Attorneys Mark Alexander and John Tanski ()
Appellate lawyer Daniel Klau is like the goalie in a soccer game who’s just lost a 1-0 game, with the winning goal booted in by the referee. The deciding legal issue in his case was interjected at the appeal stage by the Appellate Court itself. Since then, Klau has been asking, “Is this really possible?”
In a word, “yes,” answered Supreme Court Associate Justice Richard Palmer, writing for a unanimous court in Blumberg Associates Worldwide v. Brown & Brown.
The decision explained in unprecedented detail the circumstances in which Connecticut Supreme and Appellate court “umpires” can introduce game-changing legal issues that may wind up deciding the case.
John Tanski of Hartford’s Axinn, Veltrop & Harkrider argued the case for Brown & Brown, an insurance brokerage firm. Gratified for his client’s win, Tanski added: “Justice Palmer wrote something that’s much broader than the particular situation here. It’s going to have impact in criminal cases as well,” he predicted.
Tanski, who has also done criminal defense work, said, “the response from the defense bar was, ‘Hey, this is great.’ So often a court will reject a potentially meritorious appeal based on technicalities. Here’s a court saying it’s OK for judges to go that extra mile, and bring up a new issue, to do the right thing.”
Mark Alexander teamed with Tanski on the case. The Blumberg decision, he said, fundamentally explores the role of the appellate courts. “Are they there for the benefit of the parties, or for the development of the law, the bigger picture? There are plenty of meaty issues here.”
This issue goes to the basic role of appellate courts. Klau’s brief quoted U.S. Supreme Court Justice Antonin Scalia’s distillation of the point: “The premise of our adversarial system is that appellate courts do not sit as self-directed boards of legal inquiry and research, but essentially as arbiters of legal questions presented and argued by the parties before them.”
Any lawyer who tries to argue on appeal an issue that wasn’t ruled on at trial faces a nearly impossible uphill battle. As the Pennsylvania Supreme Court put it, “failure to preserve an issue on appeal will be excused only when a strong public interest outweighs the need to protect the judicial system from improperly preserved issues.” And so, the Pennsylvania court added, whether an appeal issue “is waived on strategic grounds or by inadvertence, it is waived.”
Klau, who practices at McElroy, Deutsch, Mulvaney & Carpenter, also cited a 2011 Palmer dissent: “It is a bedrock principle of our adversarial system that courts decide only those claims that the parties have raised.”
However, Klau noted, over the past decade a handful of Connecticut decisions imply that appellate judges, unlike the lawyers before them, can raise any new issues they want, “sua sponte” or on their own initiative, so long as they allow the parties a chance to brief them.
Palmer admits that the Connecticut Supreme Court has “not always been clear” on when and how this will be allowed. This case, Palmer wrote, “provides us with an opportunity to clarify these issues.”
First off, he noted the three main exceptions when lawyers, and courts, may raise new issues on appeal. One is when the court’s authority to hear the case, its jurisdiction, is challenged. When that happens, it’s like a scuba diver disconnected from his air supply. The court’s one immediate task is to establish jurisdiction.
Next come instances when issues of undebatable “plain error” are raised anew. And finally, constitutional rights issues can be raised in appellate proceedings if they meet the test of the 1989 Connecticut Supreme Court case of State v. Golding.
But the general ban on introducing new issues in appellate courts is a practice, not a legal requirement, Palmer observed. No statute or Practice Book rule prevents appellate judges from raising new issues on appeal, and the Blumberg opinion analyzed the powerful pressures for and against doing so.
Legal scholars have been highly critical of courts injecting issues sua sponte, calling it “playing God,” behaving like the 800-pound gorilla, or risking “trial by ambuscade.” On the other hand, Palmer wrote, courts sometimes have to raise new issues to do justice.
One explanation of the ongoing struggle, Palmer wrote, comes from the fact that today’s state and federal courts are a merger of law courts and courts of equity.
In England, the King’s law courts behaved like a stern father, imposing harsh and sometimes arbitrary consequences for not following the letter of the law. Standing in contrast were the kinder, gentler equity courts established under the King’s Chancellor. These courts of chancery acted more like the compassionate mother, seeking just and merciful results for worthy parties.
Palmer, quoting from law review articles, noted that the purpose of a law court’s “writ of error” appeal was “not to test whether the proper party had won, but only whether the judge had made an error.”
Equity courts, in contrast, permitted the rehearing, “which allowed the court to address new facts and law not originally raised by the parties.”
These historic tensions between law and equity persist, partly because judges continue to seek justice in the equity sense, and revive otherwise dead issues to avoid an unjust result, Palmer explained. He added, quoting a 1983 Connecticut Supreme Court case, Persico v. Maher: “Orderly rules of procedure do not require sacrifice of the rules of fundamental justice.”
The Blumberg case didn’t start out focused on the powers of appellate judges. It was a contract dispute between two insurance sellers.
West Hartford’s Blumberg Associates Inc. (BAI) had developed a business relationship with the Milford-based parent of Subway sandwich shops. In 2004, Blumberg Associates was sold to Brown & Brown (B&B) of Connecticut, which is part of a nationwide insurance brokerage. BAI moved to B&B’s Newington address.
In 2004, B&B erroneously told the state Insurance Department that BAI’s worldwide affiliate, BAW, had also moved to Newington. As a result, the state did not send insurance license renewal notices to BAW, and in January 2006, its license to sell insurance in the state expired. Five months later, BAW entered into a new contract with B&B that gave BAW access to Subway insurance business. In exchange, BAW would give B&B a share of the commissions.
Then in 2008, B&B abruptly terminated the Subway contract, citing a contractual requirement that BAW had to remain licensed.
This cost BAW dearly, and it sued on multiple grounds related to breach of contract. It argued that B&B’s role in hindering license renewal should invalidate the licensure clause. The trial court disagreed, ruling that because licensure information is public record, B&B hadn’t hindered the license renewal process.
Subsequently, the Appellate Court had a brainstorm. It asked the parties to brief the new issue of whether a contract can be breached before it is formed. When BAW lost on this point, Klau argued on appeal to the Supreme Court that the Appellate Court was unfairly and improperly raising a new issue that B&B had legally waived.
The result of this final appeal was a loss on the merits for BAW, and the creation of Palmer’s detailed roadmap describing when and how appellate courts can raise new issues on appeal.
Such issues can be considered on appeal under “exceptional circumstances,” so long as the parties have an opportunity to be heard on the issue, and specific steps are taken to assure there is no unfair prejudice to either party, Palmer wrote. Specifically, he stated, parties should be allowed to explain why raising the new issue would unfairly prejudice their case. If in light of the proposed new issue, a party argues it would have put on different evidence or employ different trial strategies, the new issue may turn out to be too prejudicial to introduce, Palmer concluded.
Though Klau may have been on the losing end of the case, he agreed with his opposing counsel that the decision is likely to have widespread impact. “This is already being discussed on national appellate blogs,” he said, “and appears to be the first decision that comprehensively addresses the issue of sua sponte decisions by appellate courts.”•