Saturday, May 15, 2010

A Judge Judging Himself: Another Opinion on Judicial Recusal

Last year I wrote about the unique challenge posed by a motion to recuse, in which the judge accused of being insufficiently impartial must rule on his own ability to hear the case. A judge judging himself: judicial recusal. I have come across yet another opinion from Texas on this sticky situation. Pease v. First National Bank of Giddings, Adv. No. 10-1011 (Bankr. W.D. Tex. 5/4/10).

What Happened

In the latest case, a pro se debtor thought he had scored a major coup. He sued a bank and recovered a default judgment for $8 million. However, the judgment had a few problems. First, the plaintiff did not serve the motion for default judgment on the defendants. Second, the motion sought unliquidated damages, which would have required a hearing. The bank was none too happy with the judgment, since it would have put it out of business. The bank moved promptly for reconsideration. This time the debtor did not appear. The court gamely recognized that it had made a mistake and vacated the judgment.

At this point, the case moved out of the procedural realm and into the pro se zone, a place where saying something makes it so. According to the court's opinion:

After the entry of the order setting aside the default judgment, a copy of the order was sent to the plaintiff. The plaintiff was evidently displeased with the ruling, as he filed a document entitled “Notice of Non Acceptance and Return of Order and Notice of Void Order” on May 3, 2010. The plaintiff attached a copy of the order, across the face of which the plaintiff had written “VOID” with the explanatory statement “Refusal for Cause, No Notice! No Security! Violation of Stay by Defendants!” He signed his name, under which he wrote “Surety in Fact” and dated it April 30, 2010. In the Notice, plaintiff states that the order must be void as a denial of his due process, and details his basis for that contention – that the expedited hearing was too expedited to be adequate notice under the Constitution. At the end of the pleading, the plaintiff states that the order of this court setting aside the default judgment “... is void and is hereby returned to the court.”
Opinion, p. 3.

While it is possible to understand the debtor's frustration at losing his victory over the bank, the specific language used suggests a magical view of the law where a judicial action may be invalidated merely by saying so. However, the debtor supplemented his response with one which was recognizable: a motion to recuse. This placed the court in the uncomfortable position of having to rule upon its own competency.

The court described the motion to recuse as follows:

On the same day, the plaintiff also filed this motion to recuse. In it, plaintiff recounts what he believes are multiple reasons why I should recuse myself. He recounts his version of the facts and the law in this case, and, in essence, asserts bias on my part because I do not agree with his version of the facts and the law. He also alleges bias based upon “extrajudicial sources and actions,” and for support, contends that “Judge Clark received and used false ex parte evidence, rumors and innuendo in the hearing to lift stay on February 1, 2010.” He then explains the basis for this contention, namely that the court heard evidence presented by the bank at that hearing “... although the Bank had never filed a claim against Plaintiff, nor submitted any nexus of debt between itself and the Plaintiff and sua sponte claimed that Plaintiff was responsible for his brother’s debt, even though the bank never sued his brother for the debt.” In other words, the plaintiff disagreed with this court’s ruling on the motion for relief from stay, and the basis of this court’s ruling. Plaintiff, in other words, finds bias from the fact that the court did not agree with the plaintiff’s version of the facts and the law.

For further support, the plaintiff claims bias from the fact that the court set aside the default judgment, and from what plaintiff describes as failing to “zealously guard the jurisdiction of the court.” He claims the court “knew from the filings that the Bank had trespassed on federal jurisdiction, and he made no move to hold the guilty parties in contempt, thereby ratifying the unlawful seizure and destruction of all of Plaintiff’s personal property.” This allegation is an evident reference to a pleading filed March 1, 2010, in which Plaintiff claimed “contempt of federal jurisdiction” in the main case. Plaintiff obviously finds prejudice from the fact that this court did not believe that any contempt had taken place. However, the pleading filed by plaintiff was entitled “Notice of Contempt of Federal jurisdiction.” On its face, the caption of the pleading was not a motion. No form of order was submitted with the pleading, meaning that, under the court’s electronic filing system, the motion would not have come to the court’s attention. The docket also reflects a “motion for expedited hearing” with regard to the notice of contempt, but the document actually filed on that date was a duplicate of the Notice. No order was uploaded with this document either. In the final paragraph of the Notice, plaintiff states “Petitioner prays for an expedited hearing on the matter of sanctions and requests that the trsutees of this court demand an accounting of the property held in trust and the taking, destruction, and devastation visited upon said property and that all actors be held responsible and accountable for their complete and total disregard and disdain for any authority other than that of their own making.”
Opinion, pp. 3-5.

The Court went on to quote the conclusion of the motion at length:

Because Judge Clark’s fias or prejudice prevents Plaintiff from receiving a fair hearing before the court, the judge should recuse himself and his order of April 28, 2010, is void because the Defendants are in violation of the automatic stay as of February 27, 2010 and have never questioned the debt prior to this, although the proposal to contract was offered in 2007. At no time has the debt ever been questioned and it is apparent from the record that the debt was liquidated by the Court record. What is the new trial about? The debt is well plead and the Defendant bank is liable for numerous constitutional violations over a five year period against the Plaintiff. Judge Clark is not on the side of the Texas Legislature concerning the underlying possession issue and has clearly departed from his previous rulings in order to give the Defendants the right to violate the automatic stay, re-instate the stay in order to create the illusion of emergency and then set aside an eight million dollar judgment without any supporting affidavits or protection fro the Plaintiff in the form of a supersedeas bond is clearly non-governmental. Either tyhe Judge or Mr. Powell or both needs to post a ten million dollar bond and restore me to possession of the property.
Opinion, p. 6.

Considering the Motion to Recuse

On a motion for recusal, the judge is placed in the interesting position of evaluating his own ability to consider the case. Judge Clark noted that "A motion to recuse is entrusted to the sound discretion of the judge to whom the motion is submitted."

The standard for recusal is "whether a judge's impartiality might reasonably be questioned." A judge must recuse himself if he has a bias or prejudice against a party or has knowledge of disputed evidentiary facts. However, the judge is presumed to be impartial and bias arising from proceedings occurring in court is only grounds for recusal if the judge has "a disposition so extreme that as to display a clear inability to render a fair judgment."

Thus, if the judge determines that a party is a liar, the obligation to recuse would depend on the source of that belief. If the judge makes this determination based upon evidence submitted in court, he may remain on the case so long as he is capable of giving the witness the benefit of the doubt in future hearings. On the other hand, if he decides that the witness is a liar because someone from his church told him so, then the judge would need to recuse himself.

Turning to the allegations of the motion, the court found that "the plaintiff’s principal bases for claiming bias and prejudice is that this court has not agreed with his version of the facts, or his vision of how the law works. These are not valid bases for finding bias or prejudice." Opinion, p. 7.

This was not a difficult case. However, it illustrates the unique nature of motions to recuse. On a motion to recuse, the judge is both a fact witness and the trier of fact. This works as long as the judge has the integrity and the clear-sightedness to recognize even the appearance of impropriety.

However, there is potential for abuse, as shown by the case of U.S. District Judge Thomas Porteous, who is now facing impeachment, for among other things, refusing to recuse himself in a case where he had received gifts and things of value from one of the attorneys appearing before him.

The current system assumes that cases of outright dishonesty, such as the Porteous case, will be extremely rare. On the other hand, most requests for recusal, such as the one in this case, are likely to be based on sour grapes. The difficult case will be where the judge's bias clouds his own perception of whether he is biased. In those cases, appeal or mandamus will be available to correct the mistake. As long as the procedure gets the result right in the vast majority of cases, it is probably good enough despite its unusual aspects.

Interestingly, there is an alternate procedure for recusing a judge under 28 U.S.C. Sec. 144. Under Sec. 144, a judge must cease hearing a proceeding upon the timely filing of an affidavit by a party asserting bias and a certificate of counsel. However, this statute has been held to be inapplicable to bankruptcy judges. In re Johnson, 408 B.R. 123 (Bankr. S.D. Ohio 2009).

While it is not designed as a recusal mechanism, the procedure for withdrawing the reference to the district court is another way to achieve the same result.

The Pro Se Zone

On a final note, it would be a mistake not to comment on the eccentric pleadings filed by the debtor in this case. The terms that he used, such as "proposal to contract" and "notice of contempt of federal jurisdiction" are typical of the sovereign citizen movement. This is the same debtor who attempted to pay for the filing fee for his appeal with a self-created "Certified Money Order." They believe that the U.S. Government and its monetary system are illegal and that they can create their own alternate authority and money. However, when they get into trouble, sometimes they run to the federal bankruptcy court, whose jurisdiction they seek but ultimately reject.

Back in 2003, Manuel Newburger from my firm was quoted in an article in the ABA Journal about this phenomenon. I was not able to find the article online, but I did find a blog article which repeated some of its content, which I will link to here. It is certainly a strange world out there when people can copyright their names and pay their debts in self-created currency.

Dealing with these issues is just one of the challenges of being a federal judge.

3 comments:

Declaring Personal Bankruptcy said...

I read this article thoroughly,it was very informative....

Thanks For Posting.

chasd.harris said...

The ultimate case of somone who makes up their own laws, rules and terminology, is the case of the Dominion of Melchizedek. This county will let you incorporate, issue bonds and debentures, file lawsuits and bankruptcy, and conduct all sorts of business (for a fee). The only problem is that the country does not exist anywhere except on the internet. The entire country is made up. See: http://en.wikipedia.org/wiki/Dominion_of_Melchizedek

We have actually had debtors in our courts (ND Texas) who claimed to have been discharged in a Melchizedek bankruptcy proceeding and a Chapter 11 debtor whose plan involved exchanging oil and gas interests for stock in a Melchizedek corporation. Apparently, crooks and scam artists were using Melchizedek corporations, judgments, bonds, etc. to commit frauds all over the country during the 90's. 60 Minutes finally exposed them in 2000 and I haven't heard much about Melchizedek since.
However, Melchizedek still has a very official looking website: http://www.melchizedek.com/dom/index.html

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