Summary
holding that since "no sentence was imposed because of the mistrial, no relief [was] available"
Summary of this case from Taylor v. United StatesOpinion
Editorial Note:
This opinion appears in the Federal reporter in a table titled "Table of Decisions Without Reported Opinions". (See FI CTA9 Rule 36-3 regarding use of unpublished opinions)
Submitted June 8, 1989.
Appeal from the United States District Court for the Northern Mariana Islands, Appellate Division; Alfred Laureta, District Judge, Presiding.
N.Mariana Islands
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
Before FARRIS, DAVID R. THOMPSON and TROTT, Circuit Judges.
This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir. Rule 36-3.
David Wiseman appeals a decision of the Appellate Division of the United States District Court for the Northern Mariana Islands reversing a judgment of the Commonwealth Trial Court which granted summary judgment against the Bank of Guam on the Bank's suit against Wiseman as alleged guarantor of a $35,000 note in default. We reverse, and we reinstate the judgment of the Commonwealth Trial Court.
JURISDICTION
On May 2, 1989, after this appeal had been filed, the legislature of the Commonwealth of the Northern Mariana Islands enacted Public Law No. 6-25 purporting to divest all federal courts of jurisdiction over appeals involving cases originating in the local trial courts, including those pending when the law was passed. The issue of whether Public Law No. 6-25 divests our court of jurisdiction over this appeal was decided in Wabol v. Villacrusis, No. 87-1736, slip op. 6855, (9th Cir. Filed Feb. 20, 1990, Amended July 9, 1990). Wabol v. Villacrusis holds that the Commonwealth lacks power to divest this court of jurisdiction over appeals properly filed from a final order of the appellate division of the district court entered before passage of Public Law No. 6-25. Notice of Appeal was filed by David Wiseman on March 4, 1987. Thus, we have jurisdiction to hear this appeal, which in all other respects is properly before us.
FACTS
David Wiseman is a lawyer, business executive and managing officer of several corporations, including Rainbow Center, Inc. and Marianas Rainbow, Ltd. The Bank of Guam is a Guam banking corporation.
In late 1981, Wiseman executed a continuing guaranty in favor of the Bank for the indebtedness of Rainbow, Ltd. up to $100,000. Between 1981 and 1982, the Bank made various loans to Rainbow Center and to Rainbow, Ltd. For each loan the borrower issued a promissory note. Among these promissory notes was CL 4446, the note at issue, which was dated November 4, 1981 and made out in the amount of $35,000. The maker of this note was Rainbow Center.
Both Rainbow Center and Rainbow, Ltd. defaulted on their obligations to the Bank. After the defaults, the bank extended and renewed the notes in a consolidated promissory note. Following another default, this note was extended, renewed, and consolidated with a later-issued promissory note, to form a new note, CL 5254, made by Rainbow Center in the sum of $89,000.
LEGAL PROCEEDINGS
Three lawsuits ensued from these facts. First, the Bank sued Rainbow Center on the $89,000 note. Bank of Guam v. Marianas Rainbow Center, Inc., dba Garapan Supermarket, CA No. 82-0073. On July 31, 1984, the court entered judgment for the Bank against Rainbow Center for $89,000.
The Bank contends that after judgment was entered, it discovered that some of the loans had been made to Rainbow, Ltd. not Rainbow Center. It then sued Wiseman in CA No. 84-197, as guarantor of Rainbow, Ltd.'s indebtedness, alleging that Rainbow, Ltd. was liable on the renewal note, CL 5254. Wiseman moved for summary judgment on the grounds that the $89,000 note was made by Rainbow Center. The Bank cross-moved for summary judgment, asserting that Wiseman was clearly liable on the $35,000 note. Wiseman's motion for summary judgment was granted.
The Bank appealed. Subsequently, it decided to bring the instant action for $35,000 against Wiseman as alleged guarantor of the $35,000 note. The Bank then dismissed its appeal.
The Commonwealth Trial Court dismissed the Bank's new suit on summary judgment on the ground that the court's entry of summary judgment in CA No. 84-197 had a preclusive effect. The trial judge also ordered the Bank to pay Wiseman's attorney's fees and costs for filing a frivolous suit. The Bank appealed to the appellate division of the district court.
The appellate division reversed, holding the Bank had been denied an opportunity in both CA No. 84-197 and in this case to prove that the maker of the $35,000 note was in fact Rainbow, Ltd. The district court remanded to allow the Bank to prove that Rainbow, Ltd. and Wiseman are liable on the $35,000 note, and that renewal of the note did not discharge Wiseman. The district court also vacated the award of attorney's fees and costs. Wiseman appeals this decision.
STANDARD OF REVIEW
We review questions of law decided by Commonwealth appellate divisions de novo. Guam v. Yang, 850 F.2d 507, 509 (9th Cir.1988) (en banc).
DISCUSSION
The question is whether Wiseman's liability on the $35,000 note was litigated and decided by the trial court in CA No. 84-197, thereby precluding the Bank from bringing a subsequent suit on an issue already settled. The bank inserted the issue of Wiseman's liability on his guaranty for the $35,000 note into CA No. 84-197 in its cross-motion for summary judgment. Wiseman's liability on the note was fully litigated, and the court issued a reasoned decision. The summary judgment order stated that "the bank accepted the signature of the officers of Rainbow Center on the $35,000 note. Thus if suit were brought on the note, the defendant would be Rainbow Center and not Rainbow, Ltd." The court held that "[t]he undisputed fact is that the November 4, 1981 $35,000 note was an indebtedness of Rainbow Center and the renewals were between the plaintiff and Rainbow Center."
The judge in CA No. 84-197 also mentioned an alternative reason for dismissing the bank's claim on the $35,000 note. It stated that the claim on that note was not properly pled:
[P]laintiff's cross motion for judgment on the $35,000 note must fail because this is simply not what the complaint alleges. The suit is on the $89,000 note and no other.
This alternate holding does not mean that the court's previous discussion of the $35,000 note was dicta. Collateral estoppel bars both rationales from future litigation:
[E]ven though the court rests its judgment alternatively upon two or more grounds, the judgment concludes each adjudicated issue that is necessary to support any of the grounds upon which the judgment is rested.
In re Westgate-California Corp., 642 F.2d 1174, 1177 (9th Cir.1981). The trial court need not have addressed the second issue, but it did. This decision does not make the first rationale dicta.
The present lawsuit against Wiseman as guarantor on the $35,000 note came before the same judge who heard the suit on the $89,000 note. The following exchanges between the judge and counsel for the bank reveal that the judge thought Wiseman's liability on the $35,000 note had already been finally litigated:
THE COURT: Your other case, 84-197, is sued on the $89,000 note which included this $35,000 note you're suing on. Right?
Mr. Arriola [counsel for the Bank]: That's correct, sir.
Later, the court continued:
THE COURT: Now, as I gather your cross motion is now you're trying to avoid the effect of 84-197 because what you're saying is, well, Mr. Wiseman caused the proceeds of the $35,000 to be paid over into Rainbow Center [sic] and therefore, now, he's liable for the $35,000 note.
[Y]our own exhibit shows the Center is the maker of the note. As a matter of fact, that is clearly a fact which already been found in 84-197. That's been found twice, in the district court and the Commonwealth Trial Court.
From the foregoing and from the record in CA No. 84-197, it is evident that the summary judgment in CA No. 84-197 resolved Wiseman's liability as an alleged guarantor on both the $89,000 note and on the $35,000 note. This was sufficiently clear to the trial court for it to determine that this lawsuit, CA No. 85-245, was frivolous. The Bank was collaterally estopped from bringing a new suit against Wiseman on the $35,000 note. The Commonwealth Trial Court was correct in its ruling, and the decision of the appellate division must be reversed on this issue.
ATTORNEYS' FEES
The Commonwealth Trial Court awarded attorneys' fees to Wiseman, finding this lawsuit to be frivolous. This award was reversed by the appellate division, a decision we believe was warranted even though it was predicated on an erroneous view of the case. We affirm the appellate division's reversal of the award of attorneys' fees in favor of Wiseman because we do not find sufficient evidence to suggest this was a frivolous lawsuit. The facts and circumstances of this case are complex and confusing, and we cannot fault the Bank for going to court "one more time" to try to recover on its defaulted loans, even though the Bank has now been found to be incorrect in its view as to what occurred in CA No. 84-197.
AFFIRMED in Part, REVERSED in Part, and REMANDED with instructions to enter judgment on behalf of Defendant-Appellant Wiseman and to VACATE the award of attorneys' fees in his favor.
The parties shall bear their own costs of this appeal.