Whalen v. Ford Motor Credit Co.

FRANCIS D. MURNAGHAN, Jr., Circuit Judge, with whom DONALD RUSSELL, WIDENER, ERVIN and CHAPMAN, Circuit Judges, join: Jurisdiction here depends on diversity. Suit was instituted on December 10, 1975. Trial by jury commenced on March 31,1980 in the United States District Court for the District of Maryland, with Judge C. Stanley Blair presiding. The case grew out of the refusal by Ford Motor Credit Company (“Ford Credit”) to close with Towson Associates Limited Partnership (“Towson”) (or more precisely, the provider of interim financing, Equibank N.A. (“Equibank”)), under a loan commitment to make available take-out financing for a' twenty-seven1 floor apartment and office building complex, provided certain terms and conditions were satisfied. Compliance by Towson with the terms and conditions was required to have been achieved by September 2, 1975,2 The case was complicated by a number of issues, including (a) whether Towson met the completion requirement, (b) whether an assignment by Towson to Equibank of its interests under the take-out commitment with Ford Credit was absolute, and (c) whether rulings on the admissibility of evidence and the phraseology of instructions related to damages and their methods of calculation were correct. After the taking of three weeks of testimony, Judge Blair on April 20, 1980 tragically and suddenly died.3 Ford Credit, on the grounds of Judge Blair’s death, moved for a mistrial, citing F.R.Civ.P. 63. The Rule, entitled “Disability of a Judge,” provides for substitution of a new judge for the one disabled by death or other disability when the disability occurs “after a verdict is returned or findings of fact and conclusions of law are filed.” Judge Herbert F. Murray, who had taken Judge Blair’s place, considered and denied the motion for mistrial, reasoning that it would be “inconceivable” to hold substitution over the objection of a party of a new judge before return of verdict absolutely forbidden in a civil action when Rule 25(a) of the Federal Rules of Criminal Procedure explicitly permits such a substitution in a criminal setting.4 In effect, Judge Murray treated the question of whether to substitute a new judge and continue the trial as a matter committed to the new trial judge’s — 274 — discretion, and no doubt perceived force in the argument that the rule was literally silent as to what should happen in a civil case where disability occurs before a verdict is returned or findings of fact and conclusions of law are filed. Judge Murray dealt with a number of civil cases arising in a non-jury trial setting which found substitution before filing of findings of fact and conclusions of law absolutely forbidden, purporting to distinguish them on the grounds that non-jury cases raise “more serious due process issues than if such replacement occurs during a jury trial.” Arrow-Hart, Inc. v. Phillip Carey Co., 552 F.2d 711 (6th Cir. 1977); Brennan v. Grisso, 198 F.2d 532 (D.C.Cir.1952); Ten-O-Win Amusement Co. v. Casino Thea-tre, 2 F.R.D. 242 (N.D.Calif.1942); Burrill v. Shaughnessy, 9 Fed.R.Serv. 918 (N.D.N.Y. 1946). We conclude, for the following reasons, that retrial was mandated by the rule, and that consequently there must be a reversal and return of the case to the district court for a new trial: 1) The basis for a distinction of non-jury cases from jury cases does not appear to exist for Rule 63 does not differ in what it provides for both types of trials. On the contrary, it clearly calls for like treatment: “after a verdict is returned or findings of fact and conclusions of law are filed.” 5 In addition to cases cited by Judge Murray, see: Bromberg v. Moul, 275 F.2d 574 (2d Cir. 1960); Havey v. Kropp, 458 F.2d 1054 (6th Cir. 1972); State ex rel. Lunsford v. Weber, 153 W.Va. 544, 547-48, 170 S.E.2d 671, 673 (1969); Girard Trust Bank v. Easton, 12 N.C.App. 153, 182 S.E.2d 645 (1971), cert. denied, 279 N.C. 393, 183 S.E.2d 245 (1971).6 2) The supposition is unrealistic that the distinguished group of legal scholars who, as the Advisory Committee on the Civil Rules, prepared the Rules for approval and adoption by the United States Supreme Court meant, by their silence, to permit the possibility of substitution of a judge before verdict when Rule 63 entitled “Disability of a Judge” expressly deals only with substitution of a judge after return of verdict. Inherent in the ascription of such a sub silentio purpose would necessarily be establishment that there had been prior practice in which substitution of a judge after trial began but before return of verdict customarily had been allowed over the objection of one of the parties. But the experience had all been the other way. Research has failed to turn up a single case of substitution before verdict — 275 — where one of the parties refused to consent. Cf. Substitution of Judge in Criminal Case, 83 A.L.R.2d 1032, 1034, 1036 (1962) (“A substitution of judges during the introduction of evidence, over the objection of the accused, has been held to be error.”); Coleshill v. Manchester Corp., [1928] 1 K.B. 785 (Scrutton, J.: “I doubt whether a judge has any jurisdiction to continue the hearing of a case in which witnesses have been called in court in the course of the trial before the jury and another judge.. .. ”).7 3) Furthermore, we need not merely rationalize as to the intent of the Advisory Committee on the Civil Rules. The records of their proceedings make crystal clear their intentions.8 After the Civil Rules were adopted in 1938, the Committee continued its existence to monitor their application and to consider possible revisions. On May 20, 1953 the Committee met, including as members continuously having served since its inception in 1935 the Chairman William D. Mitchell, the Reporter Charles E. Clark,9 Armistead M. Dobie,10 and Monte M. Lemann. Responding to suggestions that death of a judge while a long-lasting trial was in progress should not require a substitute judge to start the trial all over again, Judge Clark, as reporter, recommended as an addition to the language of Rule 63 the following: A judge so acting may receive in evidence a transcript of evidence theretofore taken in the case and may accept the testimony therein transcribed except so far as he shall find it necessary to hear witnesses whose credibility must be determined as a step in the adjudication. “Reporter’s Draft of Several Amendments, Federal Rules of Civil Procedure, May 11, — 276 — 1953,” at p. 9 (Charles E. Clark Papers, Yale University Library). The recommendation was fully explored: CHAIRMAN MITCHELL: [T]wo or three years ago ... [w]e came to the conclusion that under the existing rule, the only way a judge could take up a case which has been tried by another judge but he hasn’t decided it, is by stipulation. ... Here is a case where the trial judge died and you have had a long transcript of testimony taken. He is dead, and there is no law or rule that allows another judge to take over the case on a transcript made by the preceding judge who is now dead. The only way it can be done now is by stipulation. If your adversary won’t consent to that, you have to start your case all over again before another judge. MR. LEMANN: Apparently it never occurred to us that we ought to permit another judge to come in and act at all if the case had not reached the point of decision by the first judge. CHAIRMAN MITCHELL: That is it. MR. LEMANN: ... It didn’t occur to anybody, and hadn’t for fifteen years except the one guy, that it isn’t enough. I wouldn’t change the rule just because one guy writes a letter in and says this might happen and counsel might not stipulate. . .. MR. TOLMAN: Yes. It is a problem, and I know that the Judicial Conference has discussed this rule several times. MR. LEMANN: They never have recommended a change, though. MR. TOLMAN: That is quite true. CHAIRMAN MITCHELL: As I say, I have had a concrete case where the lawyers were very much distressed. They had gone through a long trial and a long record. The judge had died, and there was no relief under the statutes or rules which enabled a new judge to decide the case on the basis of the testimony taken by the dead judge. I suggested they had better try getting a stipulation, and they succeeded in it. CHAIRMAN MITCHELL: But what happens when the plaintiff has made out a case and has gone through a long trial and then the judge dies, and he asks the defendant to consent to have another judge decide it on the basis of the old record, and the other side says no? MR. LEMANN: It breaks my heart by imagining a sufficiently hard case, but I don’t think it is likely to happen. If I had one case in 15 or 20 years, it would have to be very hard to make me change the rule, I think. JUDGE DRIVER: It seems to me we almost have to limit it to cases in which all or substantially all the testimony had been received. Otherwise, we would be compelling the plaintiff to go on the record of witnesses, and the defendant would have flesh-and-blood witnesses in the court ready to testify. If I were the defendant, I wouldn’t consent to that arrangement unless I had to. MR. LEMANN: Then we would have to rewrite Rule 63, because if you leave it as it is, as Mr. Mitchell pointed out, it restricts it to cases where a verdict has been returned or findings of fact and conclusions of law have been filed by the judge who had died. That is the way it reads now, and that is the way the statute from which it was copied read. CHAIRMAN MITCHELL: That is right. CHAIRMAN MITCHELL: I think the amendment proposed is inadequate because it leaves in the provision that the rules don’t apply at all unless the judge has made findings. That is aside from the mark. I have the feeling that maybe we had better leave it alone. — 277 — JUDGE DOBIE: I don’t think it is vital. Let’s pass it. JUDGE CLARK: All right. 3 Transcript of the Proceedings, Meeting of the Advisory Committee on Federal Rules of Civil Procedure, May 18-20, 1953, at pp. 572-579 (May 20, 1953) (Charles E. Clark Papers, Yale University Library). Charles E. Clark, as reporter necessarily the member most familiar with the rules, had earlier expressed the same view that death of the judge before verdict or filing of findings and conclusions necessitated a new trial absent a stipulation of the parties. Professor James William Moore, Judge Clark’s colleague at Yale University, and a member of the Advisory Committee on the Civil Rules, who deservedly enjoys a reputation for knowing the rules, replied on November 1, 1938, on “behalf of Dean Clark and myself” to a suggestion that a whole new trial should not be required: ... Dean Clark ... and I feel that it [your case] is not within the literal meaning of the rule [Rule 63] and probably not within the rule even when given a liberal construction. You will note that the rule authorizes another judge to act “after a verdict is returned or findings of fact and conclusions of law are filed.” . .. Although Rule 63 may work harshly in your case, I believe that its requirement that findings of fact and conclusions of law be filed as a condition to action by another judge is sound since in many cases, although a judge may indicate his general decision, there will be considerable dispute over the exact findings of fact to be made. Letter from James William Moore to Douglas Arant, Esq. (November 1,1938) (Charles E. Clark Papers, Yale University Library). Again, in 1943, Charles E. Clark appended to Rule 63 a comment respecting a contemplated draft of revisions to the rules. He cited the case of Ten-O-Win Amusement Co. v. Casino Theatre, 2 F.R.D. 242 (N.D. Calif.1942), supra, where death interrupted a trial. He concluded: “In such a case, a new trial is necessary.” Charles E. Clark, Tentative Draft for Revision of the Rules and Comments Covering the Early Rules, at p. 173 (Advisory Committee on Rules for Civil Procedure: January 16, 1943) (Charles E. Clark Papers, Yale University Library). 4) Resort to the contrasting developments of F.R.Civ.P. 63 and its counterpart, F. R.Crim.P. 25, only serves to confirm the conclusion that a new trial is mandated. F.R.Crim.P. 25, when first adopted, contained only what is now Rule 25(b). It was, consequently, in the district court’s language, “virtually identical” to Rule 63. The Judicial Conference of the United States in 1963 approved a recommendation “that if a judge dies, becomes ill, or suffers other disability, by reason of which he is unable to continue the trial of a civil or criminal case, provision should be made authorizing the substitution of another judge in the case.” Report of the Proceedings of the Judicial Conference of the United States held at Washington, D. C., March 11 — 12, and September 17-18,1963, pp. 70-71. The recommendation, which certainly proceeds on the premise that such substitution would not be possible without a rule change, was referred to the respective advisory committees for the civil and the criminal rules. The criminal rules committee proceeded to fashion a proposed Rule 25(a), which was indeed subsequently adopted, permitting substitution of a judge “During trial.” That in itself was an acknowledgment by a body knowledgeable about the Federal Rules that in its previous form (now Rule 25(b)), virtually identical with Civil Rule 63, Rule 25 did not permit substitution during trial. Furthermore, the Committee called particular attention to the point, repeating in several publications the following comment: “Notice that Civil Rule 63 is substantially similar to the present version of Criminal Rule 25 so that parallel consideration by the Civil Committee would seem appropriate.” See Deskbooks of Meetings of the Advisory Committee on Criminal Rules for January 1964 and October 1964 (Public Files, Library of the Administrative Office of the United States Courts, Washington, D. C.). — 278 — In face of its own earlier resolution of the issue and of the reiterated suggestion of its sister committee, the Advisory Committee on the Civil Rules took no action. It is difficult to come to any other decision than that the Committee was content to leave Rule 63 as it was, i.e., as still necessitating a trial de novo when the trial judge dies in the course of it, before verdict or the filing of findings and conclusions.11 5) Reference to the Criminal Rules at the earlier dates when they were first being considered for adoption only supplies telling confirmation of the conclusion that the provision in Rule 25 for specific relief “after a verdict or finding of guilt” must be read not merely as omitting but rather as positively precluding similar relief before verdict or finding of guilt. The fourth draft of the Criminal Rules Committee, dated May 18, 1942, proposed Rule 25 omitting any language as to “before” or “after” verdict or finding of guilt. It simply read: Disability of a Judge. If by reason of absence from the district, death, sickness, or other disability, the judge before whom the defendant was tried is unable to perform his duties under these rules, any other judge regularly sitting in or assigned to the court may perform his duties. The Supreme Court reacted negatively, expressing dissatisfaction with the fact that Rule 25, as proposed, “apparently allows one judge to be substituted for another in the midst of a trial or even after all the evidence has been taken, but before the jury is charged.” 3 L. B. Orfield, Criminal Procedure under the Federal Rules, § 25.1. To meet the Supreme Court objection, the Criminal Rules Committee “made changes conforming to the criticism by the Supreme Court.” The changes were the insertion in the rule of the words “after a verdict or finding of guilt.” As so amended, the rule was acceptable to the Supreme Court. The Supreme Court thus established very clearly indeed that saying “after” in such circumstances negates “before.” 6) Finally, it has been suggested that F.R.Civ.P. 83 conferred authority on Judge Murray to continue the trial. The last sentence of Rule 83 provides: “In all cases not provided for by rule, the district courts may regulate their practice in any manner not inconsistent with these rules.” However, we have demonstrated that Rule 63 communicates a positive prohibition on substitution of a judge prior to verdict where, as here, all parties have not stipulated their consent.12 Consequently any attempt of the sort suggested, to resort to Rule 83, must fail since it would produce a result “inconsistent with these rules.” 13 As additional proof of that rather evident proposition consider that the Criminal Rules had a “virtually identical” analogue to Civil Rule 83. F.R.Crim.P. 57(b) reads: If no procedure is specifically prescribed by rule, the court may proceed in any lawful manner not inconsistent with these rules or with any applicable statute. Yet no one, the Supreme Court, the Judicial Conference of the United States, or the — 279 — Advisory Committee on Criminal Rules suggested that, in light of Criminal Rule 57(b), the amendment which added F.R.Crim.P. 25(a) was consequently unnecessary. On the contrary, they apparently fully appreciated that a rule amendment was essential. No such amendment has ever been made to the Civil Rules, and that, in a nutshell, disposes of the case.14 In conclusion, it should be observed that our failure to address certain of the questions posed, even though they may arise again on retrial, is not through inadvertence or oversight. While frequently in like circumstances it is appropriate to afford guidance to the trial judge, this in our judgment is not such a case. Our decision that a complete trial de novo was required renders, in many respects, a nullity all that happened following Judge Blair’s death, yet to address the unanswered questions would require some attention by us to such materials. Even more significantly, perhaps, the Court finds itself with no fixed uniform view on any of the as yet unresolved issues. It accordingly deems it best to defer consideration and any attempt to dispose of them until they come to the Court after, rather than before, they have been fully litigated. REVERSED AND NEW TRIAL ORDERED. Footnotes [1] Twenty-seven floors contained condominium units. An upper deck conceived of as a community room perched on top of everything, but apparently did not contain any marketable units. Description as a twenty-seven or twenty-eight floor building would be appropriate. We shall consider the building as comprised, for the purposes which concern us, of twenty-seven floors. [2] The date actually specified in the documents was September 1, 1975, which in that year coincided with Labor Day. [3] Subsequently, Judge Herbert F. Murray, as a substitute for Judge Blair, took two weeks more of testimony before the jury retired and returned a verdict in favor of Towson. [4] Professor Charles Wright (who served as an assistant to the Reporter for the Advisory Committee on the Civil Rules) has expressed the belief that constitutional obstacles stand in the way of application of Rule 25(a) over the objection of the defendant. 2 Wright & Miller, Federal Practice and Procedure: Criminal § 392. We have no occasion here to investigate that possibly thorny question. [5] In an effort to escape the consequences of that telling argument, the dissent proposes that Rule 63 is as inapplicable to judge trials as it is to jury trials where the death of the judge has occurred before the return of verdict or the filing of findings of fact and conclusions of law. For both it contends that the rule is silent, and, therefore, not involved. The disregard of precedent in that approach is substantial. The courts have uniformly accepted the applicability of Rule 63 to the cases where death of the judge came before filing of findings and conclusions. E.g., Arrow-Hart, Inc. v. Philip Carey Co., 552 F.2d 711 (6th Cir. 1977) (“... we hold that a new trial is required and that Judge Siler was correct in his construction of Rule 63.”); Ten-O-Win Amusement Co. v. Casino Theatre, 2 F.R.D. 242 (N.D.Calif.1942) (“The language of the rule [Rule 63] seems clear. ... As findings of fact and conclusions of law herein were not ‘filed’ by Judge LOUDERBACK before his death, I have no power to sign and file them now. A new trial will be therefore granted as to defendant Donohue.”). The dissent, accordingly, suggests a rationale for such cases not only distinct from, but in direct conflict with, the reasoning actually employed by them. [6] The dissent suggests that state court authorities are inappropriate precedent “for the Federal Rules of Civil Procedure were adopted to end conformity with state procedures.” The suggestion overlooks, however, that, after the Federal Rules of Civil Procedure were adopted, the states themselves moved to bring themselves into conformity with federal procedures. Thus the state decisions cited, State ex rel. Lunsford v. Weber, 153 W.Va. 544, 170 S.E.2d 671 (1969) and Girard Trust Bank v. Easton, 12 N.C.App. 153, 182 S.E.2d 645 (1971), cert. denied, 279 N.C. 393, 183 S.E.2d 245 (1971) were decided under state rules of civil procedure which had adopted in haec verba the Rule 63 language of the Federal Rules of Civil Procedure. See 1 West Virginia Code Appx. Rule 63; 1A General Statutes of North Carolina (1969 Replacement Volume) § 1A-1, Rule 63. [7] The dissent seeks to denigrate the observation of Scrutton, J. in Coleshill v. Manchester Corp. on the basis that, despite a doubt expressed on jurisdictional grounds, the Court in Coleshiii nevertheless reviewed the appeal on the merits. The dissent fails, however, to allude to the most pertinent consideration that the trial below had continued before a substituted judge “at the urgent request of the parties.” Hence, no point was preserved, or presented, on appeal. It would have required something bordering on effrontery for the judge to have frustrated the earnest desire of both parties to obtain a result. However, had, as here, one of the parties objected to continuation before a substituted judge and demanded a trial de novo, there is no doubt that Scrutton, J., regarding the result as dictated by English law, would have accommodated him. St. Louis Southwestern Ry. v. Henwood, 157 F.2d 337 (8th Cir. 1946), cert. denied, 330 U.S. 836, 67 S.Ct. 965, 91 L.Ed. 1282 (1947), rehearing denied, 331 U.S. 870 (1947) has no pertinence. It was not a jury case, and, indeed, as a bankruptcy case, did not even arise under F.R. Civ.P. 63. In re Schoenfield, 608 F.2d 930, 933 (2d Cir. 1979); F.R.Civ.P. 81(a)(1). Indeed, St. Louis Southwestern Ry. v. Henwood, supra, seems to say that, had the statutory predecessor to Rule 63 been applicable, the discretion to substitute a judge would have been foreclosed. Id. 157 F.2d at 342. Where, as here, Rule 63 does apply: “The death ... of a judge during a trial and before a verdict is returned in a jury case or before findings of fact and conclusions of law are made in a court case will, in the absence of consent of all parties, normally result in a mistrial.” 6A Moore’s Federal Practice (2d ed.) j) 59.08[2], [8] The materials are fully accessible as a consequence of deposits by members of the Advisory Committee on the Civil Rules with several law schools with which they had affiliations: Charles E. Clark (Yale University), Edmund M. Morgan (Harvard University), Edgar B. Tolman (University of Chicago), and Monte M. Lem-ann, (Tulane University). The dissent argues that reliance on such materials is inappropriate. However, it should be appreciated that, at the panel level, the dissent demonstrated, at least to the author’s satisfaction, why Rule 63 mandated a new trial. It did so without any reliance on such materials. The materials are primarily relevant in that they serve to remove completely any lingering doubt that, however logical and persuasive, the result might just possibly be contrary to what the Rules Committee actually intended. As the dissent acknowledges, proceedings of the Rules Committee are “of great interest to scholars of the federal judicial system.” In their almost daily resort to the authorities, federal judges are “scholars of the federal judicial system,” as interested in making their decisions as accurate as possible as any professor of law. [9] His distinguished career embraced, in addition, the deanship of the Yale Law School, and service as a judge of the United States Court of Appeals for the Second Circuit. [10] A member of the Fourth Circuit Court of Appeals. [11] The suggestion that it was “inconceivable” that there should be a rule permitting judge substitution before verdict in criminal proceedings without a similar provision in the Civil Rules overlooks the special impact in the criminal area of double jeopardy considerations. For a criminal defendant, the amendment in 1966 to permit pre-verdict substitution of a judge allowed a case to go forward, at least when the criminal defendant preferred that it do so, rather than inevitably having to begin entirely anew. Contrast State v. Slorah, 118 Me. 203, 209, 106 A. 768, 771 (1919). In a civil case, having to start over would not engage the Fifth Amendment. [12] Even if it be merely by implication, it is nevertheless the meaning of the Rule. Something exists although implied. Its non-existence is in no way established because, as a matter of proving, or of establishing, it, it was implied. Especially is such the case where, as here, the implication is irresistible. [13] It would also constitute a “basic procedural innovation” which is not permitted under Rule 83. Miner v. Atlass, 363 U.S. 641, 80 S.Ct. 1300, 4 L.Ed.2d 1462 (1960). [14] It not being relevant, we do not discuss (far less determine) the issue of whether Ford Credit was prejudiced by being compelled to proceed before a substituted judge following Judge Blair’s death. However, the dissent has concluded that there was no demonstrated prejudice. We observe simply that prejudice may exist at several levels. One may concern solely the circumstances of the particular case; there is another general institutional level of prejudice. One may wonder, if one judge presumably may substitute for another in the midst of a jury trial without prejudice to an objecting party, why the practice never is employed to ease the operational problems confronting the courts. When a case drags on longer than anticipated, threatening to intrude on long-laid plans of the presiding judge to attend a scheduled judicial conference, why do we not simply substitute another judge, so long as it can be done without “prejudice?” The lawyers will tell us that in almost every such case the objecting party will perceive substantial prejudice. We should readily perceive it too.