Wrote a memo for a real US court case...| July 11, 2009
I spent two of the first weeks of July working on a Vermont case for my Director, Gleb Glebovich. Although the work was not related to Russia in any way, it was a great opportunity to refresh my research and memo writing skills.
Here are the facts of the case: It involved debtors in bankruptcy who own real estate in Vermont and in 2003 mortgaged this property in exchange for a loan from Bank of America. The action was brought against Appellee, Bank of America, based upon a defect in the acknowledgment in the mortgage. The legal basis for the action was 11 U.S.C. § 544, known as the "Strong Arm Clause" of the Bankruptcy Code because it affords bankruptcy trustees the right to avoid defective transfers to the extent such transfers would be avoidable by subsequent purchasers. In the Bankruptcy Court the defendant, Bank of America moved for summary judgment. The trustee cross-moved for summary judgment. At issue was the fact that the space in the acknowledgment in the mortgage deed where the parties would normally be identified as those who certify that their signing of the deed was their free act and deed, was blank. Summary judgment was granted to Bank of America primarily because "the reference following the blank space on the acknowledgment 'signer(s) and sealer(s) of the forgoing written instrument' was sufficient to identify both of the [debtors] as having acknowledged their signatures on the deed." The debtors appealed to the district court and lost.
The major issue was that the district court based its affirmation on a new fact that was neither stipulated to or even argued by the parties, nor found by the Bankruptcy Court. This fact was that the bottom of each page of the mortgage deed contained the initials "NWS" and "RCS" (allegedly that of the debtors). My task was to research federal law and see what precedent exists on point relating to new fact-finding by an appellate court (the role of the district court in this case). Even logically speaking, the difficulty with relying on a new fact is that it was never tested at the trial level and the appellant never had an opportunity to object to this fact, to probe it or to argue its relevancy. With a few exeptions, the appellate court may not serve as a fact-finder.
These are just some of the cases I found:
Wegner v. Grunewaldt, 821 F.2d 1317, 1320 (C.A.8 (S.D.),1987) ("[D]istrict court may not make its own independent factual findings. If the bankruptcy court's factual findings are silent or ambiguous as to an outcome determinative factual question, the district court may not engage in its own factfinding...")
In re High Fructose Corn Syrup Antitrust Litigation, 293 F.Supp.2d 854 (C.D.Ill., 2003) ("If the judge would have abused his discretion to admit the evidence, then of course the appellate court will not consider it in deciding whether to uphold summary judgment. If the judge would not have abused his discretion to admit the evidence, then the appellate court will consider it and if, with it considered, there is enough evidence to defeat summary judgment, the appellate court will vacate the grant of summary judgment to give the judge a chance to exercise his discretion. If on remand the judge decides to exclude the evidence in the proper exercise of his discretion, and the evidence was crucial to the appellate court's determination that summary judgment should not have been granted, the district judge should reinstate the summary judgment.")
Adler v. Wal-Mart Stores, Inc. 144 F.3d 664 (C.A.10 (Colo.),1998 ("[A]lthough our review is de novo, we conduct that review from the perspective of the district court at the time it made its ruling, ordinarily limiting our review to the materials adequately brought to the attention of the district court by the parties...[W]e, like the district courts, have a limited and neutral role in the adversarial process, and are wary of becoming advocates who comb the record of previously available evidence and make a party's case for it.")
I wrote a memo summarizing my findings and the Director forwarded it on to the trustee involved in the case. He ended up using a lot of my research in his brief that will be filed in their appeal of the district court decision. So, I got pretty lucky since I didn't even have to get a summer internship with a firm to get some experience with a real case!