on the State to prove both the commission of the offense, and a conviction thereof. We find no merit in this contention. Article 42.12, Sec. 6, Vernon's Ann.C.C. P., provides that the terms and conditions of probation may include, but shall not be limited to the conditions that the probationer shall: "a. Commit no offense against the laws of this State or of any other State or of the United States;" There is no requirement of a final conviction before an order of probation may be revoked. Day v. State, 474 S.W.2d 246 (Tex.Cr.App.); Carr v. State, 476 S.W.2d 329 (Tex.Cr.App.); Marshall v. State, 466 S.W.2d 582 (Tex.Cr.App.). Appellant contends, however, that because the court's order used the word "and" between the condition that appellant should commit no offense and the condition that he should not be convicted of any offense, the proof only of commission of the offense was not sufficient cause for revocation. Notwithstanding the use of conjunctive term, we construe the first condition or term of the court's order to be applicable separately to (1) proof of the commission of an offense, or (2) proof of a final conviction of an offense committed after the entry of the court's order. Ground of error number two is to the effect that the evidence is insufficient to sustain a finding that appellant on the occasion in question committed the offense of assault with intent to kill. At the close of the evidence, the trial court dictated into the record his findings, one of which reads: "... it is my finding that on the evidence presented before me today that the defendant Jimmy Hancock has been proven to have violated the terms of his order of probation ... that he committed an aggravated assault upon Mr. Owens ..." The record further shows that when the judgment was placed before the trial judge to be signed, he called to the attention of the prosecuting attorney the error in the finding of assault with intent to kill and asked that it be corrected to conform with his true finding. Evidently, through clerical error, it was not corrected. The evidence was sufficient to reflect an attack upon Owens by appellant and others, from which Owens received a wound across the bridge of his nose and eyes requiring twenty-three stitches. Appellant does not in his brief controvert the propriety of a finding of the commission by him of an aggravated assault. Such assault is included within the offense alleged in the motion. "Where, as in the present case, this Court has the necessary data and evidence before it for reformation, the judgment may be reformed on appeal." Vasquez v. State, 477 S.W.2d 629, 635 (Tex.Cr.App.). The order revoking probation is ordered reformed so as to reflect that the trial court found that appellant did on the 7th day of June, 1971, commit the offense of aggravated assault on one Terry S. Owens. The judgment is affirmed. Opinion approved by the Court.