On Tuesday the Miss. Court of Appeals affirmed a $144,865 verdict in Cassibry v. Cassibry. The Court also remanded the case for a hearing on the issue of attorney’s fees. Here is the Court’s opinion.

The case originated in the Bolivar County Chancery Court with Judge Catherine Farris-Carter presiding.

Judge Barnes wrote the Court’s unanimous opinion.

The case involved a family trust in which one family member was named trustee. The beneficiaries were the testator’s wife and three children, one of whom was trustee. The testator set the trust up as a support trust for his wife with his children as remaindermen.

The trustee bilked at least $55,325 from the trust as ‘loans.’ Unable to even argue that the withdrawals were permitted by the trust document, the defendant argued that the testator’s wife authorized the withdrawals.

The chancellor found that the trustee committed a blatant breach of fiduciary duty.

On appeal, a unanimous Court of Appeals found that there was substantial evidence to support the chancellor’s findings. The Court heavily relied on the Restatement (Third) of Trusts. The Court noted that under the Restatement, “even express authorization to engage in transactions otherwise prohibited under a trustee’s duty of loyalty does not ‘completely dispense with the trustee’s underlying fiduciary obligations to act in the interest of the beneficiaries and to exercise prudence in administering the trust.’”

Stated differently, a trustee must follow the trust agreement or their is a breach of trust. Period. No exceptions. No excuses. Follow the trust document or else. Don’t like it? Then don’t agree to serve as trustee.

The trustee also did a terrible job in maintaining trust records. Again citing the Restatement, the Court noted that a trustee who fails to maintain books and records is liable for loss or expense resulting from that failure and that poor record keeping may cause doubts to be resolved against the trustee.

My Take:

A trustee finger-pointing at a beneficiary or arguing that a beneficiary consented to the violations of the trust document is the classic loser defense in trust cases.

Don’t take my word for it, ask Trustmark. Incidentally, there is currently pending in Hinds County Chancery Court a breach of trust case against Trustmark that makes the Weidner judgment look like chump-change.

I would like to report more on the case, but Trustmark’s lawyers had me thrown out of the courtroom when I went to watch the trial. Seriously. Open court. A good crowd including family members of the attorneys. And I got kicked out. But don’t worry Trustmark, I’ll get caught up when the Court’s decision comes down.

Trustmark appealed Wiender and then paid more than the judgment to settle the case before the Court decided the appeal. That’s not inside information. That’s buried in the appeal docket.

The problem with trustees finger-pointing at beneficiaries is that if the testator wanted to allow the beneficiary to make the decisions, he would not have gone to the trouble of setting up a trust. He would have just given them the assets. The Restatement of Trusts is built around this underlying premise. Trustees–especially institutional trustees–have a huge blind spot on on this point.

The chancellor’s and Court of Appeal’s decisions are completely consistent with the Restatement. That includes the fact that the plaintiff can recover attorney’s fees even without a punitive damages verdict–the Restatement says the Court should have that discretion.

The typical breach of trust case where the plaintiff wins at trial is an obvious breach of the trust document and a defendant that can’t get its brain around trust law.

No, probably not.

The Mississippi Court of Appeals heard oral arguments yesterday in Emergency Medicine Associates of Jackson v. Glover. Jane’s law blog provides links to the briefs and oral argument replay here.

I wrote about the verdict in 2012 here. The jury awarded $1.5 million in economic damages and $2 million in non-economic damages, leading to a constitutional challenge of the caps on non-economic damages in medical malpractice cases.

I watched the argument on-line.

Side bar: I’ve experimented with watching oral arguments live and online. I’ve decided that online is better because the podium places the arguing attorney’s back to the gallery. I used to think that maybe you could get more of a ‘vibe’ watching live. But appellate arguments are usually pretty dry unless someone is acting like a wingnut, so there isn’t much of a vibe to get. In the future, I will probably just watch from my desk despite being only blocks from the courthouse.

Collins Wohner of Watkins Eager argued for the Defendant-Appellant. Rocky Wilkins of Jackson argued for the Plaintiff-Appellee. John Corlew of Jackson argued amicus curiae against the caps. Doug Miracle with the Attorney General’s office argued for upholding the caps on behalf of the State.

This is a good argument to watch. All of the attorneys are skilled lawyers and did a great job. I would feel comfortable with any of them arguing my case. Unlike many oral arguments, this one did not get bogged down in minutia that you have to know the record to understand. There were some interesting issues including a new one for me: the invited error doctrine. I’ve got to remember that one.

As with most of these cases, caps was not the main focus of oral argument. The Appellant focused on the evidence–or lack thereof–supporting the economic damages award and not getting an intervening superseding cause instruction.

On the issue of caps, Judge Griffis made the best point in the form of a question: “Should we be concerned that the Supreme Court has had the opportunity to decide caps 4 times and has not done so?”

Rocky Wilkins responded about as well as anyone could, contending that the time is right.

My Take:

One of these days the Court of Appeals or Supreme Court will rule on the caps. And whenever that happens, it’s going to be a surprise. As Judge Griffis pointed out, the Supreme Court has had plenty of chances to address caps and not done so. That begs the question of why should the Court of Appeals take it up?

My guess is that the Court decides Glover without reaching the caps. After Sears v. Learmonth, that’s going to be my guess until I’m wrong.

On Tuesday the Mississippi Court of Appeals issued a controversial decision in City of Jackson v. Rhaly. Here is the Court’s opinion.

Facts:

The case was a lawsuit against the City for flood damages after a creek overflowed because it was not properly maintained. In interrogatory responses the plaintiffs requested any standard operating procedures which govern the site of the incident. The City’s response was: none and that the City would supplement on receipt of further information. Sometime later, the City supplemented the response to identify a procedure without producing it. A week before the trial the plaintiff found the procedure in the clerk’s office while researching another case.

This all happened back in the early 2000’s before the current City Attorney or anyone working in his office worked in the office.

The plaintiff moved for a default judgment for discovery abuses and Hinds County Circuit Judge Swan Yerger granted the motion. Judge Yerger determined that the City’s actions were not willful and wacked them anyway due to their neglect. He awarded $149,872 in damages, $31,226 in attorney’s fees and $3,862 in expenses.

Court of Appeals Decision:

Judge Ishee wrote the Court’s 5–3 opinion. The Court cited the following factors to consider when determine whether a dismissal was justified. My commentary is in brackets:

1. the failure to comply with the court’s order resulted from willfulness or bad faith; [factor clearly not met: there was no order and trial court found it was not willful];
2. the deterrent value of Rule 37 cannot be substantially achieved through a less severe sanction; [factor not present];
3. whether the other party’s preparation for trial was substantially prejudiced; [nothing in opinion suggested this factor was present; court of appeals said maybe-but decided that this factor does not have to be present]
4. dismissal may be inappropriate when neglect caused by lawyer rather than client; [pretty obvious that it was the fault of the lawyers in prior administration].

The Court discussed these factors and determined that dismissal was appropriate.

Pieter Teeuwissen and Claire Hawkins represented the City. William Joseph Kerley and John Clark represented the plaintiffs.

Judge Irving dissented joined by Judges Griffis and Maxwell.

My Take:

Judge Yerger had a reputations as perhaps the most defense leaning trial judge in the state. Except when the City of Jackson was a defendant.

I was shocked by this decision. Early indications are that I was not alone in Jackson legal circles. These are not the facts where I would expect to see a default judgment granted for discovery abuses. In fact, I wouldn’t even expect to see a motion filed.

There was no order violated and the plaintiff obtained the documents before trial. Also, the plaintiff did not articulate any real prejudice or move for a continuance. The fact that the plaintiff could have used the documents in depositions and “so forth” could have been handled by a continuance and more depositions at the City’s expense.

Parties producing documents shortly before a trial is not uncommon. Sometimes this appears to be gamesmanship. Other times, not. Most of the time, the attorney on the receiving end complains to the Court, but rarely is anything done. Honestly, I didn’t know that a default judgment was even possible for what happened here. I’m not condoning it. And I think that attorneys are getting more and more lax in responding to discovery and supplementing their responses. But I am very surprised by the result.

I will probably have more analysis of this opinion in a future post.

The Court of Appeals concluded 2010 with a decision that bothers me. Here is the Court’s opinion in Triplett v. River Region Medical Corp.

Facts:

This was a Warren County medical malpractice case against a hospital, doctor and CRNA. River Region got out on summary judgment and the case was tried in May 2008 before Judge Frank Vollor. The case was tried to a defense verdict and the appeal ensued.

One of the issues on appeal was whether the trial court should have ordered a mistrial after defense counsel dropped this bomb in opening statement:

“a doctor from Viginia is the only one, apparently, [that Triplett’s heirs] could find in the whole United States to testify against [River Region].”

Plaintiff’s counsel objected and the trial court sustained the objection and advised the jury to disregard the statement. The next morning plaintiff’s counsel moved for a mistrial and the trial court denied the motion.

Tim Porter, Patrick Malouf and Johnny Givens with Porter and Malouf in Ridgeland represented the plaintiff. Gene Parker and Penny Lawson of Vicksburg represented the defendants.

Court of Appeals Decision:

On appeal a unanimous Court ruled that the motion for mistrial was untimely because under Mississippi law the objection and motion must be made contemporaneously with the improper remarks. That didn’t really seem fair to me so I did a little research and have come to the conclusion that the Court of Appeals is getting the law wrong on this.

My Take:

First, defense counsel’s statement was way out of bounds. The Court could have at least acknowledged that.

More importantly, the Court’s decision does not explain the rationale for the contemporaneous objection rule. But the Mississippi Supreme Court did explain the rule in 1997 in Herrington v. State, 690 So. 2d 1132 (Miss. 1997). There the Court explained that “contemporaneousness is critical because it allows the judge to avert a mistrial, if possible, by admonishing the jury to disregard the utterance.”

Given the rationale for the rule, it would seem that a contemporaneous objection alone should be enough to preserve the issue. Case law from other jurisdictions supports this conclusion.

A New Jersey District Court ruled in Lyles v. Flagship Resort Development Corp., 371 F. Supp. 2d 597 (D. N.J. 2005) that a contemporaneous objection alone is enough to preserve an issue. The Court observed that the law of the Third Circuit is that an objection alone without a motion for mistrial preserves an issue.

In my opinion the Court of Appeals got this wrong. If the reason for the contemporaneous objection rule is that it gives the judge the opportunity to admonish the jury to disregard the improper statement, then the reason for the rule does not apply in this case. There was a contemporaneous objection and the trial court did admonish the jury. If the reason for the rule does not apply, then the rule should not apply. That’s basic common sense.

What really bothers me about this decision is that this involved what appeared to be a planned cheap shot. While I agree that a trial court should not grant a mistrial for every improper statement that attorneys make in trial, I believe that trial courts should err on the side of granting a mistrial when the statement appears to be a planned cheap shot. Otherwise, what disincentive do lawyers have for making cheap shots?

There was also an issue in the case whether a juror employed by a law firm who represented the hospital should have been struck for cause. The trial court did not and the Court of Appeals affirmed. I also disagree with these rulings.

Having worked at large law firms, I can say without reservation that staff members—at least the ones with a clue—understand where the firm’s bread is buttered. Lawyers and their firms are loyal to their clients—-the law requires it—and a law firm employee should not be on a jury deciding the case of one of the firm’s clients.