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BANKING Lost promissory note is still enforceable Alabama law allows a party that acquired the rights to a promissory note to enforce it even though the original note was lost or destroyed before it acquired those rights, the Alabama Supreme Court ruled on Oct. 5. Atlantic National Trust v. McNamee, No. 1060423. Jack McNamee executed a $150,000 loan with SouthTrust Bank in 2003. SouthTrust’s successor, Wachovia, lost or destroyed the note. In 2005, Wachovia assigned the matured note to Atlantic National Trust, which demanded repayment. When McNamee failed to pay, Atlantic sued him in federal district court in Alabama. The federal court asked the Alabama Supreme Court whether state law required repayment under the circumstances. The Alabama Supreme Court ruled that the note was enforceable. Alabama Code 7-3-309(a), adopting Uniform Commercial Code 3-309, is silent on the point at issue, but under Alabama common law an assignee “simply steps into the shoes of the assignor.” Therefore, if the assignor was entitled to enforce the lost note, so is the assignee. Full text of the decision CIVIL PRACTICE Pre-emption turns on airline ticket prices Airlines need to show that state regulation of aircraft seat configurations would affect ticket prices if they want to claim that the state law is pre-empted by the federal Airline Deregulation Act (ADA), the 9th U.S. Circuit Court of Appeals held on Oct. 4. Mantalvo v. Spirit Airlines, No. 05-15640. Airline passengers filed suit against various airlines in California state court, arguing that the carriers’ failure to warn of the risks of deep vein thrombosis (DVT) and their allegedly unsafe seat configurations, which the passengers claimed caused DVT, violated California common law. The airlines removed the suit to federal district court. The federal judge dismissed on grounds that the Federal Aviation Act (FAA) pre-empts any state failure-to-warn claims, and that the ADA pre-empts the seating-configuration claims. Requiring airlines to reconfigure their seats, he ruled, would have impermissibly raised airline ticket prices. The passengers appealed. Affirming in part and reversing and remanding in part, the 9th Circuit agreed that the FAA pre-empts the entire field of airline safety. While the ADA pre-empts state regulation of airline rates, the parties below offered no evidence as to whether state regulation of seating configurations would have a “forbidden significant impact” in that regard. The appeals court returned the case to the trial court with instructions to develop an evidentiary record on the point. CIVIL RIGHTS Mother can’t sue officials who dragged their feet Federal law grants a single mother no privately enforceable right to sue local officials who neglected for eight years to enforce a child support order, the 5th U.S. Circuit Court of Appeals ruled on Oct. 5. Cuvillier v. Sullivan, No. 05-61186. Laurene Cuvillier contacted a Georgia state agency regarding years of back child support owed to her by her ex-husband, Robert Harrison. In 1994, the agency asked officials in Copiah County, Miss., where he lived, to collect the $261,000 that he owed. Despite her repeated inquiries, the county waited until June 2002 to act, but Harrison died before the case could be heard. Cuvillier filed a 42 U.S.C 1983 claim, arguing that the county violated her rights under Title IV-D of the Social Security Act. A federal judge rejected her case on statute of limitation grounds, and she appealed. The 5th Circuit affirmed the dismissal, but on different grounds. Although people like Cuvillier are the intended beneficiaries of Title IV-D programs, there is no evidence that Congress intended to grant an individual federal right within that statutory scheme. Title IV-D is a spending statute that focuses on what state agencies should be doing to enforce child support, not on the individuals the agencies and their collection efforts will help. CONTRACTS No tort in mistake by home-alarm company A claim against a home-alarm company for giving an ambulance company the wrong address for a customer is grounded in contract law, not torts, the 6th U.S. Circuit Court of Appeals ruled on Oct. 4. Spengler v. ADT Security Services Inc., No. 06-2537. Dwight Spengler contracted with ADT Security Services to provide a safety system for his mother’s home, including a portable call button for her. Because his mother was incapable of speaking aloud, ADT was instructed to call Spengler if the company ever received an alarm from her. In October 2005, ADT received an alarm from the mother, but gave the ambulance company the wrong address. The mother was unconscious by the time the ambulance reached her 16 minutes later, and she died soon thereafter. Spengler sued ADT in a Michigan federal district court for negligence. The trial court ruled that the company had violated no independent duty to Spengler, but did breach its contract with him. The district court awarded him $500, the amount stipulated in the contract. Spengler appealed. The 6th Circuit affirmed. ADT’s obligation to promptly and correctly dispatch emergency services emanated only from contract, not from Michigan common law. As a breach-of-contract claim, Spengler’s damages were limited to the amount specified in his contract. There was no record of unconscionable conduct by ADT. CRIMINAL LAW Sex offender registration ruled a ‘one-time’ event In a case of first impression, the Maine Supreme Judicial Court threw out a sex offender’s conviction for failure to register with authorities, ruling on Sept. 25 that Maine’s Sex Offender Registration and Notification Act (SORNA) does not create a continuing duty to update an offender’s registration. State v. Diecidue, No. 2007 ME 137. The offender, Leonard Diecidue, registered upon completion of his prison sentence in February 2002. However, Diecidue refused to register again on subsequent occasions, including upon his move to another town, claiming that he was not required to do so. In a bench trial, the judge convicted him on two counts of failure to register. Diecidue appealed. Reversing, the Maine Supreme Judicial Court ruled that by its plain language, SORNA requires authorities to verify sex offenders’ registration information. However, the offenders themselves must register only upon release from prison or when moving to another state. “The act of registration is a one-time event,” the court said. “The Legislature could have required registrants to ‘register’ when verifying or updating their information . . . but it did not do so.” ENVIRONMENTAL LAW Coalition blocked from intervening in dispute An environmental coalition has no right to intervene on behalf of the National Park Service in a quiet-title fight with a local government over a road that runs through an environmentally sensitive streambed, an en banc panel of the 10th U.S. Circuit Court of Appeals ruled on Oct. 2. San Juan County, Utah v. U.S., No. 04-4260. Amid protracted litigation, San Juan County, Utah, brought a federal action to quiet title to the road, which runs in and out of Salt Creek in Canyonlands National Park. The Southern Utah Wilderness Alliance (SUWA) and allied groups sought to intervene, but a Utah federal court refused to allow it. A divided panel of the 10th Circuit overruled the trial judge. The full 10th Circuit voted en banc to review that ruling. In 154-page decision, the en banc panel split over what the majority called “difficult issues concerning intervention under Fed. R. Civ. P. 24.” Because it could show “an interest relating to the property” at issue, and the case outcome “may as a practical matter impair or impede [its] ability to protect that interest,” the group met part of the test to intervene. However, the coalition failed to overcome the presumption that the original party, the federal government, would adequately represent its interest in the key issue, federal control of the road. That the group and the government had wrangled over managing that asset didn’t matter. EVIDENCE Self-insurance claim inquiry is discoverable Statements made by a company’s employees to its own risk management department were not protected by the attorney-client or work-product privileges, the Colorado Supreme Court ruled on Oct. 1 in a personal injury case. In re Compton v. Safeway Inc., No. 07SA50. Stephen Compton, a delivery man for Pepperidge Farm, was making a delivery to a Safeway supermarket when he tripped over a pallet jack and injured his ankle. His lawyer wrote a letter asking Safeway to submit a claim to its insurer. An adjuster for Safeway’s self-insurance arm interviewed two employees who witnessed the accident, then determined the company was not at fault and denied the claim. Compton filed suit and sought copies of the witness statements. A trial judge ruled that they were protected by privilege. Reversing, the Colorado Supreme Court said that, under state precedent, insurance claims investigations are presumed discoverable unless prepared in contemplation of specific litigation. “The fact that, unlike traditional insurance companies, insurance is not Safeway’s only line of business is irrelevant.” Moreover, there was no “substantial probability of imminent litigation” at the time of the claims investigation. “In fact, there is no evidence that any Safeway attorney was even involved in the investigation of Compton’s claim. Therefore, any reliance on this privilege by the trial court was also in error.” Formal hearings are best test of bona fides Formal in limine hearings are the best avenue for testing whether a potential expert witness’s testimony meets the Daubert tests for reliability and relevance, a divided Mississippi Supreme Court ruled on Oct. 4. Smith v. Clement, No. 2006-CA-0018-SCT. Two students were severely burned when their propane-powered school bus caught fire. Their parents sued the school board, which in turn sought indemnity from the company that converted the bus from gasoline power. The company sought to exclude the school board’s expert and the trial court agreed, ruling based on the parties’ affidavits that his findings were unreliable and unsupported by facts. The school board appealed. Reversing and remanding, a majority of the Mississippi Supreme Court ruled that, regarding expert testimony, “the basic requirement under the law is that the parties have an ‘opportunity to be heard before the [trial] court makes its decision.’ ” Here, the record was too truncated to judge the school board’s expert’s merits. “ While an in limine hearing may not be necessary in all cases, it does provide the most efficient manner of addressing the issue in many cases,” the majority said. IMMIGRATION LAW Failure to raise issue was prejudicial error An undocumented immigrant’s attorney’s failure to take advantage of an extended deadline to reopen immigration proceedings under the Violence Against Women Act was a seriously prejudicial error that requires reopening her case, the 7th U.S. Circuit Court of Appeals ruled on Oct. 4. Sanchez v. Keisler, No. 06-2745. Under 2005 legislation, Congress made it easier for domestic violence victims to appeal a removal order; for example, they are entitled to 90 days to reopen their cases, as opposed to the usual strict 30-day deadline. The lawyer for Mexican-born Ana Sanchez failed to invoke the law despite strong evidence she was a domestic violence victim. Her immigration judge (IJ) ordered her removal from the United States. The Board of Immigration Appeals (BIA) refused to let her invoke VAWA, ruling that her attorney had waived that right on her behalf. The 7th Circuit reversed, saying that the attorney’s omission “seriously prejudiced” Sanchez’s case. “There is simply no basis on which to support the Board’s conclusion that [the lawyer] was exercising any professional judgment at all when he abandoned the VAWA theory,” the court said. “It is not our role to tell the BIA how it is supposed to weigh these factors,” the 7th Circuit said. “But, having found that counsel was ineffective for abandoning the VAWA theory for no explicable reason, and that the record before the IJ (and thus the record that went to the BIA) was woefully incomplete, we conclude that further proceedings are necessary so that the proper authorities can evaluate the legal claims and exercise their discretion on the basis of a presentation that is fair to the alien.”

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