Court Opinion

ID: 811754
Source: CourtListenerOpinion
Date Created: 2012-11-09 21:28:52+00
Date Added: 2024-06-11T18:00:42.377831
License: Public Domain

United States Court of Appeals
                      For the First Circuit

Nos. 10-1275
     10-1593
     11-2290
     11-2346

                 MADELEINE CANDELARIO DEL MORAL,

               Plaintiff, Appellee/Cross-Appellant,

                                v.

       UBS FINANCIAL SERVICES INCORPORATED OF PUERTO RICO,

               Defendant, Appellant/Cross-Appellee.

          APPEALS FROM THE UNITED STATES DISTRICT COURT
                 FOR THE DISTRICT OF PUERTO RICO

        [Hon. Salvador E. Casellas, U.S. District Judge]

                              Before

                   Howard, Selya, and Thompson,
                          Circuit Judges.

     Judith Berkan, with whom Mary Jo Méndez and Berkan/Méndez were
on brief, for appellee/cross-appellant.
     Christopher N. Manning, with whom Ashley W. Hardin and
Williams & Connolly LLP were on brief, for appellant/cross-
appellee.

                         November 9, 2012
            THOMPSON, Circuit Judge.

                              OVERVIEW

            This diversity suit for negligence presents interesting

questions of Puerto Rico law in a complex procedural setting, but

we will do our best to simplify.        The combatants are plaintiff

Madeleine Candelario del Moral ("Candelario") and defendant UBS

Financial   Services   Incorporated    of   Puerto   Rico   ("UBSPR").

Candelario's ex-husband, David Efrón, also has a starring role in

our story, though he is not a litigant in this case.

            The lead issue argued here arises from a Puerto Rico

judge's verbal order in the Candelario/Efrón divorce contest –

basically the order vacated a multi-million dollar attachment

Candelario obtained against Efrón's UBSPR accounts.         A courtroom

clerk later wrote that vacating order up in a document called

"minutes," which never got signed by a judge and never got properly

noticed to Candelario and Efrón.       Claiming that the minutes were

facially defective, Candelario insists that UBSPR was negligent as

a matter of law in letting Efrón withdraw millions from certain

accounts.   UBSPR argues the opposite, not surprisingly.       Ruling on

cross-motions for summary judgment, Judge Casellas sided with

Candelario, granting her motion as to liability. But acting on his

own initiative, Judge Casellas granted her summary judgment on her

damages claim too – even though she had expressly limited her

motion to the threshold liability issue, candidly admitting that

                                 -2-
genuine issues of material fact precluded any pre-trial resolution

of the damages question. Both parties filed post-judgment motions,

which Judge Casellas denied, and both now appeal, fighting tooth

and nail over liability and damages, and also over whether we

should reassign the case to a different district judge if a remand

is needed.   When all is said and done, we vacate the summary

judgment for Candelario – because there is an unresolved material

factual dispute, which a jury needs to sort out – and remand for

trial.   And, yes, we remand the case back to Judge Casellas for

further proceedings, because we see no reason not to.

                            BACKGROUND

          Because the case comes to us on summary judgment for

Candelario, we must take the facts and the reasonable inferences

from them in the light most favorable to UBSPR.          See, e.g.,

González-Droz v. González-Colón, 660 F.3d 1, 8-9 (1st Cir. 2011).

          When Candelario filed this federal-court suit against

UBSPR in 2008, her divorce from Efrón (after sixteen years of

marriage) was seven years old.      But the two were still fighting

over money, and there was lots of money to fight over – millions

and millions of dollars, in fact.   To give the reader a rough sense

of what happened here, we go back a few years.

                                 -3-
                  The Fallout from a Messy Divorce:
                       Local-Court Proceedings

            After shuttling between Puerto Rico trial and appellate

courts in the early 2000s, Candelario got a judgment ordering Efrón

to pay her $50,000 monthly till the marital estate was divvied up,

with interest on any unpaid amounts set at 10.50%.    Efrón thumbed

his nose at the order – Candelario claimed for the longest time

that she never received any payments – so Candelario marched to

Superior Court in October 2006, accused him of stiffing her out of

$4,160,552.61 (a figure that included interest), and moved the

court to let her execute on his assets to satisfy the amount then

owed.   A Superior Court judge obliged, ordering the attachment or

garnishment of Efrón's property so that "in due course" money could

be "sent to this Court in an amount sufficient" to cover "the

principal sum of $4,160,522.61," with "interest over said sum at a

rate of 10.50% annually . . . ."   The judge signed the "Order for

Execution of Judgment," and the regional clerk signed the "Mandate

of Execution of Judgment."   (Excessive capitalization removed.)

            Two days later, Efrón moved the judge to set aside the

attachment, and the judge set a hearing for November.       In the

meantime, a court marshal served UBSPR with the attachment order

and related documents, and UBSPR froze all of Efrón's accounts that

same day.   About a week later UBSPR moved the judge to clarify the

exact amount Efrón owed and which (if any) of his securities it

should sell.    UBSPR suggested that the judge could take up its

                                 -4-
motion at the hearing on Efrón's motion.           But the judge chose not

to do that and instead heard argument only on Efrón's motion.

            Candelario and Efrón showed up for the November 2006

hearing    with   counsel.   Because    it   was    not   a   party   to   the

litigation, UBSPR did not attend – apparently, family-law cases in

Puerto Rico are not open to the          public or to non-parties.

Candelario and Efrón each testified about the amount of money that

Efrón supposedly owed her.    Ruling from the bench, the judge ended

up vacating the attachment order for two reasons:             first, because

the amount attached appeared to exceed what Efrón actually owed

(the judge put the number just south of $3.3 million), and, second,

because another Superior Court judge was already handling issues

related to the division of marital property.          Candelario's counsel

then orally moved for reconsideration.        But the judge would have

none of it:       "Reconsideration denied," he said. "We affirm our

finding.    The orders of attachment are vacated . . . ."                  That

ruling puts Superior-Court Rule 32(B)(1) front and center, a rule

that pertinently provides that the "minutes" of the proceeding

"will constitute the official record" of the key events "that occur

at the hearing in court and in chambers" and "will be signed by the

judge and notified to the parties" if they reflect a ruling or

                                  -5-
order "issued by a judge in open court."1   Neither party got the

minutes here until much later, as we are shortly to see.

          The judge's oral ruling sparked yet another series of

pitched battles in the Puerto Rico appellate courts.          Kicking

things off, Candelario immediately filed a petition for mandamus

asking the Puerto Rico Court of Appeals to reverse the judge.

Naturally, the Court of Appeals first checked to see if it had

jurisdiction.   After quoting Rule 32(B)(1) and canvassing the

caselaw, the court said that the contested ruling "does not appear

in writing in a signed minute or notified order" and stressed that

a party cannot repair to the Court of Appeals until the judge's

"oral statement . . . is transcribed in ruling or minutes."    So the

court dismissed her petition toward the end of November.

     1
        See Rule 32(B)(1) of the Rules for the Administration of
the Court of First Instance of the Commonwealth of Puerto Rico,
quoted in Sánchez Torres v. Hosp. Dr. Pila, 158 D.P.R. 255, 2002 WL
31789282 (2002) (official English translation, slip op. at 3). At
least one Puerto Rico appellate opinion – which the parties had
translated and then placed in the joint appendix – quotes the rule
as saying that the minutes "'shall be signed by the judge . . . .'"
Candelario v. Efrón, No. KLRX200600058, slip. op. at 4 (P.R. Ct.
App. Nov. 21, 2006) (quoting Rule 32(b)(1)) (certified copy
provided by the parties).     Even UBSPR describes the judicial-
signature part of the rule in "shall" terms. The reason for this
is that the rule uses the Spanish phrase "será firmada," and,
apparently, there is no precise English equivalent – it translates
as "will be signed" or "shall be signed." But whether it is "will"
or "shall" does not matter. Both are "unmistakably mandatory,"
Hewitt v. Helms, 459 U.S. 460, 471 (1983), and, importantly, the
Puerto Rico appellate courts have treated the rule as mandatory in
respects directly relevant to this case (more on that later).

                               -6-
          Unhappy, Candelario petitioned the Puerto Rico Supreme

Court a couple of weeks later for certiorari.       Around this time, a

courtroom clerk transcribed and signed the minutes and made them

part of the Superior-Court file.      The minutes accurately reported

the judge's ruling – on this the parties agree:          "The orders and

annotations of attachment are hereby set aside."         But the judge's

signature appears nowhere on that document.

          Things   stayed   quiet     until   February   9,    2007,   when

Candelario's lawyer wrote to UBSPR's outside counsel, saying that

she was challenging the lower court's "verbal order" in the Supreme

Court and that even though the attachment order "was verbally

revoked" it "has never been notified" and thus "is not final and

binding." (Emphases removed.) Consequently, Candelario's attorney

demanded that UBSPR keep Efrón's accounts frozen.             About a week

later, on the 15th, the Supreme Court rejected her certiorari

petition because she had submitted no Rule 32(B)(1) minutes showing

what the judge's ruling was.    That same day, Efrón's lawyer gave

the minutes to UBSPR along with copies of Candelario's appellate

filings and the appellate courts' orders denying her requests.

UBSPR's assistant general counsel later said that that document

delivery from Efrón's lawyer is what first clued UBSPR in to the

verbal order. Whether that is right or whether UBSPR learned about

the oral ruling from Candelario's lawyer on the 9th matters not.

What matters is that UBSPR did not know about the verbal order

                                    -7-
until sometime in February 2007 – long after the Superior Court

judge spoke the words in November 2006.   In any event, after its

legal team perused the documents, UBSPR released the restraints on

Efrón's accounts one day after he had passed along these papers –

apparently, one account was worth more than $11 million at that

time.

           Candelario supposedly had no inkling of the minutes'

existence until UBSPR's counsel wrote her lawyer back near the end

of February 2007, saying that he had "read[] the minutes" of the

hearing where the judge had verbally "set aside" the attachment

order.   He later faxed over a copy of the minutes, and Candelario

then asked the Puerto Rico Supreme Court to reconsider the denial

of her certiorari petition, attaching the missing minutes to her

request.   Her lawyer forwarded the motion to UBSPR's counsel and

again insisted that UBSPR keep Efrón's accounts frozen, arguing

that the judge's oral "revocation of the order of attachment" was

not "final and enforceable" because the minutes had not been

properly "notified."   One can infer from the letter that she did

not know that UBSPR had already unfrozen Efrón's accounts. Anyway,

neither the motion nor the letter intimated even the slightest

whisper of a hint that Candelario thought the minutes defective for

lack of a judge's signature.    Six days later, the Supreme Court

denied Candelario's reconsideration request without saying why.

                                -8-
           We fast-forward to May 2007, when Candelario petitioned

the Superior Court to reinstate the vacated attachment order.             A

new Superior Court judge had taken over the case (the first judge

had retired), and she issued a written order saying that she would

take up that matter once she had had a chance to check out the

file.   But Candelario petitioned the Puerto Rico Court of Appeals

to compel the judge to reinstate the attachment order straightaway,

and this time the court granted her request. Heeding the appellate

court's command,   the    judge   in   August   2007   ordered   UBSPR   "to

immediately sell and liquidate" the securities in three specific

Efrón accounts "up to the amount of $4,160,522.61" (a directive

that took care of UBSPR's earlier clarification motion) and to

issue Candelario a check promptly after doing so.            UBSPR sprang

into action the following month, liquidating Efrón's accounts,

using part of the proceeds to pay off a line of credit that it had

extended to him (he owed about $804,043), and sending Candelario

the $351,783.19 balance that remained.

           It was now Efrón's turn to appeal, apparently, for he

asked the Puerto Rico Court of Appeals to "revoke" the judge's

August 2007 order.       The court refused, and in laying out the

background facts, it emphasized these points:          the first Superior

Court judge had "verbally annulled the attachment orders"; an

earlier panel had dismissed Candelario's bid to undo that order

because the lower court "had yet to issue its judgment in writing";

                                   -9-
the Supreme Court had denied her relief for essentially the same

reason; and the minutes capturing the verbal order "were certified

by the Courtroom Services Clerk," though "the judge who presided

over the hearing" never signed them.

                       The Fallout from the Fallout:
                         Federal-Court Proceedings

           Changing       gears,    Candelario     headed   to    Puerto   Rico's

federal    district       court    in   August     2008,    invoked    diversity

jurisdiction, see 28 U.S.C. § 1332(a)(1), and sued UBSPR for

negligently releasing Efrón's funds and paying off his credit-line

account, see P.R. Civ. C. art. 1802, P.R. Laws Ann. tit. 31,

§ 5141.    She sought a judgment for $3,808,739 (representing the

difference      between    the    $4,160,522     attachment   amount    and   the

$351,783 she got from UBSPR, if we disregard pennies, which we will

do from here on out) plus interest.              After a period of pre-trial

discovery, the parties filed dueling motions for summary judgment.

Candelario asked for summary disposition on liability only, and she

conceded that the damage-calculation issue had to be resolved at

trial.

           Finding no local caselaw exactly on point concerning "the

validity   of    the   verbal      order,"     Judge   Casellas   certified   the

following questions of law to the Puerto Rico Supreme Court:

           1.     Is a verbal order, issued in open court
           in a civil case, valid and executable from its
           inception?

                                        -10-
           2.     Does    a    verbal    order    require
           notification of the written Minutes, or
           transcript of the proceedings, and the
           presiding Judge's signature, for its validity,
           pursuant to Rule 32?

           3.     Is a verbal order, issued in open court
           in a civil case, and transcribed in the
           court's Minutes, valid if the Minutes were
           never notified to the parties nor signed by
           the presiding Judge?

The Supreme Court denied the petition, however, so Judge Casellas

had to make an Erie prediction – a phrase used as a shorthand way

of describing what federal judges since Erie R.R. Co. v. Tompkins,

304 U.S. 64 (1938), often do when local law may be uncertain –

i.e., follow the rule they think the highest local court would

follow.   See Whyte v. Conn. Mut. Life Ins. Co., 818 F.2d 1005, 1011

n.22 (1st Cir. 1987).   And that is what he did.

           At the outset of his decision, Judge Casellas gave a

primer on Puerto Rico negligence law and framed the lead issue this

way: Is "a verbal order," given "in open court at the Commonwealth

level, . . . valid and enforceable from its issuance, if it was not

notified to the parties in Minutes signed by the presiding Judge"?

Saying again that no Puerto Rico opinion explicitly answered that

question, Judge Casellas mined what nuggets he could from the

available caselaw.    On doing so, he saw that Puerto Rico courts

insist on strict compliance with Rule 32's requirements – at least

when it comes to triggering the appeal process, which is precisely

why the appellate courts rejected Candelario's appeals/petitions.

                                -11-
With this in mind, and keeping his eye on the literal words of Rule

32, Judge Casellas concluded that a verbal order "is not final, and

thus enforceable, until the Courtroom Clerk issues the Minutes for

the proceedings, the Judge signs the same," and the parties are

properly notified.   And because Rule 32's requirements were not

satisfied here, Judge Casellas ruled that UBSPR acted negligently

when it unfroze Efrón's accounts based on minutes neither signed by

a judge nor formally notified to the parties.

           But that was not all.   Judge Casellas then sua sponte

granted Candelario summary judgment on the damages issue.    UBSPR

had correctly paid off Efrón's credit-line account, the judge

ruled.2   But despite the Superior Court's giving her a $4,160,522

attachment order, Candelario only got $351,783 from Efrón's UBSPR

accounts, leaving a $3,808,739 shortfall.       So Judge Casellas

ordered UBSPR to pay that amount, plus 10.50% interest from the

date (way back in 2001) when Efrón was required to start making the

$50,000 monthly payments to Candelario.

           The parties later filed post-judgment motions, and Judge

Casellas issued written rescripts denying them.   The nitty-gritty

details of these motions and rulings are unimportant, so we will

skip them.

     2
       The judge held that the UBSPR/Efrón credit-line agreement
gave UBSPR "a perfected first-priority lien and security interest
over the assets" in Efrón's accounts. We offer no opinion on the
correctness of his conclusion.

                               -12-
          Both UBSPR and Candelario eventually filed appeals.

Which brings us to today.

                                 ANALYSIS

          The parties bombard us with arguments in an effort to

convince us that Judge Casellas got more than one ruling wrong.

But only two broad categories of arguments require our attention.

                                    (1)
                             Summary Judgment

          Our standard of review in this setting is familiar.            We

give a fresh look to Judge Casellas's summary-judgment decision,

affirming only if, viewing the admissible evidence in the light

most agreeable to UBSPR, we spot no genuine dispute of material

fact for a jury to decide and conclude that Candelario is entitled

to judgment as a matter of law.           See, e.g., Soto-Padró v. Pub.

Bldgs. Auth., 675 F.3d 1, 5 (1st Cir. 2012).             That this is a

negligence   case   brings   another    important   principle   front   and

center, complicating things for Candelario.         We explain briefly.

          Puerto Rico law defines negligence as the failure to

exercise due diligence to prevent foreseeable harm.             See, e.g.,

Malave-Felix v. Volvo Car Corp., 946 F.2d 967, 971 (1st Cir. 1991)

(collecting Puerto Rico cases).        To prevail on a negligence claim,

a plaintiff must show duty, breach, causation, and damages, see,

e.g., Woods-Leber v. Hyatt Hotels of P.R., Inc., 124 F.3d 47, 50

(1st Cir. 1997) (marshaling Puerto Rico cases), concepts that all

first-year law students learn. As argued by the parties, this case

                                   -13-
turns on the first two essentials – duty and breach.      Of course

whether a duty exists is typically a legal question for the court.

See, e.g., Wojciechowicz v. United States, 582 F.3d 57, 66 (1st

Cir. 2009); Restatement (Second) of Torts § 328B (noting that the

court decides both "whether [the] facts give rise to any legal duty

on the part of the defendant" and "the standard of conduct required

of the defendant by his legal duty").        But breach of duty –

involving fluid concepts like reasonableness and foreseeability,

see Vázquez-Filippetti v. Banco Popular de P.R., 504 F.3d 43, 49

(1st Cir. 2007) (discussing Puerto Rico law) – is usually an issue

for a factfinder, meaning summary judgment is generally an improper

vehicle for resolving questions of this sort, see, e.g., Jewelers

Mut. Ins. Co. v. N. Barquet, Inc., 410 F.3d 2, 15 (1st Cir. 2005);

Mejías-Quiros v. Maxxam Prop. Corp., 108 F.3d 425, 427 (1st Cir.

1997); Taylor v. Gallagher, 737 F.2d 134, 137 (1st Cir. 1984).   An

exception exists where a reasonable jury could only decide the

breach-of-duty issue one way, in which case a judge can resolve the

matter on summary judgment. See, e.g., Jewelers Mut. Ins. Co., 410

F.3d at 15; Taylor, 737 F.2d at 137.   But such negligence cases are

rare birds indeed.    See 10A Charles A. Wright et al., Federal

Practice and Procedure § 2729, at 533 (3d ed. 1998).

          With these principles in mind, we press on.

                               -14-
                                Liability

             First up is the duty-of-care issue.            UBSPR does not

disagree that it owed Candelario some duty in this situation –

i.e., where (among other things) it was not a party in the

Candelario/Efrón divorce proceedings, was not in Superior Court

when the judge orally vacated the previous attachment order, and,

according to its assistant general counsel, only learned of the

verbal ruling when its client forwarded (along with other papers)

minutes lacking a judge's signature.         And highlighting many non-

Puerto Rico decisions – most prominently Hicks v. Midwest Transit,

Inc., 531 F.3d 467 (7th Cir. 2008), and United States v. Morton,

467 U.S. 822 (1984) – UBSPR agrees with Candelario on what the duty

in play here is:       When a bank-like institution (which we will

simply call a bank from here on out) is handed what is supposedly

an order releasing an attachment, it must see whether the order is

facially valid – but, in this context, that is it; the bank has no

duty to look beyond the four corners of that document in sizing up

its legitimacy.     See, e.g., Hicks, 531 F.3d at 471-72 (discussing,

among others, Morton).       This kind of facial-validity review must

have some substantive content; otherwise it would be an empty

exercise, which is something the law detests.         See, e.g., Ward v.

Comm'r of Soc. Sec., 211 F.3d 652, 656 (1st Cir. 2000).          Hicks and

Morton respectively held that the facial-validity standard applies

when   one   is   deciding   whether   to   comply   with   attachment   or

                                   -15-
garnishment orders.       But we see no reason why that standard should

not hold sway when a bank is deciding whether to accept an order

purporting to vacate an attachment.

          This facial-validity approach – which Judge Casellas

followed – squares with commonsense realities, providing a not-too-

burdensome   way    for    busy   banks    to   live    up   to   some    basic

responsibilities:         protecting      accounts     against    questionable

attachment-related maneuvers, on the one hand, and complying with

valid court orders, on the other.         And given the unique confluence

of circumstances – with everyone (including the judge) agreeing on

a duty formula driven not only by persuasive precedent (with no

contrary caselaw cited to us) but also by common sense – we assume

the Puerto Rico Supreme Court would say:             A bank like UBSPR has a

duty in a case like this to see whether minutes releasing an

attachment are facially valid under Puerto Rico law – with UBSPR

and its ilk presumed to know what a facially-valid order looks like

– but has no duty to go outside the face of that document.               It goes

without saying (though we say it anyway) that Puerto Rico is free

to tell us that we are all wet on this, and thus wipe away what we

have written.

          Next we turn to the breach issue, which is the decisive

issue here. But before we do that, we must get something straight.

UBSPR writes that Judge Casellas focused on whether the oral order

vacating the attachment was effective when spoken, casually adding

                                    -16-
in a footnote to its opening brief that some non-Puerto Rico cases

hold that verbal orders are effective immediately.3                     UBSPR does not

seriously press the point there, however, which makes waiver a real

possibility.          See, e.g., United States v. Zannino, 895 F.2d 1, 17

(1st       Cir.     1990)     (discussing    how        an   argument   is   waived    by

"perfunctory" treatment).              No matter.              UBSPR really pins its

reversal hopes on the minutes that memorialized the verbal order,

stressing that these are what it had "received and reviewed" before

releasing Efrón's accounts.             Unsurprisingly, then, we zero in on

UBSPR's minutes-based arguments.

                  Convinced     that   it      acted         reasonably      under    the

circumstances,         UBSPR's     position        on    the   breach   issue   can    be

succinctly summarized:             Certified by a clerk and placed in the

court file, the minutes, UBSPR says, used clear and unequivocal

language ("[t]he orders and annotations of attachment are hereby

set aside") and are self-evidently valid to the lay mind, which

UBSPR insists is all that is required for facial validity.                            See

Morton, 467 U.S. at 829 n.10 (agreeing that "[f]acial validity of

       3
       These cases do not control our case. One says nothing –
repeat, nothing – about verbal orders. See Smith v. Cain, 132 S.
Ct. 627 (2012). Others are factually distinguishable, since they
involve (as best we can tell) parties who were present when the
judge made his or her oral ruling, not a non-party like UBSPR who
was not. See Roland v. Phillips, 19 F.3d 552 (11th Cir. 1994);
Knott v. Knott, 395 So. 2d 1196 (Fla. Dist. Ct. App. 1981). And the
rest offer little in persuasive analysis and thus are not helpful
on this point. See Dynamic Changes Hypnosis Ctr. v. PCH Holding,
LLC, 306 B.R. 800 (E.D. Va. 2004); In re Bill Heard Chevrolet,
Ltd., 209 S.W.2d 311 (Tex. App. 2006).

                                            -17-
a writ need not be determined upon the basis of scrutiny by a

trained legal mind") (internal quotation marks omitted); accord

Hicks,    531   F.3d    at   472.      And   so,   building      to   the   ultimate

crescendo,      UBSPR   says   that,    having     relied   on    facially     valid

minutes, it unquestionably behaved reasonably in unfreezing Efrón's

accounts and thus cannot be negligent as a matter of law.

            A key premise of UBSPR's argument – that the minutes are

facially valid – is wrong, we believe, though we do not pretend

that this is an easy matter since it involves predicting how the

Puerto Rico Supreme Court would handle this subject.                   Thankfully,

there is enough here to do that, at least that is how we see it.

            We start with Rule 32(B)(1), which, again, requires that

the minutes – representing the "official record" of in-court and

in-chambers events – "be signed by the judge and notified to the

parties" if they commemorate "a ruling or order . . . rendered in

open court . . . ."4         George Orwell famously said that "[t]o see

     4
         The relevant text states:

     The minutes will constitute the official record of the
     most important incidents that occur at the hearing in
     court and in chambers, and will be prepared as prescribed
     by the rules established by the Administrative Director
     of the Courts and certified by the Clerk of Court
     Services.

          The original minutes will be included in the court
     record. . . .

     . . . .

            The minutes will not be notified to the parties or

                                        -18-
what is in front of one's nose needs a constant struggle."5   But it

does not take much to see that no judge signed the minutes here.6

Sure, we know of no Puerto Rico Supreme Court case holding minutes

invalid for lack of a judge's signature.     And yet while the Erie

lights may seem dim, they do illuminate the likely path that that

court would take.   Consider Cruz González v. Thermo King de P.R.,

Inc., a Puerto Rico Court of Appeals case stating that "[o]nly"

with a judge's signature will the minutes "constitute a judicial

holding."   Civ. No. CPE2001-0270 (401), 2006 WL 4073763 (TCA Dec.

20, 2006) (certified translation provided by the parties at our

request, slip. op. at 2) (emphasis added).     The reasoning behind

that conclusion is straightforward:   Without a judge's signature,

     to counsel, unless they include a Resolution or an Order
     issued by the judge in open court, in which case, [they]
     will be signed by the judge and notified to the parties.

(Emphasis removed.)   For the cite, see supra note 1.
     5
       George Orwell, In Front of Your Nose, in 4 The Collected
Essays, Journalism and Letters of George Orwell: In Front of Your
Nose, 1945-1950 125 (Sonia Orwell & Ian Angus eds., 1968).
     6
       True, Judge Casellas did find UBSPR negligent for relying on
minutes neither signed by a judge nor formally notified to the
parties. We focus solely on the signature issue, however, because
(unlike with notice) whether there is a signature is readily
apparent from the face of the minutes, and so is most relevant in
deciding if UBSPR satisfied its duty of seeing that that document
was facially valid. In a footnote to her opening brief, Candelario
seemingly suggests that the minutes are also defective because the
wrong clerk "certified" them.      But the claim is inadequately
developed there and so is not properly preserved for review. See,
e.g., Solis-Alarcón v. United States, 662 F.3d 577, 584 (1st Cir.
2011); Zannino, 895 F.2d at 17.

                               -19-
"the minute[s] only reflect[] the impression of the . . . courtroom

employee who prepared it, which will not necessarily coincide" with

what the judge actually ruled "in open court."        See id.   And that

signature   formality   must   be   respected,   otherwise   chaos   could

result, Cruz González surely implies.      See id.7   So in other words,

the judge's-signature requirement is not a picayune thing to be

brushed aside whenever it pleases, at least according to Cruz

González.   And to suggest, as UBSPR does, that that requirement

means nothing in gauging the minutes' validity strikes us as

incorrect – since in such a world a bank could end up following a

non-judicial holding, reflecting the court clerk's thoughts, not

the judge's, which is a no-no.         Given all this, we, like Judge

Casellas, are reasonably confident that the Puerto Rico Supreme

Court would consider a judge's signature indispensable to the

minutes' facial validity in cases of this sort.

     7
       Generally speaking, Puerto Rico law is what the Puerto Rico
Supreme Court says it is. See, e.g., West v. Am. Tel. & Tel. Co.,
311 U.S. 223, 236 (1940). But we can and do look to Cruz González
because there is no reason to think that the high court would hold
differently. See Fid. Union Trust Co. v. Field, 311 U.S. 169, 177-
78 (1940) (stressing that "[a]n intermediate state court in
declaring and applying the state law is acting as an organ of the
State and its determination, in the absence of more convincing
evidence of what the state law is, should be followed by a federal
court in deciding a state question"); see also West, 311 U.S. at
236 (similar).     And we accept Cruz González for its sheer
persuasiveness, as we are entitled to do. See P.R. Laws Ann. tit.
4, § 24x.

                                    -20-
           Ever persistent, UBSPR suggests that Hicks and Morton

help highlight the facial validity of the minutes.            We think the

opposite is true.

           The Hicks plaintiff sued a financial services company for

negligence after the company froze one of his accounts.              See 531

F.3d at 468.   The company pointed out that it had acted under a

judicial attachment order.     See id. at 468-70.       But the plaintiff

insisted that the order was defective, arguing that the court-

appointed receiver who had asked for the attachment should have but

failed to post a surety bond.      Id. at 471.    He raised some service-

of-process and personal-jurisdiction issues too.            Id. at 472-73.

Applying a facial-validity test, the Hicks court bought none of it.

The   attachment    order,   the   court    stressed,   had    the   classic

"trappings of valid legal process," bearing the case number and

caption, the judge's signature, and the court clerk's attestation.

Id. at 473.    Some defects are obvious from a quick look at an

order, the Hicks court noted.         Id. at 472.       But these ones –

dealing with the posting of a surety bond, service of process, and

personal jurisdiction – were not.          Id. at 472-73.     And the Hicks

court held that an attachment-order recipient has no duty to go

beyond the "indicia of legitimacy" and scour the law books for

potential legal problems in deciding whether to comply.              Id.

           So too the Morton Court.        There, an Alabama tribunal had

issued a writ – on a form regularly used by that court – subjecting

                                   -21-
the pay of an Air Force officer in Alaska to garnishment for unpaid

child support and alimony.                467 U.S. at 824.                 The government

honored the writ, over the officer's objections.                          Id.   Not willing

(apparently)       to     take   this    lying    down,       the    officer      sued    the

government in federal court to recover the amounts withheld from

his check, arguing that the Alabama court had no jurisdiction over

him when it issued the writ.               Id. at 824-25.            A federal statute

lets the government off the liability hook in situations like this

if   it    had    acted    "'pursuant     to     legal   process          regular    on   its

face . . . .'"            Id. at 825 (quoting 42 U.S.C. § 659(f)).                        The

Morton court concluded that the writ fell within that category,

adding that a garnishee is not required to go beyond the writ's

face      and    explore    arcane      corners    of     the       law    like     personal

jurisdiction in figuring out whether to obey.                       Id. at 828-32.

                Compare those cases with ours and the differences are

night and day.       The Hicks and Morton orders were "regular" on their

"face," full of telltale validity signs – a judge's signature in

Hicks,     for    example;       the   court's    use    of     a    standard       writ-of-

garnishment form in Morton. And one could not spot the complained-

of defects simply by eyeballing the documents.                             Cf. Millard v.

United States, 16 Cl. Ct. 485, 489 & n.3 (1989) (holding that the

supposed facial defects with an order – that it (a) failed to

comply with California laws concerning personal service and default

judgments and (b) was not a final order – "are precisely the sort

                                          -22-
of    defects"   that    "a   facially-directed    inquiry   was    meant   to

exclude," adding that the order was "complete in all its details,"

having (among other things) "the stamped signature of the judge

[who] ordered the action").        Contrastingly, the minutes here were

not    "regular"    on   their   face,   lacking   an   essential   validity

indicator under Rule 32(B)(1) – a judge's signature.                And this

defect jumps off the page.         Consequently, Hicks and Morton hurt

rather than help UBSPR's facial-validity theory.

            Still hoping to persuade us differently, UBSPR basically

argues that the Puerto Rico Supreme Court would not insist on

strict compliance with Rule 32(B)(1)'s terms, adding that our

opinion in Goya Foods, Inc. v. Wallack Mgmt. Co., 290 F.3d 63 (1st

Cir. 2002) ("Goya," for short), should light the way.               We think

not.

            Goya refused to require slavish compliance with the

requirements of Puerto Rico Rule of Civil Procedure 56, id. at 72,

a rule that lets courts issue provisional remedies like ex parte

attachments:       "'The attachment and prohibition to alienate real

property,'" the rule reads, "'shall be effected by recording them

with the Registry of Property and notifying the defendant,'" id. at

70 (quoting Rule 56.4). Among other problems, the attachment there

was never recorded.       Id. at 71.     Yet we held it effective.    Id. at

74.    And while UBSPR's reliance on Goya has a certain superficial

appeal, that case differs from ours in a critical respect (there

                                     -23-
are others, but this is enough for now):     The Puerto Rico Supreme

Court construes Rule 56 expansively, we noted, adding that that

court believes flexibility is that rule's "'"greatest virtue"'" –

a "'"virtue"'" judges "'"should promote and preserve"'" rather than

bedevil "'"with technical concepts and requirements."'"        Id. at 71

(quoting HMG Prop. Investors, Inc. v. Parque Indus. Rio Canas,

Inc., 847 F.2d 908, 914 (1st Cir. 1988), which in turn was quoting

F.D. Rich Co. v. Super. Ct., 99 P.R.R. 155, 173 (1970)).       But UBSPR

cites no Puerto Rico cases (nor are we aware of any) requiring

courts to construe Rule 32(B)(1) flexibly, like courts must do when

working with Rule 56.   Actually, the cases that the parties talk

about require strict adherence to Rule 32's terms, see, e.g.,

Sánchez Torres v. Hosp. Dr. Pila, 158 P.R. Dec. 255, 2002 WL
31789282 (2002) (certified translation provided by the parties) –

indeed, we need not look beyond what the Puerto Rico appellate

courts did here to know this:       Remember, these courts spurned

Candelario's   appeals/petitions   because   Rule   32(B)(1)    was   not

followed to a T.    Admittedly, these cases deal with an order's

appealability, not enforceability, as UBSPR is quick to point out

(e.g., the cases stress how the minutes must be signed by the judge

and notified to parties to fire up the appellate process).            But

they help show which way the Erie wind blows in Puerto Rico, a

breeze (if only a slight one) indicating that the loose tack taken

with Rule 56 has no business in this case.

                               -24-
          The short of it is that, despite UBSPR's contrary view,

we believe that the fought-over minutes are facially defective

under Puerto Rico law for lack of a judge's signature (though,

again, the    highest    or   first-writing    court   of   Puerto   Rico    is

obviously free to reject our Rule 32(B)(1)-based analysis). Yet we

cannot end our breach discussion here.             As a negligence case,

reasonable care applies, see, e.g., Vázquez-Filippetti, 504 F.3d at

49, meaning the question now is:          Was UBSPR's mistake in deeming

the minutes facially valid reasonable under the circumstances?

Reasonableness in this context is generally a question for the

jury, as we mentioned a few pages ago.          See, e.g., Jewelers Mut.

Ins. Co., 410 F.3d at 15; Taylor, 737 F.2d at 137.              So a judge

cannot   decide   that    issue    on    summary   judgment     unless      the

reasonableness or unreasonableness of what a party did or did not

do is beyond dispute.     See, e.g., Jewelers Mut. Ins. Co., 410 F.3d

at 15; Taylor, 737 F.2d at 137.         Cases like that are doubtless few

and far between, which is why summary judgments for negligence

plaintiffs are not everyday occurrences.           See, e.g., 10A Federal

Practice and Procedure, supra, § 2729, at 573-75.

          What we need to figure out, then, is whether – if the

summary-judgment record were a trial record – a rational jury could

only conclude that UBSPR acted unreasonably in releasing the

attachment.    If the answer is yes, the summary judgment for

Candelario on this issue can stand.             If the answer is no, a

                                   -25-
reversal is necessary.        See, e.g., Taylor, 737 F.2d at 137.

Viewing the facts and inferences (as we must) most favorably to

UBSPR, we believe the answer is indeed no.

            Getting a grip on what makes minutes facially valid in

Puerto Rico required some work on our part.         Again, no Puerto Rico

case has stamped minutes facially invalid for want of a judge's

signature.    We got there through a judicial mind-reading exercise

of sorts, picking up on clues pointing out an Erie direction.                  Ours

is an educated prediction (we are not in the same predicament as

the philosopher who compared his calling to searching in a dark

room for a black cat that is not there), but it is a prediction

still the same.

            Now consider how UBSPR handled the situation.             Based on

a   bank   official's   unsworn   declaration,    see   28   U.S.C.       §    1746

(permitting    a   document   like   this   to   substitute   for     a       sworn

affidavit), we know that UBSPR had its lawyers look the minutes

over before unfreezing Efrón's accounts.         But what steps they took

in this process the record does not say.             Yet approaching the

summary-judgment materials from a UBSPR-friendly vantage, one can

reasonably infer that they made that call (at least in part)

because of the absence of any Puerto Rico case holding unsigned

minutes facially defective – a case shortage that caused Judge

Casellas to ask the Puerto Rico Supreme Court for help, by the way.

Also and importantly, once Candelario read the minutes (which was

right around the time UBSPR released the attachment), she said

                                     -26-
nothing either in her communiqués with UBSPR or in her motion to

reconsider with the Puerto Rico Supreme Court that suggests that

she thought that the nowhere-to-be-found signature was a problem –

a fair inference could be that she, like UBSPR, believed that the

missing signature did not affect the minutes' validity.           On top of

all that, UBSPR's compliance manual provides (emphasis ours) that

"[o]nce placed on an account," an attachment "can only be released

upon receipt of a court order or other instruction from the court,"

and the underscored phrase plausibly suggests that something short

of signed minutes may suffice.      Critically, Candelario concedes

that the UBSPR manual is "consistent" with Puerto Rico law.

           Obviously she draws a different inference from that

passage.   And she also argues that there is plenty here from which

a rational jury could infer unreasonableness on UBSPR's part:

(a) UBSPR's lawyers "should have advised" UBSPR "that Rule 32

requires the judge's signature," she writes – but did not.

(b) UBSPR could have asked the Superior Court judge to clarify any

"doubts it had" concerning "the impact of the minutes" (something

it had no trouble doing, she adds, as its earlier motion to clarify

the first attachment order shows) – but did not.            And (c) UBSPR

could have taken other legal steps to protect itself (filing an

interpleader action, perhaps, she suggests) – but, once again, did

not.   At this stage, however, we are duty-bound to draw all

reasonable inferences helpful to UBSPR, not Candelario.                And

because the   facts   here   "admit[]   of   more   than   one   inference"

                                 -27-
concerning   the     "reasonableness"       of    UBSPR's   conduct,     the

reasonableness issue must go to the jury.         Taylor, 737 F.2d at 137.

          Let us be crystal clear.         At this point, we simply hold

that, on the record as it currently exists, a level-headed jury

could find   that   UBSPR   acted   reasonably, which       makes   a   trial

necessary.   Of course whether UBSPR did act reasonably remains to

be determined.     And the trial may cast the facts in a completely

different light.     Also, now that we have made our Erie prophecy

that the Puerto Rico Supreme Court would consider minutes unsigned

by a judge invalid, Candelario may want to ask Judge Casellas to

reopen discovery, though we express no view on how a motion like

that might fare.

                                Damages

          The parties spill much ink debating a host of damages-

related issues (the amount, the right interest rate, etc.).               But

because we reverse on liability, we need not grapple with any of

their arguments.     Instead, we simply vacate the damages-related

rulings and award (including those having to do with interest) and

stress that these issues can be hashed out as necessary on remand.

                                  (2)
                            Judge on Remand

          Which district judge should handle the case from here on

out is something that is sharply contested by the parties.               See

generally D.P.R.R. 3A(e)(3) (indicating a general presumption in

favor of remanding to the same judge).           Citing 28 U.S.C. § 455(a)

                                    -28-
and § 2106, UBSPR – over Candelario's spirited opposition – says

that a new judge should run any remand.    Section 455(a) requires a

judge to recuse himself whenever "his impartiality might reasonably

be questioned."     And section 2106 lets us craft remands in the

interest of justice, a proviso that empowers us to direct that a

different judge take over when we send a case back.      See Hull v.

Mun. of San Juan, 356 F.3d 98, 104 (1st Cir. 2004).     Importantly,

UBSPR does not invoke section 455(b), which offers a list of

situations requiring recusal, one of which is where a judge "has a

personal bias or prejudice concerning a party . . . ."        See 28

U.S.C. § 455(b)(1).      Also importantly, the parties agree that

reassignment to another judge on remand is for the rare and

exceptional case.    See Conley v. United States, 323 F.3d 7, 15 (1st

Cir. 2003) (en banc).    This is not that case, and here is why:

          Training its sights exclusively on the post-judgment

rulings, UBSPR accuses Judge Casellas of sympathizing too much with

Candelario – for proof, it points to his writing about her "10-year

long quest to access her rightful share of the marital estate," her

"plight to collect" the judgment, and Efrón's effort to "turn the

tables" on her.     UBSPR also blasts Judge Casellas for saying both

that it had acted "hast[ily]" in "accomodat[ing] the whims" of

Efrón, one of its "wealthy client[s]," and that it had poorly

briefed the legal issues in its post-judgment papers.    But judging

is all about making judgments, obviously. See Nelson v. Scala, 192
F.3d 32, 35 (1st Cir. 1999).     And human nature being what it is,

                                 -29-
those tasked with making some of the hardest calls imaginable may,

quite understandably, develop strong feelings about the cases they

work on.   See, e.g., Liteky v. United States, 510 U.S. 540, 556

(1994).    So   while   they   must   avoid   even   the   appearance   of

partiality, even when bias or prejudice does not exist, see, e.g.,

id. at 548, we do not expect trial judges to act like unemotional

cyborgs of sci-fi fame, see Logue v. Dore, 103 F.3d 1040, 1046 (1st

Cir. 1997); see also Obert v. Republic W. Ins. Co., 398 F.3d 138,

145 (1st Cir. 2005).    That is why problems with the views they form

in slogging through cases typically do not provide "a sound basis

either for required recusal or for directing that a different judge

be assigned on remand."    Hull, 356 F.3d at 104 (citing Liteky, 510

U.S. at 555-56, which held, among other things, that judicial

comments "critical or disapproving of, or even hostile to, counsel,

the parties, or their cases, ordinarily do not support a bias or

partiality challenge").     This case exemplifies the general rule,

not the exception to it:       Taking everything into account, we see

nothing suggesting that Judge Casellas cannot reapproach the case

with an open mind, which erases any aura of bias.          See Maldonado

Santiago v. Velázquez García, 821 F.2d 822, 832 (1st Cir. 1987).

The upshot, then, is that UBSPR cannot get the remedy it seeks.

                               CONCLUSION

           Our work finally over, we vacate the summary judgment for

Candelario and remand for further proceedings consistent with this

                                  -30-
opinion, though we do not think that we are crossing any lines in

"suggesting that this is a case best resolved by settlement."   See

Bos. Edison Co. v. Fed. Energy Regulatory Comm'n, 233 F.3d 60, 69

(1st Cir. 2000).    Again, we intimate no view on the ultimate

outcome.

           Vacated and Remanded.   Costs to UBSPR.

                               -31-