ANALYSIS OF JULY 30, 2020 SUPREME COURT OPINION

 

 

(Posted July 30, 2020) Today’s lone published opinion from the Supreme Court of Virginia comes straight out of the Crying Shame Department. Baumann v. Virginia State Bar presents what I view as an entirely avoidable outcome.

The appellant here is a 40+ year veteran of law practice here in Virginia. He’s a general practitioner, a dying breed in an era of specialization.

In 2015, a widow consulted the GP for guidance. She and her late husband had created a family trust. Upon his death, her stepchildren consulted a lawyer who wrote to the widow, asking for a copy of the trust agreement, an accounting, and some items of personalty that their father had promised them. The widow didn’t want to give up the document, regarding it as private, but was apparently okay with giving up the personalty.

The GP proposed a $7,500 nonrefundable fee for handling the matter. He added that if the matter went to litigation, he’d require another $15,000 as a retainer, against which he’d bill $325 an hour for his work. The widow agreed and gave him a check for $7,500.

According to today’s opinion, the lawyer stated that he performed 10-12 hours of legal research over the ensuing weekend, though he didn’t keep time records or make any notes. The next week, he called the stepchildren’s lawyer, and faxed her a copy of the trust agreement. The two lawyers coordinated a date and time for the stepchildren to pick up the items they wanted.

Nothing more happened for a year. In 2016, the widow e-mailed the GP, telling him that the heirs had picked up their items. She terminated the representation and asked the lawyer for an itemized statement of his fees and costs advanced. Two weeks later, the GP sent her a statement asserting that “he had: (1) read a 179-page trust document, performed legal research, and advised Wright ‘concerning the same,’ (2) contacted various parties ‘as needed’; (3) guaranteed his availability to Wright instead of the opposing party, (4) prepared the matter for litigation, and (5) closed Wright’s file. The statement claimed that Baumann earned the entire $7,500 fee.”

Sound reasonable to you? Before you answer, let’s consider a few small details. First, the trust agreement was only 38 pages, not 179. Do you think the widow would have known that? Second, while the lawyer facilitated a stress-free swap of personalty, he never resolved – indeed, never even addressed – the biggest item in the case, the demand for an accounting. And third, while not directly related to the quantum of fees, the GP gave away a document that the widow had wanted to keep private.

Around this time, the stepchildren’s lawyer wrote to the GP and asked, “Now, how about that accounting?” The GP, regarding that he had been terminated, simply forwarded that to the widow. Up to this point, she didn’t know that that issue hadn’t been addressed.

The widow then did what she should have done the first time: She consulted a specialist in trusts and estates law. That lawyer looked at the trust agreement and told the widow that she didn’t have to give up the document to her stepchildren; indeed, she could end any claim that they had by unilaterally terminating the trust. She had that authority, spelled out right in the document. The lawyer picked up the phone, spoke with the stepchildren’s lawyer. And resolved the accounting issue on the spot.

The T&E lawyer then wrote to the GP and asked for a copy of his file. The GP replied with the opening lines of The Adventures of Tom Sawyer (“Tom!” No answer.). A second request produced copies of e-mails and “four pages of sparse, handwritten notes.”

The T&E lawyer asked the GP to refund part of the $7,500 fee. That generated a refusal. And that, in turn, generated a Bar complaint, filed by the widow.

Now you know why this is a crying shame. For maybe three or four thousand dollars, the GP could have bought himself peace and quiet, and a lot of good nights of sleep. Instead, he fought the complaint, even when the Bar offered him private discipline.

The district committee found that the GP had violated the Rules of Professional Conduct by not finishing the job he was hired for, not communicating with the widow, and charging an excess fee. It imposed a public admonition with terms, including refunding $5,000 to the widow. The GP appealed on to the State Bar’s Disciplinary Board, which affirmed.

Today, the justices affirm, too. They turn aside challenges to the Board’s standard of review, the constitutionality of the private-discipline setup, and the sufficiency of the evidence. Justice Chafin’s exploration of these issues is thorough and the result is thoroughly predictable. Now the GP is out $5,000, and his name will be in Virginia Reports for all time, in a way that none of us wants to achieve that lasting fame.

 


NOTES ON APPELLATE DEVELOPMENTS

 

 

(Posted July 24, 2020) The opinion mill at Ninth and Franklin has been quiet for a couple of weeks, so let’s look around the landscape and see what else is happening.

 

Fourth sticks with remote arguments for now

The Fourth Circuit announced on Wednesday that its next oral-argument session won’t feature in-courtroom appearances. Appeals slotted for arguments September 9-11 “will be scheduled for argument by video-conference or teleconference, submitted on the briefs, or continued to a later session, at the direction of the panels in each case.” The notice assures courtwatchers that it will live-stream the audio of each remote argument.

 

Updated FAQ page from the Court of Appeals of Virginia

The CAV this week updated its helpful listing of frequently asked questions. The page confirms that the CAV won’t resume in-court oral arguments until at least November.

 

A promising leading indicator?

After a long dry spell – only seven writs granted in 3 ½ months – it’s raining writs at Ninth and Franklin. The SCV has awarded 21 appeals since late June. And incoming business is good enough that the justices have added a writ panel on August 13. The court will convene three panels on September 2, as previously scheduled. One casualty of the pandemic is the court’s late-summer road shows, where the court convenes two panels outside Richmond. There’s no formal announcement of this, but I believe it’s overwhelmingly likely that the August and September panels will be by teleconference or audioconference. We’re probably still a ways away from in-court appearances.

That being said, I’ve been eyeing the calendar nervously throughout the suspension of jury trials. No trials mean no final judgments, and no final judgments mean no appeals. (There are a few judgments over this span from nonjury rulings, so the faucet isn’t off completely.) The usual lead time of an appeal portends a real slowdown in the Supreme Court’s October 20 and December 1 panels, and a corresponding reduction in the size of the April and June sessions next year. Maybe it’ll be a good time for appellate lawyers to write that novel …

 


ANALYSIS OF JULY 9, 2020 SUPREME COURT OPINION

 

 

(Posted July 9, 2020) It’s a double opinion day here at VANA, as the Robes in Richmond hand down a decision on the same day when their brethren across the Potomac wrap up October Term 2019. For coverage of the US Supreme Court’s decisions, you should go to SCOTUSblog. For coverage of the SCV, well, (heh, heh) I’m the only game in town; you may as well read on.

 

Regulated utilities

Lest you perceive that that last line was unbounded egotism, please be assured that I meant it only as a lead-in for today’s ruling in Wal-Mart Stores East, LP v. SCC. The question here is whether Wal-Mart can shed the shackles of buying electricity from the dominant utility around, a regulated monopoly that you know as VEPCO or APCO, depending on where in Virginia you are.

Some time ago, the 140 Troublemakers created a framework for some semblance of competition in electric utilities. Nonresidential customers whose demand exceeds 5 megawatts have the right to buy electricity from a competitor to VEPCO and APCO. Any customer, including a plain-old homeowner, has the same right if they want 100% renewable energy and their “host” utility doesn’t offer that.

There’s a third category for nonresidential customers. If separately they demand less than 5 MW, but they can aggregate different locations to exceed that threshold, they may ask the State Corporation Commission to permit them to bolt and get their electricity elsewhere. The commission has the discretion to approve that request if there are no adverse effects to other customers and the request is consistent with the public interest.

Wal-Mart, as you know well, operates a lot of stores in Virginia. The individual locations don’t use 5 MW, but when you add up all of them, they greatly exceed that figure. Wal-Mart accordingly filed an application seeking to enter the wholesale energy market, to save a few dollars.

An SCC hearing examiner convened a hearing to consider the matter. That hearing established that the electric companies would sustain losses if all the Wal-Marts across our fair land left the grid, and those costs would be passed along to “captive” consumers, those unable to leave the monopoly, in the form of higher rates. “Yes, but,” Wal-Mart replied, “the average customer’s bill would go up only fractionally, not enough to harm anyone.” The evidence showed a monthly increase of 13 cents for VEPCO customers using 1,000 KW, and five cents for those in APCO’s territory. A footnote in today’s opinion recites Wal-Mart’s contention that such a customer could offset that tiny increase by replacing a single incandescent lightbulb with an LED. (As evidence of my environmental bona fides, I hereby certify that all of my old lightbulbs are long gone, replaced by LEDs some time ago.)

I’ll reframe this setup slightly, in a way that will telegraph the outcome of today’s decision: Would you be willing to pay a few extra cents each month so one of the world’s largest retailers can save a lot, maybe millions, on its electric bills? The SCC looked at that proposed transfer of wealth, a few pennies at a time, and balked. It found that other customers would indeed be affected, and that the retailer’s request was thus contrary to the public interest.

Wal-Mart then moved for reconsideration, asking the SCC to allow it a more limited extent of relief – not all its stores, but something less than that, in a manner that would make it palatable. The commission denied that motion and Wal-Mart headed to the courthouse.

In this case, that means the Supreme Court itself. Under Virginia law, the SCC is a tribunal of equal dignity with circuit courts, and proceedings there offer the priceless opportunity for a by-right appeal. No petition stage; you just go straight to the merits.

Today a unanimous Supreme Court affirms the SCC’s decision. It affords the commission substantial deference where, as here, the statutory framework provides that the commission “may” grant requested relief. Despite the de minimis nature of the individual effects on each residential customer, the overall effect is to transfer millions of dollars from individual customers to a corporate giant, without those customers’ consent. The SCC thus had the discretion to rule as it did.

The court also affirms the denial of Wal-Mart’s reconsideration motion. The justices agree with the SCC that this wasn’t a request to reconsider anything; it was a request to grant relief other than what the application sought. That would require amending the pleading, something that Wal-Mart never sought. Instead, the initial “request” was a passing reference during testimony by a Wal-Mart representative.

 


NOTE ON MIDYEAR APPELLATE ISSUES

 

 

(Posted July 2, 2020) Today marks the middle of the calendar year; it’s the 183rd day of what seems like an interminable 2020, and there are 183 days left. (It’s also the anniversary of the formal vote in the Second Continental Congress for independence, in 1776; the Fourth gets the publicity, but the Second deserves it.) That seems like as good an excuse as any to take a look around at what’s happening.

 

Judicial Conference Study

You’ve probably seen word of this: The Judicial Council of Virginia is studying whether to expand the jurisdiction of the Court of Appeals of Virginia. The proposal would provide for an of-right appeal to the CAV in all, or nearly all, cases, with certiorari review in the Supreme Court if you can get it. The idea is to adapt our courts to something like the federal model.

As Virginia Lawyers Weekly has correctly reported, our fair Commonwealth is now the only jurisdiction in America with no automatic right of appeal. The Council has solicited opinions from anyone and everyone; if you’d like to contribute yours, here’s a link where you can do that. The deadline is August 21.

 

David-Goliath Index

Once a quarter, I review the published and unpublished merits decisions from the Supreme Court of Virginia to see how well the little guys in the appellate system are faring against their big-guy brethren. David’s been getting his clock cleaned by Goliath in recent years, but the second quarter was comparatively kind to him: 9 wins against 16 losses for a 2Q D-GI of 36-64. For the year, David has prevailed 11 times against 26 for Goliath, for a year-to-date D-GI of 30-70.

Speaking as a stats geek, I hereby forecast that the end-of-year proportions will be within shouting distance of these. That’s because of the extraordinarily small merits dockets, which will in turn produce relatively few final decisions by the end of the year. The Supreme Court heard 21 appeals in April, but only five in June. September has traditionally been one of the larger sessions of the year, but given the paucity of writs, who can say how many we’ll see then?

That raises the topic of what’s left on the court’s merits plate. There’s one appeal still pending and undecided from the February session; five from April; and five from June. Rulings in these appeals should arrive, alone or in small groups, over the course of the summer.

By the way, if you think these dockets are small, just wait’ll 2021. The moratorium on jury trials means far fewer final judgments in circuit courts. And because those final judgments are the raw materials of the Supreme Court’s docket – not to mention the appellate bar’s collective caseload – we could see a substantial dry spell in the second, third, and maybe fourth sessions of next year.

 

SCOTUS slowly clears its docket

As I’ve mentioned here recently, the US Supreme Court has an extended term because the April sitting, traditionally the last one before the Court finishes its business at the end of June, got pushed back into May by Coronavirus concerns. The Court has scheduled a rare post-July 4 date to release opinions, this one on Monday, July 6. Because there are eight appeals still pending, I expect one or two more opinion days, likely next week but possibly after that.

 


UPDATE ON APPELLATE COURTS’ PROCEDURES

 

 

(Posted June 24, 2020) Our fair Commonwealth appears to be emerging slowly from the biggest health challenges posed by the Coronavirus contagion, even as other states, principally to our south and west, worsen. Here’s a quick report on how appellate courts here are handling their dockets.

 

Court of Appeals of Virginia

Yesterday the CAV entered an order that initiates Phase III of its operations in response to the pandemic. Key new provisions include an announcement that the Court of Appeals will entertain oral argument by remote means, either telephone or video-conference, through the end of October. The court still wants you to e-file everything using the VACES system; the drop box at the courthouse entrance is only for those precious few filers who absolutely cannot file electronically. There’s a tangible drawback to filing on paper: anything that you file that way, whether it goes to the drop box or arrives by mail or courier, will result in a delay of at least a day, and likely two, before anyone sees it. Use electrons!

 

Supreme Court of Virginia

The justices entered a sixth judicial-emergency order on Monday. This order doesn’t contain any new provisions for operations in the Supreme Court itself; the changes primarily govern proceedings in trial courts. The building is still off-limits unless you have official business at the court.

The next officially calendared gathering of the Robes will be September 2/3, when the court has customarily convened “road shows,” two writ panels in courthouses outside Richmond. It remains to be seen whether the court will actually travel to those courthouses, or will continue to receive oral arguments remotely. If I were dumb enough to be a betting man, I’d wager a small sum on the electronic approach for those panels and even for the September session; but I don’t have any inside information about this.

 

Fourth Circuit

This court issued a notice on June 1 that continues in effect; its stated expiration date is August 31. That court, too, has a drop box, but you’re better off e-filing everything through the CM/ECF system. The requirement to file a paper copy has been suspended for now.

 

Quick note on the SCOTUS docket

As always, when June draws near to a close, the biggest bombshells from the Supreme Court of the United States start landing. The Court has traditionally closed out its term by June 30, and usually does so with a flurry of high-profile, media-magnet opinions.

The Court’s next opinion day is tomorrow. There are 14 cases remaining from those argued this term. Ten of those were argued in the pandemic-delayed May sitting; they had previously been scheduled for April. My best guess is that the Court will decide the earlier-argued ones first, simply because the justices have had more time to prepare them. That means that the likeliest ones to arrive tomorrow, in the order they were argued, are Espinoza (tax credits for non-religious schools only), Thuraissigiam (deportation orders), Seila Law (validity of the CFPB), and June Medical (abortion). I expect one or more of these decisions to arrive tomorrow. For the other ten, we may or may not get rulings sometime next week.