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ATTORNEY FEES Lender’s collection costs may include legal fees A provision in a deed of trust requiring the payment of a lender’s attorney fees as part of the collection costs doesn’t violate public policy, the Mississippi Supreme Court ruled in a nonjudicial proceeding on Feb. 25. Parkert v. Lindquist, No. S-04-089. Mark J. Parkert was a homeowner who financed his home through Wells Fargo Home Mortgage Inc. The residence was secured by a deed of trust, which contained a provision that if payments were in default Parkert would be obligated to pay reasonable attorney fees. After entering into an agreement to sell his home, Parkert became delinquent on his mortgage payments. A notice of default and an instrument appointing Eric H. Lindquist, an attorney representing Wells Fargo, as successor trustee under the deed of trust was filed with the register of deeds. After closing, Parkert was sent a check representing the net proceeds of the sale, minus the attorney fees charged by Lindquist. Parkert sought damages for conversion. The trial court dismissed the complaint. The Mississippi Supreme Court affirmed. The “American rule” that holds that contract provisions requiring attorney fees for the prevailing party in litigation is contrary to public policy doesn’t apply to nonjudicial proceedings. The court refused to let “parties . . . escape their contractual obligations,” particularly as “a contract provision requiring payment of a reasonable attorney fee does not violate public policy.” CIVIL RIGHTS Travel ban on internees key to award eligibility Children born to Japanese-Americans after Jan. 20, 1945, following the lifting of their parents’ travel restrictions imposed by the wartime internment scheme, may still be eligible for redress payments if they can establish that they were otherwise deprived of liberty as a consequence of the government’s actions, the U.S. Court of Appeals for the Federal Circuit ruled on Feb. 23. Murakami v. United States, No. 04-5050. On Feb. 19, 1942, President Roosevelt signed Executive Order 9066, which authorized military commanders to establish prohibited military zones in the United States and to exclude entire classes of citizens and aliens from these zones. The mass exclusion order was effectively rescinded on Jan. 20, 1945, though the U.S. issued orders that excluded individual Japanese-Americans from the West Coast for additional time periods. Arthur Murakami, a U.S. citizen living in Los Angeles, was placed in an internment camp for Japanese-Americans in 1942. The government allowed him to move to Chicago in 1944, but prohibited him from returning to L.A. Later that year, he married a woman from L.A. who was not under a travel restriction. His restriction was lifted in July 1945, when his wife was eight months pregnant. His son, Robert, was born in Chicago, where the family stayed until moving back to L.A. in 1955. As an adult, the son applied for redress under a law allowing payments to children born to parents who were not allowed to return to their homes under the internment scheme. The Court of Federal Claims denied his request. The Federal Circuit affirmed, finding that though Robert Murakami may have been eligible, he had not proved that he in fact was so. He would have been eligible had he been able to show that the government had prevented his parents from returning to their home, even after the travel restrictions were lifted. However, the parents could have returned to L.A. in the month after the lifting of the restriction, before the birth of their son. Full text of the decision CONSTITUTIONAL LAW Prison ban on reading matter unconstitutional A prison regulation prohibiting access to all reading materials except religious and legal publications obtained through the prison library unconstitutionally burdens inmates’ First Amendment rights, the 3d U.S. Circuit Court of Appeals ruled on Feb. 25. Banks v. Beard, No. 03-1245. The Long Term Segregation Unit near Pittsburgh houses the Pennsylvania system’s most troublesome inmates. Inmates are sent to the unit’s “Level 2″ for a minimum of 90 days, though they can remain there indefinitely until they can work their way up to “Level 1.” In Level 2, they are prohibited access to all newspapers, magazines and photographs, as well as television and radios. They are given paper and envelopes, and they can have religious and legal publications, and paperback books, ordered through the prison library. Prison officials say the restriction is necessary for rehabilitative purposes, as well as to ensure prison security, as contraband can be hidden in the materials, and they can be used to start fires or be fashioned into blow guns or feces-throwing catapults. A district court struck the restrictions down. The 3d Circuit affirmed, noting that the other materials allowed in the inmates’ cells can be used as tools, to fling feces or to start fires. Further, the goal of rehabilitation achieved through extreme deprivation would be met if imposed temporarily, but an inmate may be required to stay in Level 2 indefinitely. Full text of the decision CRIMINAL PRACTICE OK to admit priors so as to defeat illness defense A trial court did not err in admitting evidence of former Governor Bill Janklow’s prior traffic violations, the South Dakota Supreme Court ruled on Feb. 23, affirming his reckless driving and second-degree manslaughter convictions. State v. Janklow, No. 2005 SD 25. Janklow ran a stop sign at a blind intersection. A motorcycle approaching from the intersection on the crossroad slammed into Janklow’s car and its driver was killed. Though admitting he ran the stop sign, Janklow denied he was speeding. The trial court allowed a police officer to testify that Janklow had sped through that same area before. Another officer testified about an incident when Janklow sped through a construction zone and almost lost control of his car. One of Janklow’s defenses was that he was in a state of hypoglycemic unconsciousness at the time of the accident. The trial court refused to give the jury an instruction on unconsciousness, and the state called the defense “goofy.” Janklow’s request for a mistrial based on the prosecution’s comments was denied. Janklow was convicted as charged. The South Dakota Supreme Court affirmed. Both officers’ testimonies were properly admitted to show Janklow’s state of mind, knowledge of the intersection and absence of inadvertence or mistake. An instruction on unconsciousness was unnecessary because other instructions, plus the evidence, allowed the jury to consider the hypoglycemia defense. Further, the trial court did not abuse its discretion in determining that the jury was not prejudiced by the state’s derogation of the defense. Full text of the decision DAMAGES Splitting awards so as to maximize recovery is OK It is proper to apportion a jury’s un-apportioned award to maximize recovery of a prevailing Title VII plaintiff who is otherwise constrained by the $200,000 damages cap, the 1st U.S. Circuit Court of Appeals held on Feb. 22. Rodriguez-Torres v. Caribbean Forms Manufacturer Inc., No. 03-2223. A jury found that Ramallo Brothers Printing had terminated Migdalia Rodriguez-Torres’ job in violation of Title VII of the 1964 Civil Rights Act and Puerto Rico law. It awarded her $250,000 for emotional distress and $105,000 in back pay, without being asked to apportion these awards between the federal and Puerto Rico claims. It also awarded $250,000 in punitive damages under Title VII. Ramallo sought to reduce the Title VII award, under the statutory $200,000 compensatory and punitive damages cap, and to eliminate the award for the commonwealth claims because the total exceeded the Title VII cap. A Puerto Rico federal court allocated $249,999 for emotional distress to the commonwealth claims and $1 to the Title VII claim. It awarded $199,999 in punitive damages under Title VII, then doubled the damage award on the commonwealth claims as required by Puerto Rico law, but declined to award front pay. The 1st Circuit affirmed the allocation. Other appeals courts have approved the method used by the district court here in allocating damages where the jury provides one damage award, in excess of the federal cap, for parallel state and federal discrimination claims. They consider the unspecified award fungible between the state and federal claims and allocate it so as to maximize recovery while adhering to the Title VII cap. Full text of the decision EMPLOYMENT Retaliatory firing suit can be prior to benefits claim An employee need not have commenced a civil action seeking workers’ compensation benefits before bringing a retaliatory discharge claim, the Alabama Supreme Court said on Feb. 25. Hexcel Decatur Inc. v. Vickers, No. 1031447. Hexcel Decatur Inc. terminated its employee, Terry Vickers, eight days after he was injured walking down a flight of stairs on the job. More than one year after his termination, Vickers filed a claim for workers’ compensation benefits and a complaint alleging that his employment had been terminated solely because he made a claim for workers’ compensation benefits. The trial court denied the employer’s motion to dismiss. The Alabama Supreme Court affirmed. Ala. Code � 25-5-11.1 states that “[n]o employee shall be terminated by an employer solely because the employee has instituted or maintained any action against the employer to recover workers’ compensation benefits.” Following established case law, the court determined that the word “action” in the statute doesn’t refer only to a formal judicial action for benefits but also to a less formal demand. GOVERNMENT U.S. owns submerged lands off islands’ coast Despite the terms of a covenant executed when the Northern Mariana Islands became a commonwealth of the United States, under the paramountcy doctrine the government of the United States held paramount rights over submerged lands off the Northern Mariana coast, the 9th U.S. Circuit Court of Appeals held on Feb. 24. Northern Mariana Islands v. United States, No. 03-16556. In the aftermath of World War II, the United Nations established a trust territory over Micronesian islands in the Pacific Ocean. Some of these islands-known as the Northern Mariana Islands-desired closer relations with the United States, and eventually executed a covenant under which the islands became a United States commonwealth. Citing a section of the covenant, which it argued gave the commonwealth ownership rights over submerged lands off its coast, the commonwealth filed a quiet title action, and the United States counterclaimed. A district court granted summary judgment to the United States, and the commonwealth appealed. Affirming, the 9th Circuit rejected the commonwealth’s claims to the submerged lands. It held that, under the paramountcy doctrine, the United States held “paramount rights” over these and other seaward submerged lands as part of its national external sovereignty. Noting the general language of the covenant provisions on commonwealth land, the court said, “Absent express indication to the contrary, the ownership of seaward submerged lands accompanies United States sovereignty. The Covenant lacks such an expression.” Full text of the decision INSURANCE LAW Vehicle-loading exclusion invalid for home mishap The “complete operation doctrine” of insurance law doesn’t apply in a dispute over a vehicle-loading exclusion to a homeowners’ policy because, although the operation in question-the unloading of an antique washer from a truck-had not been completed at the time of the injury, the injury had no connection to the vehicle, the Maine Supreme Judicial Court decided on Feb. 25. Foremost Ins. Co. v. Levesque, No. 2005 ME 34. Robert Levesque and his father, Percy Levesque, were unloading an antique washing machine from a pickup truck and placing it in a shed. They had the washer in the shed when Percy Levesque tripped over an item on the floor, causing the washer to fall on him and injure him. Robert Levesque’s homeowners’ insurance company, Foremost Insurance Co., refused to indemnify him for his father’s claims, citing an exclusion in his policy for injuries resulting from the loading or unloading of a motor vehicle. Foremost’s declaratory judgment action, seeking a summary judgment releasing it from liability, was denied. Affirming, the Maine Supreme Judicial Court declined to apply the “complete operation doctrine” under which loading or unloading isn’t complete until the object reaches its final destination. Holding that such an application would lead to absurd results with large gaps in homeowners’ coverage, the court said, “The complete operation doctrine is not particularly helpful where, as here, the injury occurs on the premises, as a result of negligence or a defect on the premises, and with no connection to the vehicle.” Full text of the decision

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