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Berthold v. Indus. Claim Appeals Office of Colo.
Bertholdv.Indus. Claim Appeals Office of Colo.
Judy BERTHOLD, Petitioner, v. INDUSTRIAL CLAIM APPEALS OFFICE of the State of Colorado, Eberl's Claim Service, and Liberty Mutual Insurance, Respondents.
¶ 1 In this workers' compensation action, Judy Berthold (claimant) challenges an order of the Industrial Claim Appeals Office (Panel). To resolve claimant's challenge, we must consider the effect of her approved request to begin treatment with a new physician. Specifically, did her treatment with her newly approved physician automatically terminate her first physician's status as an authorized treating physician (ATP)? The answer matters because her first physician opined that claimant had reached maximum medical improvement (MMI) after claimant had begun treating with her new physician. If her first physician was no longer an ATP at the time of this MMI finding, claimant's employer could not properly rely on that finding.
¶ 2 To answer the broader query, we must address two subsidiary questions of first impression. First, does newly enacted section 8-43-404(5)(a)(VI)(B), C.R.S. 2017—which automatically terminates the relationship between an ATP and an injured worker upon treatment with a new ATP—apply retroactively to a request to change physicians made before the statutory provision took effect? Second, if it does not apply retroactively, does the termination provision contained in section 8-43-404(5)(a)(IV) apply to all changes of physician or is it limited to changes made under section 8-43-404(5)(a)(III)"within ninety days after the date of the injury"?
¶ 3 We hold that the termination provision of section 8-43-404(5)(a)(VI)(B) applies only to a request to change a treating physician made after the effective date of that provision. We further hold that section 8-43-404(5)(a)(IV) applies only to changes of physician obtained under section 8-43-404(5)(a)(III). Because claimant's request to change her physician predated section 8-43-404(5)(a)(VI)(B), and because the request was not granted under section 8-43-404(5)(a)(III), her treatment with her new physician did not automatically terminate her first physician's status as an ATP. We therefore affirm the Panel's order.
¶ 4 Claimant worked as a property damage adjuster for Eberl's Claim Service (employer). In June 2014, she sustained injuries from falling off a roof she was inspecting for employer.
¶ 5 After the accident, claimant received medical care from Dr. Anjmun Sharma, an ATP. Several months later, claimant requested and received permission to begin treatment with Dr. William Miller. Dr. Miller evaluated her for the first time in February 2015. Yet, even after the agreed-upon change of claimant's physician, employer periodically sent her to Dr. Sharma for "demand appointments."
¶ 6 In January 2016, Dr. Sharma saw claimant and reported that she "was noncompliant in presenting for functional capacity evaluation and noncompliant in her completion of this task. I have, therefore, assigned maximum medical improvement [MMI] date as of 01/22/2016 with this report serving as the final dictated report for this claim." Dr. Miller, however, disagreed with Dr. Sharma's MMI determination, criticizing it for lacking "medicolegal sense." Despite this disagreement between medical practitioners, employer filed a final admission of liability (FAL) based on Dr. Sharma's MMI conclusion.
¶ 7 Claimant challenged the FAL's validity on the ground that, under section 8-43-404(5)(a)(IV)(C), Dr. Miller's assumption of her care in February 2015 automatically terminated Dr. Sharma's status as her ATP, rendering him unqualified to issue an MMI finding. As a result, she argued, the FAL was invalid and she was entitled to continuing temporary total disability benefits. Employer countered that section 8-43-404(5)(a)(IV)(C)'s automatic termination provision applied only to so-called "one-time" changes of physician permitted by section 8-43-404(5)(a)(III). And claimant's change of physician did not satisfy section 8-43-404(5)(a)(III).
¶ 8 The administrative law judge agreed with claimant, finding that Dr. Sharma's status as claimant's ATP terminated when she began treating with Dr. Miller, per section 8-43-404(5)(a)(IV)(C). The Panel reached the opposite conclusion, however, and agreed with employer that section 8-43-404(5)(a)(IV)(C) applied only if the worker sought a change of physician under section 8-43-404(5)(a)(III). The Panel further held that the termination provision in section 8-43-404(5)(a)(VI)(B), enacted in 2016, did not apply either because that provision was not in effect when claimant changed physicians.
¶ 9 Claimant contends that employer erred in relying on Dr. Sharma's MMI finding when issuing the FAL because Dr. Sharma was no longer an ATP at the time of his MMI determination. She presents two theories in support: (1) her treating relationship with Dr. Sharma was automatically terminated by section 8-43-404(5)(a)(IV) because it applies to all changes of physician; and (2) even if section 8-43-404(5)(a)(IV) does not apply to her change of physician, her relationship with Dr. Sharma was nonetheless terminated by recently amended section 8-43-404(5)(a)(VI).
¶ 10 Because claimant concedes that her physician change occurred under section 8-43-404(5)(a)(VI), we begin by assessing whether the new termination provision of sub-subparagraph (VI)(B) applies to claimant's change.
III. Does the Termination Provision Added to Section 8-43-404(5)(a)(VI) in 2016 Apply to Claimant's Change of Physician?
¶ 11 In 2016, the General Assembly amended section 8-43-404(5)(a)(VI) to add, among other things, a provision automatically terminating an injured worker's relationship with an ATP once the worker begins treating with a new ATP. Claimant argues that the legislative declaration accompanying this amendment requires it to apply to all workers' compensation claims and, thus, it should apply to all changes of physician regardless of the date of the change. Claimant is mistaken. Even where an amendment to the workers' compensation law applies to a claim regardless of the date of injury, the amendment does not necessarily apply to all transactions within that claim. Instead, the amendment applies only to transactions occurring after the amendment's effective date unless the legislature clearly directs otherwise, which the legislature did not do in the amendment at issue.
In addition to the one-time change of physician allowed in subparagraph (III) of this paragraph (a), upon written request to the insurance carrier or to the employer's authorized representative if self-insured, an injured employee may procure written permission to have a personal physician or chiropractor treat the employee. If permission is neither granted nor refused within twenty days, the employer or insurance carrier shall be deemed to have waived any objection to the employee's request. Objection shall be in writing and shall be deposited in the United States mail or hand-delivered to the employee within twenty days.
§ 8-43-404(5)(a)(VI), C.R.S. 2014. Notably, this version of subparagraph (VI), the mechanics of which had not changed since the Act's 1990 reenactment, did not contain a provision terminating a claimant's relationship with a prior ATP upon a claimant's examination with a new ATP. Consequently, the Panel had held that the mere selection or designation of a new ATP under subparagraph (VI) did not have the effect of "deauthorizing" the previously authorized ATP. Jeppsen v. Huerfano Med. Ctr. , W.C. No. 4-440-444, 2003 WL 22997979 (Colo. I.C.A.O. Dec. 17, 2003) ; Granger v. Penrose Hosp. , W.C. No. 4-351-885, 1999 WL 603156 (Colo. I.C.A.O. July 20, 1999).
(B) If an injured employee is permitted to change physicians under sub-subparagraph (A) of this subparagraph (VI) resulting in a new authorized treating physician who will provide primary care for the injury, then the previously authorized treating physician providing primary care shall continue as the authorized treating physician providing primary care for the injured employee until the injured employee's initial visit with the newly authorized treating physician, at which time the treatment relationship with the previously authorized treating physician providing primary care is terminated .
(C) Nothing in this subparagraph (VI) precludes any former authorized treating physician from performing an examination under subsection (1) of this section.
(D) If an injured employee is permitted to change physicians pursuant to sub-subparagraph (A) of this subparagraph (VI) resulting in a new authorized treating physician who will provide primary care for the injury, then the opinion of the previously authorized treating physician providing primary care regarding work restrictions and return to work controls unless that opinion is expressly modified by the newly authorized treating physician.
Ch. 272, sec. 4, § 8-43-404(5)(a)(VI), 2016 Colo. Sess. Laws 1129 (emphasis added). The amended statute went into effect July 1, 2016. See Ch. 272, sec. 5, 2016 Colo. Sess. Laws 1129.
¶ 14 Claimant first saw Dr. Miller in February 2015, nearly a year and a half before the 2016 amendment went into effect. See id. Yet, claimant argues that the termination provision in section 8-43-404(5)(a)(VI)(B) should apply to her claim because the legislature declared that the 2016 amendment applies to all claims. Claimant rightly observes that the legislature prefaced the amendment with the declaration "that this act contains changes to existing law that are procedural and apply to all workers' compensation claims, regardless of the date the claim was filed ." Ch. 272, sec. 1, 2016 Colo. Sess. Laws 1127 (emphasis added). But, is this declaration sufficient to apply the amendment to completed transactions that occurred before the amendment took effect? We conclude that it is not.
¶ 15 "A statute is applied prospectively if it operates on transactions that occur after its effective date; it is applied retroactively if it operates on transactions that have already occurred or on rights and obligations that existed before its effective date." Specialty Rests. Corp. v. Nelson , 231 P.3d 393, 399 (Colo. 2010). "Absent legislative intent to the contrary, a statute is presumed to be prospective in its operation." Id. at 402. "In workers' compensation cases, the substantive rights and liabilities of the parties are determined by the statute in effect at the time of a claimant's injury, while procedural changes in the statute become effective during the pendency of a claim." Am. Comp. Ins. Co. v. McBride , 107 P.3d 973, 977 (Colo. App. 2004). Hence, absent language expressing a contrary intent, a substantive amendment to the Act applies prospectively only to injuries sustained after the amendment's effective date. See Rosa v. Indus. Claim Appeals Office , 885 P.2d 331, 334 (Colo. App. 1994) ("[T]he general rule [is] that the rights and liabilities of the parties are determined by the statute in effect at the time of injury, except that procedural changes may be immediately applied to ongoing claims for benefits.").
¶ 16 "Statutes cannot be construed in such a way as to defeat obvious legislative intent, and the best guide to intent is the declaration of policy which forms the initial part of an enactment." Walgreen Co. v. Charnes , 819 P.2d 1039, 1044 (Colo. 1991) (citation omitted). Contrary to claimant's contention, however, we do not view the legislative declaration here as clearly and unambiguously applying the amendment to completed transactions. The declaration states only that it applies to all workers' compensation claims. We must decide, then, if the legislature intended the amendment to apply not only to all claims but also to completed transactions within those claims.¶ 17 This question is governed by the principles discussed in Specialty Restaurants , as the Panel and the parties have recognized. In that case, the supreme court analyzed a 2007 amendment to section 8-43-406, C.R.S. 2017, governing lump sum payments. The amendment "increased the maximum aggregate lump sum an employee may receive." Specialty Rests. , 231 P.3d at 395. The increased maximum lump sum went into effect just months after the claimant, Stephanie Nelson, had received a lump sum payment for her claim. After the amendment's effective date, she requested the difference between the lump sum she received and the newly adopted maximum aggregate payment. Id. at 396.
¶ 18 The legislation analyzed in Specialty Restaurants did not include a legislative declaration specifying whether the increase to the statutory maximum aggregate lump sum payment applied prospectively or retroactively, nor did it include an effective date for the amendment's adoption. The legislation merely stated that the amendment was approved May 30, 2007. See Ch. 341, 2007 Colo. Sess. Laws 1475. Nelson's employer argued that permitting her to receive the increased aggregate lump sum violated the legislature's intent to apply the amendment only to injuries occurring after the amendment's adoption. The supreme court disagreed. The court concluded that the amendment was merely "procedural in nature" because it did not create, eliminate, or modify vested rights or liabilities. Specialty Rests. , 231 P.3d at 399-400. As a result, the legislature intended the amendment to apply to all claims irrespective of the date of an employee's injury. Id. at 402.
Because the lump sum provision only functions where an employee has affirmatively chosen to elect a lump sum payment, the operative transaction is the employee's request for such payment.... [T]he new $60,000 maximum aggregate operates on Nelson's request for the additional lump sum payment—a transaction occurring after the amendment's enactment. Accordingly, the 2007 amendment is prospective in its operation and applies to all requests for lump sum payments made after the amendment's date of enactment, irrespective of the date of injury.
Id. at 402-03 (citation omitted).
¶ 20 The same is true here. As in Specialty Restaurants , the 2016 amendment to section 8-43-404(5)(a)(VI) is procedural in nature because it does not create, eliminate, or modify vested rights or liabilities. And the legislature clearly intended this procedural amendment to apply to all claims. But, as in Specialty Restaurants , the legislature did not clearly express the intent to apply the amendment to completed transactions within those claims. So, the amendment applies only prospectively to transactions taking place after the amendment's effective date.
¶ 21 The 2016 amendment went into effect well after claimant began treating with her physician, Dr. Miller. She requested the change of physician—the "operative transaction" in the parlance of Specialty Restaurants —in late 2014. Likewise, Dr. Sharma's MMI finding and employer's FAL preceded the amendment by months. In other words, all the transactions pertinent to claimant's change from Dr. Sharma to Dr. Miller occurred before the 2016 amendment to section 8-43-404(5)(a)(VI)(B).
¶ 22 Hence, when employer granted claimant permission to treat with a new ATP under section 8-43-404(5)(a)(VI)(A) and employer later issued the FAL, employer could reasonably presume that Dr. Sharma continued as one of claimant's ATPs, based on prior Panel decisions. As noted, the Panel had long held that the authorization of a new ATP in such circumstances did not terminate a claimant's relationship with a previously authorized ATP. See Jeppsen , 2003 WL 22997979 ; Granger , 1999 WL 603156. To alter the effect of employer's authorizing a new ATP—years after the fact—could upset the parties' reasonable expectations.
Although most Panel decisions addressing this issue predate the 2007 amendment adding section 8-43-404(5)(a)(III)-(IV), see discussion infra Part IV, the Panel has not repudiated its position since that amendment. On the contrary, the Panel recently reiterated that the addition of a new ATP does not automatically terminate a prior physician's status as an ATP, at least outside the context of a change permitted by subparagraph (III). See Mohammed v. Cargill Meat Sols. , W.C. No. 4-951-860-03, 2016 WL 439788 (Colo. I.C.A.O. Jan. 27, 2016).
¶ 23 In sum, the Panel correctly concluded that the amendment applies to all pending claims but should be applied only to requests for changes of physician made after the amendment's effective date. See also Zerba v. Dillon Cos. , 2012 COA 78, ¶ 37, 292 P.3d 1051 ("[W]e give deference to the Panel's reasonable interpretations of the statute it administers."). Therefore, new section 8-43-404(5)(a)(VI)(B) does not terminate claimant's relationship with Dr. Sharma or invalidate employer's FAL.
IV. Does Section 8-43-404(5)(a)(IV) Apply to Claimant's Change of Physician?
¶ 24 As discussed, claimant was granted a change of physician under section 8-43-404(5)(a)(VI)(A). We have determined that the automatic physician termination provision of newly amended section 8-43-404(5)(a)(VI)(B) does not apply retroactively to this change. An amendment is presumed to change the law. See City of Colorado Springs v. Powell , 156 P.3d 461, 465 (Colo. 2007). So, we presume that, before the enactment of section 8-43-404(5)(a)(VI)(B), a change of physician granted under section 8-43-404(5)(a)(VI)(A) did not automatically terminate an injured worker's treating relationship with her prior physician.
¶ 25 Notwithstanding this presumption, claimant contends that her change of physician under section 8-43-404(5)(a)(VI)(A) automatically terminated her relationship with her prior ATP because of the physician termination provision of section 8-43-404(5)(a)(IV). The Panel disagreed and held that section 8-43-404(5)(a)(IV) applies only to changes of physician obtained under section 8-43-404(5)(a)(III). Under section 8-43-404(5)(a)(III), a claimant, within the first ninety days after sustaining an injury, may request a "one-time" change of physician to another on the employer's physician list. Claimant argues that the Panel erred because subparagraph (IV) should be read independently of subparagraph (III) and, thus, should apply to all changes of physician. We disagree because subparagraphs (III) and (IV) are intertwined and claimant has not rebutted the presumption that the 2016 amendment to subparagraph (VI) changed the law.
(B) The notice is in writing and submitted on a form designated by the director. The notice provided in this subparagraph (III) shall also simultaneously serve as a request and authorization to the initially authorized treating physician to release all relevant medical records to the newly authorized treating physician.
(IV)(A) When an injured employee changes his or her designated authorized treating physician, the newly authorized treating physician shall make a reasonable effort to avoid any unnecessary duplication of medical services.
(C) The originally authorized treating physician shall continue as the authorized treating physician for the injured employee until the injured employee's initial visit with the newly authorized treating physician, at which time the treatment relationship with the initially authorized treating physician shall terminate .
(D) The opinion of the originally authorized treating physician regarding work restrictions and return to work shall control unless and until such opinion is expressly modified by the newly authorized treating physician.
(Emphasis added.) The provision at issue—the physician termination provision—is italicized. Subparagraphs (III) and (IV) were enacted together via a 2007 amendment. See Ch. 204, sec. 1, § 8-43-404(5)(a), 2007 Colo. Sess. Laws 763-66.
¶ 27 Section 8-43-404(5)(a)(IV) does not expressly state that it applies only when an injured employee makes a change of physician under section 8-43-404(5)(a)(III). Claimant maintains, therefore, that section 8-43-404(5)(a)(IV)(C) terminates the relationship between an "initially authorized treating physician" and an injured employee whenever the claimant begins treating with a new ATP. Although we appreciate claimant's position, we cannot accept it.
¶ 28 We review statutes de novo. Ray v. Indus. Claim Appeals Office , 124 P.3d 891, 893 (Colo. App. 2005), aff'd , 145 P.3d 661 (Colo. 2006). When analyzing a provision of the Act, "we interpret the statute according to its plain and ordinary meaning" if the language is clear. Davison v. Indus. Claim Appeals Office , 84 P.3d 1023, 1029 (Colo. 2004). And "we give effect to every word and render none superfluous because we ‘do not presume that the legislature used language idly and with no intent that meaning should be given to its language.’ " Lombard v. Colo. Outdoor Educ. Ctr., Inc. , 187 P.3d 565, 571 (Colo. 2008) (quoting Colo. WaterConservation Bd. v. Upper Gunnison River Water Conservancy Dist. , 109 P.3d 585, 597 (Colo. 2005) ).
¶ 29 We also give deference to the Panel's reasonable interpretations of the Act. Sanco Indus. v. Stefanski , 147 P.3d 5, 8 (Colo. 2006) ; Dillard v. Indus. Claim Appeals Office , 121 P.3d 301, 304 (Colo. App. 2005), aff'd , 134 P.3d 407 (Colo. 2006). Although we are not bound by the Panel's interpretation or its earlier decisions, Olivas-Soto v. Indus. Claim Appeals Office , 143 P.3d 1178, 1180 (Colo. App. 2006), we follow the Panel's interpretation unless "it is inconsistent with the clear language of the statute or with the legislative intent." Support, Inc. v. Indus. Claim Appeals Office , 968 P.2d 174, 175 (Colo. App. 1998).
¶ 30 If we were to consider section 8-43-404(5)(a)(IV) in isolation, we might agree with claimant because that provision seems to apply to all changes of physician. But "we cannot read statutory language in isolation from its context." Berges v. Cty. Court , 2016 COA 146, ¶ 10, 409 P.3d 592. Rather, we must view the Act as a whole and strive to harmonize its provisions because "[a] comprehensive statutory scheme should be construed in a manner which gives consistent, harmonious, and sensible effect to all parts of the statute." Salazarv. Indus. Claim Appeals Office , 10 P.3d 666, 667 (Colo. App. 2000). Claimant's proposed interpretation does not harmonize all provisions of the statute.
¶ 31 As employer notes, the termination provision added to section 8-43-404(5)(a)(VI) in 2016 mirrors that in subparagraph (IV). Employer maintains that it would not have been necessary for the legislature to add parallel termination language to sub-subparagraph (VI)(B) if the termination language in sub-subparagraph (IV)(C) already applied to all changes of physician.
¶ 32 We agree with employer. To harmonize the statute, we must read it as interpreted by employer and the Panel. Claimant's interpretation would render superfluous the termination provision of subparagraph (VI). And if the legislature in 2016 had intended merely to clarify that subparagraph (IV) also applied to changes of physician granted under subparagraph (VI), the legislature could have simply said so. Instead, the legislature enacted a new set of provisions applicable to changes of physician granted under subparagraph (VI). This legislative labor would have been entirely unnecessary if subparagraph (IV) already applied to changes of physician granted under subparagraph (VI). We cannot adopt a reading of the statute that "would render parts of it meaningless and without effect." Keel v. Indus. Claim Appeals Office , 2016 COA 8, ¶ 43, 369 P.3d 807.
¶ 33 Employer also points to particular language in section 8-43-404(5)(a) that confirms that subparagraphs (III) and (IV) work in tandem. Specifically, employer underscores the repetition of words and phrases found only in subparagraphs (III) and (IV) that indicates the legislature intended to limit the termination provision of subparagraph (IV) to "one-time" changes of physician under subparagraph (III). For instance, "designated authorized treating physician" is used in subparagraphs (III) and (IV) but nowhere else in the statute. Repeating "designated authorized treating physician" in subparagraph (IV) after using the term for the first time in subparagraph (III) strongly suggests that the legislature intended subparagraphs (III) and (IV) to work together.
¶ 34 Similarly, the legislature used the adverbs "initially" and "originally" in subparagraphs (III) and (IV) to distinguish a claimant's first authorized treating physician from the "newly authorized treating physician." As with "designated authorized treating physician," the phrases "originally authorized treating physician" and "initially authorized treating physician" appear nowhere else in the statute. In contrast, sub-subparagraph (VI)(B) addresses the termination of a claimant's treating relationship with her "previously authorized treating physician."
¶ 35 The repetition of identical phrases in subparagraphs (III) and (IV) indicates that the legislature intended that the phrases should be applied uniformly in both subsections. See People v. Rediger , 2015 COA 26, ¶ 31, 411 P.3d 907 ("[W]e must ascribe the same meaning to the same words occurring in different parts of the same statute, unless it clearly appears therefrom that a different meaning was intended[.]" (quoting Everhart v. People , 54 Colo. 272, 276, 130 P. 1076, 1078 (1913) )) (cert. granted Feb. 16, 2016). Conversely, "the use of different terms signals an intent on the part of the General Assembly to afford those terms different meanings." Carlson v. Ferris , 85 P.3d 504, 509 (Colo. 2003).
¶ 36 Consequently, we cannot ignore the legislature's use of "designated authorized treating physician" and "initially" or "originally authorized treating physician" in section 8-43-404(5)(a)(III) and (IV), as compared to its use of "previously authorized treating physician" in section 8-43-404(5)(a)(VI). By drawing these distinctions, the legislature signaled that subparagraphs (III) and (IV) apply early in the claim process—when a claimant may still be treating with the "initially" or "originally" designated treating physician—while subparagraph (VI) covers other situations in which a claimant may seek to change physicians.
¶ 37 Although the plain language of the provisions, when read in context, is sufficient to resolve this appeal, we also note that the legislative history of this amendment confirms our interpretation. See Specialty Rests. , 231 P.3d at 400-01 ("Our plain language interpretation of the 2007 amendment as procedural in nature is supported ... by the legislative history of the amendment."). Representative Morgan Carroll, the sponsor of the 2007 amendment that added subparagraphs (III) and (IV), explained that the purpose of subparagraph (IV) was to include the "criteria for transfer of care" occasioned by the change of physician permitted under subparagraph (III). Hearings on H.B. 07-1176 before the H. Business Comm., 66th Gen. Assemb., 1st Sess. (Mar. 5, 2007). Representative Carroll's statement corroborates our analysis that subparagraphs (III) and (IV) were intended to work in tandem, and supports our conclusion that subparagraph (IV) does not operate to terminate any physician-patient relationships except those ended by a change of physician under subparagraph (III).
¶ 38 Because claimant's change of physician from Dr. Sharma to Dr. Miller was not granted under section 8-43-404(5)(a)(III), section 8-43-404(5)(a)(IV) did not automatically terminate her relationship with Dr. Sharma when she began treating with Dr. Miller. Therefore, employer's FAL was not invalid simply because it was based on Dr. Sharma's MMI determination.
We express no opinion on whether claimant may still challenge Dr. Sharma's MMI determination by requesting a division-sponsored independent medical examination.
¶ 39 The Panel correctly interpreted section 8-43-404(5)(a). Neither the termination provision of sub-subparagraph (IV)(C) nor the termination provision of sub-subparagraph (VI)(B) applies to claimant's request to change physicians. We agree with the Panel that section 8-43-404(5)(a)(IV)(C) applies only to one-time changes of physician permitted under subparagraph (III) and that section 8-43-404(5)(a)(VI)(B)'s termination provision applies prospectively to requests for changes of physician made after the amendment's effective date. As a result, employer's FAL was not invalid on the ground raised by claimant. The Panel's decision is affirmed.
JUDGE ROMÁN and JUDGE ASHBY concur.

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James M. Lyons, Rothgerber, Appel, Powers & Johnson, Denver, CO, argued, for plaintiff-appellant. With him on the brief, was James R. Walker.
Regina S. Moriarty, Atty., Dept. of Justice, of Washington, DC, argued, for defendant-appellee. With her on the brief, were Loretta C. Argrett, Asst. Atty. Gen., Gary R. Allen and David English Carmack, Attys. Of counsel, was Edward T. Perelmuter.
Before RICH, PLAGER, and LOURIE, Circuit Judges.
John L. Kane, Jr., appeals from the decision of the United States Court of Federal Claims granting the government's motion to dismiss his claim for a tax refund. Kane v. United States, 28 Fed. Cl. 10 (1993). Because a judge's disability retirement pay under 28 U.S.C. § 372(a) (1988) is not excludable from gross income under Sec. 104(a) (1) of the Internal Revenue Code, 26 U.S.C. § 104(a) (1) (1988), we affirm.
Each justice or judge retiring under this section after serving ten years continuously or otherwise shall, during the remainder of his lifetime, receive the salary of the office. A justice or judge retiring under this section who has served less than ten years in all shall, during the remainder of his lifetime, receive one-half the salary of the office.
28 U.S.C. § 372(a) (emphasis added).1 Pursuant to Sec. 372(a), Kane received an amount equal to his salary as disability retirement pay in 1988 and 1989. He included these amounts in his gross income on his 1988 and 1989 tax returns.
In 1991, Kane filed amended tax returns for 1988 and 1989, excluding his Sec. 372(a) disability retirement pay from his gross income. He claimed that such disability retirement payments are exempt from taxation under Sec. 104(a) (1) of the Internal Revenue Code (Code), which excludes from gross income "amounts received under workmen's compensation acts as compensation for personal injuries or sickness." 26 U.S.C. § 104(a) (1). The Internal Revenue Service (IRS) denied his claim on the ground that Kane failed to establish that the disability payments were in lieu of workmen's compensation.
Kane then filed suit in the Court of Federal Claims seeking a refund, plus court costs, expenses, interest, and attorney fees. In response, the government filed a motion to dismiss the 1988 claim for failure to state a claim upon which relief could be granted.2 Kane filed a cross-motion for summary judgment and opposed the motion to dismiss. The court granted the government's motion. In so holding, the court rejected Kane's argument that entitlement to the exemption under Sec. 104(a) (1) depended solely on whether payments were provided for a work-related injury.3 Rather, the court considered that Sec. 104(a) (1) required an analysis of the statute under which payments were made to determine whether the statute qualified as a workmen's compensation act or one "in the nature of" a workmen's compensation act. Kane, 28 Fed. Cl. at 13. The court analyzed Sec. 372(a) and determined that it was not a "workmen's compensation act" or "in the nature of a workmen's compensation act" because the statute does not make a distinction between work-related disability payments and non-work-related disability payments. Id. at 14. Thus, the court held that Kane could not exclude the disability retirement payments from his gross income. Id. Kane now appeals from that judgment. We have jurisdiction over the appeal pursuant to 28 U.S.C. § 1295(a) (3) (Supp. V 1993).
Our review of the decision turns on the proper interpretation of the Internal Revenue Code, a question of law which we review de novo. Quaker State Oil Ref. Corp. v. United States, 994 F.2d 824, 826-27 (Fed. Cir. 1993). The question of law presented in this case, a case of first impression, is whether disability retirement pay received by a judge under 28 U.S.C. § 372(a) is excludable from gross income under Sec. 104(a) (1) of the Code. To resolve this question of statutory interpretation, we look first to the language of the statute. Martel v. Department of Transp., Federal Aviation Admin., 735 F.2d 504, 507 n. 6 (Fed. Cir.), cert. denied, 469 U.S. 1018, 105 S. Ct. 432, 83 L. Ed. 2d 358 (1984).
Sec. 104. Compensation for injuries and sickness.
26 U.S.C. § 104 (emphasis added).
Treasury Regulation 1.104-1(b) elaborates on the scope of this exemption:Section 104(a) (1) excludes from gross income amounts which are received by an employee under a workmen's compensation act ... or under a statute in the nature of a workmen's compensation act which provides compensation to employees for personal injuries or sickness incurred in the course of employment. Section 104(a) (1) also applies to compensation which is paid under a workmen's compensation act to the survivor or survivors of a deceased employee. However, section 104(a) (1) does not apply to a retirement pension or annuity to the extent that it is determined by reference to the employee's age or length of service, or by the employees prior contributions, even though the employee's retirement is occasioned by an occupational injury or sickness.
26 C.F.R. Sec. 1.104-1(b) (1988) (emphasis added). "Deference is ordinarily owing to the agency construction if ... the regulation 'implement [s] the congressional mandate in some reasonable manner.' " Gannet v. United States, 877 F.2d 965, 968 (Fed. Cir. 1989) (quoting United States v. Vogel Fertilizer Co., 455 U.S. 16, 24, 102 S. Ct. 821, 827, 70 L. Ed. 2d 792 (1982)).
The Code also provides that gross income includes "all income from whatever source derived," 26 U.S.C. § 61(a) (1988), and the Supreme Court has held that Sec. 61 reflects Congress's intent to use the full measure of its taxing power. Helvering v. Clifford, 309 U.S. 331, 334, 60 S. Ct. 554, 556, 84 L. Ed. 788 (1940). Thus, the Court has held that statutes granting tax exemptions should be strictly construed. E.g., Commissioner v. Jacobson, 336 U.S. 28, 49, 69 S. Ct. 358, 369, 93 L. Ed. 477 (1949) (construing 26 U.S.C. § 22(b) (3) (1946)).
Kane argues that Sec. 372(a) is "in the nature of a workmen's compensation act" and that his income received under that provision is therefore exempt under Sec. 104(a). We disagree. The language of the statute and regulation are clear. To be excluded from gross income, payments must be received "under a workmen's compensation act" or "under a statute in the nature of a workmen's compensation act." The payments to Kane are neither. Section 372(a) is not a workmen's compensation act. Workmen's compensation acts provide fixed awards to employees or their dependents in cases of employment-related accidents and diseases, regardless of fault. See W. PAGE KEETON ET AL., PROSSER AND KEETON ON THE LAW OF TORTS Sec. 80 (5th ed. 1984). In general, they provide a no-fault award in place of an employer's fault-based liability. See, e.g., The Longshore and Harbor Workers' Compensation Act, ch. 509, 44 Stat. 1424 (1927) (codified as amended at 33 U.S.C. §§ 901-950 (1988)); Federal Employees' Compensation Act, Pub. L. No. 89-554, 80 Stat. 532 (1966) (codified as amended at 5 U.S.C. §§ 8101-8193 (1988 & Supp. V 1993)). Section 372(a), on the other hand, is a disability retirement provision, not a substitute for employer liability. It provides for a continuation of salary, either full salary or half salary, depending upon tenure. It does not in any way displace or relieve the government from any employer liability to the extent that the disability might be work-related.
Section 372(a) is also not "in the nature of" a workmen's compensation act. Kane asserts that the trial court erred by applying a "face of the statute" test to determine if Sec. 372(a) is in the nature of a workmen's compensation act. In particular, Kane alleges that the trial court erroneously relied on Riley v. United States, 156 F. Supp. 751, 140 Ct. Cl. 381 (1957), for the proposition that a statute must explicitly provide for work-related disability in order to qualify for an exemption. Kane argues that a court, rather than looking to the "face of the statute," must inquire into the underlying cause of a claimant's injury to determine if payments were triggered by a work-related injury. We disagree.
While Riley dealt with a widow's pension under a District of Columbia statute, in contrast to Sec. 372(a), which is before us, the trial court did not erroneously rely on Riley. It resolved the issue before us, as does this court, by focusing on the language of Sec. 104. That statute refers to workmen's compensation acts. Faithful to the statute, the language of Sec. 104's implementing regulation clearly requires that payments be received "under a statute in the nature of a workmen's compensation act." 26 C.F.R. Sec. 1.104-1 (emphasis added). Thus, it is the statute, not the nature of the injury, that must be analyzed to determine whether it is in the nature of a workmen's compensation act.
Other courts have interpreted Sec. 104(a) (1) similarly, holding that statutes that do not limit compensation to on-the-job injuries are not in the nature of workmen's compensation acts. See Take v. Commissioner, 804 F.2d 553 (9th Cir. 1986) (ordinance that makes no distinction between work-related and non-work-related diseases is not in the nature of a workmen's compensation act); Haar v. Commissioner, 709 F.2d 1206 (8th Cir. 1983) (exemption does not apply to payments under the Civil Service Retirement Act, which is not designed to provide compensation for on-the-job injuries); Smelley v. United States, 806 F. Supp. 932 (N.D. Ala. 1992) (state statute providing disability compensation to municipal employees and state troopers, regardless of cause, not a workmen's compensation act or in nature of workmen's compensation act), aff'd per curiam, 3 F.3d 389 (11th Cir. 1993).
Kane counters that several Tax Court decisions have held that an inquiry into the nature of the injury is required under Sec. 104(a) (1) rather than an analysis of the statute. See Golden v. Commissioner, 30 T.C.M. (CCH) 691, 1971 WL 2409 (1971); McDonald v. Commissioner, 33 T.C. 540, 1959 WL 967 (1959). These contrary decisions are not persuasive in light of more recent decisions and IRS rulings to the contrary. See, e.g., Clifford v. Commissioner, 48 T.C.M. (CCH) 824, 825, 1984 WL 15075 (1984); Rev.Rul. 85-104, 1985-2 C.B. 52, 53 (same).
Kane further argues that even if we accept a "face of the statute" test, Sec. 372(a) is in the nature of a workmen's compensation act because it is a "dual-purpose" statute that provides payment for both work-related and non-work-related disabilities. Kane argues that since the payments were received for a work-related disability under a "dual-purpose" statute, he may exclude these payments from his gross income. In support of his argument, Kane points to a line of cases concerning the predecessor statute to Sec. 104(a) (1), 26 U.S.C. § 22(b) (5) (1946), in which courts made inquiry into the source of the disability when a statute provided for both work-related and non-work-related disabilities. See Simms v. Commissioner, 196 F.2d 238 (D.C. Cir. 1952) (statute providing retirement for disability incurred in line of duty or for 25 years of service); Neill v. Commissioner, 17 T.C. 1015, 1951 WL 288 (1951) (statute providing retirement for disability incurred in line of duty or for 16 years of service); Frye v. United States, 72 F. Supp. 405 (D.D.C. 1947) (same statute as in Simms) .
Frye, 72 F. Supp. at 408. Faced with this dual-purpose statute, the district court made the determination that benefits were awarded under the first part of the statute and therefore exempt from taxation. Id. at 409. Here, however, Sec. 372(a) makes no distinction between payments for work-related and non-work-related disabilities and therefore it is not a dual-purpose statute. Accord Take, 804 F.2d at 557. No inquiry into the nature of the injury is thus required.
Our interpretation of Sec. 104, and the trial court's, is consistent with the general rule that all income is taxable unless specifically excluded from gross income. Disability retirement income under Sec. 372(a) is nowhere specifically excluded from gross income; in particular, it is not excluded under Sec. 104(a) (1) because Sec. 372(a) is not a workmen's compensation act. Moreover, the statute is no more "in the nature of" a workmen's compensation act than it is a workmen's compensation act per se. We thus conclude that disability retirement pay under Sec. 372(a) is not excludable from gross income.
Added support for the trial court's conclusion is provided by the further sentence in Treasury Regulation Sec. 1.104-1(b) which states that "section 104(a) (1) does not apply to a retirement pension or annuity to the extent that it is determined by reference to the employee's age or length of service, ... even though the employee's retirement is occasioned by an occupation injury or sickness." 26 C.F.R. Sec. 1.104-1. It is clear that disability retirement under Sec. 372(a), even if "occasioned by an occupation injury or sickness," provides a pension determined by length of service. Thus, Sec. 372(a) awards a retirement pension or annuity not excludable under Sec. 104(a) (1), rather than excludable workmen's compensation.
We therefore hold that disability retirement payments received under 28 U.S.C. § 372(a) are not excludable from gross income pursuant to 26 U.S.C. § 104(a) (1) because Sec. 372(a) is neither a workmen's compensation act nor is it "in the nature of" a workmen's compensation act. Accordingly, we affirm the Court of Federal Claims' grant of the government's motion to dismiss.


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Most Georgians know that possession of alcohol is illegal for individuals under the age of 21. If a person charged with this offense, which may be referred to as a Minor in Possession or MIP charge, is under the age of 17, his or her case will be heard in a Georgia Juvenile Court.
Using a fake ID to purchase alcohol.
Individuals under 21 may possess alcohol for medical purposes pursuant to a prescription authorized to practice medicine in the State of Georgia. Individuals participating in religious ceremonies are also exempt.
The statute also notes that individuals under 21 are not prohibited from dispensing, serving, selling, or handling alcohol as part of employment in a licensed establishment, or from being employed in any establishment in which alcohol is distilled or manufactured. However, individuals must be at least 18 years of age for this exception to apply per O.C.G.A. § 3-3-24.
Further, O.C.G.A. § 3-3-23 does not apply when a person under 21 possesses alcohol that was given them by his or her own parent in that parent's own home, when the parent or guardian is present. This is a very narrow exception, and only applies when a parent gives alcohol to his or her own child. If a juvenile is at a party and is given alcohol by another person's parent, the exception does not apply even if the child's own parent has given permission. This also makes providing alcohol to other people's children a risky business -- and may also open a person up to civil liability, although that is outside the scope of our law practice. See Mowell v. Marks, 277 Ga.App. 524, 627 S.E.2d 141 (2006).
There is one more significant exception to this statute.
A person who seeks medical assistance for another person who is experiencing an alcohol overdose shall not be arrested, charged, or prosecuted for violation of O.C.G.A. § 3-3-23 if the evidence for the arrest or charge results from seeking medical assistance. A person who seeks medical assistance for himself or herself for an alcohol overdose will similarly not be prosecuted. This exception also protects individuals from penalties for a violation of a temporary protective order or restraining order and from sanctions for a violation of conditions of pretrial release, probation, or parole. O.C.G.A. § 3-3-23(j)(2).
Before this exception was written into the law, teenagers who were aware that they were not legally allowed to possess alcohol would decline to seek medical assistance for their friends who were experiencing an overdose, for fear that they themselves would be charged with either possession of the alcohol or with providing alcohol to others. This placed their friends at the risk of grievous bodily harm or even death, and many teenagers have died from preventable alcohol-related overdoses. This is a particular problem on college campuses and in college towns. This exception seeks to mitigate that fear and incentivize teenagers to seek medical assistance when necessary.
This exception does not provide protection from prosecution for other individuals who may have been involved in illegally possessing alcohol. It also does not prevent law enforcement from seizing evidence or contraband or taking a person into custody during the course of an investigation.
Some Georgia Juvenile Courts play “fast and loose” with the law. However, due process still applies, juveniles still have the right to a Georgia Juvenile Court Attorney, and the State still must prove the offense beyond a reasonable doubt. In Georgia Juvenile Courts, judges are the triers of fact – there are no juries. Thus, the State must prove to the judge that a juvenile possessed alcohol beyond a reasonable doubt. The State may provide a variety of factors to prove this.
For example, evidence that the defendant had the odor of alcohol on his person, appeared to be in an intoxicated state and admitted that he had consumed an alcoholic beverage, was found to be sufficient evidence. Hanson v. State, 276 Ga. 470, 569 S.E.2d 513 (2002). Evidence that the defendant smelled of alcohol and appeared “flushed,” and that open cans containing beer were in the car, was sufficient. Firsanov v. State, 270 Ga. 873, 513 S.E.2d 184 (1999). And finally, bloodshot and watery eyes and admission of drinking was found to be sufficient. In the Interest of B.J.G., 234 Ga.App. 285, 506 S.E.2d 449.
In order to secure an adjudication under O.C.G.A. § 3-3-23 (and indeed, under most statutes dealing with possession of any kind of contraband) the State must prove that a juvenile knowingly possessed alcohol. It is easy to envision a scenario in which a juvenile is riding in a car with other individuals, while the driver has a bottle of alcohol under the seat. The State would have to prove that all individuals charged knew the alcohol was there. This would be a case of constructive possession. Possession may be actual or constructive. Actual possession occurs when a substance is found on one's person. Constructive possession occurs when a substance is not located on a person's body, but that person nonetheless has the power and the intention to exercise control over the substance.
Thus, a defense in a case of constructive possession might be for a Georgia MIP Lawyer to prove that the juvenile charged had no knowledge the substance was there, or that he or she had no intention to exercise control over the substance.
In cases where the child has a history of significant prior court involvement, including at least one felony offense, the judge may also order placement in an institution, camp, or other facility for delinquent children or up to 30 days in a juvenile detention facility.
If the child is adjudicated delinquent and an order of disposition is entered, the child will have a juvenile record. In some cases, however, a record can be avoided with the help of a MIP Lawyer in Georgia. Some judges are amenable to outcomes that do not remain on a child's record. This may be an outcome of pretrial diversion or abeyance. Both of which include a period of supervision and possibly completion of certain conditions, but ultimately result in the charges being dismissed instead of adjudicated. This is always a preferable outcome, but whether it is available to your child depends on many factors, including the facts and circumstances of the case, the child's prior court involvement (or lack thereof), how the child performs in school, and measures taken by the family to address the situation prior to going to court. It also depends on the players involved and their attitudes about such charges.
Why hiring a Georgia Juvenile Defense Attorney is Crucial in a Juvenile Court Minor In Possession Case?
Most high school kids have college and careers on their minds. Even so, many kids slip up and make mistakes. We understand that these mistakes are part of growing up and should not derail your child's life. A juvenile record can stick around for years to come. This is why it is imperative to hire a Georgia Minor in Possession Attorney who understands that no case is “just a misdemeanor.” Every case is important, especially when juveniles are involved. Don't let a minor in possession case get in the way of your child's goals. Call us today.

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Under the Bank Secrecy Act (BSA), 31 U.S.C. 5311 et seq., and its implementing regulations at 31 C.F.R. Chapter X (formerly 31 C.F.R. Part 103), FinCEN may bring an enforcement action for violations of the reporting, recordkeeping, or other requirements of the BSA. FinCEN's Office of Enforcement evaluates enforcement matters that may result in a variety of remedies, including the assessment of civil money penalties. For example, civil money penalties may be assessed for recordkeeping violations under 31 C.F.R §1010.415 (formerly 31 C.F.R. §103.29), or for reporting violations for failing to file a currency transaction report (CTR) in violation of 31 C.F.R. §1010.311 (formerly 31 C.F.R. §103.22), a suspicious activity report (SAR) in violation of 31 C.F.R. § 1021.320 (formerly 31 C.F.R. §103.21), or a report of foreign bank and financial accounts (FBAR) in violation of 31 C.F.R §1010.350 (formerly 31 C.F.R. §103.24). FinCEN also takes enforcement actions against money services businesses (MSBs) for failure to register with FinCEN in violation of 31 C.F.R §1022.380 (formerly 31 C.F.R. §103.41).
If you are unable to download a copy of an enforcement action from FinCEN's Web site, you may request that a paper copy be mailed to you by: (i) an e-mail: frc@FinCEN.gov; (ii) a fax request to FinCEN's fax number at 202-354-6411; or (iii) a call to FinCEN's Regulatory Helpline at 1-800-949-2732. The request should include your name and name of your organization; the enforcement action and matter number as listed on the index; and a method of sending the document to you (postal address, fax number, or telephone number for arranging pick-up).


Two recent decisions impose severe consequences upon insurers that breach a duty to defend. A New York case, K2 Investment Group, LLC, et al v. American Guarantee & Liability Ins. Co, 21 N.Y.3d 384 (2013), involved a legal malpractice insurance policy. A Missouri case, Columbia Casualty Company v. Hiar Holdings, LLC, No. SC93026 (Mo. Aug. 13, 2013), involved a CGL policy. But the decisions are important for all duty-to-defend insurers in those states, regardless of the policy-type.
Under the New York K2 decision, an insurer wrongfully disclaiming a duty to defend, must indemnify its insured for any resulting judgment even if policy exclusions otherwise negate coverage. Lenders had sued an entity and its owners to collect on a debt, but then also sued an attorney/owner for legal malpractice, alleging that, as lenders’ counsel, the attorney failed to record a mortgage securing the debt. The legal malpractice insurer refused to defend the attorney/owner, citing exclusions for a “Claim based upon or arising out of, in whole or in part . . . D. the Insured’s capacity or status as: 1. an officer, director, partner, trustee, shareholder, manager or employee of a business enterprise . . . E. the alleged acts or omissions by any Insured . . . for any business enterprise . . . in which any Insured has a Controlling Interest.” The insurer thereafter also refused to settle for $450,000, well under the $2 million policy limit. The trial court in the malpractice and collection case then entered a default judgment against the attorney on the malpractice claim, for over the $2 million policy limit.
Under the Hiar Holdings decision from Missouri, an insurer that wrongfully refuses to defend its insured is liable for all damages flowing from the breach, even exceeding the policy limits. The CGL insurer refused to defend and then settle a class action against its insured alleging violations of the Telephone Consumer Protection Act involving junk faxes. The insured with court approval settled with the class for $5 million, well over the $2 million CGL policy limit. The class then sued the CGL insurer under a garnishment statute, with the insurer counterclaiming for a declaratory judgment. The Court affirmed a judgment against the insurer for the entire $5 million settlement, finding the insurer breached its duty to defend claims alleging both property damage and advertising injury under the policy.
The New York and Missouri decisions are somewhat similar to what Illinois courts have been doing for quite some time. In Illinois, an insurer that fails to defend under a reservation of rights or bring a declaratory action is estopped from raising coverage defenses to an indemnity obligation, where it has breached a duty to defend. Doe v. Illinois State Medical Inter-Insurance Exchange, 599 N.E.2d 983 (1st Dist. 1992).
The insurer in the New York decision is seeking further review. So stay tuned. But these decisions are a red-flag for any insurer that caution is in order when declining a defense obligation in New York, Missouri, and Illinois.
May an insurer rescind a legal malpractice policy for misrepresentations by one attorney, leaving that attorney’s innocent partner with no coverage? Not when there’s a severability clause; and because of the “innocent insured doctrine,” even if there is no such clause. So says the Court in Illinois State Bar Association Mutual Ins. Co. v. Law Office of Tuzzolino and Terpinas, 2013 IL App (1st) 122660 (Nov. 22, 2013).
Tuzzolino, for his firm, answered “no” to the renewal form question: Has any member of the firm become aware of a past or present circumstance(s) which may give rise to a claim that has not been reported? But he knew he should have answered “yes” because his client had threatened to sue. Terpinas, Tuzzolino’s partner, had no knowledge of the threatened claim then. He learned of the claim upon receiving a lien letter from the client’s attorney and then reported it to ISBA Mutual promptly. Client thereafter sued Tuzzolino, Terpinas, and their firm. ISBA Mutual sued to rescind the policy. The appeals court reversed a summary judgment for ISBA Mutual against Terpinas.
The APPLICATION, and any addendum or supplements and the Declarations, are the basis of the Policy. They are to be considered as incorporated in and constituting part of this Policy. The particulars and statements contained in the APPLICATION will be construed as a separate agreement with and binding on each INSURED. Nothing in this APPLICATION will be construed to increase the COMPANY’S Limit of Liability.
Each insured thus had its own policy; so ISBA Mutual could only “partially” rescind — with no rescission for the innocent insured’s, Terpinas’s separate policy.
And based on the common-law innocent insured doctrine, Terpinas had coverage even absent severability: When multiple insureds share a policy and one insured’s actions would void the policy, coverage for the innocent insured remains.
Economy Fire & Casualty Co. v. Warren, 71 Ill. App. 3d 625 (1979) controlled. It addressed a fire insurance policy under which, a husband and wife, settled a claim with their insurer for loss of their home to fire. But the settlement was based on a fraud by the wife, who unbeknownst to the husband, had burned down the house. The insurer tried to rescind the settlement agreement, but the court held that the husband — unaware of the wife’s fraud — could keep half the settlement monies.
The Court in ruling for Terpinas refused to follow Home Insurance Co. v. Dunn, 963 F. 2d 1023 (7th Cir. 1992), where the Seventh Circuit supposedly applying Illinois law allowed a legal malpractice insurer to rescind, even when some insureds weren’t aware of a misrepresentation in the application.
Lesson for insurers: With a severability clause like the above, you won’t be able to rescind as to innocent insureds; and you may not be able to do so even without it, though there’s considerable uncertainty about application of the common-law innocent insured doctrine.
Zurich American Ins. Co. v. Diamond Title of Sarasota, Inc., Case No. 8:10-cv-383-T-30 AEP (M.D. Fla. Dec. 4, 2013) addresses a common question-type in professional liability insurance applications — namely, did the applicant or prospective insured “know of any circumstances, acts, errors or omissions that could result in a professional liability claim against the Applicant?” Similar questions are in some D&O policy applications.
Rotolo, Diamond Title’s owner and President, answered “No” to the question, although involved in a mortgage fraud. Later, she pled guilty to related crimes.
JLO sued Diamond Title during the policy period for negligence in releasing escrow funds, but not fraud. Zurich then sued Diamond Title to rescind its professional liability policy, joining JLO to bind it to any judgment.
Like the insurance code of many states, Florida’s Code provides that “a misrepresentation in an application for insurance may prevent recovery under the policy if the misrepresentation was material to either the acceptance of risk or the hazard assumed by the insurer.” Fla. Stat. § 627.409.
The Court concluded the undisputed material facts established as a matter of law that Rotolo made a misrepresentation material to acceptance of the risk and the hazard assumed; so Zurich was entitled to summary judgment.
THE DISCOVERY OF ANY FRAUD, INTENTIONAL CONCEALMENT, OR MISREPRESENTATION OF MATERIAL FACT WILL RENDER THIS POLICY, IF ISSUED, VOID AT INCEPTION.
The Court does not need an underwriter or guidelines to appreciate how not knowing Rotolo and her employee had been committing mortgage fraud in excess of five years left Zurich unable to adequately estimate the nature of risk in issuing the Policy. [Citation omitted]. As previously discussed, many of these acts could have resulted in claims against the Policy. An objective insurer may not have issued a policy at all. Certainly a policy would not have been issued under the same terms and pricing knowing that Diamond Title was engaged in an ongoing scheme to commit mortgage fraud.
The end of “fraud on the market”?
Adopted by the Supreme Court in 1988, the “fraud on the market” doctrine allows plaintiffs in securities cases to bring a class action without alleging reliance on false statements regarding securities. Much has been written about the Supreme Court’s grant of certiorari in Halliburton v. Erica John Fund and the future of the “fraud on the market” doctrine in securities class actions. The Supreme Court in Halliburton is expected to decide whether “fraud on the market” should continue. As explained by Kevin LaCroix in the D&O Diary and by Douglas W. Greene in D&O Discourse the impact of the Supreme Court’s ruling — expected in mid-2014 — on D&O claims for securities class actions could be significant.
Does a management liability policy require an insurer to defend an IRS claim for alleged failure to pay employment taxes, where “taxes,” “fines,” and “penalties” are exceptions from the definition of “Loss”? Not this one, according to this court.
The IRS claimed the insured hospital failed to pay what was owed for employment taxes for withholding and otherwise under the hospital’s quarterly Form 941. It demanded payment from the hospital and its trustees personally.
The policy included a duty to defend, providing: “The Insurer shall have the right and the duty to defend any Claim regardless of whether any of the allegations are groundless, false, or fraudulent.” Claim included “… any Insured Person Claim . . . .” “Insured Person Claim” included certain written demands, civil and criminal proceedings, and administrative and regulatory proceedings. “Loss” wasn’t incorporated into the “Insured Person Claim” definition, but it was used within the policy’s insuring agreement.
We are not persuaded by this overly-simplistic and literal interpretation of the policy. The notion advanced by plaintiffs would require North River to provide a defense against any and all claims lodged against its insureds, regardless of whether the claim embraced a covered risk. This novel interpretation is contrary to our settled jurisprudence with respect to liability policies, and not supported by principles of interpretation applied to insurance policies in general.
D&O insurance, as far as insurers are concerned, isn’t a means for insureds to transfer liability for contract obligations to their insurers. D&O policies frequently include exclusions for contractual liability. Wording varies. And the exclusions are frequently litigated, as you’ll see from earlier posts to this blog.
Beazley, the D&O insurer here, addressed contractual liability through an exception to the definition of Loss — for “damages representing amounts allegedly owed under an express written contract, including a guarantee or obligation to make payments.” The issue was whether the insured’s $500,000 repayment to the Social Security Administration fell within that exception to the Loss definition. This Federal District Court concluded that it did.
So why did the $500,000 repayment qualify as for “damages representing amounts allegedly owed under an express written contract . . . ?” Family Assistance’s arrangement with the Social Security Administration was subject to a “Form SSA-11” which “includes a term requiring that the representative payee [(Family Assistance)] ‘[r]eimburse the amount of any loss suffered by any claimant due to misuse of Social Security or SSI funds by me/my organization.'” The Form SSA-11 was an express written contract. The $500,000 was damages representing amounts allegedly owed under that contract.
An insured with an $80 million loss takes a $5 million hair-cut off a $10 million limit in settling with a primary insurer and, as a result, is left with no excess coverage for $70 million in additional losses. Settling with the primary insurer for less than limits, thus, backfired.
The insured, Quellos Group — an investment firm — created a tax shelter for clients to offset capital gains with losses. But the shelter ran afoul of IRS’s rules, leading Quellos to pay a $35 million settlement and incur $45 million in defense fees.
Because the exhaustion language in the Federal and Indian Harbor excess insurance policies is clear and unambiguous, we must enforce it as written, and affirm summary judgment dismissal of the lawsuit against Federal and Indian Harbor.
It didn’t matter that the insured paid the $5 million the primary insured didn’t pay, so that the insured’s and primary insurer’s combined payments totaled $10 million, the full amount of the primary policy. The excess policies’ wording required that the primary insurer actually pay its $10 million primary limit before any excess coverage would attach.
The Court also rejected the insured’s arguments that: (1) “only after” in the excess policies’ insuring agreements made exhaustion a condition, shifting the proof burden to the excess carriers to show prejudice; and (2) enforcement of the exhuastion language would violate public policy.


…the priesthood as a whole, but especially in its exercise of the office of governance, is exercised with the full flowering of the vocation of the laity in mind. The goal of the priesthood is a mature and well-formed laity that embraces its own vocation.
Calling of the Apostles by Domenico Ghirlandaio.
The Second Vatican Council highlighted and clarified a truth that had perhaps been obscured in the Catholic imagination for many centuries, that all the faithful are called to a life of holiness, a life that manifests the perfection of charity (Lumen Gentium §32). The Council thus rejected a two-tiered image of the Christian life—one which is still somewhat entrenched—in which those who aspired to Christian perfection joined the clergy or the religious life. The rest of the faithful were called to a sort of Christian mediocrity, a less-than-perfect state of living with a heart divided in the midst of the distractions of the world. Furthermore, the Council clearly taught that all the faithful participate in the mission of the Church (Apostolicam Actuositatem §1), which is Christ’s own evangelizing mission, the Church’s deepest identity (Evangelii Nuntiandi §14). This mission stems from baptism, and therefore all are called to the apostolate, to carrying out this mission in the concrete circumstances of their life in the world (Apostolicam Actuositatem §2- 3). Finally, the Council emphasized that the lay vocation, that is the lay path to holiness, has a properly secular character, which is oriented to a proper love for this world, and to life in the world; indeed the laity are to consecrate the entire world to Christ, as part of the divine plan for the redemption of all things (Lumen Gentium §30).
The relationship of the ministerial and common priesthood is best discussed in the context of an ecclesiology of communion, which is the main self-understanding of the Church highlighted by the Council (Christifideles Laici §19). Ecclesial communion is an “organic” communion, analogous to that of a “living and functioning body,” which is characterized by a “diversity and complementarity” of vocations, ministries, states of life, charisms and responsibilities (Christifideles Laici §20).
For this reason, it is the priests’ part as instructors of the people in the faith to see to it, either personally or through others, that each member of the faithful shall be led in the Holy Spirit to the full development of his own vocation in accordance with the Gospel teaching, and to sincere and active charity and the liberty with which Christ has set us free. Very little good will be achieved by ceremonies, however beautiful, or societies, however flourishing, if they are not directed towards educating people to reach Christian maturity (Presbyterorum Ordinis §6; emphases added).
The Pope also spells out the various tasks involved in governance: attention to a variety of persons and their vocations, the ability to coordinate all the gifts and charisms inspired in the community by the Spirit, and to discern these, and orient these, to the building up of the Church, always in communion with the bishops.
After this brief survey of magisterial teaching on the munus regendi, we focus on the exercise of this office with respect to three aspects of the vocation of the laity: the universal call to holiness, the secularity of the lay vocation, and the discernment of charisms.
The Council emphasized the universal call to holiness as the foundational vocation of each and every Christian. Promoting a culture of vocation, and vocational discernment, is an urgent pastoral need. Too often, the term “vocation” is understood as only pertaining to the discernment of a priestly, or a religious, vocation, and thus is understood to be the task only of a few.8 “It is inconceivable that an ordinary Christian be resigned to, or content with, mediocrity if he/she has not discovered a specific calling from God.”9 Discernment of God’s will is the task of every Catholic. What is needed is an emphasis on the universal call to holiness, precisely in the ordinary circumstances of life, and of seeing the entire field of one’s life as the arena for the exercise of one’s baptismal vocation. This does not, of course, preclude that there are “special vocations” within the over-arching vocation to holiness (Christifideles Laici §56). The exercise of pastoral ministry includes the promotion of a culture of discernment for all the lay faithful to discover their vocation, and be formed to fulfill it (Christifideles Laici §57).
The Council teaches that a “secular character is proper and peculiar to the laity.” This secularity is to be understood not simply as accidental or circumstantial, but as the divinely ordained way for the sanctification of the overwhelming majority of the people of God, the lay faithful.10 The Council signals as much when it says that “all that goes to make up the temporal order,” is not merely a help, or a means to man’s last end, but “possess a value of their own, placed in them by God” (Apostolicam Actuositatem §7; cf., Christifideles Laici §15). The renewal of the temporal order, affected by sin, is the proper task of the lay faithful. They are to be formed in a way that helps them live out their properly secular vocation, and not an imitation of monastic or religious spirituality, in a spirit of fuga mundi. Furthermore, the confusion regarding the roles of the laity in the Church, which has led to a certain clericalization of the laity, should be avoided (Christifidels Laici §27). While there is a legitimate role for the laity within the structures of the Church, the proper arena for the exercise of their vocation, for the vast majority of the faithful, is in their own secular professions and work.11 The exercise of pastoral governance, which has as its aim the flowering of the vocation of the faithful, will keep this always in mind.
While trying the spirits if they be of God, they must discover with faith, recognize with joy, and foster with diligence the many and varied charismatic gifts of the laity, whether these be of a humble or more exalted kind (Presbyterorum Ordinis §9).
The Council’s teaching suggests that charisms are not peripheral to the life of the Church, but are “like the yeast that makes the Church the Church.”12 Theologically, the charisms highlight the complete priority and freedom of the Holy Spirit in its guiding of the life of the Church.13 Charism and hierarchy are obviously related, and not to be opposed.14 The retrieval of the charisms that the Council envisioned has clearly not come about.15 Other than those influenced by the Charismatic Renewal, and a few other groups,16 the charisms are not a regular feature of pastoral ministry, or of priestly formation, and are often regarded with suspicion. Much still needs to be done to understand and rehabilitate the discernment of charisms as an important and indispensible feature of the exercise of the office of pastoral governance.
The exercise of the munus regendi is, of course, tied closely to the exercise of the other two offices of the priestly ministry.17 Governance goes hand-in-hand with the prophetic office, which establishes the very community of believers (Presbyterorum Ordinis §4), and the sanctifying office, with the celebration of the Eucharist, the “source and summit” of the Church’s life (Sacrosanctum Concilium §10), at its very heart. Yet, the tendency still exists to let the sanctifying office eclipse the other two. This office was identified almost exclusively as that most proper to the priesthood in the medieval and post-Tridentine period.18 Yet, this view discounts the fact that the sacraments are not ends of their own, but are oriented to the full nourishment of the people, and have their ultimate destiny always in view.
This brief survey of Magisterial teaching on the munus regendi underscores that the priesthood as a whole, but especially in its exercise of the office of governance, is exercised with the full flowering of the vocation of the laity in mind. The goal of the priesthood is a mature and well-formed laity that embraces its own vocation. The formation of the laity, thus, is the unifying aim of pastoral governance,19 one that ought to be among the top priorities of a diocese, according to Pope John Paul II (cf., Christifideles Laici §57). The parish has the essential task for a more “personal and immediate” formation of the laity (Christifideles Laici §61).20 While the Holy Father identifies other areas of formation (schools and institutions, movements, groups, families, etc.), the local parish is the only place where 98 percent of Catholics have regular contact with the Church.21 Any serious attempt to form the laity has to start in the parish.
The orientation of the munus regendi to the flourishing of the vocation of the faithful finds an echo in the idea of the spiritual paternity and spousal nature of the ministerial priesthood.22 The two vocations, that of the priest and of the laity, “are never to be separated or set against each other in any way.”23 In fact, a fully mature laity, with a strong and vibrant witness in the secular world, is a sign of the fruitfulness of priestly ministry, of the “fruit of the Spirit that flows through his own sacramental ministry,” without which, he might be tempted to think of his own ministry as lacking “spiritual power, purpose, and fecundity.”24 Both vocations are complementary, and both are oriented to manifesting the presence of Christ in the world.25 A priest ought never to be threatened by a mature and capable laity, but ought to be “fascinated by lay holiness.”26 “A father finds only fulfillment in the successes of his sons and daughters.”27 A priest must think of his self-gift always as being oriented to the service of, and flourishing of, his bride, the Church, and specifically the full maturity of the laity among whom he is pastor, spiritual father, as well as servant. This cannot be understood purely in terms of being ministers of the sacraments to an essentially passive laity, who are only recipients of his ministry. The sacraments are sacraments of faith, and are geared towards the full flourishing of the universal call to holiness of all the faithful. Without proper preparation, and the correct disposition on the part of the recipient, the sacraments are not entirely effective, and the sacramental graces are “hindered,”28 until the proper disposition, the necessary conversion, or genuine repentance, is supplied.29 So much of our pastoral practice, focused as it is on what often turns out to be hasty and inadequate sacramental preparation, seems to have little impact on the vast numbers of baptized and confirmed faithful, who simply abandon the practice of their faith, or seek discipleship and spiritual maturity in other ecclesial communities. This ought to call for serious reflection. Priests need to recover a broader and deeper understanding of their own spiritual fatherhood, and their exercise of the “munus regendi,” which sees as its aim the true flourishing of mature and faithful lay disciples.
Furthermore, with the Council’s emphasis on the secular nature of the vocation of the laity, the task of pastoral governance needs to have a positive view of the secularity of lay life, and of the lay path to holiness. The universal call to holiness is still too rarely preached. The idea that Christian maturity is found in imitating priestly or religious spirituality, or is found solely in increased activity within institutional structures, or in cooperation with the functions of the ministry, is still very prevalent. The proper role of the laity in the secular arena is rarely emphasized, and the unity of life, the overcoming of the split between faith and life,30 is seen more in its absence than its presence. The spiritual fatherhood of the priest finds its greatest expression in the raising up of mature spiritual sons and daughters, well formed in the faith, who take seriously their own task to sanctify the world, and thus redeem the temporal order in Christ, orienting it to the eschatological horizon of the coming Kingdom of God, “so that God may be all in all” (1 Cor 15:28). It is clear that this requires rethinking, both in priestly formation, as well as in pastoral ministry. It is also clear that forty years after the Council, not discounting the numerous signs of hope scattered across the landscape, we have barely scratched the surface.
Rev. Mr. Gaurav Shroff is a candidate for priestly formation for the Archdiocese of Atlanta, Georgia, attending Mount St. Mary's Seminary in Emmitsburg, Maryland. He was ordained to the transitional diaconate on May 26, 2012. He holds a BS in geology from the University of Mumbai, India, and an MA in religious studies from the University of South Carolina. God willing, he will be ordained to the holy priesthood in June of 2013.
Praised be to God! I can hardly believe what I am reading, but here it is. I’m reading it, and this is only the third time in my life (a long one, at this point) that I have heard it from clergy. My wife and I are rejoicing together this moment, sir, that God has led you to discover this very beautiful and urgently needed truth in our Catholic Faith: the lay vocation to fruitful holiness, and the role and duty of the clergy to enable it. How we need priests and bishops to see this, to know and believe it, and live it! The laity need right formation, and without serious and earnest effort on the part of clergy, such right formation is very very difficult to provide.
Please keep advocating for this, Rev. Mr. Shroff. It seems that many priests and bishops missed it in their formation, and as a result many in the laity have missed it their entire lives. And we need it.
Thank you so much for writing this article! As a Catholic laywoman it was a blessing to read your understanding of the ordained priesthood as it relates to the laity and the universal call to holiness.
I have recommended your article to others, and I pray that the Holy Spirit will continue to work in you for the building up of the Body of Christ. May Our Lady of Guadalupe, whose Feast we celebrate today, be for all of us the “Star of the New Evangelization”, showing us all how she faithfully received and gave Jesus to the world so in need of Him.
Hallelujah! I think I almost broke into tongues of praise reading your article, and I’m not really that charismatic. Thank you for writing this and God richly bless your ministry!
You took the words right out of my mouth! Thank you!
Thank you for the kind words, and I pray the conversation continues!
This is a pleasing article and a well presented survey of some very complex topics, I was convinced that the soon to be priest conveys a sincere desire to be a good and holy shepherd in the footsteps of Christ.
None the less I found the thesis missed the mark by setting out on a journey with the wrong supplies and quite possibly in the wrong direction. Articles that continue to explore the bipolarity of priest/laity dialogues without even the slightest mention of the diaconate strike many as a sign of poor priestly formation. The article clearly falters by the omissions that It is not only the priest that exercises the munus regendi, and, it is not only the laity that participate in toils of secularity.
The munus regendi when exercised by the deacon, is no longer a paternalistic rampart from which the priest prepares the gifts they bestow upon the laity. Instead we see the munera exercised more fully with the inclusion of the deacon that opens the servants entrance and invites the disciple into their call to holiness through charity.
This was secret of the earliest days, and obviously the Holy Spirit intends the servant to be a significant witness in the new evangelisation in the call to holiness for all. The super abundant grace being unleashed by the ordination of tens of thousands of deacons speak plainly to the charisma of the Holy Spirit and direction of the post Vatican church.
So when the deacon/author asks the question in his article, How are the two vocations of priest and laity related? The answer provided by the Holy Spirit in no small part if found in the imitation of Christ the Deacon.
It is paradigm shift that causes the Church to open its eyes and recognize the graces we are receiving are far more than mere scattered islands of hope. The Holy Spirit has unshackled vast new continents in the call to holiness and many in the clergy and among the laity just aren’t noticing it. A mature priesthood and a mature laity have no problem expressing or embracing the words of St. Ignatius of Antioch when he says respect the deacon as you would respect Jesus. Maturity and respect emerge only through acknowledgement.
Thank you again deacon for your examination of the munus regendi and the call of holiness of the laity. Your article has provided me with many hours of thought and reflection.
Thank you Deacon Shroff your article shows your devotion to the priesthood. As an example I hold up to you and others Venerable Fathe Michael McGivney the founder of the Knights of Columbus of which I am a member here in Dallas. Father McGivney practiced his priestly ministry at St. Mary’s parish in New Haven. Ct and St. Thomas in Thomaston Ct. He convinced 24 men in New Haven to organizethe Knights of Columbus in 1882 with Father McGivney as Founder. Due to his zeal and instructions the Knights of Columbus is a strong moral force of the Catholic Church.
Deacon Bill — thought provoking comments. This article started out as a paper for a class on Ecclesiology. The requirements included, for whatever topic selected, to summarize church teaching from the Council onwards. In my research on the munus of pastoral governance, I found little or no mention of the diaconate, and nothing that would see the diaconate as a bridge between the vocations of the laity and the priest. I wanted to emphasize this dimension of the priesthood, the centrality of the priesthood being at the service of the vocation of the laity — it’s goal, as I say, is a mature, fully-formed, holy, laity. You bring up a very good point, however, regarding the general silence surrounding the diaconate. I am intrigued and hope to read some more in this area (… at some point!). If you have any suggestions as to places to start, I would be grateful. And clearly, there needs to be a lot more theological work on the nature and role of the diaconate as a distinct Order with the Sacrament of Holy Orders.


text:
Rountree, Clarke. Judging the Supreme Court: Constructions of Motives in Bush v. Gore. Rhetoric and Public Affairs. East Lansing: Michigan State UP, 2007.
Clarke Rountree's new book examines one of the Supreme Court's most consequential decisions: Bush v. Gore, the December 2000 opinion that ended the Florida recount and effectively handed the presidency to George W. Bush. As a scholar, teacher, and attorney, I recommend the book for three reasons. First, it shows the rich insights to be gained by applying Burkean methods (here, pentadic analysis) to legal discourse. Second, by positioning the Court's arguments in detailed contexts of motives in American jurisprudence, news reportage, editorialists' arguments, and scholarly debate, it offers a model for a close, careful rhetorical case study. Finally, it is structured and written in such a way that it should find a wide audience (beyond just Burke scholars) for Rountree's important arguments about rhetoric's role in creating and upholding the rule of law.
Rountree argues that if we are to understand and participate in the cultural myths of the rule of law and an impartial judiciary, then judicial opinions (especially in cases as deeply partisan and as momentous as Bush v. Gore) must be "rhetorical performances . . . constitutive of the political community" (xv). Judging the Supreme Court reads as Rountree's plea and exhaustive evidence building a particular case: that when we examine accounts of what the Court did and why it did it, Bush v. Gore is not only a failed rhetorical performance but also corrosive of political community. Rountree argues that the Bush majority knowingly used weak legal rationales and improperly shaded its recitation of the material facts to end the recount for personal and partisan motives, rather than for the motives that the opinion itself constructed or that defenders of the result have offered (such as preserving order or preventing uncertainty about who would become president).
To build his case, Rountree structures the book in thirteen chapters. The first two chapters, along with the Introduction, lay the foundation for Rountree in later chapters to apply pentadic analysis to the majority and dissenting opinions, to news reports and editorials and--most importantly--to the accounts of judicial motives in the work of legal scholars. Early in Chapter One, Rountree argues that the characterization of acts "is the primary mode of judicial persuasion," yet characterization of acts is "strangely camouflaged" behind a "technical language of rules, precedents, holdings, dicta, and the like." Rountree identifies ten different sets of acts that judicial opinions "construct, reconstruct, or embody"; these acts include the facts giving rise to the case, the parties' actions, lower court proceedings, kinds of legal authorities, competing opinions of justices deciding the same case, and others (7-10). At the end of Chapter One, Rountree introduces Burke's pentad as "a heuristic for exploring motives through discourse" and offers a four-step method for pentadic analysis: locate the relevant text (or multiple texts, as Rountree does with this "meta-analysis of motives"), specify the acts to be examined, analyze the pentadic ratios, and interpret the results (11-16). Chapter Two, entitled "The Road to Bush v. Gore," reminds readers of the crucial events of the battle for Florida's electoral votes, which would tip the contest in favor of either Bush or Gore should they prevail in that closely contested state. Chapter Two goes on to set the background for how the case ended up in front of the Supreme Court in the first place by summarizing the events of two Florida Supreme Court cases and the U.S. Supreme Court's 5-4 order staying the recount at a time when Bush held a razor-thin lead of a few hundred votes. Rountree's analysis of the rhetorical challenges of a stay order (a remedy designed to suspend court proceedings or other legal remedies for the purpose of preventing irreparable harm) is especially salient because pentadic analysis of the Court's order (and of Justice Scalia's response to the minority's dissent from it) in this case shows how the majority, from the outset, began to characterize Bush as the likely winner, the one who would suffer harm if the recount continued because he had a claim to the presidency and happened to be slightly ahead at the moment.
The road to Bush v. Gore having been traveled, Chapters Three and Four consist of extensive pentadic analysis of motives in the Court's majority, concurring, and (multiple) dissenting opinions. It bears remembering, as Rountree points out, that the Court's majority opinion was a per curiam ("by the Court") opinion, which matches the per curiam Florida Supreme Court decision it overturned, "matching camouflaged agent for camouflaged agent" (34). One effect of the unusual decision to render a per curiam opinion (usually reserved, as Rountree notes, for unanimous, summarily disposed cases [33-34]) was that the High Court's majority opinion operated scenically, with the individual justices taking action within that scene by writing concurring and dissenting opinions. Rountree analyzes how the justices, joined in a rhetorical agon, constructed the case's history, the applicable law, state court motives, the proper remedy to fashion, and their own (and one another's) motives to either support or challenge the court's intervention in the recounts and ultimate decision. Summary of these close, careful analyses would not do them justice, but what emerges from these chapters is a picture of judicial action as rhetorical through and through. While such a point will not surprise readers of KB Journal, Rountree is also clearly writing for larger, non-specialist audiences. I hope that the many law students whose libraries have purchased this book will have an enhanced understanding of judicial opinions as rhetorical, an understanding that enhances how law students learn to "think like lawyers" or "think like judges."
Chapters Five and Six examine how reporters and editorialists reconstructed the Supreme Court's action, a move that I consider important to the richly layered analysis that Rountree offers. Supreme Court opinions are, of course, not texts that average citizens read regularly. News and editorial reconstructions of the Court's action, especially in a case with stakes as high as Bush v. Gore, are crucial parts of the wider circle of how the cultural investment in the rule of law is built and perpetuated and how challenges to the legitimacy of the Court are examined. In particular, Rountree's analysis of how editorialists attempted to characterize the Court's acts as, for some, the deeds of noble jurists reluctantly stepping in to stop potential chaos or, for others, as a reckless and brazen attempt to decide the election, is especially salient.
Chapters Seven through Twelve, nearly half the total number of chapters in the book, are devoted to the arguments of legal scholars, many (but not all) of whom were, to understate it greatly, highly critical of Bush v. Gore as a cynical and terribly reasoned opinion. Rountree devotes this much space to scholarly arguments because, from the standpoint of constructions of motives, much of the lasting legacy of the Court's decision would play out in scholarly books and articles, written as they are using the twin advantages of "time and space" that academic writing enjoys (171). Rountree offers exhaustive analyses of how scholars reconstructed the stay order, how and why the Court reasoned out its decision, who (in terms of factors such as political motives of individual justices, the scene of the case as it came to the Court, past precedents, and attitudes) decided the case, when and where the Court decided the case, and Chief Justice Rehnquist's concurring opinion. Depending on their arguments about the opinion's reasoning, or effects on the rule of law, or propriety, scholars attempted to--as Burke has long helped us examine--emphasize particular pentadic ratios and downplay others.
The payoff for the first twelve chapters, besides their worth as pieces of rhetorical criticism and as models of pentadic analysis applied to a highly detailed case study, is the final chapter, "Judging the Supreme Court and its Judges." Rountree opens by arguing that while there is enough flexibility "in the structure of the grammar of motives" for supporters and defenders of particular judicial decisions to build "coherent stories," that flexibility has its limits. The limits come from "the interrelatedness of the grammatical terms and of one set of acts with other sets of acts," so that not just any story "can be convincingly constructed" (377). After being careful to note his own self-identified liberal political predispositions, Rountree sets out to offer what he contends is "the most coherent reconstruction of motives" for the Court in this case; that is, he mounts an argument about "what the Court was doing and why" (379).
In stark terms, Rountree argues that the majority justices, as some of the most brilliant and experienced legal minds in the country, knew or should have known that their arguments in Bush v. Gore were specious but nevertheless pressed ahead with ending the recount, "allowing purpose (ending the controversy and seating a Republican as president) to drive agency, rather than the other way around" (394). If the cultural myths of the rule of law and an impartial judiciary are to be upheld, argues Rountree, judicial discourse must at least muster the best arguments possible to construct court action as following the law rather than using the law as a fig leaf to cover a partisan and predetermined outcome (394). Tellingly, justices also must appear to follow their own self-fashioned judicial philosophies such as, in this case, the majority justices' earlier pronouncements about states' rights and judicial restraint (393). In this case, Rountree argues that there simply were no better arguments than the weak ones the majority offered, but the majority decided to press ahead anyway, knowing that damage to its stature and legitimacy resulting from the decision would likely be short-lived, at least in the minds of the general public. This sort of cynical and solely consequential construction of motives whereby the Court was, at best, willing to take a hit to its credibility in the name of preventing uncertainty about the election "essentially laughs behind the backs of Americans who believe in the rule of law" (403). Certainly, nothing in Justice Scalia's public statements about Bush, for example, would dispel a construction of motives concluding that the Court arrogated to itself the right to decide the election. For example, Scalia has stated, "I and my court owe no apology whatever for Bush v. Gore. We did the right thing. So there!" and "Get over it. It's so old by now” (Scalia). Of course, as Rountree notes, whether one considers the actual Bush presidency--as opposed to speculations about what a Gore presidency would have been--a fortunate or unfortunate outcome depends on one's political views (405-406). However, the main point of this final chapter of Judging the Supreme Court is that what the highest court in the land said it was doing and why are the very basis of judicial decision-making and thus will have consequences for how future cases are decided. When there are huge gaps separating quality legal arguments, justices' own stated judicial philosophies, and an opinion's self-fashioned construction of motives, the diagnostic and admonitory tools Burke provided, and which Rountree uses here, are needed urgently.
Scalia, Antonin. Interview with Leslie Stahl. 60 Minutes. CBS. 14 Sept. 2008. Television.

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