Court Opinion

ID: 8917221
Source: CourtListenerOpinion
Date Created: 2022-11-27 05:34:45.14095+00
Date Added: 2024-06-11T17:09:06.233823
License: Public Domain

ALARCON, Circuit Judge,
concurring in part and dissenting in part.
I concur in Part I and Part III of Judge Hug’s opinion. I agree with Judge Hug’s conclusion that the appeal was timely filed and that the imposition of a fine of two hundred and fifty dollars on each attorney without adequate notice, an opportunity to prepare a defense, and a hearing violated due process.
I dissent from Part II of the opinion insofar as it holds that the district court has the authority to fine counsel under the local rules of the Central District of California. It is my view that the local rules do not authorize the imposition of a fine on an attorney for failure to comply with the rules concerning pretrial preparation. I also respectfully dissent from that portion of Judge Hug’s opinion which would remand this matter for further proceedings.
Judge Wallace has concurred in that portion of Judge Hug’s opinion which declares that the local rules gave the district court authority to impose a fine and that procedural due process requires that lawyers subjected to such a sanction be given notice and a hearing. Judge Wallace has dissented, however, from Judge Hug’s conclusion that this matter should be remanded. Judge Wallace is of the view that no violation of due process occurred.
*526I.
Judge Hug tells us with some hesitation that “[t]he district court apparently relied upon the local rules of the Central District of California as authority for levying the $250 sanctions for failure to comply with C.D.Cal.R. 9.” (Majority Opinion p. 519). I read the record differently. Assuming that the facts would permit us to conclude the district court relied on the local rules, the rules do not support the imposition of a fine.
II.
We need not speculate as to what the district court relied upon as the authority for the fine he imposed.
On November 20, 1980, the district court, in denying counsel’s request to remit the fines, stated as follows:
Where, as here, both counsel are at fault and the remedy of sanctions against one party in favor of the other is unavailable, it is our view that the court’s inherent power to enforce its rules, orders and procedures and to impose appropriate sanctions for failure to comply may be invoked, that the sanctions here imposed were reasonable and appropriate and that contempt proceedings were unnecessary, (emphasis added).
These thoughtful remarks reveal two concerns of the district court.
Local rules imposing sanctions against an attorney for dilatory tactics are ordinarily invoked by the opposing party. In fact, Local Rule 28 of the Central District of California specifies that violation of the local rules directed at timely preparation for trial shall result in “the imposition of costs and such attorney’s fees to opposing counsel, as the Court may deem proper under the circumstances.” (emphasis added). Thus, the district court’s comments candidly acknowledged that the rules did not cover the problem which is presented when it appears that both counsel have disregarded local rules which compel diligence in meeting pretrial conference requirements. The district court’s statements also revealed its awareness that it was not applying the same procedures which attach to contempt proceedings.
To the extent that the district judge acted as he expressly tells us he did, i.e., by virtue of his inherent powers, the fines must be set aside because he failed to make a finding of bad faith. In fact, the district court stated that proof of good faith would not bar the imposition of a fine. The law is to the contrary.
In Roadway Express Inc. v. Piper, 447 U.S. 752, 100 S.Ct. 2455, 65 L.Ed.2d 488 (1980), the Supreme Court stated:
Similarly, the trial court did not make a specific finding as to whether counsel’s conduct in this case constituted or was tantamount to bad faith, a finding that would have to precede any sanction under the court’s inherent powers. Id. at 767, 100 S.Ct. at 2464. (emphasis added).
Thus, if the order is based on the court’s inherent powers, as we are expressly and unequivocally informed by the trial judge, we must reverse because of the absence of a finding of bad faith.
III.
Assuming for purposes of discussion that we can somehow ignore the fact that the district judge relied upon what he perceived to be his inherent powers, notwithstanding the record before us, imposition of a fine is not authorized under the local rules of the Central District of California. Judge Hug tells us that the district court relied on Local Rule 28.
The imposition of a fine is penal in nature. A rule authorizing the imposition of a fine being penal in nature, must be subjected to strict construction. See United States v. Ross, 535 F.2d 346, 350 (6th Cir.1976) (“Because § 1927 is penal in nature, we believe that it should be strictly construed, and we agree with the Seventh Circuit’s determination that ‘costs’ should be limited to taxable costs.”); Lockett v. Hellenic Sea Transports, Ltd., 60 F.R.D. 469, 471 (E.D.Pa.1973). (“The Court is aware that Sections 1920 and 1923, relating to taxable costs, are in derogation of the com*527mon law and in a sense penal in character, and therefore must be strictly construed, and the items to be taxed must be within the express language of the section in question.”)
Similarly, no person can be subjected to a penal sanction unless the statute or rule warns in clear and unambiguous terms that punishment will be imposed if he or she engages in prohibited conduct. See McBoyle v. United States, 288 U.S. 25, 51 S.Ct. 340, 75 L.Ed. 816 (1931) (fair warning should be given to world of what the law intends to do if a certain line is passed; to make the warning fair, so far as possible the law should be clear).
In Papachristou v. City of Jacksonville, 405 U.S. 156, 92 S.Ct. 839, 31 L.Ed.2d 110 (1972), the Supreme Court stated the rule as follows: “Living under a rule of law entails various suppositions, one of which is that “[all persons] are entitled to be informed as to what the State commands or forbids.” 405 U.S. at 162, 92 S.Ct. at 843.
C.D.Cal.R. 28 does not give fair warning to an attorney that a violation of the local rules will subject him to a fine. Rather, Rule 28 refers to “appropriate discipline including the imposition of costs and such attorneys fees to opposing counsel, as the Court may deem proper under the circumstances.” The district court did not purport to impose compensatory costs or attorneys fees in the matter before us.
As applied by Judge Hug, Rule 28 violates due process of the law. The facts presented as for review are completely distinguishable from those before the court in Gamble v. Pope & Talbot, Inc., 307 F.2d 729 (3rd Cir.), cert. denied, sub. nom., U.S. Dist. Ct. for E.D. Pa. v. Mahoney, 371 U.S. 888, 83 S.Ct. 187, 9 L.Ed.2d 123 (1962). There, the district court’s standing order provided for the imposition of fines against an attorney for failure to prepare for pretrial conferences. Judge Bigg in his dissent in Gamble concluded that a standing rule expressly authorizing the imposition of a fine is valid in spite of the fact that it does require a finding of contempt. Rule 28, however, does not expressly authorize the imposition of a fine. Thus, Judge Bigg’s dissenting views in Gamble are of little assistance in deciding the power of a district Judge to impose a fine under a local rule which simply does not mention the impositions of fines against a lawyer.
Judge Hug would apparently read into the words “appropriate discipline” the power to impose a fine of $250 for counsel’s negligence in preparing for trial. This generous interpretation strays far afield from the inherent power of the court to impose sanctions for bad faith conduct after notice and hearing as required by the due process clause.
On page 521 of his opinion, Judge Hug states that we should “reject the Gamble holding that a district court is without authority to impose a monetary sanction against counsel absent a finding of contempt.” (Emphasis added). The Gamble majority, however, did not hold that a monetary sanction could not be imposed, but rather concluded that a fine could not be imposed absent a finding of contempt. After substituting the term monetary sanction for the word fine, Judge Hug then states that other circuits have also declined to follow “this portion of Gamble.” The cases cited by Judge Hug do not deal with fines against counsel in the absence of a finding of contempt. A careful reading of the cases cited will reveal that in some of the decisions it was held that costs imposed pursuant to local rules were upheld and in the balance the trial court was directed to impose a sanction other than dismissal pursuant to its inherent powers. See, e.g., Martinez v. Thrifty Drug and Discount Co., 593 F.2d 992, 993 (10th Cir.1979) (“The only question presented in this appeal is that of the validity of a district court rule promulgated, ... to impose jury costs against the parties and their counsel in an instance where there has been a failure to notify the clerk ... [when] there is no necessity for [jurors] to attend court”); In re Sutter, 543 F.2d 1030 (2d Cir.1976) (local rule providing for imposition of reasonable costs directly against any attorney whose action obstructed efficient administration of the courts *528could not be read to require a finding of willful intent and would reach recklessness but not an error in judgment or inadvertent action); Flaksa v. Little River Marine Construction Co., 389 F.2d 885, 888 & n. 10 (5th Cir.1968) (inherent power includes the authority to impose reasonable and appropriate sanctions upon errant lawyers practicing before it; reversed and directed trial court to impose lesser sanctions than dismissal); Dove v. Codesco, 569 F.2d 807 (4th Cir.1978) (appellate court reversed sanction of dismissal for attorney’s failure to follow local rule and imposed lesser sanction of costs because conduct not intentional or in bad faith); Richman v. General Motors Corp., 437 F.2d 196, 199 & n. 4 (1st Cir.1971) (appellate court reversed dismissal for want of prosecution and stated trial court could impose reasonable sanctions on plaintiff or attorney).
Costs are primarily compensatory in nature and capable of being measured while the fine imposed in the instant case is primarily penal in nature and not defined or limited by any standard set forth in Rule 28. To hold that “appropriate discipline” includes the power to fine is, in my view, tantamount to leaving the bounds of judicial discretion unrestrained and unreviewa-ble. When a district court invokes its inherent powers, judicial discretion in imposing sanctions is constrained by the requirement of proof of bad faith. It is my view that Judge Hug’s construction of Rule 28 is not consistent with the principles of substantive due process. I would reverse the order imposing the fines.
My position on the issues presented by this appeal can be summarized as follows: The district court lacked authority to impose a fine under its local rules because of substantive due process deficiencies. Therefore, I would not remand for a new hearing.
If the district court had the authority to impose a fine, in spite of the absence of any due process warning in the local rules that such punishment may be imposed for a violation of pretrial orders, I share Judge Hug’s view that the challenged order cannot withstand constitutional scrutiny because appellant’s procedural due process rights were also violated.