Cuellar v. Vettorel (CA2 8/18/14)

Now that Rule 68 law has – like so much of our tort law and procedure – moved from a world of clear rules to a murky realm of maybes arguments like this are not uncommon.

In this personal-injury case the defendant made an Offer of Judgment “contingent on the satisfaction of all liens.” At trial the plaintiff received an award that was less than the OJ but more than she would have ended up with had she accepted it and used it to pay her liens. Her lawyer therefore argued that she shouldn’t have to pay Rule 68 sanctions, that the lien amount shouldn’t count. The trial court disagreed; she appealed.

The Court of Appeals affirms. The plaintiff had an Alaska Supreme Court case but the court distinguishes it and says that in any event the terms of our rule do not permit correcting for liens. Even if they did, the result would be an improper comparison between an OJ that did not include liens and a trial award that did.

Whether lien language in an OJ is technically necessary or not, liens have become enough of a problem that its inclusion is understandable. This is an uncommon example of a qualification on an OJ that doesn’t either nullify it or, even if valid under the present version of the rule, make its application difficult to compute.

(link to opinion}

Robertson v. Alling (CA2 8/6/14)

The court holds that settlement agreements are worthless.

This was a prescriptive-easement case with several plaintiffs and 27 defendants. There was a settlement conference; all defendants, or their authorized proxies, attended. They made an offer that wasn’t accepted. Their lawyer then emailed them recommending that they keep the  offer open. Five defendants emailed him that they didn’t agree to that; he didn’t read the email. A number of emails between counsel then set forth and confirmed the settlement. When the plaintiffs learned that some defendants were making problems they moved to enforce the settlement agreement. The trial court granted the motion, ruling that the defendants’ lawyer had actual and apparent authority.

The Court of Appeals reverses.

The court first decides that it treats motions to enforce settlement as motions for summary judgment.

The court finds that the lawyer had no actual authority; the Robertson’s argument that he did because he didn’t read the email has “no merit.”

The court finds that a question of fact exists as to actual authority. Why? That isn’t as clear. The court cites the traditional rule that “if the client places the attorney in a position where third persons of ordinary prudence and discretion would be justified in assuming the attorney was acting within his authority, then the client is bound by the acts of the attorney within the scope of his apparent authority.” That used to mean what it says. But the court cites a 1992 case called Canyon Contracting, which apparently implied that the principal’s manifestations must include not just placing the attorney in a position but somehow sending signals directly to the other party. What signals (you’re asking) is a good question and the court does nothing to clarify it much by suggesting that the defendants’ presence at the settlement conference might mean not that they were on board with the lawyer but, on the contrary, that he didn’t have authority to settle the case if they weren’t present. It is evidently up to “persons of ordinary prudence and discretion” to assume that things either are as appearances naturally suggest or that they are the complete and counterintuitive (to anyone who has ever actually attended settlement conferences) opposite. Perhaps having 27 clients makes a difference; perhaps that ordinary person should understand that getting 27 fractious ducks in a row can be tricky and temporary. The court does mention that the plaintiffs insisted that they all be at the settlement conference. But nothing in the court’s analysis suggests that there is a difference between one client and one thousand.

So what is the resolution? The court says that under the summary-judgment standard it would normally remand for hearing or trial on the disputed issue. (And that’s certainly a possibility, though its odd to say that that’s something that “normally” happens.) But here it simply sets the settlement agreement aside. Why? Rule 80 (agreements must be in writing or made in open court). The court apparently accepts that the emails were “in writing.” What wasn’t in writing was the clients’ assent to the settlement. Since when does that have to be in writing? The court cites Canyon Contracting for the proposition.

The court isn’t entirely comfortable with this, though, since it finds the need to justify itself in a footnote. Rule 80 does not contain this requirement but Canyon Contracting, the court says, read it into the rule. The plaintiffs did not argue that the court should change Canyon Contracting (presumably because they argued an entirely different set of issues and so had no reason to). Moreover, Canyon Contracting is “long standing precedent.”  The court does not suggest that any other case has followed Canyon Contracting on this point (we haven’t Shephardized it). We used to question a former Supreme Court Justice’s practice of finding a lone case that was wrongly-decided years ago and announcing that it had “established” the law of Arizona. Apparently he has followers after all.

So remember that your settlement agreement signed by counsel is as good as gold – until the other lawyer calls to tell you that his client never really did agree and even if he did it wasn’t in writing so you can’t enforce anything.

(link to opinion)

American v. CSK (CA1 8/5/14)

Bailiff issues – the careless, the chatty, the controlling, the prejudiced – we have always with us. Traditionally, at least, the problem bailiffs were routinely found in the courtrooms of the problem judges (though we don’t know this judge and have no idea whether  that’s true here).                  .

After a jury trial – 12 days, 24 witnesses, 168 exhibits –  produced an unsatisfactory result American hired a PI to interview jurors. He got affidavits from two. Turns out that when sent to deliberate – in the middle of Friday afternoon before a three-day weekend – the jurors, who had earlier wondered how long the trial would last, asked the bailiff how long deliberations typically take. She told them that “an hour or two should be plenty.” The affidavits also claimed that most jurors didn’t consider the evidence,  just wanted to go home, etc. American moved for new trial; the trial court denied it. The Court of Appeals reverses.

The court first rules that although the jurors’ thoughts and attitudes are inadmissible under Rule 606 the bailiff’s comment could be considered, as “extraneous information that could have prejudiced the jury.”

The court next holds, citing Perez (1997), that a bailiff communication doesn’t necessarily warrant new trial. Though bad if it was improper and prejudicial, the communication is okay if concerns an “administrative detail” or an “innocuous matter,” or if it accurately answers a question. But if it doesn’t, or if you can’t tell, or if it violated an “essential right” then a new trial can be in order.

The trial court can hold an evidentiary hearing to determine these things. That’s what the majority ends up deciding that this trial judge should have done. The dissent points out that CSK didn’t dispute what the bailiff said and therefore feels that no hearing was necessary (and that finding what happened innocuous was within the trial court’s discretion; the majority goes out of its way to mention facts to the contrary and of course that may be the point of its opinion – finding that you should have held a hearing is a way to reverse a discretionary ruling the appellate judges don’t agree with).

So why did the majority feel that a hearing was necessary? It doesn’t hesitate to conclude that length of deliberations is not a permitted communication and is of procedural importance. But the majority’s question is whether this improper communication was prejudicial. In other words, did the jury think the bailiff’s remark a general comment or did they think it applied specifically to their case? The affidavits didn’t, in the majority’s view, provide enough information to answer that.

What about the problem that the trial took place three years ago? Its for the trial court to determine whether an evidentiary hearing at this point is feasible. If not, says the majority, the court must order a new trial (apparently on the law cited above that if you can’t tell then its prejudicial).

Finally, the court discusses the scope of the hearing. The thrust appears to be that although under Rule 606 you can’t ask jurors how something actually affected their thinking you can find out things around the edges – when it happened, where it happened, how it happened, who heard it, etc.

So, one of two things will happen. Either the trial court will take the majority’s broad hints, reverse himself, and grant a new trial, using the excuse that a hearing is no longer feasible. Or he will call the jurors back to court to give testimony, the two who gave affidavits will have their recollections refreshed by them and emphasize the egregiousness of the circumstances, the rest won’t remember or won’t care or won’t show, and the judge will grant a new trial.  What we wonder is whether the bailiff will face any consequence for scuttling an expensive trial with a careless – or worse – remark. Well, no, we don’t wonder, bureaucracies being the way they are.

(link to opinion)