In re Reilly - 3rd Circuit - July 21, 2008
http://www.ca3.uscourts.gov/opinarch/064290p.pdf
A Chapter 7 trustee who does not lodge a timely objection to a debtor’s claim of exemption of personal property may not move to sell the property if he later learns that the property value exceeds the amount of the claimed exemption.
Where, as here, the debtor indicates the intent to exempt her entire interest in a given property by claiming an exemption of its full value and the trustee does not object in a timely manner, the debtor is entitled to the property in its entirety.
Debtor is a cook with a one-person catering business. In her Schedule B and Schedule C, she listed "business equipment" as personal property with a value of $10,718 and claimed an exemption for the full value under 11 U.S.C. § 522(d)(6) and 11 U.S.C. § 522(d)(5).
The trustee did not object to the exemption within the 30-day period prescribed by Fed. R. Bank. P. 4003(b). He later sought an appraisal of the business equipment and determined it to have a value of approximately $17,200. He then filed a motion before the Bankruptcy Court to sell the business equipment in order to recoup the value, less the $10,718 exemption, for the bankruptcy estate. The Bankruptcy Court rejected this motion and agreed with the debtor that the property was fully exempt from the bankruptcy estate because the trustee had not filed a timely objection to the claim of exemption.
Under Fed. R. Bankr. P. 4003(b), the trustee, as a party in interest, has 30 days from the close of the creditors’ meeting under § 341(a) (or the date of filing any supplemental schedules or amendment to the exempt-property list, whichever is later) to object to any exemptions a debtor claimed on his or her Schedule C. If no objection is made, “the property claimed as exempt on [the Schedule C] is exempt.” 11 U.S.C. § 522(l).
Recognizing a split of authority of the issue, and relying primarily on Taylor v. Freeland & Kronz, 503 U.S. 638 (1992), the court rejected the trustee's argument that Rule 4003 and § 522(l) only place a 30-day limit on the trustee’s ability to object to an exemption on the ground that it was not properly taken—that there is no statutory basis for claiming the exemption—and does not control objections to property valuation.
The court said that its holding "accords with bankruptcy’s promise of a fresh start. Once the period for objection lapses, all parties involved know what property belongs to the bankruptcy estate and what remains with the debtor. The debtor can then use that property with the knowledge that it is her own and will not be subject to later liquidation for the benefit of creditors. This is not the case where the debtor claims an exemption in an amount less than the value listed on the schedules. In that circumstance, the trustee is entitled to claim for the bankruptcy estate the value of the property in excess of the exemption sought, without the need for a timely objection....But where the debtor lists a value for the property and claims an exemption in the same amount, the trustee is on notice of the debtor’s valuation and has ample time to seek confirmation that the debtor’s claimed value represents the true worth of the asset."
The trustee’s concern that the holding today will encourage gamesmanship among crafty debtors who may seek to undervalue their property with the hope of having it bypass the bankruptcy estate is answer by the fact that "there are significant protections in place for both the trustee and the bankruptcy estate....Moreover, on the facts here, there is no reason to suspect bad behavior on the part of the debtor. Indeed, it is quite to the contrary. If the trusteee discovered bad faith by the debtor, bankruptcy and criminal law allow recourse."
Monday, July 21, 2008
consumer - used cars - proposed FTC reg
http://edocket.access.gpo.gov/2008/pdf/E8-16634.pdf
SUMMARY: The FTC requests public comments on its Used Motor Vehicle Trade Regulation Rule.
DATES: Written comments relating to the Used Car Rule must be received by September 19, 2008.
I. Background
The Commission promulgated the Used Car Rule in 1984 and the Rule became effective in 1985.2 The Used Car Rule is intended primarily to prevent oral misrepresentations and unfair omissions of material facts by used car dealers concerning warranty coverage. \
To accomplish that goal, the Rule provides a uniform method for disclosing warranty information on a window sticker called the ‘‘Buyers Guide’’ that dealers are required to display on used cars. The Rule requires used car dealers to disclose on the Buyers Guide whether they are offering a used car for sale with a dealer’s warranty and, if so, the basic terms, including the duration of coverage, the percentage of total repair costs to be paid by the dealer, and the exact systems covered by the warranty.
The Rule additionally provides that the Buyers Guide disclosures are to be incorporated by reference into the sales contract, and are to govern in the event of an inconsistency between the Buyers Guide and the sales contract. The Rule requires Spanish language versions of the Buyers Guide when dealers conduct sales in Spanish.
III. Issues for Comment
The Commission requests written comment on any or all of the following questions. The Commission requests that responses to its questions be as specific as possible, including a reference to the question being answered, and reference to empirical data or other evidence wherever available and appropriate.
A. General Issues
(1) Is there a continuing need for the Rule? Why or why not?
(2) What benefits has the Rule provided to consumers? What evidence supports the asserted benefits?
(3) What modifications, if any, should be made to the Rule to increase its benefits to consumers?
0 F(a) What evidence supports the proposed modifications?
(b) How would these modifications affect the costs the Rule imposes on businesses, and in particular on small businesses?
(c) How would these modifications affect the benefits to consumers?
(4) What impact has the Rule had on the flow of truthful information to consumers and on the flow of deceptive information to consumers?
(5) What significant costs has the Rule imposed on consumers? What evidence supports the asserted costs?
(6) What modifications, if any, should be made to the Rule to reduce the costs imposed on consumers?
(a) What evidence supports the proposed modifications?
(b) How would these modifications affect the benefits provided by the Rule?
(7) How have the 1995 amendments to the Rule affected purchasers of used motor vehicles? How have the 1995 amendments to the Rule affected used motor vehicle dealers? Please provide any evidence that has become available since 1995 concerning the costs, benefits, and effectiveness of the Rule. Does this new information indicate that the Rule should be modified? If so, why, and how? If not, why not?
(8) What benefits, if any, has the Rule provided to businesses, and in particular to small businesses? What evidence supports the asserted benefits?
(9) What modifications, if any, should be made to the Rule to increase its benefits to businesses, and in particular to small businesses?
(a) What evidence supports the proposed modifications?
(b) How would these modifications affect the costs the Rule impose on businesses, and in particular on small businesses?
(c) How would these modifications affect the benefits to consumers?
(10) What significant costs, including costs of compliance, has the Rule imposed on businesses, and in particular on small businesses? What evidence supports the asserted costs?
(11) What modifications, if any, should be made to the Rule to reduce the costs imposed on businesses, and in particular on small businesses?
(a) What evidence supports the proposed modifications?
(b) How would these modifications affect the benefits provided by the Rule?
(12) What evidence is available concerning the degree of industry compliance with the Rule? To what extent has there been a reduction in deceptive oral representations and unfair omissions made by used car dealers concerning warranty coverage since the Rule was issued? Please provide any supporting evidence. Does this evidence indicate that the Rule should be modified? If so, why, and how? If not, why not?
(13) What modifications, if any, should be made to the Rule to account for changes in relevant technology or economic conditions? What evidence supports the proposed modifications?
(14) Does the Rule overlap or conflict with other federal, state, or local laws or regulations? If so, how?
(a) What evidence supports the asserted conflicts?
(b) With reference to the asserted conflicts, should the Rule be modified? If so, why, and how? If not, why not?
SUMMARY: The FTC requests public comments on its Used Motor Vehicle Trade Regulation Rule.
DATES: Written comments relating to the Used Car Rule must be received by September 19, 2008.
I. Background
The Commission promulgated the Used Car Rule in 1984 and the Rule became effective in 1985.2 The Used Car Rule is intended primarily to prevent oral misrepresentations and unfair omissions of material facts by used car dealers concerning warranty coverage. \
To accomplish that goal, the Rule provides a uniform method for disclosing warranty information on a window sticker called the ‘‘Buyers Guide’’ that dealers are required to display on used cars. The Rule requires used car dealers to disclose on the Buyers Guide whether they are offering a used car for sale with a dealer’s warranty and, if so, the basic terms, including the duration of coverage, the percentage of total repair costs to be paid by the dealer, and the exact systems covered by the warranty.
The Rule additionally provides that the Buyers Guide disclosures are to be incorporated by reference into the sales contract, and are to govern in the event of an inconsistency between the Buyers Guide and the sales contract. The Rule requires Spanish language versions of the Buyers Guide when dealers conduct sales in Spanish.
III. Issues for Comment
The Commission requests written comment on any or all of the following questions. The Commission requests that responses to its questions be as specific as possible, including a reference to the question being answered, and reference to empirical data or other evidence wherever available and appropriate.
A. General Issues
(1) Is there a continuing need for the Rule? Why or why not?
(2) What benefits has the Rule provided to consumers? What evidence supports the asserted benefits?
(3) What modifications, if any, should be made to the Rule to increase its benefits to consumers?
0 F(a) What evidence supports the proposed modifications?
(b) How would these modifications affect the costs the Rule imposes on businesses, and in particular on small businesses?
(c) How would these modifications affect the benefits to consumers?
(4) What impact has the Rule had on the flow of truthful information to consumers and on the flow of deceptive information to consumers?
(5) What significant costs has the Rule imposed on consumers? What evidence supports the asserted costs?
(6) What modifications, if any, should be made to the Rule to reduce the costs imposed on consumers?
(a) What evidence supports the proposed modifications?
(b) How would these modifications affect the benefits provided by the Rule?
(7) How have the 1995 amendments to the Rule affected purchasers of used motor vehicles? How have the 1995 amendments to the Rule affected used motor vehicle dealers? Please provide any evidence that has become available since 1995 concerning the costs, benefits, and effectiveness of the Rule. Does this new information indicate that the Rule should be modified? If so, why, and how? If not, why not?
(8) What benefits, if any, has the Rule provided to businesses, and in particular to small businesses? What evidence supports the asserted benefits?
(9) What modifications, if any, should be made to the Rule to increase its benefits to businesses, and in particular to small businesses?
(a) What evidence supports the proposed modifications?
(b) How would these modifications affect the costs the Rule impose on businesses, and in particular on small businesses?
(c) How would these modifications affect the benefits to consumers?
(10) What significant costs, including costs of compliance, has the Rule imposed on businesses, and in particular on small businesses? What evidence supports the asserted costs?
(11) What modifications, if any, should be made to the Rule to reduce the costs imposed on businesses, and in particular on small businesses?
(a) What evidence supports the proposed modifications?
(b) How would these modifications affect the benefits provided by the Rule?
(12) What evidence is available concerning the degree of industry compliance with the Rule? To what extent has there been a reduction in deceptive oral representations and unfair omissions made by used car dealers concerning warranty coverage since the Rule was issued? Please provide any supporting evidence. Does this evidence indicate that the Rule should be modified? If so, why, and how? If not, why not?
(13) What modifications, if any, should be made to the Rule to account for changes in relevant technology or economic conditions? What evidence supports the proposed modifications?
(14) Does the Rule overlap or conflict with other federal, state, or local laws or regulations? If so, how?
(a) What evidence supports the asserted conflicts?
(b) With reference to the asserted conflicts, should the Rule be modified? If so, why, and how? If not, why not?
child support enforcement - medical support - federal regs
http://edocket.access.gpo.gov/2008/pdf/E8-15771.pdf
SUMMARY: This regulation revises Federal requirements for establishing and enforcing medical support obligations in Child Support Enforcement (CSE) program cases receiving services under title IV–D of the Social Security Act (the Act).
The changes: require that all support orders in the IV–D program address medical support; redefine reasonable-cost health insurance; require health insurance to be accessible, as defined by the State; and make conforming changes to the Federal interstate, substantialcompliance audit, and State selfassessment requirements.
DATES: Effective Date: This regulation is effective July 21, 2008.
SUMMARY: This regulation revises Federal requirements for establishing and enforcing medical support obligations in Child Support Enforcement (CSE) program cases receiving services under title IV–D of the Social Security Act (the Act).
The changes: require that all support orders in the IV–D program address medical support; redefine reasonable-cost health insurance; require health insurance to be accessible, as defined by the State; and make conforming changes to the Federal interstate, substantialcompliance audit, and State selfassessment requirements.
DATES: Effective Date: This regulation is effective July 21, 2008.
Friday, July 18, 2008
Pennsylvania Bulletin Highlights, July 19, 2008
Link: http://www.pabulletin.com/secure/data/vol38/38-29/index.html
Highlights of items of interest to the Poverty Law Community:
Recent Actions during the 2008 Regular Session of the General Assembly
http://www.pabulletin.com/secure/data/vol38/38-29/1316.html
DPW - child care - income limits - increase
http://www.pabulletin.com/secure/data/vol38/38-29/1339.html
DPW - MA - prior authorization (proposed) - radiology services
http://www.pabulletin.com/secure/data/vol38/38-29/1340.html
Sign language interpreters/transliterators - proposed final rules filed with IRRC
http://www.pabulletin.com/secure/data/vol38/38-29/1349.html
Highlights of items of interest to the Poverty Law Community:
Recent Actions during the 2008 Regular Session of the General Assembly
http://www.pabulletin.com/secure/data/vol38/38-29/1316.html
DPW - child care - income limits - increase
http://www.pabulletin.com/secure/data/vol38/38-29/1339.html
DPW - MA - prior authorization (proposed) - radiology services
http://www.pabulletin.com/secure/data/vol38/38-29/1340.html
Sign language interpreters/transliterators - proposed final rules filed with IRRC
http://www.pabulletin.com/secure/data/vol38/38-29/1349.html
UC - willful misconduct - drug testing - right to challenge drug test
Cinram Manufacturing, LLC v. UCBR - July 18, 2008 - Commonwealth Court - unreported memorandum decision
http://www.courts.state.pa.us/OpPosting/CWealth/out/2051CD07_7-18-08.pdf
The court upheld the Board decision that the employer had not proved willful misconduct, despite having produced drug test results - to which claimant did not object - showing a positive drug test.
Claimant produced countervailing evidence, including a letter from his doctor detailing how having taken cough medicine and eaten a poppy seed roll could have produced a false positive result. The referee and Board found that claimant's evidence was “credible and more compelling and logical” than that presented by employer and established that the test result was a false positive.
Under Section 402(e.1) of the Law, an employee is ineligible for unemployment compensation in any week in which (a) his unemployment is due to discharge or temporary suspension from work due to failure to submit and/or pass a drug test conducted pursuant to an employer’s established substance abuse policy, and (b) the drug test is not requested or implemented in violation of the law or of a collective bargaining agreement. 43 P.S. § 802(e.1). The employer introduced evidence which could have satisfied all requirements of Section 402(e.1) had it been accorded different weight and persuasive value.
However, proof of the elements of sec. 402(e.1) are not, per se, dispositive. Claimant has a right to dispute the accuracy of the drug test. The court rejected as "absurd" the employer's argument that, because it established the required elements listed in sec. 402(e.1), the referee and Board should not have examined the accuracy of the drug test.
The Board found credible Claimant’s evidence that lawful items he had consumed caused his drug test to produce a false positive result. While Employer interprets this as placing an additional burden on employers, it is merely the Board serving in its capacity as fact-finder. In unemployment compensation cases, the Board serves as final fact-finder and resolves any conflicts in evidence or credibility of witnesses.
The Board did not ignore the the drug test. Rather, it was given "probative value." UGI Utilities, Inc. v. UCBR, 851 A.2d 240, 252 (Pa. Cmwlth. 2004). The Board considered the positive test result, but accorded it no credibility, instead accepting substantial evidence which impugned its reliability. The Board clearly concluded that Claimant rebutted the positive test results with credible evidence that consumption of poppy seed roll and over-the-counter medicine resulted in a false positive test. Based on that, the Board concluded that he did not violate employer’s drug policy. "We are not in a position to question the Board’s finding. Thus, there is no reason for us to reverse this decision."
http://www.courts.state.pa.us/OpPosting/CWealth/out/2051CD07_7-18-08.pdf
The court upheld the Board decision that the employer had not proved willful misconduct, despite having produced drug test results - to which claimant did not object - showing a positive drug test.
Claimant produced countervailing evidence, including a letter from his doctor detailing how having taken cough medicine and eaten a poppy seed roll could have produced a false positive result. The referee and Board found that claimant's evidence was “credible and more compelling and logical” than that presented by employer and established that the test result was a false positive.
Under Section 402(e.1) of the Law, an employee is ineligible for unemployment compensation in any week in which (a) his unemployment is due to discharge or temporary suspension from work due to failure to submit and/or pass a drug test conducted pursuant to an employer’s established substance abuse policy, and (b) the drug test is not requested or implemented in violation of the law or of a collective bargaining agreement. 43 P.S. § 802(e.1). The employer introduced evidence which could have satisfied all requirements of Section 402(e.1) had it been accorded different weight and persuasive value.
However, proof of the elements of sec. 402(e.1) are not, per se, dispositive. Claimant has a right to dispute the accuracy of the drug test. The court rejected as "absurd" the employer's argument that, because it established the required elements listed in sec. 402(e.1), the referee and Board should not have examined the accuracy of the drug test.
The Board found credible Claimant’s evidence that lawful items he had consumed caused his drug test to produce a false positive result. While Employer interprets this as placing an additional burden on employers, it is merely the Board serving in its capacity as fact-finder. In unemployment compensation cases, the Board serves as final fact-finder and resolves any conflicts in evidence or credibility of witnesses.
The Board did not ignore the the drug test. Rather, it was given "probative value." UGI Utilities, Inc. v. UCBR, 851 A.2d 240, 252 (Pa. Cmwlth. 2004). The Board considered the positive test result, but accorded it no credibility, instead accepting substantial evidence which impugned its reliability. The Board clearly concluded that Claimant rebutted the positive test results with credible evidence that consumption of poppy seed roll and over-the-counter medicine resulted in a false positive test. Based on that, the Board concluded that he did not violate employer’s drug policy. "We are not in a position to question the Board’s finding. Thus, there is no reason for us to reverse this decision."
Wednesday, July 16, 2008
consumer - RESPA - insurance kickbacks
Alexander, et al. v. WAMU, et al. - ED Pa. - June 30, 2008
http://www.paed.uscourts.gov/documents/opinions/08d0740p.pdf
The court rejected defendants' 12(b)(6) motion to dismiss class action complaint against lender for alleged violations of RESPA, 12 USC 2601 et seq., by collecting illegal referral or kickback payments in the form of reinsurance premiums. Plaintiffs obtained loans with down payments of less than 20% and were required to pay for private mortgage insurance from an insurer with whom WAMU had alleged captive reinsurance arrangement.
filed rate doctrine does not prohibit a RESPA suit
The filed rate doctrine states that where regulated companies are required by federal or state law to file proposed rates or charges with a governing regulatory agency, then any rate approved by that agency “is per se reasonable and unassailable in judicial proceedings brought by ratepayers”....The filed rate doctrine has no fraud exception; rates that are approved are per se reasonable even if obtained by fraud....“[E]very court that has considered [the issue] has rejected the notion that there is a fraud exception to the filed rate doctrine.”
However, the court found that the filed rate doctrine "does not bar the plaintiffs’ claim that defendants violated RESPA through an alleged kickback or fee-splitting scheme through their mortgage lender’s captive reinsurance arrangement. While the doctrine bars direct challenges to the insurance rate structure set by a state, it does not prohibit plaintiffs from bringing suit under RESPA for a violation of fair business practices through the use of illegal kickback payments.
RESPA safe harbor provision
RESPA's safe harbor provision states that nothing shall prohibit “the payment to any person of a bona fide salary or compensation or other payment for goods or 8 facilities actually furnished or for services actually performed.” 12 U.S.C. § 2607(c)(2). HUD's two-prong test requires that the court evaluate: (1) “whether goods or facilities were actually furnished or services were actually performed for the compensation paid” and (2) “whether the payments are reasonably related to the value of the goods or facilities that were actually furnished or services that were actually performed.” Plaintiffs here "have sufficiently alleged that the payments in question are not covered by the safe harbor provision, since they say that some services were not actually performed.
Plaintiffs have Article III standing
The court followed the reasoning of Kahrer v. Ameriquest Mort. Co., 418 F. Supp. 2d 748 (W.D. Pa. 2006) rather than Morales v. Attorneys’ Title Ins. Fund, Inc., 983 F. Supp. 1418 (S.D. Fla. 1997) and concluded that under the plain language of the statute and its legislative history a plaintiff who is entitled to damages under § 8(d)(2) can seek three times the full amount he paid for any settlement services. Under the Kahrer line of cases, RESPA provides that plaintiffs have a right to purchase settlements services from providers who do not participate in an illegal kickback scheme. Therefore, plaintiffs’ failure to allege an overcharge for settlement services does not preclude a finding of injury in fact for the purposes of Article III standing.
Burford abstention does not apply
In Burford v. Sun Oil Co. the Supreme Court concluded that where complex issues of state administrative law are presented a federal court may in its discretion “stay its hand” and abstain from hearing the case. 319 U.S. 315, 334 (1943). The Court of Appeals has explained: Where timely and adequate state-court review is available, a federal court sitting in equity must decline to interfere with the proceedings or orders of state administrative agencies: (1) when there are “difficult questions of state law bearing on policy problems of substantial public import whose importance transcends the result in the case at bar;” or (2) where the “exercise of federal review of the question in a case and in similar cases would be disruptive of state efforts to establish a coherent policy with respect to a matter of substantial public concern.”
“While Burford is concerned with protecting complex state administrative processes from undue federal interferences, it does not require abstention whenever there is such a process”....Burford abstention does not apply to this case, where plaintiffs are claiming that defendants through their captive reinsurance program violated the anti-kickback provision of RESPA. Plaintiffs are not pursuing a state insurance code claim or challenging a state administrative decision, so their remedies are not limited to state administrative or court proceedings, and the mere existence of a state administrative procedures for insurance claims does not require abstention. Additionally, there are no prior or ongoing state proceedings with which the present action interferes.
Further, the second prong of the Burford doctrine – whether there are difficult questions of state law impacting public policy or exercise of federal review of the question in a case and in similar cases would be disruptive of state efforts to establish a coherent policy – is not implicated in this case. Plaintiffs are not challenging the filed rate or any other state policies in this matter. They allege that defendants’ alleged kickback scheme – not defendants’ charged rate – violates RESPA, a federal statute. Therefore adjudication of this matter will not interfere with Pennsylvania’s efforts to maintain a comprehensive and coherent regulatory regime.
http://www.paed.uscourts.gov/documents/opinions/08d0740p.pdf
The court rejected defendants' 12(b)(6) motion to dismiss class action complaint against lender for alleged violations of RESPA, 12 USC 2601 et seq., by collecting illegal referral or kickback payments in the form of reinsurance premiums. Plaintiffs obtained loans with down payments of less than 20% and were required to pay for private mortgage insurance from an insurer with whom WAMU had alleged captive reinsurance arrangement.
filed rate doctrine does not prohibit a RESPA suit
The filed rate doctrine states that where regulated companies are required by federal or state law to file proposed rates or charges with a governing regulatory agency, then any rate approved by that agency “is per se reasonable and unassailable in judicial proceedings brought by ratepayers”....The filed rate doctrine has no fraud exception; rates that are approved are per se reasonable even if obtained by fraud....“[E]very court that has considered [the issue] has rejected the notion that there is a fraud exception to the filed rate doctrine.”
However, the court found that the filed rate doctrine "does not bar the plaintiffs’ claim that defendants violated RESPA through an alleged kickback or fee-splitting scheme through their mortgage lender’s captive reinsurance arrangement. While the doctrine bars direct challenges to the insurance rate structure set by a state, it does not prohibit plaintiffs from bringing suit under RESPA for a violation of fair business practices through the use of illegal kickback payments.
RESPA safe harbor provision
RESPA's safe harbor provision states that nothing shall prohibit “the payment to any person of a bona fide salary or compensation or other payment for goods or 8 facilities actually furnished or for services actually performed.” 12 U.S.C. § 2607(c)(2). HUD's two-prong test requires that the court evaluate: (1) “whether goods or facilities were actually furnished or services were actually performed for the compensation paid” and (2) “whether the payments are reasonably related to the value of the goods or facilities that were actually furnished or services that were actually performed.” Plaintiffs here "have sufficiently alleged that the payments in question are not covered by the safe harbor provision, since they say that some services were not actually performed.
Plaintiffs have Article III standing
The court followed the reasoning of Kahrer v. Ameriquest Mort. Co., 418 F. Supp. 2d 748 (W.D. Pa. 2006) rather than Morales v. Attorneys’ Title Ins. Fund, Inc., 983 F. Supp. 1418 (S.D. Fla. 1997) and concluded that under the plain language of the statute and its legislative history a plaintiff who is entitled to damages under § 8(d)(2) can seek three times the full amount he paid for any settlement services. Under the Kahrer line of cases, RESPA provides that plaintiffs have a right to purchase settlements services from providers who do not participate in an illegal kickback scheme. Therefore, plaintiffs’ failure to allege an overcharge for settlement services does not preclude a finding of injury in fact for the purposes of Article III standing.
Burford abstention does not apply
In Burford v. Sun Oil Co. the Supreme Court concluded that where complex issues of state administrative law are presented a federal court may in its discretion “stay its hand” and abstain from hearing the case. 319 U.S. 315, 334 (1943). The Court of Appeals has explained: Where timely and adequate state-court review is available, a federal court sitting in equity must decline to interfere with the proceedings or orders of state administrative agencies: (1) when there are “difficult questions of state law bearing on policy problems of substantial public import whose importance transcends the result in the case at bar;” or (2) where the “exercise of federal review of the question in a case and in similar cases would be disruptive of state efforts to establish a coherent policy with respect to a matter of substantial public concern.”
“While Burford is concerned with protecting complex state administrative processes from undue federal interferences, it does not require abstention whenever there is such a process”....Burford abstention does not apply to this case, where plaintiffs are claiming that defendants through their captive reinsurance program violated the anti-kickback provision of RESPA. Plaintiffs are not pursuing a state insurance code claim or challenging a state administrative decision, so their remedies are not limited to state administrative or court proceedings, and the mere existence of a state administrative procedures for insurance claims does not require abstention. Additionally, there are no prior or ongoing state proceedings with which the present action interferes.
Further, the second prong of the Burford doctrine – whether there are difficult questions of state law impacting public policy or exercise of federal review of the question in a case and in similar cases would be disruptive of state efforts to establish a coherent policy – is not implicated in this case. Plaintiffs are not challenging the filed rate or any other state policies in this matter. They allege that defendants’ alleged kickback scheme – not defendants’ charged rate – violates RESPA, a federal statute. Therefore adjudication of this matter will not interfere with Pennsylvania’s efforts to maintain a comprehensive and coherent regulatory regime.
child abuse - expungement - discretionary authority of DPW
G.M. v. DPW - Commonwealth Court - July 16, 2008
http://www.courts.state.pa.us/OpPosting/CWealth/out/300CD08_7-16-08.pdf
DPW did not act in bad faith, fraudulently, capriciously or otherwise abuse its power in rejecting petitioner's 2007 petition alleging that there was good cause to expunge a founded report of child abuse which took place in 1987. A court order was entered at that time, finding that petitioner had sexually abused his daughter. There was no appeal from that finding.
Petitioner alleged that there was good cause for his record to be expunged because he was rehabilitated. He said that (1) he had undergone medical and psychiatric treatment and therapy; (2) he deeply regretted his actions; (3) at the time of the abuse, he was going through a divorce, but he now is in a stable relationship; (4) he has rebuilt his relationship with his daughter; (5) he currently is enrolled in nursing school; and (6) the founded child abuse report harmed his chances of obtaining gainful employment
The Law provides that the DPW Secretary may amend or expunge any record at any time upon good cause shown and notice to the appropriate subjects of the report. 23 Pa. C.S. §6341(a)(1). This section grants the Secretary the discretionary authority to amend any record upon good cause shown. J.C. v. Department of Public Welfare, 720 A.2d 193 (Pa. Cmwlth. 1998). Our courts will not review the actions of government bodies or administrative tribunals involving the exercise of discretion in the absence of bad faith, fraud, capricious action or abuse of power, which did not exist here.
The trial court’s orders were presumptive evidence that the child abuse report was accurate, and petitioner did not dispute the finding of abuse.
http://www.courts.state.pa.us/OpPosting/CWealth/out/300CD08_7-16-08.pdf
DPW did not act in bad faith, fraudulently, capriciously or otherwise abuse its power in rejecting petitioner's 2007 petition alleging that there was good cause to expunge a founded report of child abuse which took place in 1987. A court order was entered at that time, finding that petitioner had sexually abused his daughter. There was no appeal from that finding.
Petitioner alleged that there was good cause for his record to be expunged because he was rehabilitated. He said that (1) he had undergone medical and psychiatric treatment and therapy; (2) he deeply regretted his actions; (3) at the time of the abuse, he was going through a divorce, but he now is in a stable relationship; (4) he has rebuilt his relationship with his daughter; (5) he currently is enrolled in nursing school; and (6) the founded child abuse report harmed his chances of obtaining gainful employment
The Law provides that the DPW Secretary may amend or expunge any record at any time upon good cause shown and notice to the appropriate subjects of the report. 23 Pa. C.S. §6341(a)(1). This section grants the Secretary the discretionary authority to amend any record upon good cause shown. J.C. v. Department of Public Welfare, 720 A.2d 193 (Pa. Cmwlth. 1998). Our courts will not review the actions of government bodies or administrative tribunals involving the exercise of discretion in the absence of bad faith, fraud, capricious action or abuse of power, which did not exist here.
The trial court’s orders were presumptive evidence that the child abuse report was accurate, and petitioner did not dispute the finding of abuse.
Tuesday, July 15, 2008
consumer - arbitration clause - duress, unconscionability - discovery
Hopkins v. Newday Financial, LLC - ED Pa. - June 30, 2008
http://www.paed.uscourts.gov/documents/opinions/08D0759P.pdf
This memorandum order is meant to clarify a previous "limited discovery" order concerning "whether the arbitration agreements at issue are valid."
stay of legal actions if arbitration agreement is valid and binding
Under the Federal Arbitration Act, 9 U.S.C. § 3, federal courts are instructed to stay any suit in which an issue in dispute is properly referable to an arbitrator under a valid written arbitration agreement.
Before doing so, however, the court is obliged to satisfy itself that the arbitration agreement is valid and binding. Great W. Mortgage Corp. v. Peacock, 110 F.3d 222, 228 (3d Cir. 1997) (“Under the FAA the district court must be satisfied that the parties entered into a valid arbitration agreement.”). In making that determination, “generally applicable contract defenses, such as fraud, duress, or unconscionability, may be applied to invalidate arbitration agreements.” Doctor’s Assocs., Inc. v. Casarotto, 517 U.S. 681, 687 (1996).
challenge to validity based on allegations of duress and unconscionability
In this case, plaintiffs seek to invalidate the arbitrations agreements on the grounds of duress and unconscionability. To consider these defenses, the court looks primarily to the law of Pennsylvania, because it is the forum state and appears to have a strong relationship with the agreements at issue. Gay v. CreditInform, 511 F.3d 369, 388 n.13 (3d Cir. 2007)
a) duress - Under Pennsylvania law, “[d]uress is defined as ‘that degree of restraint or danger, either actually inflicted or threatened and impending, which is sufficient in severity or apprehension to overcome the mind of a person of ordinary firmness’”....
When the nature of the threat is economic, rather than physical, the doctrine of economic duress applies. “The important elements in the applicability of the doctrine of economic duress or business compulsion are that (1) there exists such pressure of circumstances which compels the injured party to involuntarily or against his will execute an agreement which results in economic loss, and (2) the injured party does not have an immediate legal remedy”....Duress will not lie where the aggrieved party had the opportunity to consult with counsel before entering into the allegedly coercive contract.
According to the named plaintiffs, they were forced to sign arbitration agreements in a compressed span of time under threat that their employment would terminate if they did not agree....[T]hey attest that, because the time for signing was so short, they were accorded no opportunity to seek the review of counsel. Id. Plaintiffs’ affidavits appear to present a set of circumstances that are at least arguably coercive enough to constitute duress under Pennsylvania law.
b) unconscionability - In Pennsylvania, “a contract or term is unconscionable, and therefore avoidable, where there was a lack of meaningful choice in the acceptance of the challenged provision and the provision unreasonably favors the party asserting it.” Salley v. Option One Mortgage Corp., 925 A.2d 115, 119 (Pa. 2007). Unconscion- ability, then, has procedural and substantive aspects.
As to procedural unconscionability, the touchstone is whether the party challenging the agreement had any meaningful choice regarding acceptance of its provisions. Thibodeau v. Comcast Corp., 912 A.2d 874, 886 (Pa. Super. Ct. 2006). Here, the plaintiffs have averred that they were presented with a contract of adhesion, and were given no opportunity to negotiate. An agreement is substantively unconscionable if it is “unreasonably favorable to the drafter”....
Plaintiffs argue that the arbitration agreement is unreasonably favorable to [defendant] NewDay, inter alia, because the arbitral forum’s rule prohibiting plaintiffs from proceeding as a class action, and forcing them instead to proceed individually. A series of Pennsylvania cases have held that limiting the use of the class-action vehicle, if it raises costs to the point of effectively preventing individual redress, is substantively unconscionable. See, e.g., Thibodeau, 912 A.2d at 883-84. The open question here is whether the forum’s rules raise costs to that level.
In addition, plaintiffs allege systemic bias on the part of the arbitral forum. If proved, such bias could potentially render the arbitration agreement fundamentally unfair to plaintiffs. But, as plaintiffs admit, they cannot prove that claim without discovery.
c) discovery - It is the court’s view that plaintiffs’ submissions, at the very least, highlight several questions of fact relevant to the validity of the arbitration agreements. When faced with a fact-intensive question regarding the arbitrability of a dispute, it is within the court’s discretion to allow for limited discovery into whether the arbitration agreements at issue are valid....That was the intent of this court’s order....It was not the court’s intent to limit discovery only to the question of the arbitral forum’s alleged bias, but to allow discovery more broadly into all of the defenses to arbitration raised by plaintiffs, as all appear to call for the resolution of factual questions.
http://www.paed.uscourts.gov/documents/opinions/08D0759P.pdf
This memorandum order is meant to clarify a previous "limited discovery" order concerning "whether the arbitration agreements at issue are valid."
stay of legal actions if arbitration agreement is valid and binding
Under the Federal Arbitration Act, 9 U.S.C. § 3, federal courts are instructed to stay any suit in which an issue in dispute is properly referable to an arbitrator under a valid written arbitration agreement.
Before doing so, however, the court is obliged to satisfy itself that the arbitration agreement is valid and binding. Great W. Mortgage Corp. v. Peacock, 110 F.3d 222, 228 (3d Cir. 1997) (“Under the FAA the district court must be satisfied that the parties entered into a valid arbitration agreement.”). In making that determination, “generally applicable contract defenses, such as fraud, duress, or unconscionability, may be applied to invalidate arbitration agreements.” Doctor’s Assocs., Inc. v. Casarotto, 517 U.S. 681, 687 (1996).
challenge to validity based on allegations of duress and unconscionability
In this case, plaintiffs seek to invalidate the arbitrations agreements on the grounds of duress and unconscionability. To consider these defenses, the court looks primarily to the law of Pennsylvania, because it is the forum state and appears to have a strong relationship with the agreements at issue. Gay v. CreditInform, 511 F.3d 369, 388 n.13 (3d Cir. 2007)
a) duress - Under Pennsylvania law, “[d]uress is defined as ‘that degree of restraint or danger, either actually inflicted or threatened and impending, which is sufficient in severity or apprehension to overcome the mind of a person of ordinary firmness’”....
When the nature of the threat is economic, rather than physical, the doctrine of economic duress applies. “The important elements in the applicability of the doctrine of economic duress or business compulsion are that (1) there exists such pressure of circumstances which compels the injured party to involuntarily or against his will execute an agreement which results in economic loss, and (2) the injured party does not have an immediate legal remedy”....Duress will not lie where the aggrieved party had the opportunity to consult with counsel before entering into the allegedly coercive contract.
According to the named plaintiffs, they were forced to sign arbitration agreements in a compressed span of time under threat that their employment would terminate if they did not agree....[T]hey attest that, because the time for signing was so short, they were accorded no opportunity to seek the review of counsel. Id. Plaintiffs’ affidavits appear to present a set of circumstances that are at least arguably coercive enough to constitute duress under Pennsylvania law.
b) unconscionability - In Pennsylvania, “a contract or term is unconscionable, and therefore avoidable, where there was a lack of meaningful choice in the acceptance of the challenged provision and the provision unreasonably favors the party asserting it.” Salley v. Option One Mortgage Corp., 925 A.2d 115, 119 (Pa. 2007). Unconscion- ability, then, has procedural and substantive aspects.
As to procedural unconscionability, the touchstone is whether the party challenging the agreement had any meaningful choice regarding acceptance of its provisions. Thibodeau v. Comcast Corp., 912 A.2d 874, 886 (Pa. Super. Ct. 2006). Here, the plaintiffs have averred that they were presented with a contract of adhesion, and were given no opportunity to negotiate. An agreement is substantively unconscionable if it is “unreasonably favorable to the drafter”....
Plaintiffs argue that the arbitration agreement is unreasonably favorable to [defendant] NewDay, inter alia, because the arbitral forum’s rule prohibiting plaintiffs from proceeding as a class action, and forcing them instead to proceed individually. A series of Pennsylvania cases have held that limiting the use of the class-action vehicle, if it raises costs to the point of effectively preventing individual redress, is substantively unconscionable. See, e.g., Thibodeau, 912 A.2d at 883-84. The open question here is whether the forum’s rules raise costs to that level.
In addition, plaintiffs allege systemic bias on the part of the arbitral forum. If proved, such bias could potentially render the arbitration agreement fundamentally unfair to plaintiffs. But, as plaintiffs admit, they cannot prove that claim without discovery.
c) discovery - It is the court’s view that plaintiffs’ submissions, at the very least, highlight several questions of fact relevant to the validity of the arbitration agreements. When faced with a fact-intensive question regarding the arbitrability of a dispute, it is within the court’s discretion to allow for limited discovery into whether the arbitration agreements at issue are valid....That was the intent of this court’s order....It was not the court’s intent to limit discovery only to the question of the arbitral forum’s alleged bias, but to allow discovery more broadly into all of the defenses to arbitration raised by plaintiffs, as all appear to call for the resolution of factual questions.
Monday, July 14, 2008
custody - in camera interview of child - presence of counsel - expert evaluation - admission into record
Ottolini v. Barrett - Superior Court - July 14, 2008
http://www.courts.state.pa.us/OpPosting/Superior/out/s39012_08.pdf
Pa. RCP 1915.11(b) mandates that counsel be present during in camera interview of child in custody case in which trial court relied at least in part on such interview. Sandra L.H. v. Joseph L.H., 444 A.2d 12241 (Pa. Super. 1982) is overruled to the extent that it may be inconsistent with the rule.
Remand is also required since a) the court relied on a psychological evaluation that was never entered into evidence, and b) the psychologist was not called as a witness or subject to cross-examination. Pa. CRP 1915.8(a).
http://www.courts.state.pa.us/OpPosting/Superior/out/s39012_08.pdf
Pa. RCP 1915.11(b) mandates that counsel be present during in camera interview of child in custody case in which trial court relied at least in part on such interview. Sandra L.H. v. Joseph L.H., 444 A.2d 12241 (Pa. Super. 1982) is overruled to the extent that it may be inconsistent with the rule.
Remand is also required since a) the court relied on a psychological evaluation that was never entered into evidence, and b) the psychologist was not called as a witness or subject to cross-examination. Pa. CRP 1915.8(a).
consumer - artibration - standard to vacate award
Gateway Funding Diversified Mortgage Services v. Field - ED Pa. - July 10, 20008
http://www.paed.uscourts.gov/documents/opinions/08D0790P.pdf
There was no basis in this case to overcome the "exceedingly deferential standard necessary to vacate, modify or amended an arbitration award which was sought to be confirmed under 9 USC sec. 9."
Section 9 of the Federal Arbitration Act (FAA) states that the court must grant an order confirming an arbitration award unless the award is vacated, modified, or corrected as prescribed in Sections 10 and 11 of this title. 9 U.S.C.A. § 9.
The review of an arbitration award is “extremely deferential” and vacatur is appropriate only in “exceedingly narrow” circumstances....An arbitration award may be set aside where there is an adequate showing of fraud, partiality, misconduct, violation of a specific command of law, or showing that enforcement would be contrary to public policy....The court’s ability to vacate an arbitration award is almost exclusively limited to these grounds, although an award found to be in manifest disregard of the law can also be vacated by the court.
In addition, procedural irregularities may result in such fundamental unfairness as to warrant the vacation of an arbitral award. For example, a court can vacate an arbitration award where an arbitrator received ex parte informati on to the prejudice of one of the parties; or where the arbitrator refused to admit certain evidence in rebuttal without giving parties warning about the application of evidentiary rules); or because the neutral arbitrator rendered decision without obtaining the signatures of the partisan arbitrators, so that there was a lack of evidence of any significant decision-making process by the majority of the board.
The net result of a court’s application of this standard is generally to affirm easily the arbitration award under this extremely deferential standard - a result that is squarely in line with the purpose behind the FAA where courts are tasked with reviewing an arbitration decision. When an arbitrator resolves disputes regarding the application of a contract, and no dishonesty is alleged, the arbitrator's “improvident, even silly, fact-finding” does not provide a basis for a reviewing court to refuse to enforce the award.
In discussing the courts' limited role in reviewing the merits of arbitration awards, we have stated that “‘courts ... have no business weighing the merits of the grievance [or] considering whether there is equity in a particular claim.’ ”.../When the judiciary does so, “it usurps a function which ... is entrusted to the arbitration tribunal.”
http://www.paed.uscourts.gov/documents/opinions/08D0790P.pdf
There was no basis in this case to overcome the "exceedingly deferential standard necessary to vacate, modify or amended an arbitration award which was sought to be confirmed under 9 USC sec. 9."
Section 9 of the Federal Arbitration Act (FAA) states that the court must grant an order confirming an arbitration award unless the award is vacated, modified, or corrected as prescribed in Sections 10 and 11 of this title. 9 U.S.C.A. § 9.
The review of an arbitration award is “extremely deferential” and vacatur is appropriate only in “exceedingly narrow” circumstances....An arbitration award may be set aside where there is an adequate showing of fraud, partiality, misconduct, violation of a specific command of law, or showing that enforcement would be contrary to public policy....The court’s ability to vacate an arbitration award is almost exclusively limited to these grounds, although an award found to be in manifest disregard of the law can also be vacated by the court.
In addition, procedural irregularities may result in such fundamental unfairness as to warrant the vacation of an arbitral award. For example, a court can vacate an arbitration award where an arbitrator received ex parte informati on to the prejudice of one of the parties; or where the arbitrator refused to admit certain evidence in rebuttal without giving parties warning about the application of evidentiary rules); or because the neutral arbitrator rendered decision without obtaining the signatures of the partisan arbitrators, so that there was a lack of evidence of any significant decision-making process by the majority of the board.
The net result of a court’s application of this standard is generally to affirm easily the arbitration award under this extremely deferential standard - a result that is squarely in line with the purpose behind the FAA where courts are tasked with reviewing an arbitration decision. When an arbitrator resolves disputes regarding the application of a contract, and no dishonesty is alleged, the arbitrator's “improvident, even silly, fact-finding” does not provide a basis for a reviewing court to refuse to enforce the award.
In discussing the courts' limited role in reviewing the merits of arbitration awards, we have stated that “‘courts ... have no business weighing the merits of the grievance [or] considering whether there is equity in a particular claim.’ ”.../When the judiciary does so, “it usurps a function which ... is entrusted to the arbitration tribunal.”
consumer - FTC Do-Not-Call registry - indefinite registration
http://edocket.access.gpo.gov/2008/pdf/E8-15994.pdf
SUMMARY: In this document, the FTC amends its rules under the Telephone Consumer Protection Act (TCPA) to require telemarketers to honor registrations with the National Do-Not-Call Registry indefinitely.
This action is consistent with Congress’s mandate in the Do-Not-Call Improvement Act of 2007, which prohibits the removal of numbers from the Registry unless the consumer cancels the registration or the number has been disconnected and reassigned or is otherwise invalid. The Commission also will continue to coordinate with the FTC on additional ways to improve the Registry’s accuracy.
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47 CFR § 64.1200 Delivery restrictions.
(c) (2) A residential telephone subscriber who has registered his or her telephone number on the national do-not-call registry of persons who do not wish to receive telephone solicitations that is maintained by the Federal Government. Such do-not-call registrations must be honored indefinitely, or until the registration is cancelled by the consumer or the telephone number is removed by the database administrator.
SUMMARY: In this document, the FTC amends its rules under the Telephone Consumer Protection Act (TCPA) to require telemarketers to honor registrations with the National Do-Not-Call Registry indefinitely.
This action is consistent with Congress’s mandate in the Do-Not-Call Improvement Act of 2007, which prohibits the removal of numbers from the Registry unless the consumer cancels the registration or the number has been disconnected and reassigned or is otherwise invalid. The Commission also will continue to coordinate with the FTC on additional ways to improve the Registry’s accuracy.
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47 CFR § 64.1200 Delivery restrictions.
(c) (2) A residential telephone subscriber who has registered his or her telephone number on the national do-not-call registry of persons who do not wish to receive telephone solicitations that is maintained by the Federal Government. Such do-not-call registrations must be honored indefinitely, or until the registration is cancelled by the consumer or the telephone number is removed by the database administrator.
Thursday, July 10, 2008
child abuse - expungement - founded report - PFA case
Philadelphia DHS v. DPW - Commonwealth Court - July 10, 2008
http://www.courts.state.pa.us/OpPosting/CWealth/out/1813CD07_7-10-08.pdf
A PFA order in collateral case finding father sexually abused his child provided a sufficient basis for a "founded report" of abuse, 23 P.S. 6303(a), under the Child Protective Services Law.
"Where only one defendant is charged with abuse in a PFA action, only one person defends those charges, an adjudication finds that such abuse occurred and prohibits further contact between the victim child and that defendant, the PFA order is an adjudication containing a sufficient definitive finding upon which DHS based the Founded Report."
These facts were held to distinguish this case from J.G. v. DPW, 795 A.2d 1089 (Pa. Cmwlth. 2002), where the court held that a generalized finding in a dependency case - with no definitive finding that a particular individiual was responsible for the abuse - did not preclude an appeal in a related expungement case.
"A Founded Report may be based upon any judicial adjudication finding that the child who is the subject of the report has been abused, including, but not limited to, criminal charges. The ALJ erred as a matter of law in relying upon J.G. to conclude that the PFA hearing in this case was not, on its own, able to support a Founded Report of abuse. Thus, the DPW did also err in adopting the recommendation of the ALJ and directing that the Founded Report of child abuse against R.G.S. be expunged."
http://www.courts.state.pa.us/OpPosting/CWealth/out/1813CD07_7-10-08.pdf
A PFA order in collateral case finding father sexually abused his child provided a sufficient basis for a "founded report" of abuse, 23 P.S. 6303(a), under the Child Protective Services Law.
"Where only one defendant is charged with abuse in a PFA action, only one person defends those charges, an adjudication finds that such abuse occurred and prohibits further contact between the victim child and that defendant, the PFA order is an adjudication containing a sufficient definitive finding upon which DHS based the Founded Report."
These facts were held to distinguish this case from J.G. v. DPW, 795 A.2d 1089 (Pa. Cmwlth. 2002), where the court held that a generalized finding in a dependency case - with no definitive finding that a particular individiual was responsible for the abuse - did not preclude an appeal in a related expungement case.
"A Founded Report may be based upon any judicial adjudication finding that the child who is the subject of the report has been abused, including, but not limited to, criminal charges. The ALJ erred as a matter of law in relying upon J.G. to conclude that the PFA hearing in this case was not, on its own, able to support a Founded Report of abuse. Thus, the DPW did also err in adopting the recommendation of the ALJ and directing that the Founded Report of child abuse against R.G.S. be expunged."
False Claims Act - charging excess rent in HCV program - OIG alert
http://edocket.access.gpo.gov/2008/pdf/E8-15663.pdf
SUMMARY: This notice provides important information recently issued by HUD’s Office of the Inspector General (OIG) on a recurring problem in the Housing Choice Voucher program. The problem which this notice addresses is landlords submitting false claims for periodic payments under housing assistance payment (HAP) contracts.
Fraud Information Bulletin: Excess Rent
Purpose
This Bulletin highlights a recurring problem in the Housing Choice Voucher (HCV) program. Specifically, this Bulletin discusses the submission by landlords of false claims for periodic payments under Housing Assistance Payment (HAP) contracts, where such landlords have violated their continuing obligations to not charge tenants rents in excess of what is authorized by the HAP contracts.
The Problem
Improperly requiring tenants to pay rent in excess of what is authorized by the applicable HAP contract represents both an actionable offense under the False Claims Act and deplorable behavior directed towards the very persons whom the HCV program was designed to serve. (Additionally, depending on the intent, such an action may qualify as a criminal offense under 18 U.S.C. 287, 1343, etc.) OIG will not tolerate such conduct, and rather will cooperate with efforts to bring offending landlords to justice and to remedy their wrongs.
Background
HUD administers Federal aid to local housing agencies (HAs) that is intended to implement housing assistance programs for low-income residents. With respect to the HCV program, HUD funds HAs via annual contributions contracts. The HAs, in turn, enter into HAP contracts with individual landlords. These HAP contracts provide for periodic housing assistance payments on behalf of eligible lowincome tenants. The HAP contracts also may require eligible tenants to make supplemental rent payments; however, the contracts expressly prohibit landlords from requiring tenants to pay rent in excess of what is authorized by the HAP contracts.
Pursuant to qui tam complaints and citizen complaints filed throughout the nation and subsequent activities, OIG has become aware of a number of landlords who have improperly required tenants to pay rent in excess of what is authorized by the HAP contracts, and thereby submitted or caused to be submitted false claims for HAP contract periodic rent payments.
Example
On July 29, 2005, a Connecticut tenant filed a qui tam complaint, under 31 U.S.C. 3730, against her former landlord. See Coleman v. Hernandez, 490 F. Supp.2d 278 (D. Conn. 2007). The tenant complained that pursuant to a HAP contract the landlord had agreed to accept $1,550 per month for the rental of an apartment in Stamford. Of this $1,550, the tenant was personally responsible for $20, and HUD via the HA paid the complementary $1,530. In spite of the explicit prohibition in the HAP contract, however, the landlord required the tenant to pay an ‘‘additional rent payment’’ of $60 on six separate occasions. In other words, the landlord inappropriately extracted an additional $360 from the helpless tenant. OIG is aware of numerous similar examples of this sort of egregious conduct nationwide.
Penalty
Pursuant to the False Claims Act, 31 U.S.C. 3729 et seq., persons who submit to HUD or a HUD intermediary claims that are false, fictitious or fraudulent are liable for an assessment equal to three times the amount of the claim, plus a penalty of between $5,500 and $11,000 per claim. The United States may take the position that the entire amount of its HAP payment, not merely the amount of the excess payment by the tenant, is the claim that should be trebled where landlords make false certifications concerning excess rent charged.
Additionally, each periodic rent payment constitutes a separate claim; thus, in the Coleman case the court levied a $33,000 (6 × $5,500) penalty against the landlord for her $360 victimization of the tenant.
Pertinent Information
If you have pertinent information regarding this bulletin, please contact: Office of Legal Counsel, Office of the Inspector General, Department of Housing and Urban Development, 451 Seventh St., SW., Room 8260, Washington, DC 20410. Dated: July 1, 2008.
Kenneth M. Donohue, Inspector General.
SUMMARY: This notice provides important information recently issued by HUD’s Office of the Inspector General (OIG) on a recurring problem in the Housing Choice Voucher program. The problem which this notice addresses is landlords submitting false claims for periodic payments under housing assistance payment (HAP) contracts.
Fraud Information Bulletin: Excess Rent
Purpose
This Bulletin highlights a recurring problem in the Housing Choice Voucher (HCV) program. Specifically, this Bulletin discusses the submission by landlords of false claims for periodic payments under Housing Assistance Payment (HAP) contracts, where such landlords have violated their continuing obligations to not charge tenants rents in excess of what is authorized by the HAP contracts.
The Problem
Improperly requiring tenants to pay rent in excess of what is authorized by the applicable HAP contract represents both an actionable offense under the False Claims Act and deplorable behavior directed towards the very persons whom the HCV program was designed to serve. (Additionally, depending on the intent, such an action may qualify as a criminal offense under 18 U.S.C. 287, 1343, etc.) OIG will not tolerate such conduct, and rather will cooperate with efforts to bring offending landlords to justice and to remedy their wrongs.
Background
HUD administers Federal aid to local housing agencies (HAs) that is intended to implement housing assistance programs for low-income residents. With respect to the HCV program, HUD funds HAs via annual contributions contracts. The HAs, in turn, enter into HAP contracts with individual landlords. These HAP contracts provide for periodic housing assistance payments on behalf of eligible lowincome tenants. The HAP contracts also may require eligible tenants to make supplemental rent payments; however, the contracts expressly prohibit landlords from requiring tenants to pay rent in excess of what is authorized by the HAP contracts.
Pursuant to qui tam complaints and citizen complaints filed throughout the nation and subsequent activities, OIG has become aware of a number of landlords who have improperly required tenants to pay rent in excess of what is authorized by the HAP contracts, and thereby submitted or caused to be submitted false claims for HAP contract periodic rent payments.
Example
On July 29, 2005, a Connecticut tenant filed a qui tam complaint, under 31 U.S.C. 3730, against her former landlord. See Coleman v. Hernandez, 490 F. Supp.2d 278 (D. Conn. 2007). The tenant complained that pursuant to a HAP contract the landlord had agreed to accept $1,550 per month for the rental of an apartment in Stamford. Of this $1,550, the tenant was personally responsible for $20, and HUD via the HA paid the complementary $1,530. In spite of the explicit prohibition in the HAP contract, however, the landlord required the tenant to pay an ‘‘additional rent payment’’ of $60 on six separate occasions. In other words, the landlord inappropriately extracted an additional $360 from the helpless tenant. OIG is aware of numerous similar examples of this sort of egregious conduct nationwide.
Penalty
Pursuant to the False Claims Act, 31 U.S.C. 3729 et seq., persons who submit to HUD or a HUD intermediary claims that are false, fictitious or fraudulent are liable for an assessment equal to three times the amount of the claim, plus a penalty of between $5,500 and $11,000 per claim. The United States may take the position that the entire amount of its HAP payment, not merely the amount of the excess payment by the tenant, is the claim that should be trebled where landlords make false certifications concerning excess rent charged.
Additionally, each periodic rent payment constitutes a separate claim; thus, in the Coleman case the court levied a $33,000 (6 × $5,500) penalty against the landlord for her $360 victimization of the tenant.
Pertinent Information
If you have pertinent information regarding this bulletin, please contact: Office of Legal Counsel, Office of the Inspector General, Department of Housing and Urban Development, 451 Seventh St., SW., Room 8260, Washington, DC 20410. Dated: July 1, 2008.
Kenneth M. Donohue, Inspector General.
Thursday, June 26, 2008
UC - willful misconduct - absenteeism - imprisonment
Weems v. UCBR - Commonwealth Court - publication ordered June 26, 2008
http://www.courts.state.pa.us/OpPosting/CWealth/out/1783CD07_6-26-08.pdf
A nine-month absence from work because of incarceration is willful misconduct, despite claimant's alleged eligibility for work release and employer's refusal to participate in the program.
While absenteeism alone does not constitute willful misconduct, "excessive absences and lack of good or adequate cause for the absence" can be. See Medina v. UCBR, 423 A.2d 469 (Pa. Cmwlth. 1980). Although the claimant told the employer that she would be serving a nine-month prison sentence for an assault conviction, her absence due to that incarceration "clearly constitutes excessive absence."
Imprisonment is not good or adequate cause for absence because “an employee who engages in criminal activity punishable by incarceration should realize that his ability to attend work may be jeopardized....It is the inability to attend work, not the criminal conduct, which supports the finding of willful misconduct....Thus, Claimant’s conduct did rise to the level of willful misconduct."
Claimant's alleged eligibility for work release not proven by her testimony
Claimant's testimony that she was eligible for work release was held to be insufficient to prove that she was, in fact, eligible, citing Cruz v. UCBR, 464 A.2d 656 (Pa. Cmwlth. 1983), where the court affirmed a denial of benefits "in part on the lack of any evidence of an order placing the claimant in such a program....Here, aside from Claimant’s testimony that she was eligible for work release, there is no evidence on the record of any court order related to a work release program. Even if such an order does exist, we are not aware of the limitations it might place on Claimant or the responsibilities it might impose on any potential employer."
Employer had a right to refuse to participate in the work release program
The court also rejected claimant's argument that the employer was "obligated to participate in a work release program. Employer cannot be expected to change the conditions of employment in order to accommodate Claimant. In finding the prohibition of unemployment benefits for incarcerated individuals constitutional, we suggested that the General Assembly 'could have felt that while on work release, because of restrictions necessarily imposed under those programs, prisoners were not sufficiently available for work so as to permit them to have a full range of employment options that other claimants have in pursuing new employment'....Employers need not adapt work release restrictions that change the terms of employment. The decision by Employer not to participate in a work release program does not excuse Claimant’s absence from work. Claimant had an obligation to report to work regardless of whether Employer agreed to participate in the work release program."
http://www.courts.state.pa.us/OpPosting/CWealth/out/1783CD07_6-26-08.pdf
A nine-month absence from work because of incarceration is willful misconduct, despite claimant's alleged eligibility for work release and employer's refusal to participate in the program.
While absenteeism alone does not constitute willful misconduct, "excessive absences and lack of good or adequate cause for the absence" can be. See Medina v. UCBR, 423 A.2d 469 (Pa. Cmwlth. 1980). Although the claimant told the employer that she would be serving a nine-month prison sentence for an assault conviction, her absence due to that incarceration "clearly constitutes excessive absence."
Imprisonment is not good or adequate cause for absence because “an employee who engages in criminal activity punishable by incarceration should realize that his ability to attend work may be jeopardized....It is the inability to attend work, not the criminal conduct, which supports the finding of willful misconduct....Thus, Claimant’s conduct did rise to the level of willful misconduct."
Claimant's alleged eligibility for work release not proven by her testimony
Claimant's testimony that she was eligible for work release was held to be insufficient to prove that she was, in fact, eligible, citing Cruz v. UCBR, 464 A.2d 656 (Pa. Cmwlth. 1983), where the court affirmed a denial of benefits "in part on the lack of any evidence of an order placing the claimant in such a program....Here, aside from Claimant’s testimony that she was eligible for work release, there is no evidence on the record of any court order related to a work release program. Even if such an order does exist, we are not aware of the limitations it might place on Claimant or the responsibilities it might impose on any potential employer."
Employer had a right to refuse to participate in the work release program
The court also rejected claimant's argument that the employer was "obligated to participate in a work release program. Employer cannot be expected to change the conditions of employment in order to accommodate Claimant. In finding the prohibition of unemployment benefits for incarcerated individuals constitutional, we suggested that the General Assembly 'could have felt that while on work release, because of restrictions necessarily imposed under those programs, prisoners were not sufficiently available for work so as to permit them to have a full range of employment options that other claimants have in pursuing new employment'....Employers need not adapt work release restrictions that change the terms of employment. The decision by Employer not to participate in a work release program does not excuse Claimant’s absence from work. Claimant had an obligation to report to work regardless of whether Employer agreed to participate in the work release program."
mortgage foreclosure - equitable subrogation - Pennsylvania v. Restatement
1312466 Ontario Inc v. Carr - Superior Court - June 25, 2008
http://www.courts.state.pa.us/OpPosting/Superior/out/a14025_08.pdf
U.S. Bank, mortgagee in 4th lien position loaned property owner (p/o) money, which p/o used to pay off first and second mortgage lienors. US Bank was unaware of the 3rd lienor (Ontario), due to a negligent error in its title search.
When p/o defaulted on 3d mortgage, Ontario sued and got judgment in mortgage foreclosure.
US Bank then filed petition to intervene, claiming that it was entitled to "equitable subrogation" under Restatement 3d, Property 7.6, which says that "one who fully performs an obligation of another, secured by a mortgage, becomes by subrogation the owner of the obligation and the mortgage to the extent necessary to prevent unjust enrichment." Such equitable subrogation is an exception to the "first in time" rule that generally determines the priority of a lien.
The trial and appellate courts rejected US Bank's petition, holding that it was not entitled to equitable subrogation under Pennsylvania law, as that doctrine is defined by Home Owners' Loan Corp. v. Crouse, 30 A.2d 330 (Pa. Super. 1943) and First Commonwealth Bank v. Heller, 863 A.2d 1153 (Pa. Super. 2004) -- which are different from the Restatement definition in important respects.
"Like many other jurisdictions," Pennsylvania requires "four criteria to be met for equitable subrogation to apply....These four requirements are:
(1) the claimant paid the creditor to protect his own interests;
(2) the claimant did not act as a volunteer;
(3) the claimant was not primarily liable for the debt; and
(4) allowing subrogation will not cause injustice to the rights of others."
The appellate court found that there were two "important" differences between Pennsylvania's interpretation of equitable subrogation and that in the Restatement.
a) voluntary agent - Under Pennsylvania cases, a creditor such as U.S. Bank is considered an “entirely voluntary agent with no interest in the property” The Restatement does not adopt the 'volunteer' rule but instead only requires that the subrogee paid the creditor to protect some interest. "Thus, under the Restatement, a mortgagee pays off existing loans in order to protect its own interest in gaining the first priority lien position, and therefore would be entitled to the remedy of equitable subrogation."
b) mistake - Another important difference between Pennsylvania law on equitable subrogation and the Restatement’s approach is also illustrated in the Home Owners’ decision, where the court said that “courts of equity will not relieve a party from the consequences of an error due to his own ignorance or carelessness when there were available means which would have enabled him to avoid the mistake if reasonable care had been exercised.... [A] creditor’s mistake 'can be attributed only to its own negligence in failing to search or discover what clearly appeared on the public records'....The Restatement, on the other hand, says that 'subrogation can be granted even if the payor had actual knowledge of the intervening interest; the payor’s notice, actual or constructive, is not necessarily relevant'....Instead, what is relevant under the Restatement is 'whether the payor reasonably expected to get security with a priority equal to the mortgage being paid.'....In fact, the Restatement declares that a refinancing mortgagee should be presumed to have this expectation, even if they are aware of a remaining lien, unless there is affirmative proof that the mortgagee intended to subordinate its mortgage to the remaining interest."
Although the court pointed out that existing state doctrine might sometimes lead to undesirable results*** and "may be ripe for legislative review," it determined that it was bound by its own prior decisions "and principles of stare decisis." The court was also influenced by "the fact that it was US Bank's carelessness that brought about the pecuniary loss that it is now facing."
*** The court posited that, given Pennsylvania doctrine, US Bank would not made the loan "leaving [borrower] in all likelihood unable to refinance his existing loan" -- a scenario that it thought "may be a frequent dilemma for homeowners amidst the current mortgage crisis....."
http://www.courts.state.pa.us/OpPosting/Superior/out/a14025_08.pdf
U.S. Bank, mortgagee in 4th lien position loaned property owner (p/o) money, which p/o used to pay off first and second mortgage lienors. US Bank was unaware of the 3rd lienor (Ontario), due to a negligent error in its title search.
When p/o defaulted on 3d mortgage, Ontario sued and got judgment in mortgage foreclosure.
US Bank then filed petition to intervene, claiming that it was entitled to "equitable subrogation" under Restatement 3d, Property 7.6, which says that "one who fully performs an obligation of another, secured by a mortgage, becomes by subrogation the owner of the obligation and the mortgage to the extent necessary to prevent unjust enrichment." Such equitable subrogation is an exception to the "first in time" rule that generally determines the priority of a lien.
The trial and appellate courts rejected US Bank's petition, holding that it was not entitled to equitable subrogation under Pennsylvania law, as that doctrine is defined by Home Owners' Loan Corp. v. Crouse, 30 A.2d 330 (Pa. Super. 1943) and First Commonwealth Bank v. Heller, 863 A.2d 1153 (Pa. Super. 2004) -- which are different from the Restatement definition in important respects.
"Like many other jurisdictions," Pennsylvania requires "four criteria to be met for equitable subrogation to apply....These four requirements are:
(1) the claimant paid the creditor to protect his own interests;
(2) the claimant did not act as a volunteer;
(3) the claimant was not primarily liable for the debt; and
(4) allowing subrogation will not cause injustice to the rights of others."
The appellate court found that there were two "important" differences between Pennsylvania's interpretation of equitable subrogation and that in the Restatement.
a) voluntary agent - Under Pennsylvania cases, a creditor such as U.S. Bank is considered an “entirely voluntary agent with no interest in the property” The Restatement does not adopt the 'volunteer' rule but instead only requires that the subrogee paid the creditor to protect some interest. "Thus, under the Restatement, a mortgagee pays off existing loans in order to protect its own interest in gaining the first priority lien position, and therefore would be entitled to the remedy of equitable subrogation."
b) mistake - Another important difference between Pennsylvania law on equitable subrogation and the Restatement’s approach is also illustrated in the Home Owners’ decision, where the court said that “courts of equity will not relieve a party from the consequences of an error due to his own ignorance or carelessness when there were available means which would have enabled him to avoid the mistake if reasonable care had been exercised.... [A] creditor’s mistake 'can be attributed only to its own negligence in failing to search or discover what clearly appeared on the public records'....The Restatement, on the other hand, says that 'subrogation can be granted even if the payor had actual knowledge of the intervening interest; the payor’s notice, actual or constructive, is not necessarily relevant'....Instead, what is relevant under the Restatement is 'whether the payor reasonably expected to get security with a priority equal to the mortgage being paid.'....In fact, the Restatement declares that a refinancing mortgagee should be presumed to have this expectation, even if they are aware of a remaining lien, unless there is affirmative proof that the mortgagee intended to subordinate its mortgage to the remaining interest."
Although the court pointed out that existing state doctrine might sometimes lead to undesirable results*** and "may be ripe for legislative review," it determined that it was bound by its own prior decisions "and principles of stare decisis." The court was also influenced by "the fact that it was US Bank's carelessness that brought about the pecuniary loss that it is now facing."
*** The court posited that, given Pennsylvania doctrine, US Bank would not made the loan "leaving [borrower] in all likelihood unable to refinance his existing loan" -- a scenario that it thought "may be a frequent dilemma for homeowners amidst the current mortgage crisis....."
UC- vol. quit - salary cap
Pearson v. UCBR - Commonwealth Court - June 26, 2008 - UNPUBLISHED
http://www.courts.state.pa.us/OpPosting/CWealth/out/2277CD07_6-26-08.pdf
Claimant was not eligible for benefits where she quit her job after the employer told her that "there would be no possibility of either promotion or increase in pay." Such a statement might "dampen her enthusiasm for continued employment; however, dampened enthusiasm is not a necessitous and compelling reason to quit."
"Claimant’s displeasure with being 'salary capped' was mere dissatisfaction with her working conditions....[M]ere dissatisfaction with one's working conditions does not constitute cause of a necessitous and compelling nature for terminating one's employment. Brunswick Hotel & Conference Center, LLC v. Unemployment Compensation Board of Review, 906 A.2d 657 (Pa. Cmwlth. 2006); McKeown v. Unemployment Compensation Board of Review, 442 A.2d 1257 (Pa. Cmwlth. 1982)."
http://www.courts.state.pa.us/OpPosting/CWealth/out/2277CD07_6-26-08.pdf
Claimant was not eligible for benefits where she quit her job after the employer told her that "there would be no possibility of either promotion or increase in pay." Such a statement might "dampen her enthusiasm for continued employment; however, dampened enthusiasm is not a necessitous and compelling reason to quit."
"Claimant’s displeasure with being 'salary capped' was mere dissatisfaction with her working conditions....[M]ere dissatisfaction with one's working conditions does not constitute cause of a necessitous and compelling nature for terminating one's employment. Brunswick Hotel & Conference Center, LLC v. Unemployment Compensation Board of Review, 906 A.2d 657 (Pa. Cmwlth. 2006); McKeown v. Unemployment Compensation Board of Review, 442 A.2d 1257 (Pa. Cmwlth. 1982)."
Wednesday, June 25, 2008
standing - assignees for collection of debt
Sprint Communications v. APCC Services - June 23, 2008
http://www.supremecourtus.gov/opinions/07pdf/07-552.pdf
Here is the first paragraph of the majority decision in the Court's 5-4 decision.
The question before us is whether an assignee of a legal claim for money owed has standing to pursue that claim in federal court, even when the assignee has promised to remit the proceeds of the litigation to the assignor. Because history and precedent make clear that such an assignee has long been permitted to bring suit, we conclude that the assignee does have standing.
Excepts from the Court's own summary of the case appear below.
++++++++++++++++++++++++++++++++
A payphone customer making a long-distance call with an access code or 1–800 number issued by a long-distance carrier pays the carrier (which completes the call).
The carrier then compensates the pay-phone operator (which connects the call to the carrier in the firstplace).
The payphone operator can sue the long-distance carrier for any compensation that the carrier fails to pay for these "dial-around"calls.
Many payphone operators assign their dial-around claims to billing and collection firms (aggregators) so that, in effect, these aggregators can bring suit on their behalf. A group of aggregators (respondents here) were assigned legal title to the claims of approximately 1,400 payphone operators. The aggregators separately agreed to remit all proceeds to those operators, who would then pay the aggregators for their services.
After entering into these agreements, the aggregators filed federal-court lawsuits seeking compensation from petitioner long-distance carriers. The District Court refused to dismiss the claims, finding that the aggregators had standing, and the D.C. Circuit ultimately affirmed.
Held: An assignee of a legal claim for money owed has standing to pursue that claim in federal court, even when the assignee has promised to remit the proceeds of the litigation to the assignor.
(a) History and precedent show that, for centuries, courts have found ways to allow assignees to bring suit; where assignment is at issue, courts—both before and after the founding—have always permitted the party with legal title alone to bring suit; and there is a strong tradition specifically of suits by assignees for collection. Supreme Court precedent offers "powerful support for the proposition that suits by assignees for collection have long been seen as "amenable" to resolution by the judicial process.
(b) No convincing reason is offered to depart from the historical tradition of suits by assignees, including assignees for collection. In any event, the aggregators satisfy the Article III standing requirements articulated in the Court’s more modern decisions.
Petitioners argue that the aggregators have not themselves suffered an injury and that assignments for collection do not transfer the pay-phone operators’ injuries. But the operators assigned their claims lock, stock, and barrel, and precedent makes clear that an assignee can sue based on his assignor’s injuries.
Petitioners’ claim that the assignments constitute nothing more than acontract for legal services is overstated. There is an important distinction between simply hiring a lawyer and assigning a claim to alawyer. The latter confers a property right (which creditors might attach); the former does not.
Dissent - Robert, CJ
"The majority concludes that a private litigant may sue in federal court despite having to "pass back . . . all proceeds of the litigation"...thus depriving that party of any stake in the outcome of the litigation. The majority reaches this conclusion, in flat contravention of our cases interpreting the case-orcontroversy requirement of Article III, by reference to a historical tradition that is, at best, equivocal. That history does not contradict what common sense should tell us: There is a legal difference between something and nothing. Respondents have nothing to gain from their lawsuit.Under settled principles of standing, that fact requires dismissal of their complaint.assignees
http://www.supremecourtus.gov/opinions/07pdf/07-552.pdf
Here is the first paragraph of the majority decision in the Court's 5-4 decision.
The question before us is whether an assignee of a legal claim for money owed has standing to pursue that claim in federal court, even when the assignee has promised to remit the proceeds of the litigation to the assignor. Because history and precedent make clear that such an assignee has long been permitted to bring suit, we conclude that the assignee does have standing.
Excepts from the Court's own summary of the case appear below.
++++++++++++++++++++++++++++++++
A payphone customer making a long-distance call with an access code or 1–800 number issued by a long-distance carrier pays the carrier (which completes the call).
The carrier then compensates the pay-phone operator (which connects the call to the carrier in the firstplace).
The payphone operator can sue the long-distance carrier for any compensation that the carrier fails to pay for these "dial-around"calls.
Many payphone operators assign their dial-around claims to billing and collection firms (aggregators) so that, in effect, these aggregators can bring suit on their behalf. A group of aggregators (respondents here) were assigned legal title to the claims of approximately 1,400 payphone operators. The aggregators separately agreed to remit all proceeds to those operators, who would then pay the aggregators for their services.
After entering into these agreements, the aggregators filed federal-court lawsuits seeking compensation from petitioner long-distance carriers. The District Court refused to dismiss the claims, finding that the aggregators had standing, and the D.C. Circuit ultimately affirmed.
Held: An assignee of a legal claim for money owed has standing to pursue that claim in federal court, even when the assignee has promised to remit the proceeds of the litigation to the assignor.
(a) History and precedent show that, for centuries, courts have found ways to allow assignees to bring suit; where assignment is at issue, courts—both before and after the founding—have always permitted the party with legal title alone to bring suit; and there is a strong tradition specifically of suits by assignees for collection. Supreme Court precedent offers "powerful support for the proposition that suits by assignees for collection have long been seen as "amenable" to resolution by the judicial process.
(b) No convincing reason is offered to depart from the historical tradition of suits by assignees, including assignees for collection. In any event, the aggregators satisfy the Article III standing requirements articulated in the Court’s more modern decisions.
Petitioners argue that the aggregators have not themselves suffered an injury and that assignments for collection do not transfer the pay-phone operators’ injuries. But the operators assigned their claims lock, stock, and barrel, and precedent makes clear that an assignee can sue based on his assignor’s injuries.
Petitioners’ claim that the assignments constitute nothing more than acontract for legal services is overstated. There is an important distinction between simply hiring a lawyer and assigning a claim to alawyer. The latter confers a property right (which creditors might attach); the former does not.
Dissent - Robert, CJ
"The majority concludes that a private litigant may sue in federal court despite having to "pass back . . . all proceeds of the litigation"...thus depriving that party of any stake in the outcome of the litigation. The majority reaches this conclusion, in flat contravention of our cases interpreting the case-orcontroversy requirement of Article III, by reference to a historical tradition that is, at best, equivocal. That history does not contradict what common sense should tell us: There is a legal difference between something and nothing. Respondents have nothing to gain from their lawsuit.Under settled principles of standing, that fact requires dismissal of their complaint.assignees
zoning - appeal - standing
SCRUB - Philadelphia Zoning Hearing Board - Commonwealth Court - June 25, 2008
http://www.courts.state.pa.us/OpPosting/CWealth/out/1609CD07_6-25-08.pdf
Citizen group held not to have standing to challenge decision of zoning board granting variance to erect commercial sign.
http://www.courts.state.pa.us/OpPosting/CWealth/out/1609CD07_6-25-08.pdf
Citizen group held not to have standing to challenge decision of zoning board granting variance to erect commercial sign.
Tuesday, June 24, 2008
bankruptcy - ch. 13 - lien avoidance - adversary proceeding required
In re Mansaray-Ruffin - 3d Circuit - June 24, 2008
http://www.ca3.uscourts.gov/opinarch/054790p.pdf
"This appeal requires us to determine whether the debtor in a Chapter 13 bankruptcy case successfully invalidated a lien on her property by providing for it as an unsecured claim in her confirmed plan, without initiating an adversary proceeding as required by the Federal Rules of Bankruptcy Procedure. We agree with the lienholder, as well as with the Bankruptcy Court and the District Court, that the answer to this question is no. Accordingly, we will AFFIRM."
This was a 2-1 decision. David Scholl represented the debtor.
http://www.ca3.uscourts.gov/opinarch/054790p.pdf
"This appeal requires us to determine whether the debtor in a Chapter 13 bankruptcy case successfully invalidated a lien on her property by providing for it as an unsecured claim in her confirmed plan, without initiating an adversary proceeding as required by the Federal Rules of Bankruptcy Procedure. We agree with the lienholder, as well as with the Bankruptcy Court and the District Court, that the answer to this question is no. Accordingly, we will AFFIRM."
This was a 2-1 decision. David Scholl represented the debtor.
contracts - fraud - parol evidence - integration clause
Shutter v. Herskowitz and Banks - ED Pa. - June 23, 2008
http://www.paed.uscourts.gov/documents/opinions/08D0696P.pdf
This commercial case involved the sale of a youth hostel. There was a dispute about alleged mispresentations concerning the number of beds permitted by city ordinances. The contract, which contained an integration clause, did not address this disputed issue.
Material misrepresentation
Where a sales contract contains an integration clause which expressly confirms that all agreed terms between the parties are set out in the contract and that any modifications or changes have to be contained in a writing signed by both parties, a plaintiff claiming fraudulent inducement is precluded from offering any extrinsic evidence as to any further representations. Youndt v. First Nat’l Bank, 868 A.2d 539, 548-9 (Pa. Super. 2005)
As the Youndt court stated [and as we are sick of hearing again and again]:
“Where the parties to an agreement adopt a writing as the final and complete expression of their agreement, alleged prior or contemporaneous oral representations or agreements concerning subjects that are specifically covered by the written contract are merged in or superseded by that contract.”....Where the parties,without any fraud or mistake, have deliberately put their engagements in writing, the law declares the writing to be not only the best, but the only, evidence of their agreement. All preliminary negotiations, conversations and verbal agreements are merged in and superseded by the subsequent written contract…and unless fraud, accident or mistake be averred, the writing constitutes the agreement between the parties, and its terms and agreements cannot be added to nor subtracted from by parol evidence.
Once a writing is determined to be the parties’ entire contract, the parol evidence rule applies and evidence of any previous oral or written negotiations or agreements involving the same subject matter as the contract is almost always inadmissible to explain or vary the terms of the contract. Yocca v. Pittsburgh Steelers Sports, Inc., 854 A.2d 425, 436 (Pa. 2004).
Material non-disclosure
"Fraud in the inducement” exists as a narrow exception to the rule barring parol evidence when an integration clause exists. This exception may be invoked where the party proffering the extrinsic evidence contends that he executed the agreement because he was led to believe that the document contained terms that actually were omitted.
To prevail on a claim for non-disclosure of fact, a plaintiff must satisfy the following elements:
(1) One who fails to disclose to another a fact that he knows may justifiably induce the other to act or refrain from acting in a business transaction is subject to the same liability to the other as though he had represented the nonexistence of the matter that he has failed to disclose, if, but only if, he is under a duty to the other to exercise reasonable care to disclose the matter in question.
(2) One party to a business transaction [emphasis added] is under a duty to exercise reasonable care to disclose to the other before the transaction is consummated,
(a) matters known to him that the other is entitled to know because of a fiduciary or other similar relation of trust and confidence between them; and
(b) matters known to him that he knows to be necessary to prevent his partial or ambiguous statement of the facts from being misleading; and
(c) subsequently acquired information that he knows will make untrue or misleading a previous representation that when made was true or believed to be so; and
(d) the falsity of a representation not made with the expectation that it would be acted upon, if he subsequently learns that the other is about to act in reliance upon it in a transaction with him; and
(e) facts basic to the transaction, if he knows that the other is about to enter into it under a mistake as to them, and that the other, because of the relationship between them, the customs of the trade or other objective circumstances, would reasonably expect a disclosure of those facts.
"Basic to the transaction"
A fact “basic to the transaction” under element (e) is a fact that is assumed by the parties as a basis for the transaction itself. It is a fact that goes to the basis, or essence, of the transaction, and is an important part of the substance of what is bargained for or dealt with. Other facts may serve as important and persuasive inducements to enter into the transaction, but [do] not go to its essence. These facts may be material, but they are not basic. If the parties expressly or impliedly place the risk as to the existence of a fact on one party or if the law places it there by customor otherwise the other party has no duty of disclosure.
http://www.paed.uscourts.gov/documents/opinions/08D0696P.pdf
This commercial case involved the sale of a youth hostel. There was a dispute about alleged mispresentations concerning the number of beds permitted by city ordinances. The contract, which contained an integration clause, did not address this disputed issue.
Material misrepresentation
Where a sales contract contains an integration clause which expressly confirms that all agreed terms between the parties are set out in the contract and that any modifications or changes have to be contained in a writing signed by both parties, a plaintiff claiming fraudulent inducement is precluded from offering any extrinsic evidence as to any further representations. Youndt v. First Nat’l Bank, 868 A.2d 539, 548-9 (Pa. Super. 2005)
As the Youndt court stated [and as we are sick of hearing again and again]:
“Where the parties to an agreement adopt a writing as the final and complete expression of their agreement, alleged prior or contemporaneous oral representations or agreements concerning subjects that are specifically covered by the written contract are merged in or superseded by that contract.”....Where the parties,without any fraud or mistake, have deliberately put their engagements in writing, the law declares the writing to be not only the best, but the only, evidence of their agreement. All preliminary negotiations, conversations and verbal agreements are merged in and superseded by the subsequent written contract…and unless fraud, accident or mistake be averred, the writing constitutes the agreement between the parties, and its terms and agreements cannot be added to nor subtracted from by parol evidence.
Once a writing is determined to be the parties’ entire contract, the parol evidence rule applies and evidence of any previous oral or written negotiations or agreements involving the same subject matter as the contract is almost always inadmissible to explain or vary the terms of the contract. Yocca v. Pittsburgh Steelers Sports, Inc., 854 A.2d 425, 436 (Pa. 2004).
Material non-disclosure
"Fraud in the inducement” exists as a narrow exception to the rule barring parol evidence when an integration clause exists. This exception may be invoked where the party proffering the extrinsic evidence contends that he executed the agreement because he was led to believe that the document contained terms that actually were omitted.
To prevail on a claim for non-disclosure of fact, a plaintiff must satisfy the following elements:
(1) One who fails to disclose to another a fact that he knows may justifiably induce the other to act or refrain from acting in a business transaction is subject to the same liability to the other as though he had represented the nonexistence of the matter that he has failed to disclose, if, but only if, he is under a duty to the other to exercise reasonable care to disclose the matter in question.
(2) One party to a business transaction [emphasis added] is under a duty to exercise reasonable care to disclose to the other before the transaction is consummated,
(a) matters known to him that the other is entitled to know because of a fiduciary or other similar relation of trust and confidence between them; and
(b) matters known to him that he knows to be necessary to prevent his partial or ambiguous statement of the facts from being misleading; and
(c) subsequently acquired information that he knows will make untrue or misleading a previous representation that when made was true or believed to be so; and
(d) the falsity of a representation not made with the expectation that it would be acted upon, if he subsequently learns that the other is about to act in reliance upon it in a transaction with him; and
(e) facts basic to the transaction, if he knows that the other is about to enter into it under a mistake as to them, and that the other, because of the relationship between them, the customs of the trade or other objective circumstances, would reasonably expect a disclosure of those facts.
"Basic to the transaction"
A fact “basic to the transaction” under element (e) is a fact that is assumed by the parties as a basis for the transaction itself. It is a fact that goes to the basis, or essence, of the transaction, and is an important part of the substance of what is bargained for or dealt with. Other facts may serve as important and persuasive inducements to enter into the transaction, but [do] not go to its essence. These facts may be material, but they are not basic. If the parties expressly or impliedly place the risk as to the existence of a fact on one party or if the law places it there by customor otherwise the other party has no duty of disclosure.
appeal - final order - POs
Pennsylvania Bankers Assn. v. Department of Banking -Pa. Supreme Court - June 16, 2008
majority http://www.courts.state.pa.us/OpPosting/Supreme/out/J-31A&B-2008mo.pdf
concurring http://www.courts.state.pa.us/OpPosting/Supreme/out/J-31A&B-2008co.pdf
An order granting some and denying other of defendant's preliminary objections in plaintiff's declaratory judgment action held to be interlocutory and not a final order subject to appeal.
- As a general rule, where a plaintiff files a multi-count complaint setting forth alternative theories of recovery, an order dismissing less than all of the claim is considered to be interlocutory, because the plaintiff may still pursue the merits of the case based on another theory.
- A final order under PaRAP 341(b)(1) is one that disposes of all claims and all parties
- The plaintiff filed a multi-count complaint which raised alternative constitutional theories of relief
- The lower court's granting of POs resulted in dismissal of some but not all of plaintiff's claims
- The lower court's order did not result in the the dismissal of any parties
- The lower court order did not end the litigation against any party but merely narrowed the scope of the plaintiff's case
- Under its remaining claims, plaintiff might still obtain the relief it is seeking
majority http://www.courts.state.pa.us/OpPosting/Supreme/out/J-31A&B-2008mo.pdf
concurring http://www.courts.state.pa.us/OpPosting/Supreme/out/J-31A&B-2008co.pdf
An order granting some and denying other of defendant's preliminary objections in plaintiff's declaratory judgment action held to be interlocutory and not a final order subject to appeal.
- As a general rule, where a plaintiff files a multi-count complaint setting forth alternative theories of recovery, an order dismissing less than all of the claim is considered to be interlocutory, because the plaintiff may still pursue the merits of the case based on another theory.
- A final order under PaRAP 341(b)(1) is one that disposes of all claims and all parties
- The plaintiff filed a multi-count complaint which raised alternative constitutional theories of relief
- The lower court's granting of POs resulted in dismissal of some but not all of plaintiff's claims
- The lower court's order did not result in the the dismissal of any parties
- The lower court order did not end the litigation against any party but merely narrowed the scope of the plaintiff's case
- Under its remaining claims, plaintiff might still obtain the relief it is seeking
Friday, June 20, 2008
manuf. home installation program - final HUD rule
http://edocket.access.gpo.gov/2008/pdf/E8-13289.pdf
SUMMARY: This final rule establishes a federal manufactured home installation program, as required by section 605(c)(2)(A) of the National Manufactured Housing Construction and Safety Standards Act of 1974.
States that have their own installation programs that include the elements required by statute are permitted to administer, under their state installation programs, the new requirements established through this final rulemaking.
The new elements required by statute to be integrated into an acceptable state manufactured home installation program are: The establishment of qualified installation standards; the licensing and training of installers; and the inspection of the installation of manufactured homes.
DATES: Effective Date: October 20, 2008.
SUMMARY: This final rule establishes a federal manufactured home installation program, as required by section 605(c)(2)(A) of the National Manufactured Housing Construction and Safety Standards Act of 1974.
States that have their own installation programs that include the elements required by statute are permitted to administer, under their state installation programs, the new requirements established through this final rulemaking.
The new elements required by statute to be integrated into an acceptable state manufactured home installation program are: The establishment of qualified installation standards; the licensing and training of installers; and the inspection of the installation of manufactured homes.
DATES: Effective Date: October 20, 2008.
Thursday, June 19, 2008
federal courts - preclusion - doctrine of "virtual representation" disapproved
Taylor v. Sturgell - US Supreme Court - June 12, 2008
http://www.supremecourtus.gov/opinions/07pdf/07-371.pdf
Facts: Herrick, an antique plane enthusiast, brought an FOIA suit against the Federal Aviation Administration (FAA), seeking information about a classic plane in which he was interested; he lost the case. His friend Taylor later brought an FOIA suit seeking the same information.
The courts below held that Taylor's later suit was precluded under the doctrine of "virtual representation," based on their finding of a) an identity of interests, b) adequate representation, c) a close relationship between the parties, and d) other factors.
The U.S. Supreme Court reversed, stating that the theory of preclusion by "virtual representation" is disapproved and holding that the preclusive effects of a judgment in a federal-question case decided by a federal court should instead be determined according to the established grounds for nonparty preclusion.
The preclusive effect of a federal-court judgment is determined by federal common law, subject to due process limitations. Extending the preclusive effect of a judgment to a nonparty runs up against the "deep-rooted historic tradition that everyone should have his own day in court."
The Court has often repeated the general rule that "one is not bound by a judgment in personam in a litigation in which he is not designated a party or to which he has not beenmade a party by service of process."
The rule against nonparty preclusion is subject to exceptions, grouped for present purposes into six categories.
- a person who agrees to be bound by the determination of issues in anaction between others is bound in accordance with the agreement’s terms.
- nonparty preclusion may be based on a pre-existing substantive legal relationship between the person to be bound and a party to the judgment, e.g., assignee and assignor.
- in certain limited circumstances, a nonparty may be bound by a judgment because she was " ‘adequately represented by someone with the same interests who was a party’ " to the suit.
- a nonparty is bound by a judgment if she "assumed control" over the litigation inwhich that judgment was rendered.
- a party bound by a judgment may not avoid its preclusive force by relitigating through a proxy. Preclusion is thus in order when a person who did not participate in litigation later brings suit as the designated representative or agent of a person who was a party to the prior adjudication.
- a special statutory scheme otherwise consistent with due process—e.g., bankruptcy proceed-ings—may expressly foreclose successive litigation by nonlitigants.
Reaching beyond these six categories, the D. C. Circuit recognized a broad "virtual representation" exception to the rule against nonparty preclusion. None of the arguments advanced by that court or the FAA justify such an expansive doctrine. The D. C. Circuit’s definition of "adequate representation" strayed from the meaning the Court has attributed to that term.
The FAA wanted the Court "to abandon altogether the attempt to delineate discrete grounds and clear rules for nonparty preclusion, contending that only an equitable and heavily fact-driven inquiry can account for all of the situations in whichnonparty preclusion is appropriate. This argument is rejected. A balancing test is at odds with the constrained approach advanced by this Court’s decisions, which have endeavored to delineate discrete, limited exceptions to the fundamental rule that a litigant is not bound by a judgment to which she was not a party."
Second, a party’s representation of a nonparty is "adequate" for preclusion purposes only if, at a minimum: (1) the interests of the nonparty and her representative are aligned, and (2) either the party understood herself to be acting in a representative capacity or theoriginal court took care to protect the nonparty’s interests. Adequate representation may also require (3) notice of the original suit to the persons alleged to have beenrepresented. In the class-action context, these limitations are implemented by FRCivP 23’s procedural safeguards. But an expansive virtual representation doctrine would recognize a common-law kind of class action shorn of these protections.
Third, a diffuse balancing approach to nonparty preclusion would likely complicate the task of district courts faced in the first instance with preclusion questions.
The Court also rejected the FAA's argument that nonparty preclusion should apply more broadly in "public-law" litigation than in "private-law"controversies, citing Richards v. Jefferson County, 517 U. S. 793 (1996). Richards said only that, for the type of public-law claims envisioned there, states were free to adopt procedures limiting repetitive litigation. The Court said that while Congress can adopt such procedures, it doesn't follow that the Court should proscribe or confine successive FOIA suits by different requesters.
In addition, the potential risk that several persons would coordinate a series of vexatious repetitive lawsuits does not justify departing from the usual nonparty preclusion rules. Stare decisis allows courts to dispose of repetitive suits in the same circuit, and even when stare decisis is not dispositive, the human inclination not towaste money should discourage suits based on claims or issues already decided.
Concerning preclusion on the basis of agency, the Court said that a mere whiff of tactical maneuvering will not suffice. Instead, principles of agency law indicate that preclusion is appropriate only if the putative agent’s conduct of the suit is subject to the control of the party who is bound by the prior adjudication.
The Court also rejected the suggestion that Taylor must bear the burden of proving he was not acting as Herrick’s agent.
http://www.supremecourtus.gov/opinions/07pdf/07-371.pdf
Facts: Herrick, an antique plane enthusiast, brought an FOIA suit against the Federal Aviation Administration (FAA), seeking information about a classic plane in which he was interested; he lost the case. His friend Taylor later brought an FOIA suit seeking the same information.
The courts below held that Taylor's later suit was precluded under the doctrine of "virtual representation," based on their finding of a) an identity of interests, b) adequate representation, c) a close relationship between the parties, and d) other factors.
The U.S. Supreme Court reversed, stating that the theory of preclusion by "virtual representation" is disapproved and holding that the preclusive effects of a judgment in a federal-question case decided by a federal court should instead be determined according to the established grounds for nonparty preclusion.
The preclusive effect of a federal-court judgment is determined by federal common law, subject to due process limitations. Extending the preclusive effect of a judgment to a nonparty runs up against the "deep-rooted historic tradition that everyone should have his own day in court."
The Court has often repeated the general rule that "one is not bound by a judgment in personam in a litigation in which he is not designated a party or to which he has not beenmade a party by service of process."
The rule against nonparty preclusion is subject to exceptions, grouped for present purposes into six categories.
- a person who agrees to be bound by the determination of issues in anaction between others is bound in accordance with the agreement’s terms.
- nonparty preclusion may be based on a pre-existing substantive legal relationship between the person to be bound and a party to the judgment, e.g., assignee and assignor.
- in certain limited circumstances, a nonparty may be bound by a judgment because she was " ‘adequately represented by someone with the same interests who was a party’ " to the suit.
- a nonparty is bound by a judgment if she "assumed control" over the litigation inwhich that judgment was rendered.
- a party bound by a judgment may not avoid its preclusive force by relitigating through a proxy. Preclusion is thus in order when a person who did not participate in litigation later brings suit as the designated representative or agent of a person who was a party to the prior adjudication.
- a special statutory scheme otherwise consistent with due process—e.g., bankruptcy proceed-ings—may expressly foreclose successive litigation by nonlitigants.
Reaching beyond these six categories, the D. C. Circuit recognized a broad "virtual representation" exception to the rule against nonparty preclusion. None of the arguments advanced by that court or the FAA justify such an expansive doctrine. The D. C. Circuit’s definition of "adequate representation" strayed from the meaning the Court has attributed to that term.
The FAA wanted the Court "to abandon altogether the attempt to delineate discrete grounds and clear rules for nonparty preclusion, contending that only an equitable and heavily fact-driven inquiry can account for all of the situations in whichnonparty preclusion is appropriate. This argument is rejected. A balancing test is at odds with the constrained approach advanced by this Court’s decisions, which have endeavored to delineate discrete, limited exceptions to the fundamental rule that a litigant is not bound by a judgment to which she was not a party."
Second, a party’s representation of a nonparty is "adequate" for preclusion purposes only if, at a minimum: (1) the interests of the nonparty and her representative are aligned, and (2) either the party understood herself to be acting in a representative capacity or theoriginal court took care to protect the nonparty’s interests. Adequate representation may also require (3) notice of the original suit to the persons alleged to have beenrepresented. In the class-action context, these limitations are implemented by FRCivP 23’s procedural safeguards. But an expansive virtual representation doctrine would recognize a common-law kind of class action shorn of these protections.
Third, a diffuse balancing approach to nonparty preclusion would likely complicate the task of district courts faced in the first instance with preclusion questions.
The Court also rejected the FAA's argument that nonparty preclusion should apply more broadly in "public-law" litigation than in "private-law"controversies, citing Richards v. Jefferson County, 517 U. S. 793 (1996). Richards said only that, for the type of public-law claims envisioned there, states were free to adopt procedures limiting repetitive litigation. The Court said that while Congress can adopt such procedures, it doesn't follow that the Court should proscribe or confine successive FOIA suits by different requesters.
In addition, the potential risk that several persons would coordinate a series of vexatious repetitive lawsuits does not justify departing from the usual nonparty preclusion rules. Stare decisis allows courts to dispose of repetitive suits in the same circuit, and even when stare decisis is not dispositive, the human inclination not towaste money should discourage suits based on claims or issues already decided.
Concerning preclusion on the basis of agency, the Court said that a mere whiff of tactical maneuvering will not suffice. Instead, principles of agency law indicate that preclusion is appropriate only if the putative agent’s conduct of the suit is subject to the control of the party who is bound by the prior adjudication.
The Court also rejected the suggestion that Taylor must bear the burden of proving he was not acting as Herrick’s agent.
Monday, June 16, 2008
disability - onset date - medical advisor
Mamrol v. Astrue - ED Pa. - June 9, 2008
http://www.paed.uscourts.gov/documents/opinions/08D0646P.pdf
Where there was little contemporaneous evidence about the date of onset of the claimant's disability - multiple sclerosis - the ALJ should have consulted a medical advisor, under the factors set out in SSR 83-20 and the decisions in Walton v. Halter, 243 F3d 703 (3d Cir. 2001) and Newell v. Commissioner, 347 F3d 541 (3d Cir. 2003).
Citing Newell, the court refused to draw negative inferences from claimant's infrequent or irregular doctor visits without first considering her explanations, which in this case satisfied the court.
http://www.paed.uscourts.gov/documents/opinions/08D0646P.pdf
Where there was little contemporaneous evidence about the date of onset of the claimant's disability - multiple sclerosis - the ALJ should have consulted a medical advisor, under the factors set out in SSR 83-20 and the decisions in Walton v. Halter, 243 F3d 703 (3d Cir. 2001) and Newell v. Commissioner, 347 F3d 541 (3d Cir. 2003).
Citing Newell, the court refused to draw negative inferences from claimant's infrequent or irregular doctor visits without first considering her explanations, which in this case satisfied the court.
child abuse - founded/indicated reports - right to expungement hearing
K.R. v. DPW - Commonwealth Court - June 4, 2008
http://www.courts.state.pa.us/OpPosting/CWealth/out/2060CD07_6-4-08.pdf
It was proper for DPW to deny a hearing on a request for expungement of an "indicated report of abuse and enter an determination based on findings in a related dependency case, which was the basis for a "founded" report of abuse. DPW may rely on the factual findings of the trial court in a dependency adjudication to dismiss an appeal for a request for expungement.
An administrative hearing in a later expungement case would be an improper collateral attack on the factual findings in the dependency adjudication, in which proceeding the alleged abuser has a full and fair opportunity to present evidence and to cross-examine witnesses. "Due process does not require an administrative [expungement] hearing, as the material facts found in the dependency proceeding cannot be disputed."
http://www.courts.state.pa.us/OpPosting/CWealth/out/2060CD07_6-4-08.pdf
It was proper for DPW to deny a hearing on a request for expungement of an "indicated report of abuse and enter an determination based on findings in a related dependency case, which was the basis for a "founded" report of abuse. DPW may rely on the factual findings of the trial court in a dependency adjudication to dismiss an appeal for a request for expungement.
An administrative hearing in a later expungement case would be an improper collateral attack on the factual findings in the dependency adjudication, in which proceeding the alleged abuser has a full and fair opportunity to present evidence and to cross-examine witnesses. "Due process does not require an administrative [expungement] hearing, as the material facts found in the dependency proceeding cannot be disputed."
Friday, June 13, 2008
disability - treating physician opinion - hypothetical to VE
Johnson v. Commissioner - 3rd Cir. - June 13, 2008
http://www.ca3.uscourts.gov/opinarch/072132p.pdf
The Third Circuit affirmed the denial of benefits, rejecting claimant's arguments that (a) the ALJ improperly overlooked treating physician’s opinions and (b) that the ALJ’s disability conclusion was based on the VE's response to "an incomplete hypothetical question."
The court held that the treating physician's opinion was not entitled to controlling weight because it was not well-supported by medically acceptable clinical and laboratory diagnostic techniques and was not consistent with the other substantial evidence in [the claimant's] case record. The court said that there was "overwhelming" evidence to support to ALJ's findings.
The court said that the ALJ was "entitled" to reject much of the treating physicians' evidence "without explanation" where it was "neither pertinent, relevant nor probative." In failing to cite the doctor's evidence, the court said that the ALJ implicitly rejected it. That rejection did not trigger the ALJ’s duty to give the doctor an opportunity to explain testimony that the record "overwhelming[ly] disputed."
Citing Rutherford v. Barnhart, 399 F.3d 546, 554 (3d Cir. 2005), the court held that hypothetical posed to the vocational expert accurately protrayed the claimant’s impairments that were reflected in the record.
http://www.ca3.uscourts.gov/opinarch/072132p.pdf
The Third Circuit affirmed the denial of benefits, rejecting claimant's arguments that (a) the ALJ improperly overlooked treating physician’s opinions and (b) that the ALJ’s disability conclusion was based on the VE's response to "an incomplete hypothetical question."
The court held that the treating physician's opinion was not entitled to controlling weight because it was not well-supported by medically acceptable clinical and laboratory diagnostic techniques and was not consistent with the other substantial evidence in [the claimant's] case record. The court said that there was "overwhelming" evidence to support to ALJ's findings.
The court said that the ALJ was "entitled" to reject much of the treating physicians' evidence "without explanation" where it was "neither pertinent, relevant nor probative." In failing to cite the doctor's evidence, the court said that the ALJ implicitly rejected it. That rejection did not trigger the ALJ’s duty to give the doctor an opportunity to explain testimony that the record "overwhelming[ly] disputed."
Citing Rutherford v. Barnhart, 399 F.3d 546, 554 (3d Cir. 2005), the court held that hypothetical posed to the vocational expert accurately protrayed the claimant’s impairments that were reflected in the record.
pro se litigants - liberal construction of pleadings
Hall-Ditchfield v. US - ED Pa. - June 10, 2008
http://www.paed.uscourts.gov/documents/opinions/08D0643P.pdf
During the course of this pro se case concerning an allegation that the IRS wrongfully withheld plaintiff's tax refunds, the court discussed pro se litigants and said that "[b]ecause the plaintiff is pro se, the Court will construe her pleadings liberally. Erickson v. Pardus, 127 S. Ct. 2197, 2200 (2007) (citing Estelle v. Gamble, 429 U.S. 97, 106 (1976))."
Wouldn't it be wonderful if the UCBR and Commonwealth Court had this same attitude?
http://www.paed.uscourts.gov/documents/opinions/08D0643P.pdf
During the course of this pro se case concerning an allegation that the IRS wrongfully withheld plaintiff's tax refunds, the court discussed pro se litigants and said that "[b]ecause the plaintiff is pro se, the Court will construe her pleadings liberally. Erickson v. Pardus, 127 S. Ct. 2197, 2200 (2007) (citing Estelle v. Gamble, 429 U.S. 97, 106 (1976))."
Wouldn't it be wonderful if the UCBR and Commonwealth Court had this same attitude?
Wednesday, June 11, 2008
UC- appeal - preservation/waiver of issues
Pearson v. UCBR - ordered to be reported August 18, 2008 - Commonwealth Court -
http://www.courts.state.pa.us/OpPosting/CWealth/out/2238CD07_8-18-08.pdf
original unreported decision - June 11, 2008
http://www.courts.state.pa.us/OpPosting/CWealth/out/2238CD07_6-11-08.pdf
The court rejected the Board's argument that the "Claimant failed to preserve any issues for review," in which it alleged that he "failed to specifically challenge any of the Board’s findings in his petition for review or in his statement of questions involved," and that he "waived any challenge to the evidentiary support for the Board’s findings by not addressing the issue in his appellate brief."
The court said the it "may decline to consider issues a claimant fails to raise with sufficient specificity in his petition for review. See Pa. R.A.P. 1513; Deal v. Unemployment Comp. Bd. of Review, 878 A.2d 131 (Pa. Cmwlth. 2005) " and that it "may decline to consider issues a claimant raises in the argument section of his appellate brief but fails to include in his statement of questions involved. See Pa. R.A.P. 2119(a); Leone v. Unemployment Comp. Bd. of Review, 885 A.2d 76 (Pa. Cmwlth. 2005)."
However, the court "decline[d] to apply waiver in this instance. In Claimant’s petition for review, we discern two issues preserved for argument. First, Claimant contends the Board failed to 'review all the facts. ' ....We interpret Claimant’s assertion as a challenge to the evidentiary support for the Board’s findings regarding the circumstances of Claimant’s discharge. Second, we interpret Claimant’s assertion that 'this case is not strong enough” to withhold unemployment compensation benefits as challenging whether Employer met its burden to prove it discharged Claimant for cause. Id.; see also Pa. R.A.P. 1513(d) (“The statement of objections will be deemed to include every subsidiary question fairly comprised therein.”). Because Claimant sufficiently addresses these arguments in his handwritten appellate brief, we will consider them on their merits."
http://www.courts.state.pa.us/OpPosting/CWealth/out/2238CD07_8-18-08.pdf
original unreported decision - June 11, 2008
http://www.courts.state.pa.us/OpPosting/CWealth/out/2238CD07_6-11-08.pdf
The court rejected the Board's argument that the "Claimant failed to preserve any issues for review," in which it alleged that he "failed to specifically challenge any of the Board’s findings in his petition for review or in his statement of questions involved," and that he "waived any challenge to the evidentiary support for the Board’s findings by not addressing the issue in his appellate brief."
The court said the it "may decline to consider issues a claimant fails to raise with sufficient specificity in his petition for review. See Pa. R.A.P. 1513; Deal v. Unemployment Comp. Bd. of Review, 878 A.2d 131 (Pa. Cmwlth. 2005) " and that it "may decline to consider issues a claimant raises in the argument section of his appellate brief but fails to include in his statement of questions involved. See Pa. R.A.P. 2119(a); Leone v. Unemployment Comp. Bd. of Review, 885 A.2d 76 (Pa. Cmwlth. 2005)."
However, the court "decline[d] to apply waiver in this instance. In Claimant’s petition for review, we discern two issues preserved for argument. First, Claimant contends the Board failed to 'review all the facts. ' ....We interpret Claimant’s assertion as a challenge to the evidentiary support for the Board’s findings regarding the circumstances of Claimant’s discharge. Second, we interpret Claimant’s assertion that 'this case is not strong enough” to withhold unemployment compensation benefits as challenging whether Employer met its burden to prove it discharged Claimant for cause. Id.; see also Pa. R.A.P. 1513(d) (“The statement of objections will be deemed to include every subsidiary question fairly comprised therein.”). Because Claimant sufficiently addresses these arguments in his handwritten appellate brief, we will consider them on their merits."
Saturday, June 07, 2008
tax sale - notice - posting
McCartan v. Montgomery Co. Tax Claim Bureau - Commonwealth Court - June 2, 2008 - UNPUBLISHED OPINION
http://www.courts.state.pa.us/OpPosting/CWealth/out/1162CD07_6-2-08.pdf
Held: Unverified written document about of posting was not sufficient proof of posting, in the face of uncontradicted testimony of the property owner that the property was not posted. The trial court abused its discretion by finding that the property was properly posted based solely on the unnotarized “Affidavit for Posting of Notice of Public Tax Sale” where unrebutted evidence to the contrary was submitted into the record.
Compliance with the other notice requirements of the Law does not necessarily cure a defect in posting because the posting requirement serves three purposes: to inform the taxpayer of the impending sale; to notify others whose interests in the land may be affected by the sale; and, to notify the public at large of the impending sale.
The law is well-settled in Pennsylvania that a valid tax sale requires the tax claim bureau to strictly comply with all three of the notice provisions of sec. 602 of the law, 72 P.S. §5860.602, or the sale is void. The tax claim bureau must notify the owner of the property in the following three ways: (1) publication of the tax sale at least 30 days prior to the sale; (2) notification of the sale to each owner by certified mail at least 30 days in advance of the sale; and (3) posting notice of the sale on the property at least 10 days prior to the sale. 72 P.S. §§5860.602(a), (e). Strict compliance is necessary to guard against any deprivation of property without due process of law.
http://www.courts.state.pa.us/OpPosting/CWealth/out/1162CD07_6-2-08.pdf
Held: Unverified written document about of posting was not sufficient proof of posting, in the face of uncontradicted testimony of the property owner that the property was not posted. The trial court abused its discretion by finding that the property was properly posted based solely on the unnotarized “Affidavit for Posting of Notice of Public Tax Sale” where unrebutted evidence to the contrary was submitted into the record.
Compliance with the other notice requirements of the Law does not necessarily cure a defect in posting because the posting requirement serves three purposes: to inform the taxpayer of the impending sale; to notify others whose interests in the land may be affected by the sale; and, to notify the public at large of the impending sale.
The law is well-settled in Pennsylvania that a valid tax sale requires the tax claim bureau to strictly comply with all three of the notice provisions of sec. 602 of the law, 72 P.S. §5860.602, or the sale is void. The tax claim bureau must notify the owner of the property in the following three ways: (1) publication of the tax sale at least 30 days prior to the sale; (2) notification of the sale to each owner by certified mail at least 30 days in advance of the sale; and (3) posting notice of the sale on the property at least 10 days prior to the sale. 72 P.S. §§5860.602(a), (e). Strict compliance is necessary to guard against any deprivation of property without due process of law.
Thursday, June 05, 2008
UC - willful misconduct - physician's failure to provide medical information
Zurn Industries v. UCBR - Commonwealth Court - June 5, 2008 - UNPUBLISHED OPINION
http://www.courts.state.pa.us/OpPosting/CWealth/out/2093CD07_6-5-08.pdf
The claimant was not insubordinate and did not commit willful misconduct when his doctors failed to provide the employer with information about the claimant's functional capacity. he claimant contacted his doctors and asked them to provide the information.
As in as in Bogan v. UCBR, 447 A.2d 708 (Pa. Cmwlth. 1982) and Houff v. UCBR, 397 A.2d 42 (Pa. Cmwlth. 1979), "Claimant attempted to get the information Employer requested, but neither of his physicians provided acceptable information, at least not within the time demanded by Employer. Also, similar to Bogan, Employer was also unsuccessful in its attempt to have Claimant’s physicians specify any work restrictions. Claimant attempted to fulfill the directives of Employer but had no control over his physicians."
http://www.courts.state.pa.us/OpPosting/CWealth/out/2093CD07_6-5-08.pdf
The claimant was not insubordinate and did not commit willful misconduct when his doctors failed to provide the employer with information about the claimant's functional capacity. he claimant contacted his doctors and asked them to provide the information.
As in as in Bogan v. UCBR, 447 A.2d 708 (Pa. Cmwlth. 1982) and Houff v. UCBR, 397 A.2d 42 (Pa. Cmwlth. 1979), "Claimant attempted to get the information Employer requested, but neither of his physicians provided acceptable information, at least not within the time demanded by Employer. Also, similar to Bogan, Employer was also unsuccessful in its attempt to have Claimant’s physicians specify any work restrictions. Claimant attempted to fulfill the directives of Employer but had no control over his physicians."
discovery - appeal - collateral order doctrine - privilege
T.M. v. Elwyn, Inc. - Superior Court - June 5, 2008
http://www.courts.state.pa.us/OpPosting/Superior/out/s66027_07.pdf
In general, discovery orders are not final, and are therefore unappealable. However, discovery orders involving privileged material are nevertheless appealable as collateral to the principal action pursuant to Pa.R.A.P. 313 (“Collateral Orders”).
A collateral order is an order separable from and collateral to the main cause of action where the right involved is too important to be denied review and the question presented is such that if review is postponed until final judgment in the case, the claim will be irreparably lost. Pa.R.A.P. 313(b). “A discovery order is collateral only when it is separate and distinct from the underlying cause of action.”
An appeal from a discovery order raising a question of the application of a privilege is separable from the underlying issue, so long as the issue of privilege may be addressed by an appellate court without analysis of the underlying issue.
http://www.courts.state.pa.us/OpPosting/Superior/out/s66027_07.pdf
In general, discovery orders are not final, and are therefore unappealable. However, discovery orders involving privileged material are nevertheless appealable as collateral to the principal action pursuant to Pa.R.A.P. 313 (“Collateral Orders”).
A collateral order is an order separable from and collateral to the main cause of action where the right involved is too important to be denied review and the question presented is such that if review is postponed until final judgment in the case, the claim will be irreparably lost. Pa.R.A.P. 313(b). “A discovery order is collateral only when it is separate and distinct from the underlying cause of action.”
An appeal from a discovery order raising a question of the application of a privilege is separable from the underlying issue, so long as the issue of privilege may be addressed by an appellate court without analysis of the underlying issue.
admin. law - appeal - waiver/preservation of issues - Merida v. UCBR distinguished
By an order dated June 5, 2008, this case has now been designated as an opinion, which will be reported and published.
See http://www.courts.state.pa.us/OpPosting/CWealth/out/1912CD07_6-5-08.pdf
Thanks to David Hill of Philadelphia Legal Assistance for preparing and filing the motion which got this case reported
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Ductmate Industries v. UCBR - Commonwealth Court - March 12, 2008
http://www.courts.state.pa.us/OpPosting/CWealth/out/1912CD07_6-5-08.pdf
previously reported at http://www.courts.state.pa.us/opposting/cwealth/out/1912cd07_3-12-08.pdf
Claimant did not waive any issue when, in appealing from the referee decision, he said only that he "did not agree" with it, and UCBR reversed and granted benefits. The initial determination and referee decision both dealt with a single issue, whether claimant's acts constituted willful misconduct.
The employer argued that claimant's reasons were not specific enough, citing Merida v. UCBR, 543 A.2d 593 (Pa. Cmwlth. 1988) and 34 Pa. Code 101.81(c)(4) http://www.pacode.com/secure/data/034/chapter101/s101.81.html both of which require an appellant to state the "reasons for appeal."
The court noted that in Merida there were two hearings. The employer did not attend the intial hearing, and the Board ordered a second one, during which the claimant raised a number of issues. The referee ruled against the claimant, but did not rule on the propriety of the second hearing.
The claimant appealed to the Board, making only the general objection that he did not agree with the referee's decision. The Board affirmed the referee, and the claimant appealed to the Commonwealth Court, arguing only that the Board erred in ordering the second hearing. The court determined that the claimant had waived the issue of the propriety of the second hearing, since he did not specifically bring it to the attention of the Board, which "could not be charged with scouring the record to determine every possible appeal."
In this case, however, there was only one issue - whether claimant's acts constituted willful misconduct. That was the issue decided in both the initial UCSC determination and the Board decision. Citing Black Lick Trucking Co. v. UCBR, 6677 A.2d 454 (Pa. Cmwlth. 1995), the court held that an "inartful appeal" claiming only general disagreement with the referee decision does not prevent the UCBR from addressing the issues ruled on by both the job center/UCSC and referee. The referee should review all issues in the initial determination, and the Board should review all issues the referee considered -- the precise case here.
See http://www.courts.state.pa.us/OpPosting/CWealth/out/1912CD07_6-5-08.pdf
Thanks to David Hill of Philadelphia Legal Assistance for preparing and filing the motion which got this case reported
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Ductmate Industries v. UCBR - Commonwealth Court - March 12, 2008
http://www.courts.state.pa.us/OpPosting/CWealth/out/1912CD07_6-5-08.pdf
previously reported at http://www.courts.state.pa.us/opposting/cwealth/out/1912cd07_3-12-08.pdf
Claimant did not waive any issue when, in appealing from the referee decision, he said only that he "did not agree" with it, and UCBR reversed and granted benefits. The initial determination and referee decision both dealt with a single issue, whether claimant's acts constituted willful misconduct.
The employer argued that claimant's reasons were not specific enough, citing Merida v. UCBR, 543 A.2d 593 (Pa. Cmwlth. 1988) and 34 Pa. Code 101.81(c)(4) http://www.pacode.com/secure/data/034/chapter101/s101.81.html both of which require an appellant to state the "reasons for appeal."
The court noted that in Merida there were two hearings. The employer did not attend the intial hearing, and the Board ordered a second one, during which the claimant raised a number of issues. The referee ruled against the claimant, but did not rule on the propriety of the second hearing.
The claimant appealed to the Board, making only the general objection that he did not agree with the referee's decision. The Board affirmed the referee, and the claimant appealed to the Commonwealth Court, arguing only that the Board erred in ordering the second hearing. The court determined that the claimant had waived the issue of the propriety of the second hearing, since he did not specifically bring it to the attention of the Board, which "could not be charged with scouring the record to determine every possible appeal."
In this case, however, there was only one issue - whether claimant's acts constituted willful misconduct. That was the issue decided in both the initial UCSC determination and the Board decision. Citing Black Lick Trucking Co. v. UCBR, 6677 A.2d 454 (Pa. Cmwlth. 1995), the court held that an "inartful appeal" claiming only general disagreement with the referee decision does not prevent the UCBR from addressing the issues ruled on by both the job center/UCSC and referee. The referee should review all issues in the initial determination, and the Board should review all issues the referee considered -- the precise case here.
consumer - payday lending - Consumer Discount Company Law - Loan Interest and Protection Law
Dept. of Banking v. NCAS of Delaware - Pa. Supreme Court - May 29, 2008
http://www.courts.state.pa.us/OpPosting/Supreme/out/J-97-2008mopdf
Stating that it is "well established that Commonwealth public policy prohibits usurious lending, a prohibition that has been recognized for well over 100 years, " the state supreme court affirmed the decision of the Commonwealth Court, 931 A.2d 771 (2007) http://www.aopc.org/OpPosting/CWealth/out/519MD06_7-31-07.pdf in an action brought by the state Department of Banking to prevent the unlicensed defendant lenders from charging consumers fees that exceeded applicable state limits under the Consumer Discount Company Act, 7 P.S. §§6201-6219 (the “CDCA”), and the Loan Interest and Protection Law, 41 P.S. §§101-605 (the “LIPL”).
The court determined that Advance America, a payday lender, was subject to the licensing requirements of the CDCA, since the effective interest rate in its transactions -- more than 300% -- was much higher than the statutory limit of 6%.
Although the stated contract interest rate was 5.98% - just below the 6% limit prescribed by the CDCA - AA also charged consumers $149.95 per month as a "participation fee", which the court said was a charge under the statute that had to be include in the aggregate charges and thus was part of the interest rate determination, because the participation fee was a "necessary condition" of any credit advance by AA and was a "charge inextricably related to the amount actually loaned or advanced."
The court rejected the lender's argument that Delaware law should apply to the case by virtue of a choice-of-law provision in the contract with borrowers, stating that:
a) the case was brought by the state Dept. of Banking, not any individual borrower. The Department was not a party to or bound by the terms of any such contract. The "Department instituted this action pursuant to its police power, not only to protect consumers who had already entered into contracts with Appellant, but more broadly on behalf of the general public to enforce the policy protecting them from usurious lending....When viewed in this light,...the choice-of-law provision in Appellant’s contracts cannot bind the Department in this action to enforce Pennsylvania public policy."
b) even if the contractual provision applied, the Court "has recognized that choice-of-law agreements can be avoided when the terms offend Commonwealth public policy even in disputes between contracting parties....Pennsylvania courts have consistently held that the prohibition of exploitative lending is a fundamental public policy that cannot be circumvented."
c) Although some Pennsylvania statutes permit certain lenders to charge more than the statutory 6% rate under the Loan Interest and Protection Law, 41 P.S. sec. 101 et seq., "violation of any of these statutory provisions will itself offend the public policy of the Commonwealth, as established by the General Assembly."
The court held that its "interpretation harmonizes the remedial purposes of the statute by preventing lenders from charging 'extortionate' fees, while at the same time charging a legal interest rate, thus closing a wide loophole for usurious practices" and agreed with the argument of CLS, an amicus in the case, that this lending vehicle was "an example of the industry’s latest scheme to avoid usury laws....This Court has acknowledged that 'usury is generally accompanied by subterfuge and circumvention of one kind or another to present the color of legality.' ... We agree with the Department, and the amici that Appellant’s interpretation of the statute would undermine the usury laws’ purpose: 'to protect the citizenry of this Commonwealth from being exploited at the hands of unscrupulous individuals seeking to circumvent the law at the expense of unsuspecting borrowers who may have no other avenue to secure financial backing.'"
http://www.courts.state.pa.us/OpPosting/Supreme/out/J-97-2008mopdf
Stating that it is "well established that Commonwealth public policy prohibits usurious lending, a prohibition that has been recognized for well over 100 years, " the state supreme court affirmed the decision of the Commonwealth Court, 931 A.2d 771 (2007) http://www.aopc.org/OpPosting/CWealth/out/519MD06_7-31-07.pdf in an action brought by the state Department of Banking to prevent the unlicensed defendant lenders from charging consumers fees that exceeded applicable state limits under the Consumer Discount Company Act, 7 P.S. §§6201-6219 (the “CDCA”), and the Loan Interest and Protection Law, 41 P.S. §§101-605 (the “LIPL”).
The court determined that Advance America, a payday lender, was subject to the licensing requirements of the CDCA, since the effective interest rate in its transactions -- more than 300% -- was much higher than the statutory limit of 6%.
Although the stated contract interest rate was 5.98% - just below the 6% limit prescribed by the CDCA - AA also charged consumers $149.95 per month as a "participation fee", which the court said was a charge under the statute that had to be include in the aggregate charges and thus was part of the interest rate determination, because the participation fee was a "necessary condition" of any credit advance by AA and was a "charge inextricably related to the amount actually loaned or advanced."
The court rejected the lender's argument that Delaware law should apply to the case by virtue of a choice-of-law provision in the contract with borrowers, stating that:
a) the case was brought by the state Dept. of Banking, not any individual borrower. The Department was not a party to or bound by the terms of any such contract. The "Department instituted this action pursuant to its police power, not only to protect consumers who had already entered into contracts with Appellant, but more broadly on behalf of the general public to enforce the policy protecting them from usurious lending....When viewed in this light,...the choice-of-law provision in Appellant’s contracts cannot bind the Department in this action to enforce Pennsylvania public policy."
b) even if the contractual provision applied, the Court "has recognized that choice-of-law agreements can be avoided when the terms offend Commonwealth public policy even in disputes between contracting parties....Pennsylvania courts have consistently held that the prohibition of exploitative lending is a fundamental public policy that cannot be circumvented."
c) Although some Pennsylvania statutes permit certain lenders to charge more than the statutory 6% rate under the Loan Interest and Protection Law, 41 P.S. sec. 101 et seq., "violation of any of these statutory provisions will itself offend the public policy of the Commonwealth, as established by the General Assembly."
The court held that its "interpretation harmonizes the remedial purposes of the statute by preventing lenders from charging 'extortionate' fees, while at the same time charging a legal interest rate, thus closing a wide loophole for usurious practices" and agreed with the argument of CLS, an amicus in the case, that this lending vehicle was "an example of the industry’s latest scheme to avoid usury laws....This Court has acknowledged that 'usury is generally accompanied by subterfuge and circumvention of one kind or another to present the color of legality.' ... We agree with the Department, and the amici that Appellant’s interpretation of the statute would undermine the usury laws’ purpose: 'to protect the citizenry of this Commonwealth from being exploited at the hands of unscrupulous individuals seeking to circumvent the law at the expense of unsuspecting borrowers who may have no other avenue to secure financial backing.'"
Wednesday, June 04, 2008
custody - jurisdiction - continuing jurisdiction
Billhime v. Billhime - Superior Court - June 4, 2008
http://www.courts.state.pa.us/OpPosting/Superior/out/A06024_08.pdf
This case involves Mother's petition for Pennsylvania courts to relinquish jurisdiction to Florida courts. The initial custody order was entered in Pennsylvania. In a later order, the court granted custody to the mother, who lives in Florida, where the children had been living for several years.
The UCCJEA, 23 Pa.C.S.A. § 5422(a)(1), provides that the courts of this Commonwealth will exercise exclusive continuing jurisdiction to modify child custody orders originally entered here unless the child, or a child and at least one parent (or a person acting as a parent), no longer have a “significant connection” with Pennsylvania. For the child, the lack of a continuing “significant connection” with the Commonwealth is established if the court finds that substantial evidence concerning the child’s care, protection, training and personal relationships is no longer available here.
The trial court refused Mother's petition, relying almost exclusively on Father’s continuing “significant connection” with Pennsylvania. However, the court did not focus in any detail on whether the children continue to maintain a “significant connection” to Pennsylvania, noting only that they visit Pennsylvania three times per year and spend time with their father, friends and paternal grandfather. There was little evidence regarding the continuing availability in Pennsylvania of “substantial evidence concerning the child’s “care, protection, training and personal relationships,” as is expressly required by sec . 5422(a)(1) of the UCCJEA. In fact, essentially all of the evidence presented at the evidentiary hearing demonstrates that information relating to the children’s welfare is now located in the state of Florida.
In the absence of exclusive continuing jurisdiction, a Pennsylvania court may nevertheless modify a child custody order it previously issued if it has jurisdiction to make an initial determination under section 5421 of the UCCJEA. 23 Pa.C.S.A. § 5422(b). Because the trial court did not address the applicability of section 5421 in connection with its initial consideration of Mother’s motion to relinquish jurisdiction, we remand for consideration and decision on this issue.
In the event the trial court determines that it lacks jurisdiction to make an initial custody determination pursuant to section 5421, it should grant Mother’s motion and relinquish jurisdiction of custody matters relating to these two children to the courts of the state of Florida. Order reversed. Case remanded.
http://www.courts.state.pa.us/OpPosting/Superior/out/A06024_08.pdf
This case involves Mother's petition for Pennsylvania courts to relinquish jurisdiction to Florida courts. The initial custody order was entered in Pennsylvania. In a later order, the court granted custody to the mother, who lives in Florida, where the children had been living for several years.
The UCCJEA, 23 Pa.C.S.A. § 5422(a)(1), provides that the courts of this Commonwealth will exercise exclusive continuing jurisdiction to modify child custody orders originally entered here unless the child, or a child and at least one parent (or a person acting as a parent), no longer have a “significant connection” with Pennsylvania. For the child, the lack of a continuing “significant connection” with the Commonwealth is established if the court finds that substantial evidence concerning the child’s care, protection, training and personal relationships is no longer available here.
The trial court refused Mother's petition, relying almost exclusively on Father’s continuing “significant connection” with Pennsylvania. However, the court did not focus in any detail on whether the children continue to maintain a “significant connection” to Pennsylvania, noting only that they visit Pennsylvania three times per year and spend time with their father, friends and paternal grandfather. There was little evidence regarding the continuing availability in Pennsylvania of “substantial evidence concerning the child’s “care, protection, training and personal relationships,” as is expressly required by sec . 5422(a)(1) of the UCCJEA. In fact, essentially all of the evidence presented at the evidentiary hearing demonstrates that information relating to the children’s welfare is now located in the state of Florida.
In the absence of exclusive continuing jurisdiction, a Pennsylvania court may nevertheless modify a child custody order it previously issued if it has jurisdiction to make an initial determination under section 5421 of the UCCJEA. 23 Pa.C.S.A. § 5422(b). Because the trial court did not address the applicability of section 5421 in connection with its initial consideration of Mother’s motion to relinquish jurisdiction, we remand for consideration and decision on this issue.
In the event the trial court determines that it lacks jurisdiction to make an initial custody determination pursuant to section 5421, it should grant Mother’s motion and relinquish jurisdiction of custody matters relating to these two children to the courts of the state of Florida. Order reversed. Case remanded.
appeals - MDJ appeals - appeal v. certiorari
Gladstone Partners v. Overland Enterprise - Superior Court - June 2, 2008
http://www.courts.state.pa.us/OpPosting/Superior/out/A06037_08.pdf
Appeal de novo and writ of certiorari are different, separate, and mutually exclusive.
These remedies do not and cannot exist simultaneously. MDJ Rule 1015 expressly prohibits a litigant from availing themselves of both an appeal de novo and certiorari review. Rule 1015 clearly requires a litigant desiring to challenge a magisterial district court’s judgment to choose either to appeal de novo or to seek certiorari review.
The purpose of an appeal de novo is to give a litigant a new trial without reference to the record established in the minor court, whereas certiorari connotes a review of the record established in the minor court with an eye to cure defects in procedure and legal error....
The Pennsylvania Constitution does not guarantee the remedy of certiorari review, but, rather, the Judicial Code permits the courts of common pleas to issue writs of certiorari as they had done at common law, 42 Pa.C.S.A. § 934. As such, the appellate courts of this Commonwealth have described certiorari review as an alternative to an appeal de novo.
The remedy of appeal de novo takes precedence over certiorari review due to the guarantee of the right to appeal found in Art. V § 9 of the Pennsylvania Constitution. Thus, the simultaneous filing of an appeal de novo and a praecipe for writ of certiorari will result in the striking of the writ if it is later granted by the court of common pleas.
The time for appeal is not extended while certiorari proceeding are pending
Courts cannot extend appeal deadlines without showing a breakdown in the processes of the court or fraud that would justify an appeal nunc pro tunc. The MDJ Rules state the time limits for seeking appeal de novo and certiorari review with specificity.
A party challenging the subject matter or procedural jurisdiction of an MDJ via writ of certiorari may do so at any time after entry of the court’s judgment; otherwise, the time limit for seeking certiorari review is 30 days following entry of judgment. Pa.R.C.P.M.D.J. 1009B.
On the other hand, a party appealing de novo is constrained by a 30-day time limitation from the entry of judgment or, in the case of judgments of possession of residential real property, a 10-day time limitation from the entry of judgment. Pa.R.C.P.M.D.J. 1002A, 1002B.
Therefore, to find that the grant of a writ of certiorari tolls the time for taking appeal de novo would permit the courts of common pleas to extend the time for taking appeal de novo to a potentially-limitless period.
No good cause for late filing - MDJ Rules 1002A and 1002B permit the filing of an appeal beyond the stated time periods with leave of court and upon good cause shown. In the present case, the appellant did not request the leave of court or demonstrate cause as to why their appeal was filed beyond the 30-day time limit. Accordingly, we need not consider this grace proviso in the present case.
http://www.courts.state.pa.us/OpPosting/Superior/out/A06037_08.pdf
Appeal de novo and writ of certiorari are different, separate, and mutually exclusive.
These remedies do not and cannot exist simultaneously. MDJ Rule 1015 expressly prohibits a litigant from availing themselves of both an appeal de novo and certiorari review. Rule 1015 clearly requires a litigant desiring to challenge a magisterial district court’s judgment to choose either to appeal de novo or to seek certiorari review.
The purpose of an appeal de novo is to give a litigant a new trial without reference to the record established in the minor court, whereas certiorari connotes a review of the record established in the minor court with an eye to cure defects in procedure and legal error....
The Pennsylvania Constitution does not guarantee the remedy of certiorari review, but, rather, the Judicial Code permits the courts of common pleas to issue writs of certiorari as they had done at common law, 42 Pa.C.S.A. § 934. As such, the appellate courts of this Commonwealth have described certiorari review as an alternative to an appeal de novo.
The remedy of appeal de novo takes precedence over certiorari review due to the guarantee of the right to appeal found in Art. V § 9 of the Pennsylvania Constitution. Thus, the simultaneous filing of an appeal de novo and a praecipe for writ of certiorari will result in the striking of the writ if it is later granted by the court of common pleas.
The time for appeal is not extended while certiorari proceeding are pending
Courts cannot extend appeal deadlines without showing a breakdown in the processes of the court or fraud that would justify an appeal nunc pro tunc. The MDJ Rules state the time limits for seeking appeal de novo and certiorari review with specificity.
A party challenging the subject matter or procedural jurisdiction of an MDJ via writ of certiorari may do so at any time after entry of the court’s judgment; otherwise, the time limit for seeking certiorari review is 30 days following entry of judgment. Pa.R.C.P.M.D.J. 1009B.
On the other hand, a party appealing de novo is constrained by a 30-day time limitation from the entry of judgment or, in the case of judgments of possession of residential real property, a 10-day time limitation from the entry of judgment. Pa.R.C.P.M.D.J. 1002A, 1002B.
Therefore, to find that the grant of a writ of certiorari tolls the time for taking appeal de novo would permit the courts of common pleas to extend the time for taking appeal de novo to a potentially-limitless period.
No good cause for late filing - MDJ Rules 1002A and 1002B permit the filing of an appeal beyond the stated time periods with leave of court and upon good cause shown. In the present case, the appellant did not request the leave of court or demonstrate cause as to why their appeal was filed beyond the 30-day time limit. Accordingly, we need not consider this grace proviso in the present case.
Monday, June 02, 2008
attorney fees - EAJA - paralegal time - prevailing market rates
Richlin Security Services v. Chertoff - US. Supreme Court - June 2, 2008
http://www.supremecourtus.gov/opinions/07pdf/06-1717.pdf
The question presented in this case is whether the Equal Access to Justice Act (EAJA), 5 U. S. C. §504(a)(l) (2006 ed.) and 28 U. S. C. §2412(d)(1)(A) (2000 ed.), allows a prevailing party in a case brought by or against the Government to recover fees for paralegal services at the market rate for such services or only at their cost to the party’s attorney.
Held: A prevailing party that satisfies EAJA’s other requirements may recover its paralegal fees from the Government at prevailing market rates.
EAJA, like §1988, must be interpreted as using the term "attorney . . . fees" to reach fees for paralegal services as well as compensation for the attorney’s personal labor, making "self-evident"that Congress intended that term to embrace paralegal fees.
Since §504 generally provides for recovery of attorney’s fees at "prevailingmarket rates," it follows that paralegal fees must also be recoverable at those rates.
http://www.supremecourtus.gov/opinions/07pdf/06-1717.pdf
The question presented in this case is whether the Equal Access to Justice Act (EAJA), 5 U. S. C. §504(a)(l) (2006 ed.) and 28 U. S. C. §2412(d)(1)(A) (2000 ed.), allows a prevailing party in a case brought by or against the Government to recover fees for paralegal services at the market rate for such services or only at their cost to the party’s attorney.
Held: A prevailing party that satisfies EAJA’s other requirements may recover its paralegal fees from the Government at prevailing market rates.
EAJA, like §1988, must be interpreted as using the term "attorney . . . fees" to reach fees for paralegal services as well as compensation for the attorney’s personal labor, making "self-evident"that Congress intended that term to embrace paralegal fees.
Since §504 generally provides for recovery of attorney’s fees at "prevailingmarket rates," it follows that paralegal fees must also be recoverable at those rates.
Friday, May 30, 2008
contracts - good faith and fair dealing
Spadoni v. Easton Area School District - ED Pa. - May 22, 2008
http://www.paed.uscourts.gov/documents/opinions/08D0587P.pdf
Pennsylvania does not recognize an independent cause of action for breach of the covenant of good faith and fair dealing. Temple Univ. Hosp., Inc. v. Group Health, Inc., 2006 WL 146426, at *5 (E.D. Pa. Jan. 12, 2006) (Pratter, J.) (quoting Lyon Fin. Servs. v. Woodlake Imaging, LLC, 2005 WL 331695, at *8 (E.D. Pa. Feb. 9, 2005) (Diamond, J.)).
“There may be an express or implied covenant of good faith and fair dealing in any contract between the parties, but if so, its breach is a breach of contract rather than an independent breach of duty of good faith and fair dealing.” Temple Univ. Hosp. Inc., 2006 WL 146426, at *5 (quoting Engstrom v. John Nuveen & Co., 668 F. Supp. 953, 958 (E.D. Pa. 1987)).
Because breach of the covenant of good faith and fair dealing is a breach of contract action, a complaint must allege the proper elements of a breach of contract action to survive a motion to dismiss. Temple Univ. Hosp., 2006 WL 146426, at *6 (citing McAllister v. Royal Carribean Cruises, Ltd., 2003 WL 23192102, at *4 (E.D. Pa. Sept. 30, 2003) (Kauffman, J.)).
http://www.paed.uscourts.gov/documents/opinions/08D0587P.pdf
Pennsylvania does not recognize an independent cause of action for breach of the covenant of good faith and fair dealing. Temple Univ. Hosp., Inc. v. Group Health, Inc., 2006 WL 146426, at *5 (E.D. Pa. Jan. 12, 2006) (Pratter, J.) (quoting Lyon Fin. Servs. v. Woodlake Imaging, LLC, 2005 WL 331695, at *8 (E.D. Pa. Feb. 9, 2005) (Diamond, J.)).
“There may be an express or implied covenant of good faith and fair dealing in any contract between the parties, but if so, its breach is a breach of contract rather than an independent breach of duty of good faith and fair dealing.” Temple Univ. Hosp. Inc., 2006 WL 146426, at *5 (quoting Engstrom v. John Nuveen & Co., 668 F. Supp. 953, 958 (E.D. Pa. 1987)).
Because breach of the covenant of good faith and fair dealing is a breach of contract action, a complaint must allege the proper elements of a breach of contract action to survive a motion to dismiss. Temple Univ. Hosp., 2006 WL 146426, at *6 (citing McAllister v. Royal Carribean Cruises, Ltd., 2003 WL 23192102, at *4 (E.D. Pa. Sept. 30, 2003) (Kauffman, J.)).
disability - severity - remand
Bishop v. Astrue
http://www.paed.uscourts.gov/documents/opinions/08D0583P.pdf
I agree with the ALJ that there is little, if any, medical evidence supporting the level of disability alleged by plaintiff. I also respect that the ALJ’s credibility determination is entitled to deference.
However, I am bound by Third Circuit law which provides that benefits may be denied at step two of the sequential evaluation only if there are less than slight abnormalities which would have no more than a minimal effect on an individual's ability to work and that step two is designed to screen out only groundless claims.
In this case, resolving any doubt in favor of the applicant, as I must under the law, I find that based upon the record evidence, Bishop’s claim is not groundless and, thus, the ALJ legally erred when he found that Bishop’s trigeminal neuralgia/primary trochlear headache was not a severe impairment. Id. As a result, this case must be remanded to the ALJ to determine whether Bishop is disabled due to her severe impairment of trigeminal neuralgia/primary trochlear headache and other non-severe impairment.
Although due to the ALJ’s legal error this case must be remanded, I hesitate, for based on the record, I find it highly unlikely that Bishop’s impairments are severe enough to preclude all work. See Rutherford v. Barnhart, 399 F.3d 546, 553 (3d Cir. 2005)... ; Fisher v. Bowen, 869 F.2d 1055, 1057 (7th Cir. 1989)....However, it is not my duty to make the ultimate disability determination, as that decision is reserved solely for the Commissioner. 20 C.F.R. § 404.1527(e)(1). My role is limited to determining whether the decision of the ALJ is legally sufficient and supported by substantial evidence....Therefore, the case must be remanded in order for the ALJ to supplement his findings in a manner consistent with this opinion.
http://www.paed.uscourts.gov/documents/opinions/08D0583P.pdf
I agree with the ALJ that there is little, if any, medical evidence supporting the level of disability alleged by plaintiff. I also respect that the ALJ’s credibility determination is entitled to deference.
However, I am bound by Third Circuit law which provides that benefits may be denied at step two of the sequential evaluation only if there are less than slight abnormalities which would have no more than a minimal effect on an individual's ability to work and that step two is designed to screen out only groundless claims.
In this case, resolving any doubt in favor of the applicant, as I must under the law, I find that based upon the record evidence, Bishop’s claim is not groundless and, thus, the ALJ legally erred when he found that Bishop’s trigeminal neuralgia/primary trochlear headache was not a severe impairment. Id. As a result, this case must be remanded to the ALJ to determine whether Bishop is disabled due to her severe impairment of trigeminal neuralgia/primary trochlear headache and other non-severe impairment.
Although due to the ALJ’s legal error this case must be remanded, I hesitate, for based on the record, I find it highly unlikely that Bishop’s impairments are severe enough to preclude all work. See Rutherford v. Barnhart, 399 F.3d 546, 553 (3d Cir. 2005)... ; Fisher v. Bowen, 869 F.2d 1055, 1057 (7th Cir. 1989)....However, it is not my duty to make the ultimate disability determination, as that decision is reserved solely for the Commissioner. 20 C.F.R. § 404.1527(e)(1). My role is limited to determining whether the decision of the ALJ is legally sufficient and supported by substantial evidence....Therefore, the case must be remanded in order for the ALJ to supplement his findings in a manner consistent with this opinion.
Thursday, May 29, 2008
custody - relocation
Hogrelius v. Martin - Superior Court - May 29, 2008
http://www.courts.state.pa.us/OpPosting/Superior/out/s16015_08.pdf
The court affirmed a decision granting mother permission to move with child to Virginia, where they would live with mother's new husband.
A lot of the opinion dealt with economic factors, including the fact that the stepfather alone earned more than both parents combined.
The court also rejected father's claims that the proposed alternate arrangements for his partial custody were not adequate, because they involved a reduction in his custody time and a longer commute (5.5 hours each way). The court rejected this contention as well, stating:
In addressing this prong of the Gruber analysis, a court’s determination is not whether the alternative schedule would maintain the current level of the non-custodial parent’s interaction with the children, but rather whether the substitute arrangements “will foster adequately an ongoing relationship” between the non-custodial parent and the children....This Court addressed a similar contention in Goldfarb v. Goldfarb, 861 A.2d 340, 346 (Pa.Super. 2004), and concluded that the distance between the noncustodial parent and his relocated children is not the controlling concern. We stated, 'If it were, no necessity for a Gruber analysis would ever have arisen, as physical proximity would be a sine qua non of most if not all custody determinations.' Id. Thus, although an alternative custody schedule necessarily reduces the frequency of a parent’s interaction with a child because of the distance involved, relocation should not be denied for that reason alone....Gruber, 583 A.2d at 185-86. See also Ketterer v. Seifert, 902 A.2d 533, 539 (Pa.Super. 2006) (fact that move of considerable distance will increase cost and logistical problems of maintaining contact between non-custodial parent and child will not necessarily preclude relocation when other factors favor it).
The court found that the proposed custody schedule for the father -- alternating weekends, most holidays, and seven weeks during the summer, as well as alternate holidays, and during extended breaks from school - would increases father’s extended, overnight custody and would adequately foster a healthy relationship between father and child.
http://www.courts.state.pa.us/OpPosting/Superior/out/s16015_08.pdf
The court affirmed a decision granting mother permission to move with child to Virginia, where they would live with mother's new husband.
A lot of the opinion dealt with economic factors, including the fact that the stepfather alone earned more than both parents combined.
The court also rejected father's claims that the proposed alternate arrangements for his partial custody were not adequate, because they involved a reduction in his custody time and a longer commute (5.5 hours each way). The court rejected this contention as well, stating:
In addressing this prong of the Gruber analysis, a court’s determination is not whether the alternative schedule would maintain the current level of the non-custodial parent’s interaction with the children, but rather whether the substitute arrangements “will foster adequately an ongoing relationship” between the non-custodial parent and the children....This Court addressed a similar contention in Goldfarb v. Goldfarb, 861 A.2d 340, 346 (Pa.Super. 2004), and concluded that the distance between the noncustodial parent and his relocated children is not the controlling concern. We stated, 'If it were, no necessity for a Gruber analysis would ever have arisen, as physical proximity would be a sine qua non of most if not all custody determinations.' Id. Thus, although an alternative custody schedule necessarily reduces the frequency of a parent’s interaction with a child because of the distance involved, relocation should not be denied for that reason alone....Gruber, 583 A.2d at 185-86. See also Ketterer v. Seifert, 902 A.2d 533, 539 (Pa.Super. 2006) (fact that move of considerable distance will increase cost and logistical problems of maintaining contact between non-custodial parent and child will not necessarily preclude relocation when other factors favor it).
The court found that the proposed custody schedule for the father -- alternating weekends, most holidays, and seven weeks during the summer, as well as alternate holidays, and during extended breaks from school - would increases father’s extended, overnight custody and would adequately foster a healthy relationship between father and child.
UC - voluntary quit - "purely personal reasons"
Johnson v. UCBR - Commonwealth Court - May 29, 2008 - UNREPORTED DECISION
http://www.courts.state.pa.us/OpPosting/CWealth/out/27CD08_5-29-08.pdf
Claimant was denied UC benefits when she quit her part-time, weekend job without good cause under sec. 4021(b) of the UC Law. Her desire to spend more time with elderly family members was not good cause, in the absence of proof that her presence was required for them to get proper care. Her reason for leaving was thus "purely personal." She also failed to establish that she discussed the issue with her employer or made other efforts to preserve her job.
"Under certain circumstances, the family obligations of a claimant may constitute necessitous and compelling cause to quit employment. Du-Co Ceramics Co. v. UCBR, 546 Pa. 504, 686 A.2d 821 (1996).
For instance, in Pittsburgh Pipe and Coupling Company v. UCBR, 401 Pa. 501, 165 A.2d 374 (1960), the Supreme Court affirmed the granting of benefits to a claimant who quit his employment to return home and take care of his wife, who had suffered a disabling spinal injury, and their children.
Similarly, in Beachem v. UCBR, 760 A.2d 68 (Pa. Cmwlth. 2000), we concluded that a claimant who quit his employment to move back in with his eleven-year-old son, who was having emotional and behavioral problems, established necessitous and compelling cause for quitting, thereby entitling him to unemployment compensation benefits.
We have also granted benefits to a claimant when he quit his employment to move back home, in part, to take care of his ailing father. Speck v. UCBR, 680 A.2d 27 (Pa. Cmwlth. 1996).
However, in Green v. UCBR, 529 A.2d 597 (Pa. Cmwlth. 1987), we explained that while family obligations may constitute a necessitous and compelling reason to leave one's employment, the reasons may not be purely personal."
http://www.courts.state.pa.us/OpPosting/CWealth/out/27CD08_5-29-08.pdf
Claimant was denied UC benefits when she quit her part-time, weekend job without good cause under sec. 4021(b) of the UC Law. Her desire to spend more time with elderly family members was not good cause, in the absence of proof that her presence was required for them to get proper care. Her reason for leaving was thus "purely personal." She also failed to establish that she discussed the issue with her employer or made other efforts to preserve her job.
"Under certain circumstances, the family obligations of a claimant may constitute necessitous and compelling cause to quit employment. Du-Co Ceramics Co. v. UCBR, 546 Pa. 504, 686 A.2d 821 (1996).
For instance, in Pittsburgh Pipe and Coupling Company v. UCBR, 401 Pa. 501, 165 A.2d 374 (1960), the Supreme Court affirmed the granting of benefits to a claimant who quit his employment to return home and take care of his wife, who had suffered a disabling spinal injury, and their children.
Similarly, in Beachem v. UCBR, 760 A.2d 68 (Pa. Cmwlth. 2000), we concluded that a claimant who quit his employment to move back in with his eleven-year-old son, who was having emotional and behavioral problems, established necessitous and compelling cause for quitting, thereby entitling him to unemployment compensation benefits.
We have also granted benefits to a claimant when he quit his employment to move back home, in part, to take care of his ailing father. Speck v. UCBR, 680 A.2d 27 (Pa. Cmwlth. 1996).
However, in Green v. UCBR, 529 A.2d 597 (Pa. Cmwlth. 1987), we explained that while family obligations may constitute a necessitous and compelling reason to leave one's employment, the reasons may not be purely personal."
Wednesday, May 28, 2008
disability - findings and reasons
Levine v. Astrue - ED Pa. - March 27, 2008
http://www.paed.uscourts.gov/documents/opinions/08D0368P.pdf
The court ordered a remand due to several unexplained conflicts and inconsistencies the ALJ’s findings, which are "not for an appellate court to explain....See Fargnoli v. Massanari, 247 F.3d 34, 41-42 (3d Cir. 2001)."
"Despite finding that the treating physician’s opinion was entitled to controlling weight, ...the ALJ did not discuss these limitations in his assessment of RFC, even though “a clear and satisfactory explanation” must accompany an ALJ’s finding of RFC. Fargnoli, 47 F.3d at 41....The ALJ’s opinion below is deficient in this respect because it does not specifically discuss the mental impairments the treating physician reported."
"The ALJ’s decision did not explain the conflict between the skill level the ALJ found plaintiff to have and the skill requirements of the jobs the VE testified the plaintiff could perform. The VE and the ALJ must explain such inconsistencies on the record, and if they have not, the matter must be remanded. See Burns, 312 F.3d at 127 (requiring that conflicts between an ALJ’s findings and the DOT definitions be explained “on the record and that the ALJ explain in his decision how the conflict was resolved”). This matter is therefore remanded so that the ALJ can explain these inconsistencies."
http://www.paed.uscourts.gov/documents/opinions/08D0368P.pdf
The court ordered a remand due to several unexplained conflicts and inconsistencies the ALJ’s findings, which are "not for an appellate court to explain....See Fargnoli v. Massanari, 247 F.3d 34, 41-42 (3d Cir. 2001)."
"Despite finding that the treating physician’s opinion was entitled to controlling weight, ...the ALJ did not discuss these limitations in his assessment of RFC, even though “a clear and satisfactory explanation” must accompany an ALJ’s finding of RFC. Fargnoli, 47 F.3d at 41....The ALJ’s opinion below is deficient in this respect because it does not specifically discuss the mental impairments the treating physician reported."
"The ALJ’s decision did not explain the conflict between the skill level the ALJ found plaintiff to have and the skill requirements of the jobs the VE testified the plaintiff could perform. The VE and the ALJ must explain such inconsistencies on the record, and if they have not, the matter must be remanded. See Burns, 312 F.3d at 127 (requiring that conflicts between an ALJ’s findings and the DOT definitions be explained “on the record and that the ALJ explain in his decision how the conflict was resolved”). This matter is therefore remanded so that the ALJ can explain these inconsistencies."
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