ANALYSIS OF FEBRUARY 28, 2013 SUPREME COURT OPINIONS[Posted February 28, 2013] Today is a significant milestone here at VANA, as I’m covering the 50th opinion day since launching the site back in 2005. If this keeps up, you can check back in somewhere around the June 2021 session, to see if I’m still around for the 100th.
The January argument docket was one of the smallest I’ve ever seen, with just 15 cases argued. There have been three unpublished orders since then, and three of the cases argued in January were consolidated, so we have very few opinions to cover today. Nevertheless, this opinion day will be a logistical challenge for me, since I have to leave early this afternoon for an overnight trip, returning tomorrow evening. As a practical matter, I’ll be able to work on analysis of these opinions for several hours today, and then pick it up again on Saturday, giving me much more of a delay than usual in covering this batch. I ask that you bear with me; I expect to have everything analyzed by the end of the weekend.
Today is significant for at least one other reason: It’s the 102nd anniversary of the birth of my maternal grandfather, Carl McCullough, a man who amused me when I was a young boy when he blew smoke rings from his cigar, and who sang me to sleep with “Danny Boy,” reflecting his Scots-Irish ancestry. My daughter heard the same tune years later, from me.
Freedom of Information
In The Daily Press v. Commonwealth, the court takes up a challenge by a newspaper to a trial court’s order sealing certain exhibits in a criminal trial. The exhibits had been introduced in the trial of one of two defendants charged with a single crime; the court evidently felt that release of the exhibits might prejudice the later trial of the second defendant.
The sealing order applied to the entire file, and provided for an expiration date several weeks down the road. The court later amended that order, finding that it was overly broad, but it still allowed the lawyers in the criminal litigation to withdraw the exhibits pending the second trial.
The newspaper applied to the Court of Appeals for a writ of mandamus. That court initially granted the writ, but then rescinded that ruling because, it determined, the case belonged in the Supreme Court. The justices took the case, and today, they rule in favor of the newspaper.
The court first addresses the Commonwealth’s contention that the issue is moot, because the documents are now available to the paper. The justices today find that this case fits squarely within the “capable of repetition, yet evading review” exception to the mootness doctrine. It points to the importance of open trials, and of public access to those trials. In a case of wide media interest, contemporaneous reports of the proceedings are a vital interest, and it requires a compelling interest to overcome the presumption of public access.
That was the real battle in this case, since on appeal, the Commonwealth conceded that the sealing order was erroneous. The justices still evaluate the merits, since they aren’t bound by concessions of law, even those made by the Commonwealth. The court finds today that the trial court’s stated rationale, relating to potential prejudice, was overly speculative.
If I were wearing a hat right now, I’d tip it to Justice Mims, who includes in this clearly written opinion one of my favorite observations, that newspapers are “the first rough draft of history.”
I posted a tongue-in-cheek essay yesterday about Daniels v. Mobley, a declaratory-judgment action that sought to determine the constitutionality of Virginia’s gambling statute as applied to organized games of Texas Hold ‘Em. Daniels operated a bingo hall that he converted into The Poker Palace. He generated a fair amount of money for charitable purposes in this way, but eventually got a letter from the Commonwealth’s Attorney, threatening prosecution under the illegal gambling statutes. Since that would be a Class 6 felony in Daniels’s case, he decided to seek a judicial opinion. He filed a declaratory-judgment action, naming the prosecutor as the respondent.
Daniels summoned an impressive list of witnesses, including math experts and a world poker champion. The trial court sustained a motion to strike at the conclusion of the plaintiff’s case, finding that “the outcome of any one hand is uncertain,” thus making it a matter of chance, and therefore illegal gambling. The court also ruled that the statute proscribing such gambling was not unconstitutionally vague.
Today we get an unsatisfying though understandable conclusion to this dispute. The Supreme Court holds that declaratory judgments aren’t appropriate for “pre-adjudication” of disputes involving criminal statutes. A court can’t enjoin a criminal prosecution – that would invade the elected prosecutor’s discretion in deciding which charges to bring, and against whom.
Normally, DJ actions are available “to afford relief from the uncertainty and insecurity attendant upon controversies over legal rights without requiring one of the parties to invade the rights asserted by the other in order to have an actionable case.” Sinclair & Middleditch, Virginia Civil Procedure, 5th ed. §3.10[A]. And doing that often involves the interpretation of statutes. But not in this context; the justices rule that the trial court didn’t have the authority to make a pronouncement at all on whether this planned conduct would or would not violate the criminal statute.
So, where does this leave Daniels? More important, where does it leave poker? Ironically, it leaves them both in a form of limbo. Note that the justices didn’t affirm the trial judge’s holding that this particular game fell within the purview of the statute; it vacated that ruling, leaving the ultimate issue unadjudicated.
There’s a way for Daniels to get a final answer on this question, but he’s not going to like it: He can go ahead and run a poker game and get prosecuted as a test case. In such a instance, the question of whether poker is a game of luck or of skill would emphatically be front and center, and the courts (including the Supreme Court) would have the authority to pass upon the heart of the matter. If he loses at trial, he can appeal in order to create a statewide precedent; if he wins, the outcome of the case may or may not have much precedential effect outside the boundaries of the City of Portsmouth.
This case has understandably generated a fair amount of media attention, due to the subject matter. While there are several fine stories, I particularly enjoyed reading this description from Tom Jackman of the Washington Post.
One other interesting point: The Fraternal Order of Police filed an amicus brief in the case, but probably not the one that you’d expect; they supported Daniels, even in litigation against the city’s chief prosecutor. Why would they do that, you ask? Well, to which organization do you think Daniels had sent all those charitable dollars?
Seven justices take three different routes to get to the same destination in Osman v. Osman, an appeal that interprets Virginia’s slayer statute in the context of a finding of not guilty by reason of insanity. Let’s start this analysis with the statute itself.
In Virginia, a person who meets the definition of a slayer cannot receive any inheritance from the decedent’s estate. The statute treats such a person as having predeceased the victim. Here’s the definition of a slayer:
[A]ny person (i) who is convicted of the murder or voluntary manslaughter of the decedent or, (ii) in the absence of such conviction, who is determined, whether before or after his death, by a court of appropriate jurisdiction by a preponderance of the evidence to have committed one of the offenses listed in subdivision (i) resulting in the death of the decedent.
There are thus three ways that someone can fall within this definition. He can be convicted of murder. He can be convicted of voluntary manslaughter. Or he can be adjudicated in a civil proceeding to have committed murder or voluntary manslaughter.
There’s a vital distinction to be made here. In order to be convicted of one of these crimes, the evidence must prove the defendant’s guilt beyond a reasonable doubt. That’s Crim Law 101. But even without such a conviction, the perpetrator can still be “disinherited” if a civil jury finds, by a preponderance of the evidence, that he Did It.
I’ll cut to the chase here: All seven justices agree with the learned trial judge that this perpetrator fits within the purview of the statute, despite the fact that he was adjudged not guilty of murder (he wasn’t charged with manslaughter) by reason of insanity. The disagreement is over what reasoning gets us to that common result.
Justice Lemons writes the majority opinion, joined by the chief justice plus Justices Goodwyn, Millette, and Mims. The majority finds that the criminal/civil dichotomy implicit in the statute means that when a trial court uses the civil approach, then civil principles of intent apply. That is, as long as the perpetrator intended his acts, that’s sufficient; he need not appreciate that his actions were wrongful (which is the foundation of the insanity defense). The evidence in this case established that the perpetrator acted intentionally, even though he didn’t understand that his actions were wrongful, so under the civil analysis, he’s a slayer.
Justice McClanahan files a concurring opinion. She notes that the majority’s reasoning dispenses with the requirement of mens rea, substituting civil intent for malice. She observes that without proof of malice, one can never be adjudged to have committed murder (again, manslaughter doesn’t count, since it wasn’t charged and isn’t implicated in this appeal). She would prefer an approach that draws from the language of the insanity statute, which presumes that the elements of the offense have been established:
When the defense is insanity of the defendant at the time the offense was committed, the jurors shall be instructed, if they acquit him on that ground, to state the fact with their verdict.
By using the phrase, “at the time the offense was committed,” she reasons that the statute only applies after the prosecution has satisfied its burden of proof; hence, the defendant has necessarily been shown to have committed the offense.
Justice Powell also writes separately to warn of the Law of Unintended Consequences. She notes that the majority’s reasoning, by transplanting mere civil intent into the murder statute in place of malice, would disinherit a wife who kills her abusive husband in self-defense. Under the majority’s view, she urges, that wife would be adjudged to have killed her husband intentionally, even though justifiably, and would thereby be deemed by the slayer statute to have predeceased him.
This contention doesn’t escape the notice of the majority, which adds two paragraphs at the end of today’s opinion to address Justice Powell’s concern. The majority observes the difference between justifiable and excusable homicide, and expressly rules that someone who has committed the former “is not a person who has committed a ‘wrong,’” and so may not be barred from inheriting by the slayer statute. The court elects to leave to another day how self-defense killing would be treated in this context. Reading between the lines, I sense that the court would rule that a justifiable homicide would not bar inheritance; an excusable homicide is a much closer call, probably dependent on the circumstances.
State Bar cases come to the Supreme Court relatively rarely, so it’s a remarkable day indeed when we get three published opinions in this field. We’ll take up Hunter v. Virginia State Bar first. In this one, the Bar insists that a lawyer who maintains a blog to discuss criminal-law issues, featuring his own successes in criminal court, is subject to regulation.
The blog in question is published by a Richmond lawyer who says that his site has several purposes, “including marketing, creation of a community presence for his firm, combatting any public perception that defendants charged with crimes are guilty until proven innocent, and showing commitment to criminal law.” The Bar took notice when it saw that he was posting commentary based on the cases that he won, but not on those he lost. It contended that the posts were inherently misleading. It threw in a charge that the attorney had published information that was harmful or embarrassing to his clients, without their consent.
A three-judge panel threw out the last charge, but it held that the blog was commercial speech that could be regulated by the Bar. The panel required the attorney to post a fairly innocuous disclaimer. Here, you judge for yourself: “Case results depend upon a variety of factors unique to each case. Case results do not guarantee or predict a similar result in any future case.”
That outcome satisfied nobody, so the parties headed off to the Supreme Court. Today, a divided Supreme Court affirms in part and reverses in part. The majority agrees with the panel that the speech is commercial, citing the fact that very few posts are about general legal issues, in contrast to the large number that are about the attorney’s victories in court. It then notes that while the reports are not inherently misleading, they are potentially so, thus justifying regulation. The court agrees with the panel’s decision to dismiss the embarrassing-disclosure charge, since lawyers have as much right as anyone else to report to the world what has happened in a courtroom. Finally, the majority remands for imposition of a full disclaimer that complies with the Bar’s regulations.
Justice Lemons, joined by Justice McClanahan, files an interesting dissent that raises significant questions about the majority’s reasoning on one point in particular. The dissent cites a US Supreme Court decision holding that speech is commercial if it ‘[does] no more than propose a commercial transaction.” Assuming that one purpose of this blog was to propose that potential clients hire the lawyer, it’s true beyond argument that this lawyer’s blog goes beyond that. Some of the posts, even though they were supported by news of the lawyer’s courtroom successes, contained commentary on the legal system and criminal-justice issues. The lawyer forcefully argues against what he sees as a public perception of “guilty until proven innocent” once someone has been arrested and charged with a crime.
The dissent finally notes that there was no evidence that anyone ever found the lawyer’s blog posts to be misleading. These two justices would apply heightened scrutiny to the Bar’s proposed regulation, and would reject the Bar’s attempt to post disclosures that would cheapen his political speech by “self-tagging” it as an advertisement.
We’ll turn next to Zaug v. Virginia State Bar. In this one, the lawyer was part of a team defending a medical-malpractice action. On the day in which a deposition was scheduled to occur (the deposition was to be covered by the respondent attorney’s partner), the lawyer’s phone rang. It was one of the plaintiffs. The lawyer took the call and asked the caller how she could help her.
After a very brief exchange, the caller began an emotional outburst into how the lawsuit was affecting her family. She eventually told the astonished lawyer that she wanted to withdraw the suit and move on with their lives. The lawyer did what she could to disengage politely, eventually ending the call something like 60 seconds from when it began.
When the plaintiffs’ lawyer found out about this, she filed a Bar complaint against the respondent, claiming that the defense lawyer had wrongfully taken the call and spoken directly with a represented adverse party about a matter involving the representation. The Bar issued a charge of misconduct; a district committee found a de minimis violation and dismissed the charge.
But a de minimis dismissal isn’t the same as a finding in favor of the respondent, so appeals followed, first to a three-judge panel (which affirmed the de minimis dismissal) and then to the Supreme Court.
Today, the justices unanimously reverse and dismiss the ethics charge. Citing the duties of a lawyer to act professionally and civilly, the court is clearly uncomfortable with the Bar’s seeming insistence that the lawyer should have hung up on the caller once she learned who was calling and what the subject matter of the call was. The court rejects what I’ll call a slam-down-the-phone rule for attorneys, even when they get calls from adversaries, noting in its ruling that this result s driven by “these specific and narrow facts.”
I found one procedural aspect of this opinion to be surprising. In Bar proceedings, as in virtually all other appeals, the justices view the evidence in the record in the light most favorable to the party who won below. In this instance, that would be the Bar. Indeed, in previous attorney-discipline appeals, the court has consistently applied exactly this standard of review, and today’s opinion cites that principle.
But I’m not sure that the court follows through on that principle, given the analysis I see here. There was one key dispute in the evidence between the Bar’s version of the beginning of the phone call and the lawyer’s version. Keeping in mind the factor at issue here, whether the lawyer knew that she was talking to a represented party, here are the two versions:
Lawyer’s version: “Hi, this is Heather; how may I help you?”
Bar’s version: “Hi, Mrs. [Plaintiff], this is Heather; how may I help you?”
In the Bar’s version, the lawyer picked up the phone and greeted the plaintiff by name. That would seem to end any question of which version was correct; the Bar is entitled to have the evidence viewed in a favorable light. This is particularly relevant where, as here, the lawyer “denies knowing who the caller was when she answered” the phone.
So, why the departure from established principles of appellate review? Here’s the court’s long explanation, as set out in today’s opinion:
[The lawyer] admits that she was aware of the subject of the telephone call when she answered it, and this is reflected in the district committee’s factual findings. However, the record does not disclose when she became aware that the caller was a represented person. Although [plaintiff] testified at the hearing on her motion to disqualify counsel that [the lawyer] addressed her as Mrs. [Plaintiff] when she answered the call, thereby indicating [the lawyer] knew the identity of the caller at the time she answered, [the lawyer] denied knowing the identity of the caller until [plaintiff] described the emotional toll the litigation was having on her family.
The circuit court made no factual findings and merely affirmed the district committee’s determination. However, the district committee made no finding resolving this dispute of fact. To the contrary, the district committee found only that [the lawyer] “was aware she was speaking with [plaintiff] either at the time she took the telephone call or concomitantly therewith.” We are unable to decipher the meaning of this finding. “Concomitantly” means “in a concomitant manner.” Webster’s Third New International Dictionary 471 (1993). “Concomitant” means “accompanying or attending esp[ecially] in a subordinate or incidental way[;] occurring along with or at the same time as and with or without a causal relationship.” Id.
Accordingly, the finding does not determine whether [the lawyer] knew the identity of the caller when she answered or soon thereafter. Consequently, this finding does not answer the question of when [the lawyer] knew both (a) the identity of the party with whom she was communicating and (b) the subject of the communication.
The Supreme Court seems to be saying here that it will only view the evidence (particularly on a disputed fact) in a light most favorable to the Bar if there’s a specific written factual finding to that effect. Perhaps this is something unique to attorney-discipline appeals – I will freely admit to not being anything of an expert in these cases – but it seems to be at odds with the way the court has done business in the past, at least in non-Bar appeals. If you view the evidence in the traditional way, then the lawyer knew when she took the call who the caller was (because she greeted her by name) and admits “that she was aware of the subject of the telephone call when she answered it.”
I wholeheartedly endorse the court’s ruling that lawyers should behave civilly, and slamming down the phone on anyone isn’t civil at all. I do, however, wonder about the wisdom of an attorney’s ever accepting a phone call from an opposing represented party. In my view, sensible lawyers would be best advised to refuse to accept such a call under any circumstances, if only to avoid having to undergo an odyssey like this one.
Upon reading the last disciplinary decision issued today, Northam v. Virginia State Bar, I see some light shining on the issue I described above in the Zaug case. I pondered amending my analysis of the previous case in this new light, but it occurs to me that it will probably provide a better illustration if I leave that analysis intact and expand upon it here.
This case is about what happens when a conflicts check fails. The attorney is a partner in a small firm on the Eastern Shore, where pretty much all firms are small. He was consulted by a man for representation in a contemplated divorce proceeding, and met with the man one day. The next day, one of the lawyer’s partners met with – ulp! – the first client’s wife, also to evaluate representation in divorce proceedings.
Obviously, we can’t have two lawyers from the same firm handling the opposite sides of a divorce case (or any other kind of litigation, for that matter). During the second meeting, the partner asked the wife if she knew who her husband was consulting. The response, “Northam something,” probably caused the attorney’s jaw to drop. He immediately went to his secretary and learned that his partner had, indeed, met with the husband the day before. He thereupon told the wife that he couldn’t represent her, so she got other counsel.
The issue in this case arises because the first lawyer didn’t withdraw from the case; he continued to represent the husband. The only information that he received from his partner, according to this record, was, “I think we have a problem and I’m getting out.” The partner never told the first lawyer anything that the wife had disclosed to him during the intake interview.
The district committee found violations of three provisions: conflict of interest, imputed disqualification, and declining or terminating representation. On appeal to the Bar’s disciplinary board, the lawyer prevailed with regard to the first and third charges, but the board affirmed the finding based on imputed disqualification, ordering an admonition without terms. The lawyer appealed to the Supreme Court.
This appeal contains the same resolution as the Zaug appeal – the majority reverses, basing its ruling upon the absence of a factual finding by the Bar that the lawyer had actual (as opposed to constructive) knowledge of the fact that his partner was disqualified. There was testimony in the record from the partner that he had told the lawyer about the purpose (though not the details) of his conversation with the wife, but the Bars findings of fact didn’t include a specific statement that the respondent lawyer actually knew that his partner was prohibited from the representation. Since the imputed-disqualification rule contains specific-knowledge language, the record fails to support the charge, so the judgment is reversed and the disciplinary charge dismissed.
Justice Powell dissents, and her reasoning roughly tracks the musings I posted above in discussing the Zaug decision. She notes that the court reviews the record as a whole, not merely the Bar’s stated factual findings, to see if the decision is supported; she urges an affirmance based on the partner’s disclosure.
Here’s a specific statement of the majority’s holding that summarizes why this one is reversed, and probably presages the reversal in Zaug:
An attorney charged with a violation of professional responsibility is entitled to findings of fact that contain a clear statement of how the Board resolved disputed issues.
I’m not sure whether this holding will become the new normal in Bar appeals; Justice Powell’s dissent cites a few cases in which the court seems to have taken a more expansive view of the entire record, instead of just the stated factual findings. Time will tell.
There’s one final aspect of this holding that will interest appellate lawyers. As the court mentions in a detailed footnote, the appellant made some minor changes in the wording of the assignments of error when he filed his opening brief. Specifically, he had originally described himself as “Respondent” when he filed a notice of appeal before the Disciplinary Board, but in his appellate briefs, he modified that to “Appellant.” That’s actually correct, though not technically necessary; he was indeed a respondent in the administrative proceedings and an appellant once he got to Ninth Street.
The court notes this change and recites its general rule against changing the wording of assignments. Bu it holds that non-substantive changes won’t undermine the appeal, and in my view, this one certainly shouldn’t; his attorney was trying to use the correct term in the appellate court. The justices go ahead and evaluate the case, since this change wasn’t significant and didn’t assert anything other than what had been asserted beforehand.
I will again caution each of my readers: Don’t play with the language of your assignments, especially after a writ has been granted. If these reworded assignments had been materially different, the court might have dismissed the appeal as to them (see this essay for a frightening example).
I have preached that every lawyer has to be a professional writer. You may or may not have to be a professional speaker – courtroom lawyers must; many transactional lawyers need not – but every lawyer has to be able to write. And just as a carpenter must master the use of a hammer or a saw, and a professional golfer must master the use of a sand wedge, lawyers must master the use of their primary tools, which are words. In that vein, I always appreciate an appeal that turns on things like grammar and usage, things that only a word nerd like me can appreciate. Tharpe v. Saunders provides today’s fodder for usage discussion.
This is a defamation case. Tharpe and Saunders worked in competing construction companies in Southside Virginia. Tharpe’s company got a government contract to perform some excavation at the sprawling Fort Pickett. When the company unexpectedly encountered some subsurface rock, it applied to the government for additional compensation, based on a change of condition.
The same situation occurred again in a separate contract, this time between Tharpe’s company and a regional service authority. The company again encountered rock and again sought additional compensation for the extra work that it would have to perform.
Enter Saunders. According to the complaint (this case was decided on demurrer, so the facts are as alleged in the pleading), Saunders spoke with the authority’s director and uttered these fateful words: “Tharpe told me that Tharpe was going to screw the Authority like he did Fort Pickett.”
Well, that wasn’t a very nice thing to say. It hit home with the authority, which sued Tharpe’s company for fraud and barred it from bidding on construction projects. The statement evidently made the rounds of the nearby counties. Tharpe and his company thereupon sued Saunders and his company.
The defendants demurred, contending that the claimed statement was one of opinion, because it could never be proved to be true or not. In evaluating this defense, the trial court focused on the most evocative word in the statement, eventually holding that “what is meant by the word ‘screw’ is dependent upon the speaker’s viewpoint, [so] the alleged defamatory statement was an expression of opinion.”
Today, a unanimous Supreme Court reverses and sends the case back for further proceedings. The court finds that the statement is “indisputably capable of being proven true or false.” That’s because what has to be proved true is not whether anyone was going to “screw” anyone else; it’s whether Tharpe actually said it. That fact – whether the statement was or was not made – isn’t a matter of opinion and it isn’t dependent upon anyone’s viewpoint.
The heart of today’s ruling, and the holding for which this case will be cited in the future, is as follows, taken from cases arising in other jurisdictions:
[Q]uotations falsely attributed to a plaintiff are actionable as defamation regardless of the truth or falsity of the substance of the quotation when it injures the plaintiff’s reputation.
As the court notes, sometimes the false attribution of even a statement of opinion to a particular speaker can cause significant damage. The court cites an example of a suit against New Yorker magazine, which had attributed to a well-known psychoanalyst the statement that he was “the greatest analyst who ever lived.” While the truth of that boast can never be proved, it unquestionably damages the doctor to have such a statement falsely pinned on him.
There’s more in the opinion, including a dictionary definition of the word screw (when used in this context). But VANA is a G-rated website, so I’ll leave the salacious details to Justice McClanahan, who writes today’s entertaining opinion.
Suing the government – any government – is often a tricky proposition. You begin with the proposition that you can’t sue the king in the king’s court, unless he consents to be sued. That regal prohibition has carried over to our republic, so you can’t sue the Commonwealth in Virginia’s courts unless there’s a specific statutory provision allowing such a suit. The best example of that is the State Tort Claims Act.
Counties, being arms of state government, share that immunity, and enjoy many of the same preferences in litigation. One of those preferences is that when there’s a statutory process for filing suit, you have to follow it exactly, or else you can’t proceed. That’s the issue in Albemarle County v. Camirand.
Camirand is one of several former county employees who took advantage of a golden-parachute offer from the county, electing early retirement in exchange for a sweetened “buyout.” In the process of calculating the promised buyout, a County bean-counter made a mistake, as a result of which the package offered was more favorable to the employees than it should have been. After the employees retired, the county refused to pay the extra, mistaken amount. The new retirees sought relief from the county Board, but that request was refused.
The employees took their grievance to circuit court. As required in the statutes dealing with monetary claims against counties, they posted appeal bonds. Once the case got to court, the County asked for summary judgment, because the employees hadn’t simultaneously filed a written notice of appeal, as required by the statute. The employees responded that the bond itself gave that written notice, right in the beginning:
Whereas, the Albemarle County Board of Supervisors on the 2nd day of June, 2010, denied a claim made by Principal in the amount of [the respective amounts claimed by each of the Retirees]; and
Whereas, it is the intention of the Principal to appeal said denial of claim to the Circuit Court of Albemarle County. . . .
The County acknowledged that it knew perfectly well what the retirees were doing, and it didn’t claim prejudice as a result of the omission of a separate notice. Nevertheless, the County insisted that the retirees hadn’t complied with the statutory prerequisite for filing suit. The trial court disagreed and submitted the matter to a jury, which ruled in favor of the retirees. The County got a writ.
The language of the statute, you’ll have to admit, seems to contemplate two separate documents, although it doesn’t come right out and specify that:
The disallowance may be appealed by serving written notice on the clerk of the governing body and executing a bond to the county, with sufficient surety to be approved by the clerk of the governing body, with condition for the faithful prosecution of such appeal, and the payment of all costs imposed on the appellant by the court.
Any appellant, therefore, has to (1) serve a written notice, and (2) execute a bond. Now you see the heart of the dispute. In this morning’s opinion, the justices rule that the bond itself didn’t suffice as a written notice of appeal, so they reverse and enter final judgment for the County. The court concludes that the preamble language isn’t a notice of appeal; at most, it’s a statement that the retirees intend to appeal. But they still have to follow that up with the requisite statutory document, and the court finds that the bond doesn’t suffice.
If this were a garden-variety suit involving two private litigants, the result might be different. But this is an exception to the sovereign immunity of a government, so strict compliance with the statute is necessary to avoid the bar of immunity. The retirees didn’t comply, so their claims never see the light of day. (It’s too late to fix the problem by filing a new notice of appeal and a new bond.)
Justice Mims dissents, claiming that the majority “elevates form over substance,” and pointing out that nothing in the statute specifically requires that the notice and bond be in separate documents. He cites the purpose of notices of appeal, which is to ensure that the appellee knows that further litigation is in the works; the appeal bond here certainly did that.
Usually it’s best to play nice, even when you’re involved in litigation. Occasionally, there are dangers to being too nice, as we see in D.R. Horton, Inc. v. Warren County. This appeal involves proffers paid by a developer to a county to facilitate residential construction.
Years ago, a developer sought rezoning of agricultural land to permit development of a residential neighborhood. In order to encourage the board of supervisors to say yes, the developer made two proffers, designed to minimize the economic effect of adding more than 200 residences to the County’s infrastructure. Specifically, it offered to pay $8,000 per lot, and to construct a water system and wastewater-treatment plant to serve the planned community. That was good enough for the board of supervisors, which approved the rezoning.
Thereafter, the developer sent a “confidential” letter to the County Attorney. (Let’s leave aside for now how one may protect from FOIA disclosure a proposal to a county.) The letter proposed an amendment to the previous proffer. The developer asked the County to agree to drop the requirement for building the water and wastewater facilities, as the developer planned to make arrangements with the Town of Front Royal for those services. The developer also offered to add $4,000 per unit to its payment to the county, for a total of $12,000 per site.
Here’s the point at which land-use lawyers will gasp: The board of supervisors voted to accept this proposal, but the arrangement was never formalized by a written agreement. In 2006, the developer sold the tract to another developer, who is the appellant here.
That new developer was quickly made aware of the County’s expectation of receiving $12,000 per building permit, instead of the $8,000 set out in the original proffer. It contended, in a series of exchanges with County officials, that it was not obligated to pay more than $8,000 per unit. In order to allow the project to move forward, the developer paid the full $12K under protest, “until this matter has been resolved.”
Over the next 3½ years, the new owner received 52 building permits in the community, for which it paid the disputed $12,000 per unit. It filed a declaratory-judgment action in 2007, asking for a declaration that the correct fee was $8,000. For some reason, the litigation took four years; but in 2011, the trial court agreed with the developer and ruled that the developer wasn’t obligated to pay the extra $4,000 per unit. The court based its judgment on the premise that “there was never an agreement that was finalized” between the parties to require the extra payment.
The developer had filed a separate suit in 2008, asking for restitution of the fees it was paying under protest. Once the DJ action was concluded, the trial court turned to this proceeding, in which it had a nasty surprise for the developer: It held that a recovery was barred because the developer had voluntarily paid the disputed fees. In other words, You’re entitled to win; but you lose.
That ruling sent the parties to Richmond, for today’s ultimate resolution. The justices today agree with the trial court that the voluntary-payment doctrine bars a recovery. In doing so, the court reaches back almost a century for this exposition of the doctrine:
Where a party pays an illegal demand with a full knowledge of all the facts which render such demand illegal, [i] without an immediate and urgent necessity therefor, or [ii] unless to release his person or property from detention, or [iii] to prevent an immediate seizure of his person or property, such payment must be deemed voluntary, and cannot be recovered back. And the fact that the party at the time of making the payment, files a written protest, does not make the payment involuntary.
That last part is a killer – you can’t protect yourself even by specifically providing that you’re doing so. In effect, the payment-under-protest language was a nullity. After citing this rule, the court proceeds to analyze each of the exceptions and find each one inapplicable to these facts. Since the developer had paid the fees pendente lite in order to further its own economic advantage, instead of under any real extrinsic compulsion, it couldn’t recover what it had voluntarily paid.
There’s a parallel to this in the appellate sector: An appellant who voluntarily pays a judgment, under no threat of execution or contempt citation, moots the ensuing appeal. That’s true even if the judgment carries a stiff penalty in the form of post-judgment interest, and even if the payment carries an express reservation of the right to appeal. If there’s a sheriff at the door with an execution warrant, then the judgment debtor can pay the judgment without risking waiver; but otherwise, that act is fatal to any appeal.
Everyone down here in Tidewater knows about the Waterside Festival Marketplace, commonly known by the single name Waterside, in downtown Norfolk. It was built in the 1980s as part of an urban-renewal project to revitalize the downtown waterfront, and in its early form, featured a wonderful mix of eclectic shops and restaurants. As time passed, many of the shops closed, and based on my observation, the place became more of a center for dining and entertainment alone. The City of Norfolk did what it could to encourage occupants of the property, sometimes recruiting businesses from out of the area to locate a branch in the building.
I don’t know whether Bar Norfolk and the Have a Nice Day Café were among the “recruitees,” but they each opened in the late 1990s, by which time the transformation to dining and entertainment was in full swing. They enjoyed the benefits of a blanket use permit that had been issued by the City in favor of the entire Waterside property, allowing them to operate as “eating and drinking establishments.”
The history of the land-use regulations set out in today’s opinion is far more complex than I propose to recount here; if you really want to know how it all uncoils, you can check the slip opinion in Norfolk 102, LLC v. City of Norfolk, and read what poor Chief Justice Kinser had to lay out over the course of 13 pages to explain the regulatory history and the procedural posture of the case. Not being constrained to record all the case history for posterity, I will instead head right for the controversy.
The City decided in 2009 to revoke the blanket special exception, forcing these establishments to apply individually for such exceptions. Each establishment duly submitted an application, and the local planning commission recommended approval. The matter was calendared for a City Council meeting, at which the two enterprises expected no problems.
Unknown to the two businesses, storm clouds were gathering over the Elizabeth River; the City Manager recommended to the Council that the exceptions be denied. If that happened, the two establishments would effectively be shut down, since they wouldn’t be allowed to sell alcohol. They learned of the Manager’s recommendation the day before the Council meeting.
The owners placed a frantic call to their lawyer, only to be told that he was out of the Commonwealth on a vacation; he had felt that it was safe to travel, given the solid recommendation from the Planning Commission. Since he couldn’t return on such short notice, they immediately (that is, the day before the Council meeting) hired another attorney to represent them in what now looked to be a hostile environment.
The new lawyer appeared at the meeting and asked the Council to defer the matter to allow the original lawyer to appear in support of the applications. He cited the sudden turnaround in the City staff’s position, and noted that the proposal to revoke the blanket exception wasn’t even on the advertised Council agenda. He asked as a matter of fundamental fairness that the Council postpone consideration of the matter for a short time.
The Council, unmoved by this request, went ahead and revoked the blanket exception and denied the individual applications. When the two establishments opened the next day, the City sued for an injunction; the businesses responded with a counterclaim and a separate complaint, including an appeal of the Council’s decision. The trial court ultimately sided with the City.
In evaluating the issues in this case, the justices first rule that the businesses did not acquire a vested right to continue to operate, because the use they wanted to continue was not permitted by the original ordinance. It’s possible in certain circumstances to obtain a vested right to a non-permitted use, but this wasn’t one of those circumstances. In a ruling of broader application, the court rules that the owners waived their due-process right to adequate notice of the hearing when their last-minute lawyer actually appeared and tried to defend the application. In essence, because they acted diligently, they had waived their objection.
If this last ruling seems harsh to you, I’ve got news for you: It is. To be sure, there is a statutory basis for it; a Code section (scroll down to the last sentence of subsection B) specifically provides that when you appear and participate in local-government proceedings, you waive any claim that you didn’t receive adequate notice. The court today rules that this statute complies with the Due Process Clause, and while the discussion of this issue left me less than convinced, I at least understand why the justices ruled the way they did.
There’s a subtext in this opinion that the justices may have been uncomfortable with the way in which the City handled this matter, particularly the perfectly reasonable request to defer consideration long enough to allow the original attorney to appear. The Supreme Court can’t come out and say this, but I will: I thought that the way in which Norfolk handled this aspect of the matter was a municipal embarrassment (although I doubt anyone in City Hall feels any sense of shame). This is particularly true of the City’s lawyers, who like the rest of us are supposed to practice law with civility; that includes agreeing to reasonable requests for extensions of time. In my view, that didn’t happen here; and in its inexplicable haste to shut down these businesses, the City appears to have damaged its public image.
Ever wonder what happens when the money runs out to build God’s house, and the construction folks haven’t been paid? If so, check out Glasser & Glasser v. Jack Bays, Inc., which deconstructs (sorry) the events surrounding a new church building up in Woodbridge.
The short answer to the question above is that not even God is immune from mechanics’ liens, at least under Virginia law. This congregation evidently backed its founder’s plan to build quite a palace, calling to mind the wonderful movie, The Bishop’s Wife, starring David Niven, Cary Grant, and Loretta Young. The total cost of this project, at just under $18 million, is probably a tad higher than the one that Niven’s character had in mind.
The fictional church in the movie never got off the ground (and I apologize if I just spoiled the movie for you, though it’s still well worth seeing), but the real one in Prince William County did. The contractor got paid through April 2007, but by then, available funds had run dry, and the builders (the general and a bunch of subs) were paid no more. They filed a string of mechanics’ liens and perfected them by filing timely suits, which ended in favor of the lienors.
There are several issues in this case that will be of keen interest for construction litigators and not many more folks. The court analyzes each issue, unanimously finding that the suits named all necessary parties; the liens were filed on time, based on different completion dates by different subcontractors; the lienors complied with the 150-day rule, limiting the length of time over which their work was covered by a lien; and the general contractor appropriately mitigated its damages. In only one respect was the judgment reversed: The court had directed the sale of the entire 22-acre property, instead of merely that portion on which the church was sited. The court remands for consideration of whether the liens can be satisfied by a sale of less than the entire tract.
The real star of this case is a Woodbridge lawyer named Robert J. Zelnick, who served as a commissioner in chancery to hear all the evidence over the course of a week, and who issued a report and recommendation that the trial court wholly approved. The Supreme Court approves just about all of those recommendations, too, giving Mr. Zelnick quite a track record in terms of the issues decided.