ANALYSIS OF MAY 30, 2019 SUPREME COURT OPINIONS

(Posted May 30, 2019) What had been a slow month for opinions turns lively today, as the Supreme Court of Virginia hands down five published opinions and one published order.

Criminal law

The court takes up a twist on the familiar language of Miranda warnings in Spinner v. Commonwealth. After a bench trial, the circuit court convicted Spinner of the stabbing death of his father-in-law in Campbell County. Police initially spoke with Spinner in a carport of his brother’s home, where they executed a search warrant and took a fingernail sample for DNA analysis.

During that conversation, an investigator informed Spinner as follows; I’ll highlight the key provision:

You have the right to remain silent. Anything you say can and will be used against you in a court of law. You have the right to talk to a lawyer and have him present with you while you’re being questioned. If you cannot afford to hire a lawyer, one will be appointed to represent you before any question and if you wish one. And I always caveat that with: ‘If you’re charged with a crime.’ You can decide at any time to exercise any of these rights and stop answering questions or to stop answering—making any statements.

During the ensuing conversation, Spinner made some inculpatory statements before stating that he didn’t want to answer any more questions. The investigator ended the discussion then.

Two days later, police arrested Spinner and gave him the same Miranda warnings. During the ride to the police station, the investigator suggested to Spinner that he hadn’t gone to the victim’s house with the intention of killing him. Spinner said nothing but nodded his head affirmatively.

Spinner moved to suppress both the statements and the head nod, based on a claim that the Miranda warning was improper. The trial judge ruled that the conversation in the carport wasn’t custodial, so a Miranda warning was unnecessary. The statements and the head nod both came into evidence; the court sentenced today’s appellant to two life terms.

The Court of Appeals declined to tinker with the convictions, but the justices agreed to take a look. Today they unanimously affirm. They hold that the conversation at the carport wasn’t custodial, citing the trial judge’s factual findings about that event. Viewed in a light most favorable to the Commonwealth, that ruling wasn’t plainly wrong, so the carport statements were unaffected by Miranda.

That leaves the head nod. Today’s short opinion traces the development of Miranda warnings in this context – where an officer adds something extra to the familiar language – from Miranda through two more SCOTUS decisions, California v. Prysock in 1981 and Duckworth v. Eagan eight years later. That results in the following synthesis:

Miranda warnings don’t require exact language; a “fully effective equivalent” is sufficient. A warning cannot imply that the right to counsel only attaches during court hearings, since that right applies during the investigation of a crime. But this warning (from Duckworth) is acceptable: “We have no way of giving you a lawyer, but one will be appointed for you, if you wish, if and when you go to court.”

The Supreme Court today holds that the proper reading of the investigator’s added language in this appeal is the same as in Duckworth. Police officers can’t immediately bring on a lawyer, but a suspect can insist on having a court appoint one. That means that there was nothing wrong with the warnings given here.

The justices decide two companion appeals today involving a novel procedural posture. The cases are Watson v. Commonwealth and Commonwealth v. Watson. In 2007, Watson entered Alford pleas on several felony charges, including four use-of-a-firearm indictments. The circuit court convicted him on those pleas and sentenced him to a lengthy term of imprisonment. The sentences on the firearms charges were identical: three years each, to be served consecutively.

But the law requires that a second or subsequent use-of-a-firearm conviction must carry a five-year sentence; no more and no less. In 2017, Watson learned of this and filed a motion to vacate his sentence as void ab initio, demanding a new sentencing hearing. He argued that the sentences imposed were outside the statutorily prescribed range, so the court didn’t have jurisdiction to enter the sentencing order.

He had good reason to feel that way. In 2009, the Supreme Court perceived that its rulings in improper-sentence appeals were difficult to reconcile, so in Rawls v. Commonwealth, it decided to end the uncertainty by handing down specific guidelines:

Today we adopt the following rule that is designed to ensure that all criminal defendants whose punishments have been fixed in violation of the statutorily prescribed ranges are treated uniformly without speculation. We hold that a sentence imposed in violation of a prescribed statutory range of punishment is void ab initio because the character of the judgment was not such as the [c]ourt had the power to render.

Six years later, the court described this rule as “bright line” and “purposefully broad,” intended to apply to all defendants sentenced outside a statutory range. Watson pointed out in his motion that he was inarguably sentenced outside a statutory range, so he was entitled to a new sentencing hearing. The Commonwealth responded that Watson’s sentence wasn’t void but voidable, so his motion, filed ten years after sentencing, came too late.

There’s more. Watson similarly moved the circuit court to vacate the sentences of twelve other felons for the same reason. He didn’t join the others as parties, but cited familiar language from numerous Supreme Court opinions: an order that’s void ab initio may be challenged “by all persons, anywhere, at any time, or in any manner.” Because Watson clearly falls within the category of “all persons,” he asked the circuit court to order new sentencing hearings for the other twelve, too.

On Watson’s motion to vacate his own sentence, the Rawls language persuaded the trial court that this sentencing order was void. The court accordingly ordered a new hearing. But it balked at ordering relief for the other twelve, finding that Watson didn’t have standing to challenge their sentences. The court rejected a broad reading of “any person,” insisting that any such challenge had to come from a person affected by the judgment.

Watson then did something that many, indeed most, lawyers find difficult: He persuaded a panel of the Supreme Court to grant him a writ to review the standing ruling. The court simultaneously awarded the Commonwealth an appeal on the vacatur of Watson’s sentence.

Well, now. How do we resolve this? The plain language of the Supreme Court’s jurisprudence seems to favor Watson. That broadly phrased void-ab-initio precedent looks like it covers this situation, and unless the court is going to backtrack on its oft-repeated “any person” holdings, Watson may get to canopener a bunch of other felons’ sentences, conceivably against their will.

Except it doesn’t come down that way. In the standing appeal, the justices rule that traditional standing requirements implicitly limit the class of the “any persons” who may challenge a void judgment, so Watson can’t raise this objection on behalf of the other felons. In doing so, the court limits the application of its prior holding in the Virginian-Pilot Media case in 2010, so now the ability of a person without standing to make a challenge is limited to subject-matter-jurisdiction objections. The court also declines to vacate those other felons’ sentences sua sponte, as the Virginian-Pilot concurrence had suggested; that’s because those felons should be made parties to the proceeding.

That leaves the Commonwealth’s appeal of Watson’s vacatur. Here, the court turns to two decisions from 1953, holding that a too-short sentence is merely voidable, while a too-long one is void. Today’s opinion holds that these old cases were not among the difficult-to-reconcile decisions that the court undertook to encompass within its broad doctrine in the 2009 Rawls decision. A too-short sentence is still merely voidable, so Watson’s challenge to his sentence comes years too late.

This, then, is what the court rules today:

• In the numerous earlier decisions holding that “all persons, anywhere, at any time, or in any manner” may challenge a void sentence, the ruling really meant “a person with standing.”
• In the bright-line Rawls doctrine, the phrase “a sentence imposed in violation of a prescribed statutory range of punishment” the court really meant “a sentence imposed in excess of a statutorily prescribed maximum punishment.”

That’s the law henceforth.

Venue

Here’s one for the procedure geeks among us: Is venue improper if the plaintiff sues somewhere other than the place specified in a forum-selection contract clause? Let’s dig into RMBS Recovery Holdings I v. HSBC Bank USA to find out.

This is a derivative suit filed by several entities that collectively invested in mortgage securities during the real-estate boom of about 12-15 years ago. HSBC Bank serves as trustee to three trusts that held those securities. The investors contracted with two entities that today’s opinion calls sponsors; the sponsors’ job was to ensure that only high-quality loans made their way into the trusts. The sponsors agreed to a sort of quasi-guaranty arrangement: If any poor-quality loans made it through the cracks, the sponsors would either replace or repurchase them. This afforded the investors a separate measure of security.

I don’t have to tell you what happened, do I? The recession happened, and the boom market went bust. The investors, facing a huge capital loss, insisted that the bank force the sponsors to make good on their promise. The bank agreed to do so only if the investors signed confidentiality and indemnity agreements.

While these folks are firing letters back and forth, the statute of limitations is ticking. To beat that clock, the investors filed derivative actions in New York against the sponsors. The bank and the investors then signed the confidentiality/indemnity agreements, each containing a forum-selection provision requiring any litigation to occur in New York City.

Once the ink was dry on these, the bank substituted itself in the New York suits as plaintiff. Bad news: By then, the statute of limitations had expired. The New York court accordingly dismissed the suit as untimely.

That led the investors to sue the bank in Fairfax, site of the bank’s headquarters, claiming that the bank failed to act timely to protect the investors’ rights. The bank replied with a motion to dismiss, claiming that Fairfax was a forum non conveniens. It argued that New York was more convenient due to, among other things, the presence of several witnesses there, plus the fact that New York law governed anyway. The motion said nothing about the selection clause in the confidentiality agreement.

The Fairfax court quickly convened a hearing. The judge was astounded at the contention that a bank could claim that it was inconvenient to litigate a claim in its home county. The motion to dismiss died a quick death.

The parties continued to conduct pretrial litigation in Fairfax. At one point, the court sustained a demurrer with leave to amend. The investors timely amended, and this time the bank moved to dismiss based on the forum-selection clause in the confidentiality agreement. This time, it worked; the circuit court agreed that it had to dismiss without prejudice and allow the parties to litigate up north. The court rejected a claim that the bank had waived the clause by litigating the case here in Virginia for over a year before raising this objection.

If you’ve waded through this complex tale this far, take heart: It’s time for some appellate rulings. Both sides appealed, and today the justices hand two victories to the investors. In their appeal, the court agrees that the presence of a forum-selection provision in a contract is a personal defense that a party can waive. It also rules that, on this record, the bank did waive it; objections to venue have to be raised and pressed on to a ruling promptly. The bank didn’t do that, so it lost the ability to insist upon trying the case in New York.

In the bank’s appeal, the Supreme Court rules that the trial court didn’t abuse its discretion by keeping the case in Fairfax, rejecting the claim that our courts are inconvenient. Here, the bank is undone by an unfavorable standard of appellate review. The trial court didn’t abuse its discretion, the justice rule today, because there are plenty of connections with Virginia, document transfer is simple and easy in this digital age, and it would take several years to get to trial in the Big Apple.

I saw one important tidbit in today’s opinion: “Code § 8.01-264(A) does not address an instance, as here, in which venue is properly laid but another forum has been otherwise agreed to by the parties in a forum selection clause.” That factor is relevant in a motion under § 8.01-265. The former statute deals with suits filed in an improper forum; the latter is where the plaintiff chooses a forum that’s proper, but inconvenient. Keep that distinction in mind if you’re moving to transfer or dismiss.

School discipline

There’s a complex procedural setup in Fairfax County School Board v. S.C., so I’ll give you a truncated version of the facts and then jump straight to the holdings. A high-school freshman in a Fairfax public high school found herself in hot water when three other students reported that she had sexually touched each of them. An assistant principal notified her of the accusations; she submitted a written reply, admitting the touching but insisting that it was consensual.

The school system’s behavioral policy bars sexual touching regardless of consent, so the principal issued an interim 10-day suspension to the freshman, notifying her in writing that the school division would conduct a hearing for sexual assault within that time. The student brought a lawyer with her to the hearing, in which two hearing officers presided.

During the hearing, the freshman admitted to the conduct; her lawyer acknowledged that “there’s a very good possibility that this does fall within a disciplinary realm.” The hearing officers found that the conduct was nonconsensual sexual touching, but didn’t find sexual battery as defined in the Code of Virginia. They imposed longer-range discipline, including transfer to an alternative school; the school board affirmed that.

The freshman sued in circuit court, arguing that the discipline imposed was arbitrary because the student had been exonerated of sexual assault or battery. The trial judge agreed and vacated the finding of misconduct.

The Supreme Court reverses today. There are a few key reasons for that, but the primary one is the strong deference that courts must accord to school divisions in disciplinary cases. The circuit court had focused on the legal definition of sexual battery, which requires proof of “force, threat, intimidation, or ruse.” But the school division’s policy required none of these factors; it simply banned all sexual touching, and the student unquestionably did that. The justices accordingly dismiss the freshman’s petition for judicial review.