Civil Procedure
Long
Fall 2012
Overview
Why study the Federal Rules of Civil Procedure when most litigation is in state court or is settled before getting to trial? It presents the types of questions and issues that will have to be addressed to operate under any rules of procedure. They affect how people get to the courts, and this affects how people interact with the substantive law.
Values of the Legal System
· Justice – parties should be punished/rewarded based on who they are, the nature of their dispute, and where the moral rightness lies.
· Efficiency – the dispute should be resolved as quickly and cheaply as feasible.
· Accuracy – the result should match what actually happened.
· Equality – both sides should be treated fairly, and a later case should get the same treatment as a previous one.
What is Civil Procedure?
Civil procedure is the law for lawyers on how courts administer justice for cases where one party has been wronged, and the courts are trying to make that party whole.
Courts with Jurisdiction over Detroit
Federal Courts
Eastern District of Michigan è 6th Circuit Court è United States Supreme Court
State Courts
(36th District court[1] / Wayne County Probate Court è) 3rd Circuit Court è Court of Appeals District I è Michigan Supreme Court è United States Supreme Court
Constitutional Authority
U.S. Constitution, Article I, §8, clause 9 grants Congress the power “To constitute Tribunals inferior to the supreme court”.
Article III, §1 puts the judicial power into the Supreme Court and any courts that Congress establishes.
Article III, §2 gives federal courts jurisdiction over “all Cases, in Law and Equity, arising under this Constitution, the Laws of the United States, and Treaties made, or which shall be made, under their Authority; to all Cases affecting Ambassadors, other public Ministers and Consuls; to all Cases of admiralty and maritime Jurisdiction; to Controversies to which the United States shall be a Party; to Controversies between two or more States; between a State and Citizens of another State, between Citizens of different States, between Citizens of the same State claiming Lands under Grants of different States, and between a State, or the Citizens thereof, and foreign States, Citizens or Subjects.” Because of the Eleventh Amendment, they cannot hear any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.
Article IV, §1 gives full faith and credit to the acts, records, and judicial proceedings of other states.
Authority for Rules of Civil Procedure
Federal Rules of Civil Procedure
Congress can create federal courts per Article I, §8, clause 9, so they can also abolish them; thus Congress can tell them what rules they must abide by, and Congress has delegated this power to the Supreme Court in 28 U.S.C. §2072, (the Rules Enabling Act). The rules for civil procedure are in the Federal Rules of Civil Procedure, and they govern all proceedings for district courts, pursuant to Rule 1. Pursuant to U.S.C. §2073, the Judicial Conference[2] appoints an Advisory Committee of judges, lawyers, and academics who write proposed rules and advisory notes to explain the rules. The Justices of the Supreme Court vote on the rule, and if it passes, the Court sends the rule to Congress, pursuant to 28 U.S.C. §2074, and Congress has until December 1st to vote on it; if there is no vote, the rule goes into effect (with some exceptions). Congress can say “No”, but this is rare. 28 U.S.C. §2071 gives lower courts the freedom to make their own rules unless modified or abrogated by a higher court. Public notice and an opportunity for comments must first be given.
Michigan Court Rules
Article VII, §5 gives the power to make rules to the Michigan Supreme Court. In McDougall v. Schanz, 597 N.W. 2d 148 (Mich. 1999), the court said that while the Michigan Supreme Court has exclusive authority to write rules of procedure, it is not authorized to make rules that “establish, abrogate, or modify the substantive law”. Essentially this means that any procedural law that the legislature passes will overrule the Court’s rules, since the legislature is only concerned with writing substantive law.
New Hampshire rejected a set written rule of procedure in In re Proposed Rules of Civil Procedure, 139 N.H. 512 (1995), preferring the state’s looser rules set by precedent. This benefits in-state lawyers who better know the rules of the state.
Reasons to Sue – Remedies
Litigation is expensive and should be used as a last resort.
Subsitutionary Remedies
The court provides the plaintiff with a reasonable substitute. This is what most remedies are, and the most common subsitutionary remedy is money. Money is used in debt cases and where a specific remedy is impossible (i.e. loss of a body part).
· Compensatory damages – the court may compensate for pain and suffering or emotional distress. Sometimes a party litigates because they want to get validation.
· Liquidated damages – calculating compensatory damages is too difficult, so the parties will agree before trial on the price of harm; this is usually in contracts cases.
· Statutory damages – sometimes there are statutory minimums or provisions for attorneys’ fees; this is done to discourage/punish lawbreakers.
· Punitive damages – these are aimed entirely at punishing the lawbreaker, and in some jurisdictions, the defendant’s wealth can be brought into evidence.
Specific Remedies
The court restores what defendant took from the plaintiff.
· Eject – order the sheriff to remove people from property.
· Replevy – order the sheriff to return an item to its rightful owner.
· Injunction – commands a party to do or stop doing something.
Legal vs. Equitable Relief
In England, there were two types of courts: the King’s Court (common law), with strict procedure, and Courts of Chancery (equity), which were flexible. While we do not have separate courts today, we do have this distinction still.
· Action at law is a case that proceeds through law courts, and the final decision is a “judgment”. The remedies tend to be backward-looking (fixing it after the fact). Courts prefer legal remedies.
· Suit in equity is a case that proceeds through equity courts, and the final decision is a “decree”. Remedies tend to be forward-looking (fixing it going forward). The most common form of equitable relief is an injunction. If a party does not comply with an injunction, the person can be held in contempt of court and put in jail until he complies. Equitable relief is typically only granted when a person shows that legal relief is inadequate.
In Sigma Chemical Co v. Harris, 605 F. Supp. 1253 (E.D. Mo. 1985), the court held that plaintiff was entitled to injunctive relief because the harm to plaintiff if the injunction was not granted would be more than the harm to defendant if it was granted.
Declaratory Relief
Parties can seek a declaration of their rights without having to seek damages or an injunction. 28 U.S.C. §2201 and 28 U.S.C. § 2202.The person is asking for the “because” clause of a case, but the case must be real and not hypothetical.
Paying for the Action – Litigation Financing
The American Rule vs. the English Rule
· Under the American Rule, each party pays its own legal fees; in reality, someone else usually pays for at least part. This rule encourages high-value cases.
· Under the English Rule, the losing party pays both parties’ fees, and this is used in most of the developed world; in reality, the payment is typically less than the full amount that Great Britain enforces. It encourages low-value cases with low risk.
Other Forms of Financing
· Insurance – insurance policies typically cover legal expenses for claims after an accident.
· Contingent fee – the lawyer will only get paid from the proceeds of a settlement/recovery if he wins. This is unique to America.
· Alternative Litigation finance – there is consumer lending directly to clients (typically personal injury plaintiffs) that gives them a “loan” that will only be collected if the suit is successful; there is lawyer lending (usually to plaintiff’s lawyers), usually with high interest, to pay for expenses to prepare for a case; there is direct investment in commercial claims, where the investor contracts with parties (or their lawyers), lending money for a suit, and receiving part of the recovery.
· Public subsidies – taxpayers pay for judges, courts, Attorney General’s office, and law schools.
· Professional Charity – legal aid clinics; some are publicly funded.
· Lawyers – pro bono work.
Fee Shifting
· Common Fund – if plaintiff’s suit benefits others, they have an obligation to help pay the legal fees if the result of the case is a fund where the fees are deducted from; this applies to class action suits.
· Contract – parties may stipulate that the loser to litigation will cover the costs.
· Common law – if a frivolous suit is brought, plaintiff may be forced to pay defendant’s legal fees.
· Statute – In rare cases, fees can be shifted to losers. In civil rights cases, only plaintiffs can recover fees, usually to more strongly enforce civil rights. Rule 23(e) requires court approval of terms in a class action
e are not enough to allow general jurisdiction over a nonresident company in a case where the purchases are not related to the cause of action. Goodyear Dunlop Tires Operations, S.A. v. Brown, __ U.S. __, 131 S. Ct. 2846 (2011). Personal jurisdiction can be exercised over a nonresident who was personally served with process while temporarily in that State, in a suit unrelated to his activities in the State. This goes back to Pennoyer v. Neff, and is called “tag jurisdiction”, where as soon as you step into the state, it can exercise jurisdiction over you. Burnham v. Superior Court, 495 U.S. 604 (1990).
Consent to Jurisdiction
Parties can consent to jurisdiction either through Rule 12(h)(1) as a pre-answer motion or in the answer, or contractually with the other party.
As long as a forum selection clause is fundamentally fair, it will be enforced by federal courts.
Long-Arm Statutes, Venue, and Forum Non Conveniens
Waiver vs. Forfeit
· Waiver – conscious choice to not contest personal jurisdiction.
· Forfeit – inadvertent loss of the right to contest personal jurisdiction because you did not bring up the issue.
Long-Arm Statutes
After Pennoyer v. Neff, many states began passing legislation that authorized service on defendants out of the state, often through mail.
Filing a previous suit in the forum state is not enough to bring defendant (plaintiff in the original suit) under Florida’s long-arm statute because this did not meet the “minimum contacts” test, especially since the cases were filed two years apart, and the original suit did not name the current plaintiff as a party. Gibbons v. Brown, 716 So. 2d 868 (Fla. Dist. Ct. App. 1998).
Venue
28 U.S.C. §1391 tries to put a suit in a district that is either connected to the parties or where the event(s) occurred. Many states also have venue statutes.
Pursuant to 28 U.S.C. §1391(d), foreign aliens can be sued in any federal district if no state has personal jurisdiction.
Declining Jurisdiction
State and federal courts can decline to exercise jurisdiction in cases that they could otherwise do so.
Transfer
28 U.S.C. §1404 allows federal district courts to move cases to other federal districts for the convenience of parties and witnesses.
Forum Non Conveniens
It applies to federal and state courts and literally means “inconvenient forum”.
Typically, plaintiff’s choice of forum can only be overcome when there is strong private and public interest in an alternative forum. However, when the plaintiff is a foreign citizen, less deference is given to plaintiff’s choice, since he is choosing to leave his domicile to file suit in the U.S. A forum non conveniens motion cannot be dismissed by simply showing that the substantive law that would be applied in the alternative forum would be less favorable to plaintiffs unless the remedy would be so inadequate that it would essentially not be a remedy. Piper Aircraft v. Reyno, 454 U.S. 235 (1981).
[1] Civil cases up to $25,000, garnishments, evictions, land contract forfeitures, misdemeanors where the punishment is up to 1 year in jail.
[2] Led by the Chief Justice of the United States; Other members are the chief judge of each court of appeals, a district court judge from each regional judicial circuit, and the chief judge of the Court of International Trade
[3] Technically, there are 5 things the court will look at to determine this: (1) “the burden on the defendant”; (2) “the forum State’s interest in adjudicating the dispute”; (3) “the plaintiff's interest in receiving convenient and effective relief”; (4) “the interstate judicial system’s interest in obtaining the most efficient resolution of controversies”; and (5) “shared interest of the several states in furthering fundamental substantive social policies”
