Some Thoughts on Judicial Campaigns and Money

I appreciate the Arkansas Lawyer publishing my article on Judicial Campaign Finance.   It is a timely and complex issue.  There are reforms that will help, but enacting those reforms will require leadership from judges and lawyers.  Here’s a link to the current issue, scroll to page 22 for the article.

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Supreme Court Overrules Court of Appeals on Finality Doctrine

Anyone who follows appellate decisions in Arkansas has observed the particular affinity the Arkansas Court of Appeals has for the finality doctrine. Stated simply, absent some specific exception, there must be a final order as to all claims and all parties before an appeal can be heard. The oft-repeated reason is that the appellate courts want to decide a case on appeal once, and avoid piece-meal appeals.   See, e.g., Moore v. Moore, 2015 Ark. App. 115; Youngblood v. Youngblood, 2015 Ark. App. 121; and Burton v. Templeman, 2015 Ark. App. 101.   Some (including me) would argue that the Court of Appeals is applying finality too rigidly.   A case today suggests the Arkansas Supreme Court might agree.

In Bank of the Ozarks v. Cossey, 2015 Ark. 367, the Arkansas Supreme Court took on review a case that had been previously decided by the Arkansas Court of Appeals.   The Court of Appeals dismissed the appeal for lack of a final order.   Their reasoning was:

“In the present case, the circuit court declared the Bank to be trustee of the Hamilton Living Trust and ordered the Bank to provide Cossey with an accounting. The accounting has yet to be performed and will necessarily involve future actions by the Bank, as well as future oversight and rulings by the circuit judge. The court’s order therefore contemplates further action by a party or the court and is not final and appealable.”

Bank of the Ozarks v. Cossey, 2014 Ark. App. 581, 3, 446 S.W.3d 214, 216 (2014), reh’g denied (Dec. 10, 2014) overruled by 2015 Ark. 367.

The Arkansas Supreme Court disagreed:

“The circuit court’s order was appealable as a final judgment or decree. See Ark. R. App. P.–Civ. 2(a)(1) (2014). For a judgment to be final, it must dismiss the parties from the court, discharge them from the action, or conclude their rights to the subject matter in controversy; thus, the order must put the trial court’s directive into execution, ending the litigation, or a separable branch of it. Smith v. Smith, 337 Ark. 583, 990 S.W.2d 550 (1999). Such is the case here. A single petitioner (Cossey) brought a single claim (accounting) against a single respondent (the Bank). After a hearing, the circuit court granted the petition and ordered the Bank to perform an accounting. Thus, the parties were dismissed from the court, the action was discharged, and the rights to the subject matter were concluded.”

Bank of the Ozarks v. Cossey, 2015 Ark. 367 at note 1.  Here is a link to the full decision:

http://opinions.aoc.arkansas.gov/WebLink8/0/doc/335626/Electronic.aspx

Many cases leave ministerial acts or future obligations open, even after the disputed issues in the case are fully decided.   Finality should not be an impediment to an appeal when the issues central to the case have been decided.   I’m encouraged that the Supreme Court agrees.

U.S. Supreme Court Affirms Restriction on Judges Raising Campaign Money

I blogged about this case in January.   https://reporteddecisions.com/2015/01/17/free-speech-vs-judicial-ethics/

Today, the U.S. Supreme Court affirmed the sanctions levied against a judicial candidate for violating Florida’s rules prohibiting judicial candidates from directly soliciting campaign contributions.  Like most modern Supreme Court decisions, it was a close-call (5-4) and it is a maze of majority, concurring, and dissenting opinions.  I have not analyzed them fully yet.  But I am optimistic that this holding may suggest a willingness to allow states to hold judicial elections to a higher standard than other types of elections without running afoul of the First Amendment.  Here’s the first page of the actual decision, with a link to the rest of the decision.

http://www.supremecourt.gov/opinions/14pdf/13-1499_d18e.pdf

SUPREME COURT OF THE UNITED STATES

_________________

No. 13–1499 _________________

LANELL WILLIAMS-YULEE, PETITIONER v. THE FLORIDA BAR

ON WRIT OF CERTIORARI TO THE SUPREME COURT OF FLORIDA

[April 29, 2015]

CHIEF JUSTICE ROBERTS delivered the opinion of the Court, except as to Part II.

Our Founders vested authority to appoint federal judges in the President, with the advice and consent of the Senate, and entrusted those judges to hold their offices during good behavior. The Constitution permits States to make a different choice, and most of them have done so. In 39 States, voters elect trial or appellate judges at the polls. In an effort to preserve public confidence in the integrity of their judiciaries, many of those States prohibit judges and judicial candidates from personally soliciting funds for their campaigns. We must decide whether the First Amendment permits such restrictions on speech.

We hold that it does. Judges are not politicians, even when they come to the bench by way of the ballot. And a State’s decision to elect its judiciary does not compel it to treat judicial candidates like campaigners for political office. A State may assure its people that judges will apply the law without fear or favor—and without having personally asked anyone for money. We affirm the judg- ment of the Florida Supreme Court.

Earls v. Harvest Credit Elevates Form Over Substance

I have been following the case of Earls v. Harvest Credit.  It was decided by the Arkansas Court of Appeals, but then taken on review by the Arkansas Supreme Court.  Their decision was released last week.   It was a simple collection case on an unpaid credit card debt.  But this is the kind of decision that is difficult to explain to a non-lawyer because it seems to defy common sense.

The form summons that started the case included the wrong time period for incarcerated individuals to respond to the lawsuit.  But the defendants were not incarcerated.  The summons notified them correctly of the time they had to respond.  But they filed no response.  There does not seem to be any dispute that they owed the debt.  Nonetheless, the Supreme Court held that the defective summons made the judgment invalid.

David Williams at Kutak Rock in Little Rock authored an excellent blog post on this decision.  With his permission, I am linking to it here:

https://www.linkedin.com/pulse/ark-court-reverses-default-judgment-due-incorrect-summons-williams

I encourage you to read the blog post and the majority, concurring, and dissenting opinions, and ask yourself if this outcome comports with Rule 1 of the Arkansas Rules of Civil Procedure (2015).

Free Speech vs. Judicial Ethics

The U.S. Supreme Court will hear arguments Tuesday (1/20/15) on a case pitting a judicial candidate’s First Amendment rights against the judicial code of ethics limiting a candidate’s role in campaign fundraising.   The case is Williams-Yulee v. Florida Bar.  It will be the first time the court has considered restrictions on judicial campaigns since 2002.

Most states that elect judges (and the majority of states do elect judges) restrict the candidate from taking a direct role in soliciting campaign contributions.  See, e.g., Rule 4.4, Ark. Code of Judicial Conduct (2014).  Fundraising is outsourced to a committee, and a Chinese wall should separate the candidate from knowledge about his or her contributors to avoid claims of bias. However, in practice that wall is often transparent because candidates are questioned publicly and in the press about their donors, and campaign finance reports disclosing donors are publicly available.

In the last case before the high court addressing the tension between judicial campaign restrictions and free speech, the Court held (in a 5-4 decision) that judicial ethics rules that prohibit a candidate from announcing their views on disputed legal and political issues did not pass strict scrutiny and therefore violated a candidate’s first amendment rights. Republican Party of Minnesota v. White, 536 U.S. 765 (2002).

Reading the White case together with Citizens United v. FEC, 558 U.S. 310 (2010) (the first amendment prohibits government regulation of independent political expenditures by non-profit corporations — which has been over-simplified to the concept that money equals speech), it seems likely the Supreme Court is poised to strike down another limitation that burdens judicial candidates’ free speech rights.  Fans of judicial restraint and decorum (and incumbent judges) will argue that this further opens the floodgates, turning judicial elections into ugly partisan contests that undermine confidence in the impartiality, integrity, and independence of the judicial branch. Adding to the dynamics, the federal courts (who are appointed by the president and never stand for election or retention) are perhaps unsympathetic to the plight of most state court judges who must be popularly elected, or periodically survive retention elections.

The decision in Williams-Yulee will fuel the debate over election vs. appointment of judges by at least partly answering the question: Is there is any meaningful way that state judicial races can be held to a higher standard than the superficial and hyper-partisan campaigns for congress, president, governors, and the like — without an undue burden on a judicial candidate’s First Amendment rights?

The argument in Williams-Yulee will be available on the Court’s website on Friday, January 23rd at this link: http://www.supremecourt.gov/oral_arguments/argument_audio.aspx

Here’s an article discussing the facts of the case in more detail: http://www.mcclatchydc.com/2015/01/16/253383/free-speech-or-conflict-high-court.html

For another discussion of this case, see Mark Stern’s provocative article in Slate — Justice for Sale: The Supreme Court is Poised to Make Judicial Elections Even More Corrupt.

http://www.slate.com/articles/news_and_politics/jurisprudence/2014/10/judicial_elections_and_free_speech_the_supreme_court_s_williams_yulee_case.html

Service by e-mail wasn’t good enough

Today the Arkansas Supreme Court decided Steward v. Kuettel, 2014 Ark. 499.   In this case, the trial court entered an order, pursuant to Rule 4(e)(5) allowing the plaintiff to serve the defendant by email, with a tracking pixel to confirm that the email and attached summons and complaint were received.  In support of this “other service,” the plaintiff recounted that attempts to serve by mail at the defendant’s last known address had been unsuccessful, but that other sources had confirmed the defendant was using a particular email address (that was published on a website that was the subject of the lawsuit).

The Supreme Court did not rule-out the possibility that “other service” could include service by email.

“Assuming, without deciding, that service of process by email may be allowed under
Rule 4(e)(5), we cannot say that, under the facts of this case, the alternative method of
service crafted by the circuit court was reasonably calculated to give actual notice of the
lawsuit.”

Instead, the decision turns on the fact that while the tracking pixel did tend to confirm that the email was received and opened, it did not establish that the defendant actually opened the summons and complaint that were attached to the email as PDFs.

The Supreme Court reversed the trial court’s refusal to set aside the default judgment, holding:

“The alternative service of process in this case was insufficient because it was not
reasonably calculated to give actual notice to Steward. A default judgment is void under Rule
55(c)(2) if the defendant was improperly served under Rule 4. E.g., S. Transit Co. v. Collums,
333 Ark. 170, 175, 966 S.W.2d 906, 908 (1998). Because the default judgment was void
because of insufficient service of process, the circuit court erred in denying Steward’s motion
to set aside default judgment.”

This leaves open the possibility that the Court may approve initial service of a summons and complaint by email, but the plaintiff will have the burden of conclusively proving the summons and complaint were actually received and opened by the recipient.

Here’s the full text of the case: http://opinions.aoc.arkansas.gov/WebLink8/0/doc/330359/Electronic.aspx

 

One Reason Why I’m Voting for French Hill for Congress

One of the prerogatives of blogging is the privilege to go off-topic.   This post has nothing to do with appellate court decisions or procedures.  But it is important to me.

2013-10-26 11.24.49

Six years ago next week, French Hill gave a talk at the Clinton School of Public Service.   This was long before he ever considered running for Congress.  In his speech, he used his background as a staffer to the U.S. Senate Committee on Banking, Housing and Urban Affairs, a senior economic advisor to President George H.W. Bush, and as CEO of a local bank, to comment on the Emergency Economic Stabilization Act.  This act was the first attempt to bail-out banks and investment houses deemed too-big to fail, who found themselves with unmanageable risks on their books after the real estate bubble and the widespread use of “derivatives.”

In his speech, French discussed the historical patterns of economic growth and collapse.  He was not shy about criticizing banks and investment houses for their gambles with complex derivative contracts and credit default swaps and for their low capitol reserves.  He also explained the role Congress and the SEC played in the collapse, and was critical of the lavish expenses of government-subsidized players like Fannie Mae and Freddie Mac.  He argued for more prudent capitol ratios for banks and investment houses, simplified regulatory supervision, and greater transparency in stock and bond ratings houses. He pointed out that a knee-jerk response from Congress could not fix all of the economy’s problems, but that corporate directors must step up and truly represent the interests of their shareholders.

In this campaign, French Hill’s opponent (and various groups that buy media on his behalf) decry that French is a banker.  But to borrow a phrase from another Arkansan, “it’s the economy, stupid.”  Congress spends a lot of time and energy debating things that are truly inconsequential.  But the nation’s monetary policy, banking regulation, tax policy, and when to bail-out failing financial institutions are not inconsequential.  These are complex issues involving thousands of moving pieces and trillions of dollars.  These issues don’t lend themselves well to sound-bites.  Sound economic policy is not liberal or conservative.  But it affects every American every day.

I’m thrilled to have someone like French who is willing to take on this challenge.  I believe he is the best qualified person to understand the complex and difficult issues facing our economy, and to act prudently in our best interest to urge the government to do what it can to rebuild a sound and stable American economy.

Read French Hill’s words for yourself:

http://www.electfrench.com/wp-content/uploads/2014/05/HillTrickOrTreat.pdf)

          Don’t fall for the mean-spirited commercial that ominously implies bankers are evil.  You be the judge on whether French Hill understands the complexity and importance of the economic issues facing Congress – probably better than any other person in Congress.   We will be lucky to have him steering the ship.

This is one of the many reasons I am voting for French Hill for Congress.

                                                                    Tim Cullen

Judges Behaving Badly

Two recent examples of judicial misconduct, with two very different results.

Hercules and the Umpire on Judge Fuller:  http://herculesandtheumpire.com/2014/09/11/if-judge-fuller-wont-resign-the-chief-judge-of-the-circuit-and-the-circuit-judicial-council-should-strip-of-him-handling-cases-for-as-long-as-the-law-allows/

And Max Brantley on Judge Maggio: http://www.arktimes.com/ArkansasBlog/archives/2014/09/11/supreme-court-orders-immediate-removal-of-judge-maggio-from-bench

Seventh Circuit holds Wisconsin and Indiana Bans on Gay Marriage are Unconstitutional

You will see much in the headlines today and tomorrow about this case.  The media will attempt to condense this 40 page decision into a few soundbites.   If you want to digest the whole decision for yourself, here it is:

Baskin v. Bogan and Wolfe v. Walker

If you don’t have the inclination to read the 40 page opinion by Judge Posner (joined by Judges Williams and Hamilton), here are few excerpts:

“We’ll see that the governments of Indiana and Wisconsin have given us no reason to think they have a “reasonable basis” for forbidding same-sex marriage. And more than a reasonable basis is required because this is a case in which the challenged discrimination is, in the formula from the Beach case, “along suspect lines.” Discrimination by a state or the federal government against a minority, when based on an immutable characteristic of the members of that minority (most familiarly skin color and gender), and occurring against an historical background of discrimination against the persons who have that characteristic, makes the discriminatory law or policy constitutionally suspect.”

*****

“Our pair of cases is rich in detail but ultimately straight-forward to decide. The challenged laws discriminate against a minority defined by an immutable characteristic, and the only rationale that the states put forth with any conviction—that same-sex couples and their children don’t need marriage because same-sex couples can’t produce children, intended or unintended—is so full of holes that it cannot be taken seriously.”

*****

“The district court judgments invalidating and enjoining these two states’ prohibitions of same-sex marriage are

                                                            AFFIRMED.”

*****

You may hear emphasis that this was merely a decision of a three-judge panel.  That is true.  In theory, the entire Seventh Circuit could choose to hear this en banc and issue a different decision.   That is possible, but unlikely.  The authoring judge, Richard A. Posner, is a Reagan appointee, and a rock-star among U.S. circuit judges.  You may also hear that this decision is not the law of the land until the U.S. Supreme Court weighs in.  That is not quite right.  It is now the law of the land in Wisconsin, Illinois and Indiana.  And it is persuasive (but not necessarily controlling) authority in any other court that faces the issue.  

 

Adventures in Rule Making: The Court Struggles to Make Sense Out of Non-Party Fault, and Other Outgrowth From Tort Reform — A guest blog post by Brian G. Brooks

The Court issued three separate per curiam orders on August 7, 2014, addressing the work of the Special Task Force on Practice and Procedure in Civil Cases and the Supreme Court Committee on Civil Practice.  These orders are marked by a true oddity: dissents.  And not just “I respectfully disagree” dissents.  These dissents are strong and pointed leaving no doubt that the debate within the Court’s conference room was heated.

The first of the three orders is the focus of the debate.  That order adopts changes to Rules 9, 49, and 52 of the Rules of Civil Procedure that put in place a procedure for allocating fault to absent alleged tortfeasors in civil cases.  (Well, it also amends Rule 8 of the Rules of Appellate Procedure—Civil dealing with supersedeas bonds, but no one cares.)  In essence, these Rule changes allow juries to assess “fault” against parties not sued by the plaintiff, or with whom the plaintiff has already settled before trial, when the procedures are followed and where the language applies.  Lifting language directly from Act 1116 of 2013, the Rules allow assessment of fault against anyone “who may have joint liability or several liability” for the plaintiff’s injury even if that person or entity is not, and perhaps never was, a party to the suit.  For some history of how Act 1116 relates to this rule making endeavor, you might read Legislative and Case Law Ties that Bind Act 649 of 2003 with Act 1116 of 2013, The Arkansas Lawyer (Winter 2014), and the other articles about Act 1116 found in that edition.

The overarching question purposely left unanswered by the Rules’ drafters is how far the language “may have … liability” reaches.  Does it include those who are immune, those who are outside the long-arm jurisdiction of the Court, and those who are protected by the Workers’ Compensation bar?  Are those classes of potential defendants persons or entities who “may have … liability” for the plaintiff’s indivisible injury?  Neither the Task Force nor the Court answered that question.  Indeed, how the language of the Rules will be construed, and whether it is in whole or in part constitutionally suspect, was not dealt with by the Task Force, the Committee on Civil Practice or the Court. Rather, the Court refers to the changes as “a good start,” and leaves for later cases issues of construction and validity.  That is precisely, I think, the attitude of the Task Force and the Committee.

And that is where Justices Hart and Baker took strong issue with the work of the Task Force, the Committee and the Court majority in a dissent penned by Justice Hart.  (Justice Baker wrote a separate dissent advocating that the Rules be sent out for further comment from the Bench and the Bar because of alterations to the Rules inserted by the Civil Practice Committee arising from the initial comment period.)  Justice Hart wrote that, because of the unanswered questions identified above and a few others, the Rules are “unclear,” they are “unfair,” and they “may not survive constitutional scrutiny.”  This lack of clarity and fairness combined with constitutional concerns places the Court in the odd position of perhaps needing to declare its own Rules invalid or ineffective in future cases.  “Other solutions” are available, in her view, such as instructing the jury that a defendant may only be charged with the degree of “fault” his behavior merits (as this author has advocated in other writings, The Perplexing Problem of the Absent Joint Tortfeasor, The Arkansas Lawyer, (Fall 2011)), deciding the issues case-by-case as they come before the Court, or allowing the Legislature to promulgate Rules that the Court can review, a somewhat puzzling notion given that the source of much of the need for the drafting of these Rules is the Court’s decision that the Legislature lacks any such power under the State Constitution.

The majority had good reasons for adopting these Rules as a “good start.”  Lawyers, litigants and judges need some guidance as to how to handle the mind-bending questions arising from the abrogation of joint and several liability when not all tortfeasors are in the case that goes to trial, which is what led to this quagmire.  The Legislature “messed with” several hundred years of reasoned common law and this is the result.  The Rules are, indeed, a “good start” to sorting the mess out.  But the dissenters correctly identify the problems.  Indeed, Justice Hart’s dissent is a roadmap for future wrangling over how far the Rules go and whether they are a valid approach to the problems they seek to address.  Of course, the Legislature could undo the mess by abrogating the abrogation of joint and several liability, in which case the way things have been done for decades or centuries would be revitalized.  But that’s a sermon for another day.  For now, let the wrangling Justice Hart identifies begin.

Here’s a link to the text of the first Per Curiam and Dissents:

 http://opinions.aoc.arkansas.gov/WebLink8/0/doc/328146/Electronic.aspx

          The other two orders sail on calmer waters, for now.  One sends out for comment a revision of Rule 3 of the Rules of Civil Procedure that is a novel and creative solution to the pre-suit notice problem in medical malpractice cases.  Legislative attempts to require such notice have been held unconstitutional because they are Legislative rule making offending separation of powers.  But the Task Force’s initial attempt to draft a Rule doing the same thing ran into the mirror-image problem when it in essence tolled the limitations period based on the notice.  That is a substantive issue outside the Court’s authority and within the Legislature’s.  The proposed solution is this new Rule 3(d), which is a notice provision that springs to life when and if the Legislature enacts a statute tolling the limitations period.  Comments are due to the Court on this proposed Rule by September 30, 2014.

Here’s a link to the second Per Curiam:

http://opinions.aoc.arkansas.gov/WebLink8/0/doc/328181/Electronic.aspx

          The final order deals with Rules 11 and 42 and again seeks comment on the proposals.  The primary Rule 11 change is an addition to the certification section that is meant to satisfy the desire by the medical community for a certificate or affidavit of merit in medical negligence cases.  The suggested approach is to make a certification that an expert has been consulted or has disclosed in discovery that he or she finds merit in the claim or defense part of what it means when a lawyer or a party signs a pleading.  In other words, the attorney’s signature is the certificate of merit.  The proposal then re-writes the Rule for clarity and to beef up the sanctions section.

The Rule 42 change addresses procedures in cases where punitive damages are sought.  Trial judges are given the discretion to bifurcate punitive damages questions one of two ways.  Upon motion by either party, judges may either try liability for punitive damages in the first or second phase of the trial, but must always try the amount of punitive damages to be awarded in the second phase.

Here’s a link to the third Per Curiam:

http://opinions.aoc.arkansas.gov/WebLink8/0/doc/328202/Electronic.aspx

          Comments on the proposed rule changes can be made in care of the Clerk’s Office and are due by September 30, 2014.

*** Thank you to Brian Brooks for this guest blog post.   Feel free to use the comment feature to discuss this post, or contact Brian directly at:

Brian G. Brooks

Brian G. Brooks, Attorney at Law, PLLC

P.O. Box 605

Greenbrier, Arkansas  72058

(501) 733-3457

bgbrooks1@me.com