FURTHER THOUGHTS ON HOWELL v. McAULIFFE
[Posted July 26, 2016] I promised you more discussion of last week’s blockbuster ruling by the Supreme Court of Virginia in the original-jurisdiction proceeding involving Governor McAuliffe’s restoration of voting rights to ex-felons. Because there are several themes here, I won’t attempt to weave this into a single story.
Who got “mandamused,” and why?
The lead respondent in the case was, of course, the Governor. But the petition also named the Secretary of the Commonwealth; the Board of Elections and its chair, vice-chair, and secretary; and the Department of Elections and its commissioner, all as respondents.
Last Friday’s writ, importantly, did not order the Governor to do anything. The Supreme Court thus dodges the problematic question whether the court has the power to issue a writ to the Governor himself on a matter involving his discretion. Instead, paragraphs 1-3 of the writ direct the Department of Elections and its commissioner to do certain things; paragraph 4 directs the Board and its officers to do other things; and paragraph 5 gives additional orders to the Secretary of the Commonwealth.
There was, in my view, another reason why no writ was directed to the Governor. If the court had done that, it would have been directing him to undo his April 22 order. The court has always held in the past that mandamus operates only prospectively; it can never be used to undo something that has already been done.
What the court did instead was to grant a form of relief that technically had not been pleaded – a declaratory judgment, holding that the order was unconstitutional – and then direct the several offices and officials to take steps to ensure that no one obeys it. They have until August 25 to comply.
So why not ask for declaratory judgment?
That’s easy: time. The Supreme Court has original jurisdiction to award a writ of mandamus, but only appellate jurisdiction over DJ proceedings. The same reasoning applies to the other extraordinary writ that probably would have worked here, a quo warranto proceeding to challenge the Governor’s right to do what he did.
The problem with both of those approaches is that the petitioners wanted to get a final ruling before we get too close to the November 8 general election. If they had to start in circuit court, go through pleadings, maybe some discovery, a motion or two, then a trial and potential post-trial motions, it would be many moons before they’d get to Ninth and Franklin, and the election would be over.
The government officials who are named respondents – probably not including the Governor! – have a right to file a petition for rehearing, but I doubt they’ll do that. Various media are reporting that the Governor has already started signing individual restoration orders; he vows to get relief to the roughly 13,000 ex-felons who have registered since April 22, and will get to the remaining 193,000 next. Two hundred thousand signatures! Happily, I don’t have to do anything like that.
I’ve heard at least one wag muse whether the Governor can arrange to robo-sign the orders, the way banks do with mortgage assignments and the like. No, I don’t know, and no, I’m not about to research that issue to find out.
In this vein, I can report that at last week’s oral argument, Justice Powell, while questioning the petitioners’ lawyer, noted that the petitioners had conceded that the Governor could grant these restorations individually, by signing 206,000 separate orders. So what’s the difference, she asked, between that and his merely signing his name once? His answer is destined to seem hollow to the Governor’s supporters – he said that the constitution requires the Governor to follow a specific procedure, without answering the underlying question: Are you just doing this to make things inconvenient for him?
Does this unique case offer any guidance for garden-variety appeals?
In most respects, no. As always, with any opinion there are some general takeaways on briefing and procedure, and some guidance on how the justices evaluate arguments. But this case was really sui generis; unprecedented in Virginia’s legal history. Except in other separation-of-powers disputes, this case isn’t likely to be cited heavily.
And yet. There is one aspect of the case that gives me pause, on a particularly precious aspect of appellate practice. What follows here is based on my own inference and deduction. I am not a court insider and never have been. I invite you to follow along and see if you agree with my reasoning.
Oral argument in this case began a few minutes after 9:00 am on Tuesday, July 19. The argument concluded around 10:05, at which point the court took a roughly 20-minute recess before taking up the other case on that day’s docket, Edwards v. Vesilind, involving a challenge to partisan redistricting. (The appeal itself was about whether legislators’ privilege under the Speech or Debate Clause applied to communications with outside consultants and with the Division of Legislative Services.) Argument in that appeal ended somewhere around 11:25 am.
The justices then retired to a conference room to begin what’s called the decision conference. I’ll assume that that began somewhere around noon; perhaps a few minutes before. Given the number and complexity of the issues in the two cases, I will assume that that conference lasted until at least the middle of the afternoon; perhaps a bit later.
You would normally assume that in that conference, the justices debated the issues, explained their views about each case, and ultimately voted. But this was no ordinary docket and no ordinary decision conference.
Late in the afternoon of Friday, July 22 – about 72 hours after the decision conference probably ended – the court released three opinions that aggregate to 63 pages. (I suspect that the opinions were probably ready to go earlier in the day, but a power outage at the courthouse delayed their release.) The chief justice’s majority is 32 pages; Justice Mims’s solo dissent is 10 ½ pages long, while Justice Powell’s is about 20 pages. All three opinions are meticulously footnoted; one of Justice Powell’s notes occupies 2 ½ pages, single-spaced. (Please do not try that in your briefs.) There are 33 footnotes in all.
The justices obviously swapped drafts of their opinions before finalizing them; you’ll see references in the majority to arguments in the dissent, and vice versa. There are plenty of federal cases and holdings from other jurisdictions to back up their respective conclusions.
You’re probably thinking, That’s a lot of work. You’re right.
Because of what I do on opinion days, I have to write and edit my work quickly. I’ve heard that the goal for professional writers is to put down 1,000 words a day. On busy opinion days, I can often crank out five or six thousand, and that includes the time it takes me to read the new cases, decide what to say, and make a quick pass at editing my original composition. For comparison, this essay is about 1,650 words, and it’s taken me about two and a half hours to compose and edit it.
But I could never do this in 72 hours; not starting from scratch. Writing this much would take me about a week, just to generate a first draft. I believe that these briefs took weeks to craft fully.
Assuming that’s correct – and I think it’s safe to do so – let’s see what else we can deduce. Assuming that her dissent took weeks, or at least a week, to write, Justice Powell had to know in advance that she’d have to write it. That means that she knew she was outvoted. That, in turn, means that the justices must have taken at least a preliminary vote some days or even weeks before July 19. How else could Justices Mims and Powell know they had to write something? Why would you set out to write anything if you might be part of a 7-0 decision?
It is, of course, possible that a justice could change his or her vote after hearing that argument; but really, how likely is that to occur in a setting like this? Especially after you’ve committed yourself to a position, and perhaps taken the time to craft an opinion of your own. The justices are human, and they have the same confirmation biases that we have, though I assume they’re careful to be on the lookout for that.
Even so, if all these musings are correct, that means that the justices had decided this case before the first “May it please the Court” was uttered. Oral argument didn’t change the outcome. The petitioners had already won.
As troubling as that conclusion is, it’s actually consistent with what jurists tell me about oral argument. In response to the question, “How often does oral argument change your vote?” most appellate jurists give answers somewhere in the 10-20% range. I assume that’s correct, as I have no way to test it. This extraordinary writ serves to confirm that in modern appellate practice, persuasion is one part oral advocacy and about six parts written advocacy.
Yes, it’s great to be able to give a captivating oral argument, and that’s where the most fun is in appellate practice; but briefs are where the decisions are made nowadays. This contrasts with the early days of the Commonwealth, when briefs were sparse and advocates sometimes argued for days. (Yes, it’s true.) Back then, the great oral advocates dominated appellate courtrooms. Now, it’s the briefwriters.
If you want to be a better appellate lawyer, then, focus on improving your writing. By the nature of our profession, all lawyers have to be professional writers, but for appellate advocates, that skill is particularly crucial. Never assume that your writing skill is sufficient. I never do, and I sometimes write thousands of words in a day. I’m always trying to get better at it, and you should, too.
SUPREME COURT GRANTS RARE MANDAMUS WRIT,
HANDS GOVERNOR SIGNAL LOSS
[Posted July 22, 2016] On Tuesday, I was in Richmond for the Supreme Court’s historic special session. I have planned all along to prepare a detailed account of the day’s proceedings in two highly charged, politically dominated arguments. My work and travel plans prevented me from doing that before now; I had planned to post a report on Monday.
As of this afternoon, all that is overtaken by events. A sharply divided Supreme Court today issues a writ of mandamus that effectively overturns the Governor’s April 22 restoration of voting rights to 205,000 ex-felons. There are three opinions that span 63 pages, and as is becoming more common, the court throws in footnotes liberally.
The chief justice writes the majority opinion, which rules that the petitioners have standing to bring the proceeding, that the Governor’s order effectively and impermissibly whited out a line in the constitution, and that mandamus was the proper remedy for this. (The court rejects a parallel petition for a writ of prohibition, but the petitioners are probably too busy dancing on the ceiling right now to notice that.) Justices McClanahan, Kelsey, and McCullough join him.
Justice Mims writes a solo dissent that finds no standing on this record, but he would allow the parties to further develop that record by conducting depositions. Justice Powell, writing for Justice Goodwyn, would find no standing, since she felt that the petitioners’ claimed harm is shared by the electorate as a whole. She also feels that the Governor should win on the merits, not merely on standing.
I will likely post further commentary next week — including that glimpse of the rare session — but this will unquestionably be front-page news across the Commonwealth in tomorrow’s papers.
ANALYSIS OF JULY 14, 2016 SUPREME COURT OPINIONS
[Posted July 14, 2016] Today the Supreme Court begins to hand down decisions from appeals argued in the June session. We’ll start with the last two cases argued that week, criminal appeals that turn on a common issue.
Virginia law permits a criminal defendant to withdraw a plea of guilty before sentencing, and in limited circumstances even afterward. But the statute that authorizes this practice doesn’t set out the standard for granting the relief. Today’s opinions in Edmonds v. Commonwealth and Small v. Commonwealth help fill in the analytical playing field.
Both are convictions for possession of a firearm by a convicted felon. After pleading guilty but before being sentenced, each indicated a desire to change to a not-guilty plea and take his chances at trial. Each man claimed that he possessed the weapon only because of a legitimate fear of imminent bodily harm, implicating the defenses of duress or necessity.
Criminal-law practitioners will recognize the significance of the court’s first holding: it approves and adopts the standard embraced by the Court of Appeals for duress defenses:
The Court of Appeals has held that in order to use the defense of duress or necessity, the offender must show
“(1) a reasonable belief that the action was necessary to avoid an imminent threatened harm; (2) a lack of other adequate means to avoid the threatened harm; and (3) a direct causal relationship that may be reasonably anticipated between the action taken and the avoidance of the harm.”
In both cases, the justices find that there was no imminent threat, so there would be no good-faith basis for the change of plea.
In the Small opinion, the justices also approve – as a matter of first impression – the trial court’s considering the likely prejudice to the Commonwealth in evaluating the motion. Because of Small’s cooperation with prosecutors against another criminal defendant, over two years elapsed between his plea and his motion to withdraw it. The justices find that the trial court acted within its discretion in finding that a delay that long could well prejudice the prosecution.
One last point: Both of today’s unanimous opinions were written by Justice Powell. I’ve described before how the court’s opinion-writing assignments are random, but I’ve expressed occasional skepticism – accompanied by a smile, of course – about whether things are truly random. For a recent example, I posited that there may have been some horse-trading to ensure that the chief justice got to write the opinion in Environment Specialist v. Wells Fargo back in February.
Now, the pure odds that Justice Powell just happened to draw these two cases – almost but not quite companion appeals – are 6-to-1 against. I’m not sayin’; I’m just sayin’.
Rights of action
I’m fairly sure that this is the first time I’ve discussed a decision using this heading. Strictly speaking, Cherrie v. Virginia Health Services is an admin-law matter, though it might fit under the tort umbrella, or perhaps discovery.
Virginia Health operates nursing homes, and is thus regulated by the Board of Health. The Board requires nursing homes to have written policies, and to make those policies available for review “to residents and their designated representatives.”
The personal representatives of two deceased former residents sought access to the nursing homes’ policies, presumably to help them to determine if they had med-mal claims based in part on violation of policies. The nursing homes refused, saying that only current residents, not former residents, could ask for the policies. The personal reps went to circuit court to enforce their right to see the documents.
The trial court agreed with the nursing homes, finding that former patients no longer had the right of access. On appeal, the justices decide not to resolve the direct dispute. Instead, the Supreme Court affirms based on a more fundamental consideration: standing.
The specific issue that drives today’s opinion is who has a right to enforce a violation of the Board of Health’s policies. Beyond question, the Board does; the Administrative Code allows the Board to impose sanctions, from civil penalties to license revocation, when a regulated entity blows off its obligations. But does the Admin Code create a private right of action?
No, it doesn’t, the justices rule today. Justice Kelsey writes for a unanimous court, and notes that where the General Assembly specifies a means of enforcement for a particular statutory requirement, the courts are not free to add to the list. A right of action – the right to enforce a cause of action – has to come from the Constitution, the statutes, or existing common law. There’s nothing in any of those three sources that authorizes individuals to file suit in situations like this.
This decision is a victory for the health-care industry and a loss for the plaintiff’s bar. The two sides have warred for some time over the question whether plaintiffs can get health-care providers’ policies and practices. These plaintiffs no doubt hoped to sidestep the usual legal issues surrounding traditional discovery requests, by resorting to this administrative regulation. The Supreme Court today closes that road.
Appellate veterans will recognize that the court today utilizes the revised right-for-the-wrong-reason doctrine that it crafted a few years ago. Once upon a time – and not so long ago – the Supreme Court refused to consider a challenge to standing if it was made for the first time on appeal. See, e.g., Martin v. Ziherl, 269 Va. 35, 39-40 (2005) (“We have repeatedly held that challenges to a litigant’s standing must be raised at the trial level, and the failure to do so precludes consideration of a litigant’s standing by this Court on appeal.”). The Banks/Perry duology in 2010 changed all that; now, the court will affirm for any reason that’s apparent in the record, regardless of whether the appellee raised it below.
A FRESH LOOK AT APPELLATE ORAL ARGUMENT
[Posted July 6, 2016] “Damn you.”
That’s how I began the note of appreciation I sent to the author of a recent article in Litigation, the quarterly journal of the ABA’s Litigation Section. The Spring 2016 issue arrived a few weeks ago, and on the cover, it listed titles of some of the articles inside. “The Discovery Rules Have Changed” was the first one. Happily, I’m largely immune from discovery issues and the inevitable scuffles they generate. I figured I could skip that one.
But the next one caught my eye. “Let’s Change the Appellate Rules Too,” it beckoned. Well, now. That one, I need to read. The author is Martin Siegel, a Houston lawyer who serves as the editor of the magazine. (This makes it easier for him to get his work published, of course.) I found the article on page 30 and dug in.
Siegel begins with a fairly uncontroversial ground rule:
Before getting into specifics, it’s worth stating my underlying (if head-bangingly obvious) premise up front: Legal procedures should be as easy and affordable as possible without compromising the quality of judicial decision-making. The first duty of courts is to the public – not judges or lawyers. Familiar ways of doing things may be comfortable or convenient for the bench and bar, but if they add cost while only marginally or occasionally improving the quality of appellate decisions, the basic interest of litigants in less expensive justice should prevail.
Now, before you read on, make sure you’re comfortable with the premise above. I think it makes perfect sense, but if you’re waffling over this concept, then the rest of this essay won’t have the same impact. Courts are for the benefit of clients and the public. Judges and lawyers serve that purpose; not an independent purpose of their own. If you agree with me on this, we can move on.
Siegel then lists several ways in which he believes appellate procedures can safely be streamlined to reduce the expense of appellate litigation. Here’s one: Create a short form for routine motions, perhaps even a series of click-through menus so you can do it online. Need a few extra days to file? If you have your opponent’s consent, why not just notify the Clerk by e-mail and allow her to grant the extra time ministerially? Sure, there can be limits – no extensions of jurisdictional deadlines; no repeat extensions; a limit of X additional days – but the process of filing even a routine motion can indeed be made simpler, and thus less expensive, without sacrificing decisional quality.
You think I’m dreaming, and that jurists will never delegate to the clerk the power to decide even the most routine motions? Think again! In the Fourth Circuit, who do you think acts on the kind of routine extension motion I describe above?
Motions and applications for orders if consented to, or if unopposed after due notice to all interested parties has been given or waived, or if the orders sought are procedural or relate to the preparation or printing of the appendix and briefs on appeal, or are such as are ordinarily granted as of course and without notice or hearing, need not be submitted to the Court, or to a judge thereof. Such orders may be entered for the Court by the clerk, who shall forthwith send copies thereof to the parties.
4th Cir. L.R. 27(b).
Siegel next turns to briefs, and offers a set of suggestions that may cause old-school practitioners and jurists to rebel. For example, he notes that some mandatory sections in briefs are redundant and can be eliminated with no effect on the end product. FRAP mandates a summary of the argument, placed “right before the reader takes in the arguments themselves.” Why do you need that? He notes that some jurists like the summary – he names Justices Thomas and Alito – while Justice Scalia thought it superfluous.
Siegel also thinks that the jurisdictional statement (required in FRAP) and the statement of the standard of review (required in state and federal courts) can safely be ditched. With the former, he notes that “staff attorneys screen the appeal for jurisdiction early on,” and most appeals unquestionably invoke appellate jurisdiction anyway. Why not reserve a discussion for “the unusual case,” in which the court can direct the parties to be prepared to argue the question?
As for the standard of review, he believes that “[i]n the vast majority of cases, the standard is obvious and the judges are already more familiar with it than counsel.” You know what? He’s probably right. The Rules of Supreme Court of Virginia began a few years ago to require that briefs set out the standard of appellate review, and even before that, good appellate lawyers included it voluntarily anyway, as a courtesy to the court. But why? Appellate jurists live and breathe the standard of review; it is as second-nature to them as the route of their daily commute. With the exception of a few dedicated appellate lawyers, an advocate won’t know the standard as well as the jurists will. Again, if there’s a real question about it, the court can direct the parties to address it, rather than require each brief, even in noncontroversial cases, to mechanically include a statement.
So far, there’s nothing in the article that rises to “Damn you” level. I agreed with some of Siegel’s suggestions and felt that others were unneeded. But now we get to oral argument, where he made my blood boil.
Now, as I’ve mentioned here repeatedly, oral argument is the very best part of an appellate practice. It is, as I’ve phrased it, the butterscotch sundae I get to enjoy after I finish my vegetables (the laborious process of editing my brief again and again and again). Siegel thinks so, too: “Like most appellate practitioners, I love oral argument. … Matching wits with adversaries and well-prepared judges in grand, high-ceilinged spaces is great fun.”
Despite this, Siegel thinks oral argument should be changed in a way that facilitates the premise with which he began: limiting expense without prejudicing the quality of decisions. Here’s the paragraph that stopped me dead in my tracks:
Suppose you read something, or two competing versions of something, and want more information from the authors. You probably wouldn’t ask them to spend lots of time guessing what you might ask, allocate days or weeks to review their materials in preparation, then … sit several feet away on a raised platform and ambush them with previously withheld questions. Instead, what most of us would probably do in that situation, assuming some access to the authors, is email.
I invite you to do what I did, and read that passage again. It exposes the terrible inefficiency – an artificial inefficiency, at that – of our system of appellate oral argument. It reveals that our appellate courts’ approach is geared not toward getting the best possible answer to questions – if you wanted that, you’d ask the questions in advance, and allow the advocates to prepare – but toward finding out which advocate can think, or just remember, better on his or her feet. How on Earth does that advance the goal of improving the quality of judicial decisions?
While I would love to cling to my beloved butterscotch sundae, I have to admit that he’s right. You should know that Siegel doesn’t advocate doing away with arguments; indeed, he notes that “[s]ome benefits of oral argument probably wouldn’t be well served by email exchanges.” For example, the public process of arguments helps to legitimize the judiciary in the public’s eye.
In perhaps his most important recommendation, Siegel suggests that “courts should at least provide some or all questions in advance or focus the parties’ attention on specific issues they want addressed at argument.” This can be done through a “focus order” issued by the court before oral argument. This approach would reduce costs to litigants by enabling the lawyer to concentrate her preparations, instead of having to master a massive record in order to be prepared for every possible question. It has no fiscal impact on the court system, so there’s no countervailing budgetary factor.
There’s more in the article, and I commend it to you for a fuller reading. You can see now why I began my appreciative note to Siegel with, “Damn you.” It was quite painful to recognize that the process that I’ve come to love, that I’ve accepted unquestioningly for so long, is inefficient for no good reason. It actually hinders the efficient fulfillment of the courts’ primary role.
Not long ago, I posted an essay here that decried the precipitous decline in oral-argument time. Fifty years ago, in merits arguments each side got an hour to argue in the Supreme Court of Virginia. Now, after a three-step reduction, it’s down to 15 minutes a side. I continue to believe that oral argument is valuable, and that any case that’s going to be decided on the merits by the Commonwealth’s highest court deserves more than the drive-by arguments we’re allowed now. But Siegel’s article convinces me that there’s a better way to do things than the system we’re using. We owe it to the “consumers” of the court system’s services to explore that.
ANALYSIS OF JUNE 30, 2016 SUPREME COURT OPINIONS
[Posted June 30, 2016] After a long wait, two sets of litigants get rulings today in cases argued almost four months ago.
Here’s one you don’t see every day: in three separate opinions that occupy just 7½ pages, and by a vote of 3-1-3, the justices unanimously affirm the trial court’s judgment in a tax case.
How can a metaphorical fracas like that be unanimous? Let’s dig into City of Richmond v. VEPCO and see.
The issue is fairly simple, though it involves seven million dollars. VEPCO runs an electricity-generating station in Richmond; the plant operates on natural gas. Pursuant to statutory authority, the City taxes “consumers of natural gas provided by pipeline distribution companies.” The Code defines this last term as a company that “transmits, by means of a pipeline, natural gas … to a purchaser for purposes of furnishing heat or light.”
The giant utility company refused to pay the tax. It admittedly used natural gas at the plant, but not “for purposes of furnishing heat or light.” It used it for purposes of generating power. The City didn’t budge; it evidently insisted that the plant converted gas into heat, and that heat got converted in turn into power. On appeal, the Department of Taxation sided with the City.
VEPCO appealed to circuit court, which reversed, finding that the purpose of generating power wasn’t the same as furnishing light or heat. The justices agreed to take a look at the dispute.
Justice Mims writes what’s designated as the opinion of the court. He notes that in this location, the Code refers to “heat or light.” In a nearby statute, it specifies “heat, light and power.” The court reasons that the omission of the word power in “our” statute has to mean that the legislature elected to treat power generation differently in this context. Accordingly, the trial court got it right.
Justice Powell writes separately. She notes that the trial court made a factual finding that VEPCO doesn’t consume gas in order to provide heat or light. She would affirm simply because there is evidence in the record to support that finding.
Justice Lacy pens the third opinion, and she’s joined by Justices McClanahan and Millette. Her approach is to decide the issue at an analytically earlier point: there is no “pipeline distribution company” involved here, so the tax doesn’t apply. She notes that VEPCO gets its gas from a company called VP Energy, and the SCC, which regulates such companies, has never classified VP Energy as a pipeline distribution company. Since the courts defer to interpretations like this from the SCC, Justice Lacy would affirm on that ground.
And that, my brethren and sistren, is how you get from three separate opinions to a unanimous result. It is also, evidently, how you take four months to hand down a quasi-unanimous, seven-page decision.
At the other end of the complexity spectrum, we have The Babcock & Wilcox Co. v. Areva NP, Inc. It’s a suit for royalty payments arising from the use of nuclear technology. Overwhelmingly, it involves the interpretation of some fairly unique contract language in a complex deal between a couple of large companies, and it applies fairly standard contract principles in doing that.
So why isn’t this an unpub? After all, publishing opinions serves to inform the public (including the bench and bar) of the legal reasoning that will govern future litigation; unpubs typically involve matters of no great precedential value.
Reason #1 might be the fact that this is a 42-page opinion. It’s easy to see why this one took four months to write and polish. Reason #2 might have something to do with the $16 million judgment for breach of contract and misuse of trade secrets.
Having just spent over 90 minutes reading and digesting the opinion, I don’t propose to lay out all the facts, including complex contract provisions, in detail. That would make this a monstrously long essay, and I might lose you. Instead, I’ll mention a couple of key points that contributed to the court’s decision to overturn the verdict and enter final judgment for the defendant.
First, the court rules that just because a contract provision is complex doesn’t make it ambiguous. Ambiguity means that language is susceptible of two meanings. The language of this contract is highly technical and scientific, but the justices don’t find that it requires rules of construction or interpretation; just plain application of the words used to reach a single, though complex, meaning.
Second, the trial court had entered a partial summary judgment order that barred some of the plaintiff’s claims. At the ensuing trial, however, the court allowed the plaintiff to present those claims to the jury, and the plaintiff got a verdict on them. The Supreme Court rules that the judge’s original ruling was correct, and the trial court should have set the verdict aside and entered judgment for the defendant on those claims.
How can a trial court rule in limine that a jury won’t get a particular claim, and then go ahead and allow that claim? Well, two obvious answers are mistake and oversight. But in reality, a ruling like that is interlocutory, and a trial judge can always change his mind on it, at any time before 21 days after final judgment.
Defense attorneys may take comfort in the fact that the Supreme Court has set aside yet another eight-figure judgment. The court has historically been the place where large judgments go to die. I can’t say that that’s because of actual antipathy toward them by the justices; it may be coincidence. After all, eight-figure judgments don’t come along every session. But the last one of which I’m aware that the Supreme Court affirmed on the merits was VEPCO v. Dungee, way back in 1999 (258 Va. 235). (There may be a more recent one, but I can’t think of any right now.)
One last point: according to today’s opinion, the appendix in this appeal comprised at least 28 volumes and occupied over 13,000 pages. Rule 5:32(a) requires that the parties designate for inclusion in the appendix only the portions of the record that are “germane to the assignments of error” or “necessary for an understanding of the case.” In addition, the rule allows parties to designate other parts of the record “to which the parties wish to direct the Court’s attention.”
Now, I understand that the issues were complex, but 13,000 pages is, in my mind, clearly excessive. Overdesignating is a form of defensive lawyering — including more than you have to, to ensure that you leave nothing out that might possibly be relevant. I’m going to make a wild guess that many thousands of those pages — certainly more than half the total — fit into none of Rule 5:32’s categories. That produced a stack of volumes probably four feet high, much of which was wasted paper.
SOME APPELLATE ODDS AND ENDS
[Posted June 29, 2016] Here are some notes on a few things that have caught my eye lately in the appellate world.
A wealth of issues
One of my long-time readers wrote to let me know about the writ granted last week in Blackwell v. Commonwealth. From the listing of the assignments, it looks as though the appellant was convicted of setting two fires and attempting to collect insurance money afterward. Those assignments deal with sufficiency issues, and normally an appeal like this wouldn’t be news. But the number of issues granted is news: eleven assignments. Eleven! But it could have been more; it’s apparent that the justices refused at least five others from the petition.
Now the appellant’s lawyer gets to deal with the unfortunate truth that you don’t get extra pages just because the court accepted a lot of issues for review. He’ll have fifty pages, of course, as is usual for a granted writ. But if you think you can discuss eleven sufficiency issues fully in that many pages – remembering to stop along the way for things like the facts, the statement of the case, the standards of review, etc. – then you’re either seriously deluded, or else … you’re an experienced appellate lawyer already.
I will repeat here my advice that you should restrict yourself to the fewest assignments of error you can reasonably live with. Multiplying your appellate issues, perhaps on the assumption that that gives you more opportunities to succeed, is often a self-defeating proposition. Most appellate jurists will tell you that there’s an inverse relationship between their perception of a brief’s merit and the number of issues raised. This case proves that sometimes you can get away with the kitchen-sink approach.
And plenty of new writs
I’ve written recently about the alarming downward trend of writs granted in the SCV. Go back fifteen or twenty years and you’ll find somewhere in the range of 200 to 250 writs a year. Nowadays we’re down close to 100, a far steeper drop than the decline in the number of incoming cases. The justices have become measurably stingier in issuing those writs.
This is a very small glimmer of good news, but the court has already issued 23 writs from the panels that met five weeks ago, on May 24. I know better than to put too much faith in extrapolated small samples, but multiply those 23 writs by six panels a year and you’d have about 140 writs this year – nowhere near 250, but still a move in the right direction.
I doubt that the folks in Vegas have an over/under on the number of writs we’ll get by the end of 2016, but my number is about 120. (No, I don’t make book, so you’ll have to place your bets elsewhere.) I recall that writ panels earlier this year handed them out with tweezers, so I know to be skeptical.
Retirement of a legend
SCOTUSblog’s Lyle Denniston has covered his last Supreme Court opinion day. The long-time Supreme Court reporter joined the website twelve years ago and has been the heart and soul of the site’s nonpareil live-blogging opinion coverage. His background as a journalist – unlike most of the other SCOTUSblog staffers, he isn’t an attorney – served him well as technology evolved, enabling the site to post quick analysis of new opinions. (Much as we do here, I might add.)
Follow-up on difficult preservation
I recently posted an essay about what to do when you’re trying to preserve the record and the learned judge makes life difficult on you. The simple answer is that you cannot back off; the justices don’t care that the judge is angry just at the time you need to make a record.
I referred in that essay to a CLE presentation I did last year entitled, “Courage for the Chicken-Hearted: Preserving the Record in Hostile Territory” for the VTLA. I didn’t want to upstage that organization by spilling here, and for free, all of the advice I gave to that audience. Now I’ve learned that the association has made the video of that program available for a very reasonable price: $35 (less if you’re a VTLA member). It isn’t the entire seminar; just my segment. And while you won’t get MCLE credit, you’ll be able to see the presentation and download the written materials, which include case citations. Here’s a link to the page where you can order it. (I don’t get any revenue from these sales, but if you want to tip the on-air talent, feel free.)
FOURTH CIRCUIT ANNOUNCES KEY ATTORNEY’S-FEE RULING
[Posted June 28, 2016] In a matter of first impression in this circuit, the Fourth Circuit today explains when a district court may award attorney’s fees as a component of costs upon a Rule 41 dismissal. The case is Andrews v. America’s Living Centers, LLC.
Andrews sued an entity that I assume was her former employer, plus several related entities and one individual, under the Fair Labor Standards Act. At a subsequent hearing on a motion to dismiss, she chose a Rule 41(a)(1) dismissal. The defendants sought an award of costs under Rule 41(d) since this was a second dismissal, including within that petition a claim for their attorney’s fees. The court awarded $13K in fees.
The procedural history is more complex than that, but this much is enough to frame the appellate issue. The Fourth today notes that there’s a split in the circuits over whether a Rule 41(d) costs award can include attorney’s fees. On the one hand, the rule says costs but doesn’t mention attorney’s fees. Congress knows how to spell attorney’s fees when it needs to, so the Sixth Circuit has held that costs don’t include fees. The Eighth and Tenth Circuits have gone the other way, though they didn’t explain why.
The Seventh Circuit has taken a middle ground. If the underlying suit allows for an award of fees, then the district court may allow a fee recovery on a Rule 41 second dismissal. Fees may also be awarded where the plaintiff’s actions are in bad faith, or are vexatious, wanton, or oppressive. This is the approach that the Fourth Circuit adopts today:
This rule strikes the right balance between upholding the American Rule and furthering the goal of Rule 41(d) to deter forum shopping and vexatious litigation on the part of the plaintiff.
Applying this new rule, the court reverses the fee award. FLSA does allow for a recovery of fees, but only for a successful plaintiff; not for a defendant as here. And the court finds no evidentiary support in the record for a finding that the dismissal was in bad faith or was vexatious, etc.
ANALYSIS OF McDONNELL v. US
[Posted June 27, 2016] My long-time readers know that I generally leave coverage of SCOTUS to others – I particularly commend SCOTUSblog to you – but I addressed last year the major-news case of McDonnell v. United States, involving the bribery conviction of Virginia’s 71st Governor. Today the justices reverse the Fourth Circuit, which had affirmed the convictions. It’s only fair for me to round out the coverage with a few notes from today’s ruling. This will not be a comprehensive analysis of the case; you’ll be able to get that in several other locations. I just want to highlight a few issues.
First, today’s ruling is unanimous. The Chief Justice pens a 28-page opinion that rejects an expansive view of what will constitute official acts under the Hobbs Act and honest-services statutes. The primary reason for the reversal is the Court’s agreement with the defense – and several high-profile amici – that criminalizing conduct in the way the government urged would make it virtually impossible for elected officials to interact with their constituents.
Here’s one key passage on this point:
But conscientious public officials arrange meetings for constituents, contact other officials on their behalf, and include them in events all the time.
The italics in that sentence are mine. These words are technically hyperbole, but clearly the justices view this as ordinary activities, not something that should be criminalized.
Second, the Court effectively adopts the “thumb on the scale” approach urged by the defense in this appeal. That is, arranging a meeting with an appropriate government official isn’t an official act, unless the actor leans on the second official to make something come out a particular way. (The court adds that advising the second official can also support criminal culpability, so this isn’t a blanket pass for anything short of arm-twisting.)
Third, the reversal is not, as the Governor had sought, a complete victory. The Court remands the case to the Fourth Circuit to decide whether to remand for a new trial. The justices today focus on what the correct jury instruction should be to define official act, and then direct the Fourth to consider, in the first instance, whether the evidence here could have supported a conviction under the correct instruction. If so, then the case goes back to the district court; if not, it’s a final dismissal.
The Governor had asked the justices to find the statutes unconstitutionally vague, but they decline that invitation, finding that their newly announced explanation will satisfy due process.
Finally, the justices clearly are not happy with the package they’ve received. Their distaste for the facts comes though loud and clear in a couple of instances. I sense that they reverse primarily because of the logical extension of the Fourth’s holding, not because of a sense that the Governor deserved no blame.
Even so, the Governor is back in the game, so he’s had a good day. If the Fourth gives him a favorable ruling, then his long nightmare (and probably his wife’s, too) will be at an end. Failing that, he might be in for a terrible ordeal – a retrial, if the US Attorney is so advised.
ANALYSIS OF JUNE 23, 2016 SUPREME COURT OPINIONS
[Posted June 23, 2016] The Supreme Court of Virginia hands down two published opinions this morning, both from appeals argued in the April session. There’s one about coverage issues between two parallel insurance policies, and another about a possibility of reverter in a deed of gift.
Okay, stop. Do not click on a link to another website. You should be ashamed of yourself, trying to skip out on today’s opinions just because the topics aren’t exactly what you’d immediately describe as sexy. Justice Kelsey put a lot of work into these two unanimous opinions – witness the fact that they aggregate to about 28 pages and there are 31 footnotes – and you should pay attention.
Look, we’ll check in on some of our old pals like Blackstone and even Coke. It’ll be just like old times, back in law school. If it’ll help, I’ll do what I can to make the prose sparkle.
The case of Hamm v. Hazelwood involves a deed of gift in which a woman gave some property to her sister, reserving a life estate unto herself. The sister had six children, including a son named Reginald. The grantor evidently cared not for her nephew; although the record in the case doesn’t expressly say why, it’s clear that there was a strain between the two. She built into the deed a reversion clause:
The PROPERTY hereby conveyed shall AUTOMATICALLY REVERT to [the grantor] in the event Reginald Wayne Clarke, son of the [grantee], ever acquires any interest therein by grant, inheritance or otherwise or is otherwise permitted to occupy, even temporarily, any portion of said property.
Wow! The precise legal term for this level of antipathy is that she “hated his guts.”
Of course, I’m reading between the lines a bit, but I think I’m right. As you might imagine, the grantor died first, and six years later, her sister died. Guess who was one of the sister’s heirs?
The issue in this appeal is whether the clause set out above is a valid restraint on the sister’s right to alien the property. Virginia law doesn’t countenance universal restraints on alienation; that means that you can’t convey fee-simple title to John Johnson but bar him from selling it to anyone, forever. (Nor does American law permit the fee-tail estate, which features so prominently in Jane Austen’s writings.) But this was a far more limited prohibition; it only applied to Reginald.
Now, you’ve noticed how expansive the reverter clause is. All Reginald has to do is set foot on the property and the whole estate reverts to the grantor (as it turns out, to her son, who is Reginald’s cousin). But in this case, this most draconian part of the clause isn’t implicated; Reginald received an ownership interest by virtue of surviving his mother, who had survived her sister. That presents the question whether a deed like this can prevent a given person from acquiring an ownership interest in the future.
I’ll spoil all the glorious run-up and give you the answer: yes, it can. This isn’t anywhere near as broad as the expansive, hypothetical limitation I set out above for Mr. Johnson. This provision creates – and vests immediately in the grantor – a possibility of reverter, one of the hallmarks of a fee-simple determinable estate. Melba never got the estate we call fee-simple absolute, because of the existence of that possibility of reverter. No, it doesn’t violate the Rule Against Perpetuities, because the reversion would occur during the life of a then-existing person (poor Reginald).
When a pretrial detainee in a regional jail felt that he got inadequate medical attention, resulting in permanent disability, he sued everybody he could think of, alleging §1983 liability and medical malpractice. It eventually surfaced that there were two applicable insurance policies that might be liable for coverage and a defense. Today’s ruling in Division of Risk Management v. Virginia Association of Counties Group Self Insurance Risk Pool resolves the dispute between two insurers over which one was primary coverage and which one was secondary.
Actually, both policies claimed to be primary coverage. They said so, directly. But one of them had a provision in the event of another policy:
… if, at that time of loss, there is any other coverage or insurance available to a Covered Party which covers such loss or which could have covered such loss, VaRISK shall not have any liability for such loss.
That provision, if it governs here, means that the VaRISK policy is no policy at all, since the VaCo policy unquestionably applied. That policy, in contrast, said that when other coverage is available, a formula should be used to apportion liability among the two policies. The trial court looked at these provisions and ruled that while both policies were in force, the VaCo policy was primary, and the VaRISK policy provided only excess coverage beyond the VaCo policy’s limits.
Today, the justices disagree in part. They note that there are three possible kinds of other-coverage clauses. One of those is the one in the VaCo policy, providing for allocation of the costs among the two policies. A second makes one of the policies excess – pretty much what the trial judge had ordered. The third type is the harshest: it “seeks to absolve the insurer of any and all liability — co-primary or excess — in the event that the insured obtains duplicative coverage elsewhere.”
You can imagine what might happen if two policies each have clauses like the third one: they cancel each other out, leaving the insured defenseless. Happily, the court notes today, we don’t have that kind of situation here. (The subtext is that if we did, the Supreme Court of Virginia would find a way to avoid that result.) Both insurers readily acknowledged in the litigation that they weren’t arguing for this “escape-clause” ruling. The justices take them at their word.
But the VaRISK policy clearly says just that, in the stark language I quoted above. It’s an escape clause, not an excess clause. That leaves only one alternative: the apportionment approach.
And that’s what the justices direct. They find that both policies are primary: neither involves an escape clause, and there’s no provision to convert either into an excess policy. The Supreme Court thus remands the case to the trial court to determine, in the first instance, how to apportion equitably the costs of defense of the inmate’s claims.
Update June 24: I’ve heard from my pal John Rasmussen about this case. John is one of Virginia’s leading coverage gurus. He generously offered the following comments about how yesterday’s opinion will affect you:
This case shows the tools available to courts in applying coverage terms. This matters because policies and risk plans can be awkwardly drafted and thus hard to parse.
Here, the Supreme Court of Virginia relies on DRM’s assessment that its escape clause does not apply to eliminate coverage here, despite the DRM plan’s plan terms. Many courts would follow the proposition that the policy says what it says, the meaning of its terms is a question of law for the court to resolve, and an insurer’s statements about what the policy covers or does not cover would not matter. The SCV does not follow that approach in this opinion. Indeed, it adopts an interpretation, connected in part to DRM’s interpretation, that leaves the escape clause without any clear effect, given that it does not allow escape or function to make DRM coverage excess.
This approach by the Supreme Court supports an argument for deposing a carrier’s designee as to what effect the policy terms have and why.
Carriers frequently resist such deposition topics, arguing that a deponent cannot change the policy terms. Now, in Virginia, that may be a harder argument to win.
The Court here also uses some tools it has not relied on as heavily to determine coverage in the past — secondary sources like Couch, Appleman, and Windt. Rather than depend on such sources, Virginia courts have instead focused on prior Supreme Court of Virginia opinions and, to a lesser extent, federal district court and Fourth Circuit authority, as well as the actual cases from other jurisdictions.
One challenge to that earlier approach is that other states have addressed coverage issues in detail that Virginia has never addressed.
This opinion also looks at “other insurance” provisions, and escape clauses in particular. While it appears to disfavor applying escape clauses such that coverage evaporates, Virginia’s high court does not decide the issue given DRM’s position that the policy does provide excess coverage rather than no coverage.
ANALYSIS OF JUNE 16, 2016 SUPREME COURT OPINIONS
[Posted June 16, 2016] The Supreme Court of Virginia announces three published decisions this morning.
Dorman v. State Industries involves a products-liability claim against a manufacturer of water heaters. The plaintiffs were Virginia Tech students who sustained injuries from carbon-monoxide poisoning at their apartment. They sued the manufacturer, claiming that the unit vented exhaust openly, so that the CO could enter their apartment, rather than in a closed system that would vent the exhaust outdoors.
At trial, the parties each brought an expert. The plaintiffs’ expert felt that the heater was designed incorrectly, causing the poisoning. The manufacturer’s blamed improper installation, and noted that the apartment had been newly carpeted nine days before the event, reducing the flow of fresh air into the apartment (since the carpet effectively sealed off the opening at the bottom of the door).
A jury sided with the manufacturer. The plaintiffs got a writ to review several assignments.
The first issue relates to the manufacturer’s evidence about the number of its water heaters now in service (in the millions). The plaintiffs claimed that this evidence was improper, since, as the Supreme Court has ruled, “evidence of the absence of other injuries is not admissible in a negligence action when timely objection to it is made.” The justices hold that this wasn’t that kind of evidence. It was relevant, the court holds, as a component of the units’ merchantability.
In products cases implicating the implied warranty of merchantability, one key question is whether the goods pass without objection in the trade. This, in turn, depends on whether a “significant segment of the buying public” is okay with buying it.
When you put it that way, it makes sense that evidence of the number of units sold is admissible, even if evidence of the absence of other injuries isn’t dispositive of whether a particular product was negligently designed. Nevertheless, products-liability defense lawyers will regard this as a major victory, since they can implicitly make the no-other-injuries connection, or at least expect jurors to make that connection on their own.
Next, the court takes up the trial court’s giving of an instruction on superseding cause. A majority of the court finds that this was a proper issue for the jury, since the manufacturer’s expert testified that the heater wasn’t defective when it left the factory; it only became a problem after it was installed and the landlord put in new carpet. The majority specifically finds that the jury could have attributed the problem to installation issues.
Finally, the court affirms the wording of the superseding-cause instruction, noting that it’s “substantially the exact language given here,” and was supported by more than a scintilla of evidence. The court turns aside an objection that the instruction didn’t properly tell the jury that the burden of proving superseding cause was on the manufacturer. That’s because the plaintiffs never tendered their own instruction to do that. Preservation caselaw provides that if you think the Bad Guys’ instruction is incorrect, you have to proffer your own correct one, or else the objection is waived.
Because this is an important issue that’s overwhelmingly likely to reoccur, I’ll add one observation. The plaintiffs here may well have declined to offer a burden-of-proof instruction for superseding cause because they feared waiving their objection to the presentation of the issue to the jury in the first place.
You can preserve the issue without that waiver by stating clearly, on the record, that you submit your corrected version to the trial court under protest, while maintaining your position that superseding cause (or whatever your issue is) should not be considered by the jury. If you haven’t brought an instruction with you but you want to object to the Bad Guys’ wording, you should at least tell the judge – again, on the record – how a properly worded instruction should read. That would give the justices the full picture for appellate review. What you cannot do is simply claim that the Bad Guys’ instruction is incorrect, without telling the judge exactly what’s wrong with it.
I mentioned a majority opinion, and that tells you there’s a dissent. The chief justice (joined by Justice Millette) feels that while the installation of the heater, and the addition of the carpet, may have been intervening causes, they weren’t truly superseding. A superseding cause exists wholly independent of the defendant’s negligence, and the dissent feels that this set of facts doesn’t rise to that level, so the jury shouldn’t have been instructed on it.
Note that the dissent doesn’t touch the million-of-units issue, signaling that the full court agrees that the number of sales is admissible, not to prove that other injuries haven’t occurred, but for the discrete issue of merchantability. I sense that some future plaintiffs may eschew product-liability theories in favor of straight negligence claims, in order to avoid this issue with widely distributed products. Time will tell.
While VEPCO v. Hylton is a condemnation case, it contains an important preservation-and-waiver ruling that appellate practitioners will want to know about. The appeal involves the condemnation by VEPCO of an easement across some rural land in Wise County, allowing the utility to string some power lines from a generating plant to a nearby substation.
The easement comprised about eight acres across a 350-acre farm. VEPCO appraised the easement at $19K and offered that much; the landowner declined. In its condemnation petition, VEPCO alleged that it had “complied with all of its statutory obligations associated with the exercise of eminent domain as to the Easement.” The landowner admitted that. In the next paragraph, the utility asserted that it had made a bona fide offer to purchase – that’s one of the statutory prerequisites to condemning land – and this time, the landowner responded that he didn’t think VEPCO had offered enough, so he denied the allegation.
The case matured for trial, but in discovery, the utility’s appraiser – who was relatively new to the practice – admitted that he hadn’t considered any value added to the site by virtue of the mineral rights, specifically coal, that the land might contain. As it happens, there once was an active mine on the site. The mining company that leased it had ceased operating it several years before, though it was still paying nominal rent to the owner under the mineral lease.
A month before trial, the landowner moved the court to dismiss the petition, claiming that the utility hadn’t made a bona fide offer. The trial court agreed; it dismissed the case and awarded the landowner a combined $400K in attorney’s fees and litigation expenses.
A stunned VEPCO applied for a writ and got one of the precious documents. Today, the justices reverse the case and send it back for trial. Today’s opinion contains a few evidentiary rulings on what will happen on remand, but for eminent-domain lawyers, this case will primarily be about the dismissal order.
By statute, if a landowner wants to challenge the jurisdictional basis of a condemnation petition, he has to do so affirmatively, in his answer or in a pleading filed along with it. Here’s the guts of the requirement:
Within 21 days of the service [of the petition for condemnation] any such owner who desires to assert any objection or defense to the taking or damaging of his property or to the jurisdiction of the court to hear the case, … shall file … (ii) the grounds of any objection or defense to the taking or damaging of his property or to the jurisdiction of the court to hear the case …
Code § 25.1-213. While the landowner did claim that the utility’s offer was too low, that’s not enough to constitute a jurisdictional defect. Think about it: if it really was true that the petition could be dismissed whenever the ultimate valuation was higher than the condemnor’s offer, condemnation would effectively be shut down.
Today’s opinion lists several things that the landowner did that were inconsistent with contesting jurisdiction:
- He conceded that VEPCO had met the statutory requirements for condemning.
- He affirmatively elected to proceed to trial by a condemnation jury.
- He agreed to an order allowing VEPCO a right of entry on the property.
- He drew down and pocketed the $19K that VEPCO had paid into court along with filing the petition.
These circumstances lead the Supreme Court to the conclusion that the landowner waived his objection to the proceeding by failing to raise it timely.
I promised you an important preservation ruling. The court bases its decision on the language in the statute I quote above. But in the trial court, the utility had relied upon a different statute entirely:
If any answer and grounds of defense has been filed objecting to the jurisdiction of the court, the court shall determine such issues or other matters in controversy, excepting the issue of just compensation or matters relating to the ownership of any land or other property or the interests of any party in such land or other property before fixing a date for the trial of the issue of just compensation.
Code § 25.1-219(B). This statute, you will note, places an obligation on the trial court, but none whatsoever on the landowner. Here, then, is the preservation question: where your appellate argument depends on a statute, can you preserve the issue for appeal by exclusively arguing a different statute below? Before today, I would have wagered a substantial amount of loot, American currency, that the answer was no. If you’re relying on a statutory obligation but you assert a wholly different statute, how fair is it for you to switch statutes once you get to Richmond?
It’s not fair at all; or so I had thought. In this case, the justices reverse based on a statute that the trial judge never had the opportunity to consider and that the landowner never had the opportunity to brief. But in a long footnote – the footnotes are where the goblins hang out in appellate decisions – the Supreme Court surprisingly says, “Close enough.”
Preservation under Rule 5:25 does not require a party to precisely reference the exact statute or rule upon which they rely in making an argument. Rather, a party need only give the trial court “sufficient ‘notice of the substance of the objection.’”
Since part of my job here is to give you sensible practice tips in your own trial and appellate practices, I will entreat you, when making your objections, to steer a course that’s well clear of the approach in the sentence I quoted here. Cite the precise statute, not its second cousin! There’s no way to be certain in advance that the court will be similarly forgiving in future cases.
There’s one other astonishing detail here. The landowner’s attorney’s-fee petition laid out the basis on which his lawyer was being paid. One of those provisions was for “an hourly fee of $100 per hour for appeal work.” Conceivably, that’s the going rate for legal work in Wise County; though I seriously doubt it. But of the appellate lawyers I know, no one has an hourly rate that’s in the same Zip Code as that. If you’re expecting to hire an experienced appellate practitioner for one Benjamin per hour, good luck with that.
For the second time in just over a year, dirt lawyers are going to erupt when they read a Supreme Court opinion. Last year, it was Evans v. Evans, where the court ruled that a tenancy by the entireties could be severed by a deed signed by only one spouse. Today, it’ll be Parrish v. FNMA.
The Parrishes bought a home and mortgaged it. A couple of years ago, they evidently got far enough behind on the payments that the lender foreclosed. A substitute trustee knocked down the sale and conveyed the property to Fannie Mae, who apparently was also the lender.
Fannie Mae then filed an unlawful detainer action in general district court, seeking to kick the Parrishes out of their home. In response, the Parrishes contended that the foreclosure was invalid. They claimed that they had – as federal lending law provides – filed a loss-mitigation application more than 37 days before the sale date, so the trustee was powerless to conduct the sale. Since the sale was improper, they reasoned, they weren’t subject to UD proceedings.
The GDC judge didn’t bite; the court gave possession to Fannie Mae. The Parrishes appealed to circuit. There, the lender’s lawyer had an unpleasant surprise wrapped inside a motion for summary judgment. It claimed that the trustee’s deed was prima facie evidence of its right to possess the home, and the GDC didn’t have jurisdiction to try title to the case. The Parrishes had implicitly challenged Fannie Mae’s title in their answer. Since the circuit court’s appellate jurisdiction was derivative of the GDC’s, that meant that neither court had the authority to try title.
The circuit court agreed with Fannie Mae and gave it possession. Today’s opinion resolves the Parrishes’ appeal of that judgment.
By a vote of 5-2, the Supreme Court today reverses and dismisses the UD case, restoring the possessory aspect of the case – though not the legal title to the home – to where things stood before Fannie Mae brought the UD action.
Here’s how the Parrishes won, and what that means for UD practice going forward. The majority – Justice Mims writes for the chief justice plus Justices Kelsey, Russell, and Millette – finds that a bona fide question about the foreclosure process necessarily implicates the new owner’s title to the property. General district courts are not empowered by law to try title; only circuit courts can do that. Since the GDC didn’t have that power, then the circuit court, when it exercises appellate jurisdiction, doesn’t have that power, either. When a court doesn’t have subject-matter jurisdiction, the only order it can enter is to dismiss the case. The majority concludes that Fannie Mae’s legal avenue is to bring a new UD action in circuit court under its original jurisdiction, and at that point the court can adjudicate the title.
Remember when I mentioned earlier the bit about footnotes and goblins? There are enough goblins here to storm Minas Tirith, gathered in no fewer than 24 footnotes, some of which are quite extensive. Justice McClanahan starts the dissenting ball with a surprisingly blunt accusation: “In a result-oriented approach, the majority creates, and then resolves, a question of subject matter jurisdiction that has heretofore never existed.”
As an aside, I’ll begin by noting my appreciation for her honor’s correct use of the hyphen in the phrasal adjective result-oriented. (In a close call that could really go either way, I might have used another one in subject-matter jurisdiction, but I’m so happy to find another grammar geek, I won’t quibble.) That being said, it’s those two words that represent the nuclear explosion today. The rule of law is based in part on the premise that in these cases, the legal analysis drives the case outcome; it isn’t supposed to be a desired outcome shaping the legal analysis.
In this context, her accusation raises a sore subject: does the Supreme Court actually shade its legal analysis in order to make a given case come out the way the justices want it to come out? Permit me to say only that there are two kinds of thinking on this question. All too often, the two differing kinds are represented by the winners and the losers. That makes many of the complaints look like they, too, are result-oriented.
But Justice McClanahan argues forcefully that, at least since 1855, nobody tries title in UD proceedings; you try the right of possession, which is a separate issue, far more limited than title. In her view, Fannie Mae can establish its right to possession by flashing the trustee’s deed, and that’s enough on this issue.
Justice Powell files a separate dissent. She argues that “there is a significant difference between an action that turns on the question of title and an action that tries title.” The state of title to property may be an evidentiary issue in a UD action, but it isn’t the action itself. She points to a statute that makes UD rulings non-binding in subsequent trespass or ejectment actions – both of which arise in circuit court and both of which emphatically require the court, when a dispute arises, to try title.
The Code gives general district courts the right to try UD cases. Today, in post-foreclosure actions, the Supreme Court has stated that a possessor can forestall those proceedings by raising a plausible defense, requiring the plaintiff to suffer a dismissal without prejudice before heading off to circuit.
Justice Powell offers one parting shot for lenders, and ominously for law firms that represent them in foreclosure proceedings. She notes that a trustee owes fiduciary duties to both the mortgagor and mortgagee (the borrower and the lender, respectively) and cannot favor one over the other. In turn, that means that a trustee cannot be both a seller at auction and the buyer, “because the two roles are incompatible.”
In this case, the substitute trustee was a law firm. Acting on instruction from the noteholder, Fannie Mae, it likely bid the property in at a fixed amount representing the amount of the loan. (This is to prevent a single bidder from showing up at the sale and “stealing” the property for a $1 bid.) That made Fannie Mae the buyer. But Justice Powell notes that that same law firm represented Fannie Mae in the UD proceeding; it was clearly acting as Fannie’s agent. “Thus, the record clearly demonstrates that Fannie Mae was both the buyer and, through its agent, seller at the foreclosure auction.” Uh-oh.
Several law firms that handle foreclosures will read this language and swallow hard. This reasoning, if it governed Virginia foreclosure practice, would radically change the way things are done. But take comfort; this is just a lone dissent and not the opinion of the court. No, the real traffic jam from now on will be in GDC, as purchasers’ lawyers try to argue that the UD defendants’ claimed defects are not, in fact, bona fide. Otherwise it’s a long, slow process to get to the trial date in circuit.
Update June 17: I’m lucky enough to have some very bright readers, and one of them has written to me to let me know about the provisions of this statute:
§ 64.2-1423. Trustee not disqualified due to status as stockholder, employee, or officer of corporate noteholder; sale of property by trustee not voidable.
A. The fact that a trustee in a deed of trust to secure a debt due to a corporation is a stockholder, member, employee, officer, or director of, or counsel to, the corporation does not disqualify the trustee from exercising the powers conferred by the deed of trust, nor does it render voidable a sale by the trustee in the exercise of the powers conferred on him by the deed of trust so long as the trustee did not participate in the corporation’s decision as to the amount to be bid at the sale of the trust property.
B. In addition to the provisions of subsection A, if the lender secured by the deed of trust bids the amount secured, including interest through the date of sale and costs of foreclosure, the trustee’s participation in fixing the bid price by the lender shall not be deemed improper and the sale shall not be rendered voidable solely by reason of the trustee’s participation. …
While this doesn’t address the problem of unlawful-detainer suits in GDC, it does at least give some comfort to law firms that serve as trustees, at least where the noteholder is a corporation. That lessens the sting of Justice Powell’s closing warning. Thanks for the heads-up, Chris.
ANALYSIS OF JUNE 9, 2016 SUPREME COURT OPINION
[Posted June 9, 2016] If you’re reading this on a tablet or a cell phone, and you’re standing – or even leaning on something – you need to sit down before you read further.
Comfy? Okay; let’s take up Clarke, Director v. Galdamez, a habeas corpus appeal from up in the State of Northern Virginia.
This is an ineffective-assistance claim by a resident alien, a native of El Salvador. He was charged with drunk driving and felony hit and run. His lawyer negotiated the second charge down to a misdemeanor and Galdamez pleaded guilty, getting a total of ten days in jail to serve, with a total of 260 days suspended on the two charges.
Alas for him, Homeland Security was on the ball; it notified him that his Temporary Protected Status as an alien was being revoked. The HS folks recommended that he pack his bags.
Relying on Padilla v. Kentucky, Galdamez got a lawyer who filed a habeas petition, claiming that his defense lawyer failed to advise him of the deportation consequences of his guilty plea. He asserted that if he had been advised correctly, he would have fought the charges by going to trial. The Director of the Department of Corrections moved the habeas court to dismiss because regardless of the quality of the advice, Galdamez had “no viable defenses” to the charges.
The habeas court conducted an evidentiary hearing, and concluded that Galdamez had stated a claim for relief. It found that the lawyer had failed to advise his client properly, and found it possible that Galdamez would have been acquitted if the case had gone to trial. The court set the convictions aside, subject to the Commonwealth’s right to retry him.
At this point, you’re probably wondering why I needed to warn you to sit down. Let’s deal with that now. Here are the underlying facts:
Galdamez drove his car, westbound, out of a parking lot into the northbound lanes of a road. Despite the fact that the weather was clear and his line of sight down the roadway was unobstructed, he failed to see a car coming from his left. He entered the road, intending to turn left. He T-boned the oncoming car, resulting in significant damage to his entire front end and the entire right side of the victim’s car, which slued across a concrete median before coming to rest in the southbound lanes. A police officer estimated $4,000 in damage to Galdamez’s car and $2,000 to the victim’s.
Instead of stopping to check on the victim, Galdamez completed his left turn and drove to a nearby friend’s home. The friend urged him to go back, and he returned 12 to 15 minutes later – evidently before the police got there – and soon thereafter found himself under arrest for DUI and leaving the scene.
The habeas court ruled that he would have had a plausible basis for being acquitted, because despite leaving the scene, he returned promptly. Unfortunately, the hit-and-run statute requires drivers to stop “immediately,” a word that, in my mind, doesn’t contemplate a 15-minute detour. (Etymologically, the word comes from Latin roots meaning, “not to be in the middle.” That’s good enough for me.)
A bare majority of the Supreme Court affirms today, but on more expansive grounds. It holds that Galdamez could reasonably have perceived that a jury would buy his explanation that he didn’t know at the time that he had been in an accident; he only figured that out when he got to his friend’s house. Today’s majority finds that the factfinder should have resolved this issue.
And it is here, I’ll confess, that today’s majority loses me completely. Instead, I find myself in Justice Kelsey’s corner (the chief justice and Justice McClanahan are keeping me company over there) as he writes, “A rational jury could not come to that conclusion [that Galdamez didn’t know there had been a collision] because it simply defies common sense.”
The linchpin of the majority’s holding is a 1946 case in which a bus driver ran over a person lying in the roadway, but didn’t realize it. The bus driver was convicted of hit and run, but that conviction was reversed on appeal. That probably sounds puzzling to you, and it puzzled me; how can you not notice that you’ve just run someone over?
And then I read the dissent’s explanation of the decision: the bus driver was proceeding in thick fog that obscured vision for more than a few feet. The 1940s edition of the Supreme Court noted that “it was impossible to discern objects on the roadbed immediately in front of the bus,” and concluded:
A heavy bus loaded with 35 passengers and their baggage could have passed over the head or body of a person without the driver or passengers being able to distinguish the jar or jolt, if any, from that made by the wheels of the bus passing over any ordinary defect in the roadbed.
Now I see how someone could run over a guy and not know it. Galdamez, in contrast, had a clear day and a clear view of the car that he hit broadside. There may be a nuance to the evidence that I just don’t perceive at this distance, but from what I can see, the idea that acquittal was reasonably likely is wholly implausible to me.
This issue matters because if a reasonable defendant – not this actual defendant, because this is an objective standard – could have found it rational to go to trial, then the prejudice component of Strickland v. Washington is satisfied. Since the Director didn’t challenge the performance prong, that leads the court to send the case back for a retrial.
One last point: you can always reason that a jury might have decided to shake Galdamez loose despite the evidence, in a form of jury nullification. But the dissent quotes SCOTUS caselaw that excludes considerations like that from the courts’ calculus. Otherwise, a quixotic hope could undo the entire Strickland doctrine, making every conceivable escape effective to uncork the conviction. The dissent points out that taking that liberal a view wouldn’t satisfy the prejudice analysis; it would eliminate it.
ANALYSIS OF JUNE 2, 2016 SUPREME COURT OPINIONS
[Posted June 2, 2016] The Supreme Court of Virginia announces twelve rulings this morning. There are eight published opinions, one published order, and three unpubs.
There are two decisions today in this field. As usual, I’ll start with the shortest one of the day (that’s so I can get commentary posted for you faster): Johnston v. William E. Wood & Associates is just over four pages.
Well-established Virginia law holds that in the absence of a contract of employment, all employees serve at will: they can resign or be fired at any time and for any reason (subject to some exceptions, like a Bowman claim). The party who severs the relationship just has to give reasonable notice to the other party, and it’s done. The question in this appeal is what “reasonable notice” is.
Johnston worked for a real-estate brokerage here in sunny Virginia Beach. One day her boss stopped by her desk and said, “Good morning; you’re fired.” The termination was effective immediately; not two weeks (or apparently even two hours) later. The employee sued, claiming that a termination without any advance notice at all was unreasonable. The learned chancellor refused to bite; he sustained a demurrer.
The justices note that they’ve never addressed this precise issue before, but it turns out not to be hard. The Supreme Court affirms, finding that imposing a time-based requirement – something that the legislature has not deigned to do – “would create a great deal of uncertainty in employment relations.” Suppose an employee gets a red-hot job offer, but she has to leave the next day to accept it. Should the employer be able to make her stay for a waiting period – let’s say two weeks – thereby causing her to lose the opportunity?
Virginia law allows the employee the freedom to pursue that opportunity, so it allows the employer the same flexibility. The justices conclude that the phrase “reasonable notice” means “effective notice that the employment relationship has ended.” Once the other party gets the word, the notice is effective. It can be delayed, of course; there’s nothing wrong with giving two weeks’ notice if you want to. But the law won’t craft such a requirement for employers and employees.
I noted that this is the shortest opinion of the day. I like to think that the concise writing might be attributable to the fact that the author, Justice McCullough, is the only member of the court who earned a living as an appellate lawyer. And we appellate lawyers understand the value of conciseness.
Let’s turn to the public sector, and Andrews v. Richmond RHA. Andrews got fired just as Johnston did in the last case, but she had one advantage over Johnston: because she worked for a public entity, she had a right to a grievance process. Her internal grievances got her nowhere, so she resorted to the Authority’s admin hearing officer.
That step paid off, as the officer ruled in her favor, awarding reinstatement and back pay due to the Authority’s failure to apply properly its internal personnel policy. The officer’s ruling ended with a notice that either party could appeal to the local circuit court. The Authority took that step and secured a reversal; the court ruled that the hearing officer had erroneously interpreted the policies and procedures.
Andrews wasn’t giving up – if she had, we wouldn’t be talking about her today – and at the final step, the justices rule this morning that despite what the hearing officer said, the circuit court didn’t have subject-matter jurisdiction to consider the Authority’s challenge. The court thus reverses the judgment and dismisses the Authority’s appeal.
Where did we go wrong? Well, the Authority’s first mistake – one repeated by the hearing officer and even by Andrews below – was in assuming that its grievance process stemmed from Title 15.2 (Counties, Cities and Towns). In a process like that, a court might very well be empowered to review a hearing officer’s interpretation of internal policies and procedures. But the RRHA’s grievance procedure was instead based on the model in Title 2.2 (Administration of Government, the state’s grievance procedure).
The key to the court’s holding is the comparison between these two paragraphs in Code §2.2-3006:
A.Upon the request of a party to a grievance hearing for an administrative review of the hearing decision, the Director of the Department of Human Resource Management shall determine, within 30 days of the conclusion of any other administrative reviews, whether the hearing decision is consistent with policy.
B. Within 30 days of a final decision, [either] party may appeal on the grounds that the determination is contradictory to law by filing a notice of appeal with the clerk of the circuit court in the jurisdiction in which the grievance arose. . . . Within 30 days of receipt of the grievance record, the court, sitting without a jury, shall hear the appeal on the record. The court may affirm the decision or may reverse or modify the decision. . . .
I’ve bolded the critical words above. This statute sets out that decisions on the application of departmental policy stay in-house – no resort to court is permissible. Only if there’s an allegation that the decision is contrary to law may you go to a judge.
The Authority’s appeal to the circuit court claimed only that the hearing officer had improperly interpreted, applied, and even rewritten departmental policy. There’s a difference between law (statutes and caselaw are the obvious sources) and policy (established by an executive to govern internal processes). Respecting this difference means the court have to stay out of administrative determinations involving only disputes about policy.
I’ll add a couple of quick points here. First, Andrews never asserted in the circuit court that that court didn’t have jurisdiction; she went along with the whole process. But subject-matter jurisdiction cannot be waived, so despite her failure to object below, Rule 5:25 was defanged here; the justices took up the jurisdictional issue in the first instance.
Second, Andrews originally filed her appeal in the Court of Appeals – presumably under that court’s admin-law jurisdiction. But the CAV determined that the case belonged upstairs, so it transferred the record to the Supreme Court.
I’m not sure why the case didn’t fit in the Court of Appeals, but I don’t need to take the time to sort it out. Practitioners should know that there’s a saving statute, providing that if you make a mistake and file your appeal in the wrong court, you are not really-most-sincerely dead; it’s simply transferred to the right appellate court. If you get shipped from the CAV (where you have an appeal of right) to the SCV (where you have to seek a writ), the justices will give you leave to convert your brief of appellant into a petition for appeal.
There are a lot of fatal appellate landmines in the Virginia system, and some of them are, unfortunately, largely invisible. This isn’t one of them; there’s no real penalty for guessing incorrectly which appellate court gets your appeal.
SCOTUS has told us in no uncertain terms that criminal defendant cannot be required to stand trial while dressed in identifiable prison clothing. Today, in Wilkins v. Commonwealth, the Supreme Court takes up whether the appellant was indeed in such identifiable clothing, and resolves the first-impression issue of who has the burden of proof on that point.
This opinion is as much about the adequacy of an appellate record as it is about criminal procedure. In the chief justice’s opinion, he repeatedly refers to something before noting that it doesn’t appear in the record. Wilkins showed up for trial dressed this way, based on his lawyer’s representation in the record:
He’s wearing Portsmouth City Jail clothes. They are kind of like a green, sort of scrub outfit. He is wearing black sneakers that I think they have the inmates wear. He’s got a visible bracelet on his left arm.
The trial judge granted a short recess to allow Wilkins’s lawyer to get him some civilian clothes, but that was unavailing. The court felt that Wilkins was gaming the system – he had sought the previous day a fourth continuance of the trial date – and the judge noted for the record that he wasn’t confident that the jury would even recognize the outfit as coming from a jail.
The jury got ‘im, of course, and the Court of Appeals affirmed, ruling in part that the record “fails to establish that the appellant’s clothing at trial actually was clearly identifiable as jail clothing.” It’s this last holding that furnishes the basis for the justices’ ruling today.
Here’s how the chief justice frames the decisive issue:
This case presents a very narrow question for resolution: whether Wilkins’s attire was “readily identifiable” as jail-issued clothing. To answer that question, we first must determine which party has the burden of proof. In other words, does Wilkins have to prove that the clothing he wore at trial was readily identifiable as jail attire? Or, does the Commonwealth have to prove that it was not?
Relying on caselaw from elsewhere, the court rules that the burden is on the defendant, when he asserts that he’s about to be tried in prison clothes, to show that the clothing was “readily identifiable to the jury as jail attire.” And that brings us back to the problem of the inadequate record. The justices have only that sparse description from the defense lawyer. They hold that that isn’t enough to establish a constitutional violation.
What would be enough? Well, if the words COUNTY JAIL or SHAWSHANK PRISON appear on the uniform, we can all agree that that would suffice. You’d get the same result with an orange jumpsuit, or stripes, or a prominent serial number. But there’s nothing about a set of green scrubs, black sneakers, and a bracelet that screams, “Inmate comin’!”
If you have a problem like this in the future, my advice is to make whatever record you can, since the absence of a satisfactory record sank this appeal. At a minimum, take a photograph and ask that it be placed in the record of the case, so appellate jurists don’t have to guess.
There’s a double rarity in Commonwealth v. Bass. The first is that the Court of Appeals applied the ends-of-justice exception to the contemporaneous-objection rule, on its way to reversing a conviction. The second is that the justices reverse that ruling and reinstate the original judgment.
Police arrested Bass on warrants charging him with robbing Victim A and attempting to rob Victim B. (If you want a helpful mnemonic, think of the robberies as Actual and Botched.) The Commonwealth took the case to a grand jury, which inadvertently got the victims backwards. The indictment accordingly charged him with actually robbing Victim B and attempting to rob A.
Nobody noticed this defect at trial. As the evidence came in, it showed only an attempted robbery of Victim B, since he had no money to give up, while Victim A lost $85 in cash. The court instructed the jury consistent with the evidence and with the warrants, but inconsistent with the indictments.
The jury then hung as to Victim B, but it found Bass guilty of robbing Victim A – you know, the guy who had actually been robbed. After a sentencing phase, the jury sentenced Bass to ten years in prison for robbing Victim A.
In criminal-law parlance, this is a “fatal variance” between the indictment and the evidence. It means what you think it means: the defendant is entitled to a reversal when he’s convicted of a crime of which he wasn’t indicted. But Bass never raised this issue in the trial court.
The Court of Appeals took the rare step of applying the ends-of-justice exception and remanding the case for a new trial on the attempted-robbery charge. Today, the justices, in an even rarer move, reverse that decision and reinstate the conviction. They hold that while Bass was convicted of a crime for which he wasn’t indicted, there was no grave injustice here – that’s a requirement for this exception – since, under prior caselaw, “no grave injustice occurs merely because a variance exists between an indictment and the evidence offered at trial.”
Bass was made aware in the warrants that he was charged with actually robbing Victim A. All of the evidence pointed to that actual robbery, and that’s the basis on which everyone understood that the case was proceeding. In sum, the process wasn’t even remotely unfair, so Bass doesn’t get the benefit of the exception. Since he didn’t raise the objection in time for the trial court to remedy it, the Supreme Court holds that this issue is waived.
The court goes on, in what I saw as almost an anticlimax, to address a second issue, one that the CAV felt it didn’t need to reach: the sufficiency of the evidence. It finds that this issue, too, was improperly preserved at trial, since Bass never asserted the grounds for it in his limited motion to strike the Commonwealth’s evidence. He did move to strike – good for his lawyer, who apparently is a reader of this website – but the grounds asserted didn’t match up with the one he pressed on appeal.
There’s a distinctly Richmond-and-Tidewater theme in today’s cases. All seven published opinions arose in The Holy City or down here in the southeast corner of the state. Bank of Hampton Roads v. Powell began its life in Chesapeake as a suit for breach of contract and for specific performance.
Thirteen years ago, Powell owned some land in what we call the Greater Great Bridge section of Chesapeake. A developer coveted the land to assemble into a subdivision it wanted to develop, and offered to buy it from her. The parties agreed on a purchase price of $265K plus one lot in the new subdivision. They later executed an addendum, giving Powell the right to Lot 1.
Powell started to get suspicious when, as the subdivision sprung up over the next few years, the developer hadn’t given her her lot yet. In 2012, the developer sold Lot 1 to a builder instead of to Powell. Powell didn’t get mad; she got a lawyer.
The lawyer sued everybody he could think of – the developer, its principals, and the bank that had extended a loan over the property. She sought money damages and the imposition of a constructive trust on Lot 1.
During the course of the litigation, the builder settled with Powell, evidently for $25,000. She then asked the court to affix the constructive trust against another parcel, known as Lot A, which was the only part of the land that the developer still owned. The court held a bench trial and found in Powell’s favor. It imposed that constructive trust, giving Powell an interest in Lot A superior to the bank’s lien. It added that if she did not receive title to Lot A, then she would receive judgment for $110,000 (the price that the builder had paid for Lot 1) against the developer and two of its principals.
The bank alone appealed; the developer and its principals chose to live with the judgment.
The dispositive issue in this appeal is whether a court may impose a constructive trust upon Lot A when the contract was for Lot 1. Primarily citing a 1995 decision, the court rules that unless you can trace your claim directly to specific property, a constructive trust is inappropriate; you’re just a general creditor like anybody else.
Powell had a specific claim to Lot 1. When she settled with the developer, that claim ended. She still had damages, and the court notes today that the judgment against the developer and its principals is still valid; but the bank is off the hook.
One last point: the bank assigned error to the trial court’s refusal to reduce the $110K judgment by the $25K that Powell got from the builder. The court rules that the bank doesn’t have standing to make that claim, because there’s no money judgment against it. Only the judgment debtors would have had that standing, and they didn’t appeal.
We get the court’s newest pronouncement on the always-important topic of sovereign immunity in Pike v. Hagaman, a medical-malpractice action against a nurse at the VCU Medical Center in Richmond. The nurse worked in an intensive care unit, and on this occasion supervised a patient after he had received reconstructive surgery on his palate.
The nature of the patient’s surgery required that postoperatively, his head be kept in a neutral position, and that no pressure be placed on the right side of his face. The patient alleged that the nurse negligently supervised him and allowed his head to roll to the right side for a period of time, essentially destroying the reconstructive work.
The nurse filed a special plea of immunity, and after hearing evidence, the trial court sustained it and dismissed the action. The patient got a writ to review the immunity ruling.
This case is governed by the James v. Jane doctrine first announced in 1980. Claims of immunity by governmental employees – Jane, the appellee in the 1980 case, was a surgeon at the U.Va. Hospital – are evaluated by examining exactly four factors.
Or so I had thought, until I reread a couple of lines in today’s opinion. Here are those lines:
[In James, we] developed a list of four non-exclusive factors to assess whether a plea of sovereign immunity should be sustained. [Non-exclusive?]
[From a footnote] Neither party suggests that we consider any factors beyond the four articulated in James v. Jane. Accordingly, we confine our analysis to these factors. [Citation omitted]
I began to learn immunity law in 1990, when I went to work for a municipal government and started defending City employees who got sued in cases where the City was absolutely immune. I read James v. Jane back then, and for the life of me, I always assumed that the four factors were exclusive. So did everyone else in the municipal-liability field, as far as I could tell.
I just had to satisfy my curiosity, so I interrupted this essay a few minutes ago to pull down 221 Va. – it’s one of those obese, 1,000-page volumes they used to crank out in the late 70s and early 80s – and reread the case. I found no statement in Justice Harrison’s majority opinion setting out whether the list was exclusive or not. As of today, at least, it’s not.
In fairness, I should point out that in an early, and famous, citation to James, the justices gave a broad hint of what I had missed: “Among the factors to be considered are the following …” Messina v. Burden, 228 Va. 301, 313( 1984). But other decisions described the four factors as exclusive; for just one example, Friday-Spivey v. Collier, 268 Va. 384, 391-92 (2004) (“the question whether an individual working for an immune governmental entity … is entitled to the protection of sovereign immunity is answered by applying a four-part test first enunciated in James v. Jane … and reiterated in subsequent cases. The four factors are …”)
You know what that means: from here on, lawyers will be limited in their James v. Jane arguments not by this list, but by their own imaginations.
Back to today’s decision. The justices today affirm the trial court’s ruling that the nurse was entitled to immunity. Using the four factors, a five-member majority – Justice McCullough, writing for the chief justice and Justices McClanahan, Powell, and Kelsey, finds that all four militate in favor of a grant of immunity. The nurse was performing a vital public function in which Virginia had a strong interest – so it says in statutory pronouncement of public policy. The nurse had to use judgment and discretion in performing her job, and the hospital – and hence the government – exercised control and direction over her work.
Justices Mims and Goodwyn dissent. They note that while Virginia obviously wants a sound public-hospital system, the daily care of a single nurse for a single patient is hardly the stuff of grave governmental importance. Their best point is probably this zinger, in which they take a quotation for James v. Jane and replace the word doctor with nurse, with devastating effect:
The only issue we decide here is whether a [nurse], employed by an agency of the Commonwealth of Virginia and practicing in a hospital operated by such an agency, should be immune from an action for his negligence, i.e., for his failure to exercise reasonable care in attending a patient. In Eriksen v. Anderson, 195 Va. 655, 660-61, 79 S.E.2d 597, 600 (1954), we said: “There is no statute which authorizes the officers or agents of the State to commit wrongful acts. On the contrary, they are under the legal obligation and duty to confine their acts to those which they are authorized by law to perform. If they exceed their authority, or violate their duty, they act at their own risk, . . . and the State is not responsible or liable therefor.” . . . A [nurse] who fails to use reasonable care in the treatment of a patient acts at his own risk, and is not entitled to invoke the doctrine of sovereign immunity.
I’ve taken longer than I normally do to analyze Thorsen v. Richmond SPCA, a legal-malpractice case. It’s a 6-1 ruling with a majority opinion by Justice Millette. The majority’s reasoning is complex but understandable, but Justice McClanahan’s dissent stopped me in my tracks, causing me to do something I’ve never felt I had time to do before: go back and reread the majority, to see if I’d missed anything.
Here’s the setup: Client goes into Lawyer’s office in 2003 and asks him to write a will for her. She wants to leave everything to her elderly mother (Client is 43; Mother is around 80), and if Mother predeceases Client, then Client wants everything to go to the SPCA. Lawyer draws up the will and Client signs.
Mother dies shortly thereafter. Client, having survived Mother, dies in 2008. Her assets at death include about $70,ooo in personalty and $600,000 in realty. Lawyer contacts SPCA and tells it, “You just inherited a substantial estate.”
The fly in the ointment, the monkey in the wrench (to quote that eminent Twentieth Century philosopher, John McClane) was that in preparing the will, Lawyer made the SPCA the contingent beneficiary of Client’s personal estate only. It omitted the real property, which passed by intestate succession to two of Client’s relatives. The SPCA got $70K instead of the $670K it thought it would receive.
The SPCA then sued Lawyer in Richmond Circuit, claiming legal malpractice and contending that it as an intended third-party beneficiary of Client’s agreement with Lawyer for the preparation of the will. Lawyer filed a demurrer, claiming that SPCA had no standing to sue because of a lack of privity, and a special plea of the statute of limitations, arguing that more than three years had elapsed since his representation had ended.
The trial court overruled the demurrer and the special plea, convened a bench trial, and entered judgment for the SPCA for the $600,000 difference. Lawyer journeyed three blocks south and got a writ.
The primary issue in the appeal – the one that absorbs most of the discussion in the majority opinion, and the lion’s share of the dissent – is privity.
“Virginia has,” the dissent assures us, quoting a 2010 SCV decision, “adopted the strict privity doctrine in legal malpractice cases.” We also learn that the General Assembly has modified by statute this requirement in one class of cases, those involving the creation of irrevocable trusts.
Today a majority of the Supreme Court rules that the common-law third-party-beneficiary doctrine establishes another exception. Turning to numerous cases from other jurisdictions, the court holds that a beneficiary of a testamentary document has standing to sue for legal malpractice the lawyer who wrote the document. The majority notes that if this were not the case, there could be no meaningful recovery for the breach of the attorney’s duty: the Client could recover only nominal damages, since she wasn’t harmed.
This is the ruling that triggers Justice McClanahan’s forceful dissent. She begins by noting that the privity requirement has not been abolished in Virginia – with the exception of the irrevocable-trust statute described above – and it shouldn’t be the role of the courts to carve out exceptions. That, she feels, is the legislature’s prerogative. The Code allows a client to sue his lawyer for malpractice, but doesn’t give that right to anyone else, even third-party beneficiaries.
The dissent notes the policy implications of creating such an exception. Lawyers who have to worry about being sued by nonclients might find their loyalties divided, or diminish the quality of services to a client. Today’s ruling might expose the lawyer to liability to “an unforeseeable and unlimited number of people.” Many lawyers might opt to get out of the estate-planning business entirely.
One key holding today is that the right of action accrues for these third-party beneficiaries when the testator dies. That, Justice McClanahan, can easily be decades after the lawyer drew the will. Thus, attorneys have the potential for liability for astronomical damages (such as with especially wealthy clients), owed to unknowable potential beneficiaries (such as bequests to “my children” by a woman who’s still of child-bearing age), triggered by an event that may occur decades into the future (such as when a client in his 30s wants to make a will).
You know, she’s got a point about that liability? I’m sufficiently terrified; I think I’ll stick with appeals.
The dissent regards this as the recognition of a new cause of action in favor of parties who would have been barred by the strict privity rule in Virginia. Whether you regard it as a new rule or as a logical extension of third-party-beneficiary jurisprudence into another field, this case is a watershed: lawyers can now be sued for malpractice by people other than their clients, so long as the injured party was an intended beneficiary of the lawyer’s services.
We’ll head back to Tidewater for our final case of the day, Saddlebrook Estates Community Association v. City of Suffolk.
Years ago, a lady we’ll call Landowner owned a tract of land in Virginia’s largest city. She got a permit to develop it into homesites, with a substantial area reserved for an equestrian center. She then sold it to a developer, which platted the equestrian center in a specific area.
The developer leased the equestr- – you know, I’m getting tired of typing that long, tricky word – the horse center to an LLC that planned to operate a stable and riding school there. It then developed the rest of the neighborhood.
This case is about real-estate taxes. Specifically, the City taxed the horse center, sending the bill to the LLC’s owner. This matched up well with the lease, which specified that the LLC would pay the taxes on the horse center.
But no one paid the tax bill, so the City initiated the process for a tax sale. By this point, the neighborhood had been fully developed and the developer had conveyed the common areas, including the horse center, to the community association. The association filed suit to get a declaration that it didn’t owe the taxes. It also sought to stop the sale.
At a bench trial, the judge rejected the association’s citation to a statute that ostensibly placed upon the unit owners – not the association – the tax burden for the horse center. The court found that the horse center was a commercial enterprise, because the LLC accepted paid boarding from nonresidents. It thus found that the horse center didn’t meet the statutory definition of “open or common space” that would qualify it for the kind of tax treatment that the association craved. Judgment for the City.
The justices take a dispositively different view. They find it irrelevant that the horse center received outside income, since the statutes don’t list that as a factor. The court relies for this conclusion on a 1985 case involving not horses but golfers – Lake Monticello Owners’ Ass’n v. Ritter.
The court doesn’t come out and find the property to be tax-exempt; instead, the burden is indeed distributed among the property owners – not as a pro rata share of what would be the normal tax bill, but in consideration of the value that the horse center adds, as a neighborhood amenity, to their homes. Even those residents who don’t ride got benefits – walking trails, picnic tables, and just plain-old open space. (Space is one thing that Suffolk has in abundance.)
WHEN PRESERVATION BECOMES PAINFUL
[Posted June 1, 2016] If you’re an ABA member (and you should be), you’ve seen the news out of Las Vegas that a judge last week ordered a public defender handcuffed and held in the jury box, seated next to inmates awaiting hearings. In the eyes of the court, her offense was not to stop talking when he ordered her to do so. In the eyes of her supporters, her offense was that she tried to protect her client’s interest when the judge was about to issue a summary ruling without hearing her argument. There’s a transcript of the short hearing and even a silent security video on the link above, though without the nuance of tone of voice, those can’t answer categorically who’s right.
Sound familiar? Remind you of some of the fire-breathing jurists you deal with every week? Well, in truth, things like this happen very, very seldom. The reason this made such a splash is the man-bites-dog feel to it: if judges directed the “arrest” of lawyers all the time, this wouldn’t have become a sensation. In my experience, the overwhelming majority of judges will tolerate an argument that’s made politely and respectfully. But this judge was havin’ none of it; he essentially gagged the lawyer while her client stood unrepresented before the court to receive a jail sentence.
For lawyers, the conflict is often most critical when they’re trying to preserve an issue for appeal. The lawyer may sense that the judge has already made up her mind – and he may be right about that, as many judges have poor poker faces on occasion – and will understandably want to preserve his ability to ask a higher tribunal to review the case. Indeed, as the Rules of Professional Conduct tell us, the lawyer has an obligation to do that, even in the face of judicial wrath.
This is one of the tightropes that trial lawyers have to walk at times. Last year, I discussed how to deal with such situations in a CLE program entitled, “Courage for the Chicken-Hearted: Protecting the Record in Hostile Territory.” I spoke about the professional and ethical obligations that lawyers must meet when faced with a variety of problems, including things like obvious home cookin’ in a remote venue, and outright judicial hostility.
The message of that program was that it takes guts sometimes to perform your professional obligations, and cowardice isn’t an option, no matter how angry the judge becomes. I’m fond of quoting a wonderful line from Chief Justice Lemons, who advised a group of trial lawyers, “If you’re afraid of trial judges, you need to consider a career as a transactional lawyer.”
He’s right. If you view a judge as a demigod with a robe and a ready supply of lightning bolts, you’re either in federal court (in which case your perception may be justified) or you’re predisposed to accept defeat without doing what you can about the record. (Just kidding about the federal-court angle. The lessons in this essay apply there, too.) After all, a judge can order you to stop talking while you’re in the middle of making a crucial argument or proffer, and he has a bailiff available to enforce his directive. What do you do?
The dynamic is even more complicated during jury trials. Jurors will regard the judge as an authority figure who can do no wrong, and they’ll view with great skepticism any lawyer who dares to argue that her honor is wrong about something. In this situation, a lawyer who needs to object and make a record risks angering the judge and turning off the jury. How do you perform your ethical obligations while giving your client the best shot at a victory?
The justices haven’t given us a bright-line answer, but some of their relatively recent rulings do give us some strong clues. Let’s take up Maxwell v. Commonwealth, 287 Va. 258 (2014). This opinion resolved two companion appeals; the one we’ll focus on is an appellant named Rowe.
Rowe faced a jury trial on larceny charges. With the evidence all in, the prosecutor rose to give his closing argument. Just before he concluded, he told the jury, in effect, “You’re entitled to infer from possession that the defendant is guilty unless he comes forward with evidence to the contrary. And, of course, he didn’t offer any evidence.” Two short sentences later, he sat down.
Criminal-law practitioners will recognize here a clear violation of the defendant’s Fifth Amendment right to remain silent and of the presumption of innocence. When the prosecutor sat down, the judge invited the defense lawyer to give a closing argument. Instead, the lawyer said, “Actually, before I make my argument, there’s a motion I would like to make outside the presence of the jury.”
Anyone familiar with practice inside a criminal courtroom knows what the lawyer meant: a motion for a mistrial. The prosecutor had crossed a line, and this jury was tainted. But the judge had other ideas: “We’ll deal with it when the jury goes out to retire.” I assume that the court reasoned, there’ll be a long stretch of time when we’ll otherwise have nothing to do; this is more efficient. The lawyer said simply, “Very well,” and began his closing argument.
Unfortunately, once the jury begins to deliberate, it’s too late to make a mistrial motion based on improper argument of counsel. Once the door to the jury room closes and the jury has the case, all objections to arguments are waived. That’s a bright-line rule.
The question presented in Rowe was whether a lawyer can waive an argument by obeying the judge’s directives about when to make the motion. Specifically, the justices considered whether the lawyer had “no opportunity to object to an order or ruling at the time it is made …” If that’s the case, then by statute (Code §8.01-384) the party isn’t prejudiced by the absence of a timely objection.
Unfortunately for Rowe, and for chicken-hearted lawyers across the Commonwealth, the answer is that the lawyer had the opportunity to make the motion, but he meekly accepted the judge’s directive to delay making it until it was too late. A 5-2 majority of the justices ruled that in this situation, the lawyer had the duty to fight back – to insist upon being allowed to make the motion in a timely way.
Justices Lemons and Mims dissented, insisting that “there has to be a recognition of real world trial practice.” The dissenters felt that the judge should immediately have known what the motion would be. They also expressed the concern that I describe above – the fact that by arguing with the trial judge in the jury’s presence, “defense counsel risked prejudicing the jury against him, and by extension, his client.”
Now, what kind of a dilemma is that to inflict upon lawyers? You either stand up to the judge and risk offending the jury (not to mention the judge), or else obey the judge’s directive and waive a meritorious issue for appeal. The latter course, I hasten to add, might bring the threat of a Bar complaint. The majority’s ruling in Rowe indicates that such a complaint might be valid, at least from 2014 on. Hence the dilemma: Bar complaint or jail cell? Jail cell or Bar complaint? Hmmm …
The Nevada lawyer who was cuffed and silenced last week assuredly didn’t know about Rowe, but she seems to me to have been motivated by its majority’s thrust. What do you do if your ethical obligations to your client demand that you speak up, but the judge says – perhaps angrily – “Shut up, counsel!”? The Las Vegas defender effectively did what the SCV majority said that Rowe’s lawyer should have done, and her reward was a pair of bracelets.
I’ll add one more component to this discussion, if only to confirm that the problem persists. On April 22, the Supreme Court of Virginia decided Way v. Way, involving a trial lawyer’s request for a continuance because the clerk of court had refused to issue trial subpoenas that the lawyer had timely requested. The issue on appeal was whether the court abused its discretion by refusing to continue the trial because of the clerk of court’s mistake.
One aspect of the case especially alarmed me. Here’s what I wrote back then:
In my view, probably the worst thing that the judge did was, in response to the husband’s lawyer’s arguments that the court should hear all of the witnesses, to threaten her with contempt “if you keep going … after I have told you I am not going to hear it. I am going to find you in contempt if you continue.”
This passage was horrifying to me – a judge who threatens a lawyer who’s making a proper record and protecting her client’s rights. There’s no indication that the lawyer argued rudely, or was otherwise contemptuous of the court’s dignity; the judge simply wanted to shut her up.
And that, my dear readers, brings us back to last week’s embarrassment in Las Vegas. At least the Virginia judge didn’t shackle the lawyer who just wanted to make a record. On the other hand, that Virginia lawyer may or may not have held back an argument in order to avoid judicial wrath; we’ll almost certainly never know. These rulings establish firmly that the essential requirements for practicing law include guts and a fair measure of diplomacy.