Amicus Curiae Brief — Rivet v. Regions Bank of Louisiana
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> Supreme Court, U.S.
FILED
ss DEC 22 2000
In The |_ OFFICE OF TH CLEWK !
Supreme Court of the United States
¢
MARY ANNA RIVET, MINNA REE WINER, EDMOND
G. MIRANNE, and EDMOND G. MIRANNE, JR.,
Petitioners,
versus
REGIONS BANK, WALTER L. BROWN, JR.,
PERRY S. BROWN, and FSA, L.L.C.,
Respondents.
¢
On Petition For Writ Of Certiorari
To The United States Court Of Appeals
For The Fifth Circuit
o
BRIEF OF THE STATE OF LOUISIANA, AS AMICUS
CURIAE, SUPPORTING THE PETITION FOR
WRIT OF CERTIORARI
¢
RIcHARD P. IEYous
Attorney General
Counsel of Record
AnciE Rocers LAPLACE
Assistant Attorney General
LouisIANA DEPARTMENT OF JUSTICE
P.O. Box 94005
Baton Rouge, Louisiana 70804
(225) 342-1134
Attorneys for The State of Louisiana
as Amicus Curiae
225-6964
COCKLE LAW BRIEF PRINTING CO., (800
OR CALL COLLECT (402) 342-283
—-
QUESTIONS PRESENTED
(1) Must a federal bankruptcy court’s order affect-
ing property rights in Louisiana be domesticated and
enforced according to the statutes of the State of Louisi-
ana, or may those statutes be completely ignored on the
theory that the judgment is somehow “self-executing”?
(2) May a federal bankruptcy court order be so con-
strued as to necessarily result in erroneous and inaccu-
rate entries being maintained in the Louisiana public
records, thereby irreparably damaging the integrity of the
public records of the State of Louisiana?
il
LIST OF PARTIES
The State of Louisiana has no knowledge of any
parties to the proceedings in the Court whose judgment is
sought to be reviewed here other than those whose names
appear either in the caption of the case or in the section
entitled “List of Parties” in the Petition for a Writ of
Certiorari. See, Petition for Writ of Certiorart, at ii.
ili
TABLE OF CONTENTS
Page
Cpsetions Presented... ....5ccccsvcaveccscisnevesase i
oF 8. | rer rrerrrr rr errr rst er yr rc ii
:. tae Perr errr iii
cc Ue 2 errr rer iv
Opinions Below ...............eee eee e eee e eee eeee 1
Giatemnent of TarieGiction. « «6.06 osc0ecesacnavcaun cs 1
Interest of the State of Louisiana as Amicus Curiae.... 2
Constitutional and Statutory Provisions Involved...... 2
a ea Per ree er ree rer 3
I. Basis for Federal Jurisdiction in the Court of
ee Peer rrr er Terre ret eer tee re 3
Me Dee OE FOCES ... oo cic n ccc ai Tecan sccnces 3
III. Course Proceedings and Disposition Below.... 3
IV. The Opinion Below ..............-...eeeeeeees 3
Argument for Allowance of the Writ............--. 4
I. Summary Of Argument..................52+5: 4
II. The State of Louisiana cannot accept a situation
where its valid statutory enactments are simply
ignored based upon the entry of a bankruptcy
I BE ona 5 coun sdcn nb anencass es cantene sss 6
III. The State of Louisiana cannot accept a situation
where the integrity of its public records is com-
promised by the entry of a bankruptcy court
eel aa ec kG osc chead ine Wee 06.65 eawene bees 15
iv
TABLE OF AUTHORITIES
Page
Cases:
Amoskeag Bank v. Chagnon, 133 N.H. 11, 572 A.2d
SOE ere eee ere ee 16
Anthony v. Butler, 38 U.S. (13 Pet.) 423, 10 L.Ed.
od BR See err er rrr rr erm 17
Baker by Thomas v. General Motors Corp., __ U.S.
Sn Oe CORO ss rb is bas anerwaniaes 7, 8, 12
Clarke v. Willard, 294 U.S. 211, 55 S.Ct. 356, 79
iS % ¢: . Baer Seer eee 17
Davis v. Davis (In re Davis), 170 F.3d 475 (Sth Cir.) (En
banc), cert. denied, 120 S.Ct. 67 (1999)....... 7, 10, 17, 18
Dick v. Balch, 33 U.S. (8 Pet.) 30, 1 L.Ed. 856 (1834) .... 17
Durfee v. Duke, 375 U.S. 106, 84 S.Ct. 242, 11
Se CI Gk 5 ae eta deekaehehueak een 14
Ferguson v. Porter, 359 So.2d 676 (La. App. 1st Cir.
ccc, COE Ce EE CET Se eee er oor 18
Green v. Bushkirk, 72 U.S. (5 Wall.) 307, 18 L.Ed.
eT CN 5 tay ahacnsd ced bie eEN UE tee eee eueun 17
Hampton v. McConnell, 16 U.S. (3 Wheat) 234, 4
Ss ee EEN 65 cad Ove chee dCaenhatucasatbaes 11
Hervey v. Rhode Island Locomotive Works, 93 U.S. (3
Otte) 664, 23 L.Ed. 10035 C1676) ...... 2. cs cncecenes 17
Lepard v. Lepard, 722 So.2d 367 (La. App. 2nd Cir.
a eee eee ey reer rr rr ery ee Pree ee ep ere 13
Levinz v. Will, 1 U.S. (1 Dall.) 430, 1 L.Ed. 209
PRPS yh ks beaka ka ae eee 17
TABLE OF AUTHORITIES - Continued
Page
McDuffie v. Walker, 51 So. 100 (La. 1909) ............ 16
McElmoyle ex rel. Bailey v. Cohen, 13 Pet. 312, 10
Lt, BFF COGRRP ss <0 cds hese vend eceeeeew bee cae 8
Mills v. Duryee, 11 U.S. (7 Cranch) 481 (1813)....... 11
Milwaukee County v. M. E. White Co., 296 U.S. 268,
36 S.Ct. 229, GO L.Bd. ZOD CIGGE). . «cas vanscsncsves 10
Osteoimplant Technologies v. Rathe Products, 107
Md.App. 114, 666 A.2d 1310, cert. denied, 341
Md. 648, 672 A.2d 623 (1995) ......scccssvcesveses 11
Pacific Gas & Elec. Co. v. State Energy Resources
Conservation and Dev. Comm'n, 461 U.S. 190, 103
DAS. E719, 7D 1.2 Foe CIGD cise xcs cecs duress 7
Parker v. Wood, 1 U.S. (1 Dall.) 436, 1 L.Ed. 212
to. Pr reerrre er. errr er Tyee, ir erry eee 17
Phillips v. Parker, 483 So.2d 972 (La. 1986)........... 16
Property Asset Management v. Pirogue Cove Apts.,
693 So.2d 1217 (La. App. 4th Cir. 1997)........... 18
Regions Bank of Louisiana v. Rivet, 224 F.3d 483 (5th
Bee Tere eT re er eee ree passim
Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 67
S.Ct. 1146, 91 L.Ed.20 1447 (1967) ......00ccccsers 17
Riley v. New York Trust Co., 315 U.S. 343, 62 S.Ct.
608, 86 L.Ed. 885, rehearing denied, 315 U.S. 829,
GE SAL. FES, OS Lie. TZES (IPGE) ov cick ceciw ees 10
Security Trust Co. v. Dodd, Mead & Co., 173 US.
624, 19 S.Ct. 545, 43 L.Ed. 835 (1899) ............. 17
vi
TABLE OF AUTHORITIES —- Continued
Page
Socony Mobile Oil Co. v. Burdette, 309 So.2d 655 (La.
BOF i vcs ceases ceavesseenenddeccescrdeenessaacsacs 18
Sunderland v. United States, 266 U.S. 226, 45 S.Ct.
64, 69 L.Ed. 259 (1924) ..... 0... cee eae 17
Tennessee ex rel. Sizemore v. Surety Bank, 200 F.3d -
373 (Sth Cir. 2000). .... 0.0.0... ccc cece eee 13
Thompson v. Whitman, 85 U.S. (18 Wall) 457, 21
L.Ed. 897 (1873).............. Wakeueueescuusceteces 8
United States v. Fox, 94 U.S. (4 Otto) 315, 24 L.Ed.
Pe CRPOD sca se ans nsacocsaseccetnesavaveéddssccce 17
Matter of De La Vergne, 156 B.R. 773 (Bkrtcy.E.D.La.
CNC kd hai wy kena wala a ad baue cee eka oa ee ee eae 16
Watts v. Waddle, 6 Pet. 389, 8 L.Ed. 437 (1832)....... 12
WellTech, Inc. v. Abadie, 666 So.2d 1234 (La. App.
Sth Cir), rehearing denied, writ denied, 672 So.2d
690 (La. 1996), writ denied, 712 So.2d 864 (La.
Orr ry wen TAT bm nro ese ay Ly eee ae 13
Wisconsin v. Pelican Ins. Co. of New Orleans, 127
U.S. 265, 8 S.Ct. 1370, 32 L.Ed. 239 (1888) ......... 8
CONSTITUTIONAL PROVISIONS:
ee eS rr rr rte ery ie 8, 10
8 Be a re re re ees passim
ie en, Ree. BD, & OO CR i ihices cadiswieds dive 15
——
Vii
TABLE OF AUTHORITIES - Continued
Page
FEDERAL STATUTES:
LE UG. § ORI) obese ccvesssescenaess caeaaeeee 19
ae Wash. & TGR <s06 cose ceh ene secvekeesaeeee 1
20 UDA... © MGR sc vrei ncavide' 16sehs teen Ree passim
ye ae Br eT rey pret ks 6 2, 8, 10, 11
Be Us B es ec ieas cast cossuonesmans eae passim.
STATE STATUTES:
c. TOR SO, PRRs svc eatin ccenseen chee sewer 15
re SS | errr ere eee tr ee passim
ee 8. 6 Rie rere passim
i. Te Sek: Tee kw oe biiccics cide dduebeceeeanesees 20
La. Rev. Stat. Ann. Title 13, Part III (Table) (West
POPE eee eee reer Peery ree ee 11
La. Rev. Stat. 13:4241 to 13:4247............... 6, 11, 14
eS Br ee ee passim
Rh TOM: SORE. SIG kd dic dc tne vceuddauneverase ee passim
Le. ome Coe, Pome. Ave: ZaG) A ci csecicvncevas passim
es gk Ff Seer rrr re re ere rs: 16
Fee fe Fe RT er reer rer rcr eS 15
Se te FF Bg ere rer rr ry rere rere 16
ah, Ge ee OU: Be veo vc xkcd csc dvasb isan ksosces 20
Uniform Enforcement of Foreign Judgments Act
EE SE ccs cn peau na bueekackuan Weawus 10, 11, 14
Vili
TABLE OF AUTHORITIES - Continued
Page
Court RUuLeEs:
U.S. Sup. Ct. R. 37.4...... cece cece cere ees eereeveeee 1
, 8 be) | OPT errr ee 13
SCHOLARLY COMMENTARY:
Alejandro M. Garro, The Louisiana Public Records
Doctrine and The Civil Law Tradition (1989)......... 16
Lee Hargrave, Public Records and Property Rights,
56 La.L.Rev. 535 (1996) ........ccccsecsevevenenenss 15
William V. Redmann, The Louisiana Law of Recorda-
tion: Some Principles and Some Problems, 39
; PR ee 8 OR reer es ere 15
William L. Reynolds, The Iron Law of Full Faith and
Credit, 53 Md.L.Rev. 412 (1994) ...........000+. 13, 14
Restatement (Second) of Conflicts of Laws (1971)........ 8
J. Story, Conflicts of Laws, § 609 (7th ed. 1872)........ 8
1 Peter S. Title, Louisiana Real Estate Transactions
CRED ccc ebieunnbituked ee ede ed teaee Perey ee Webekekhs 16
1
TO THE HONORABLE CHIEF JUSTICE AND THE
ASSOCIATE JUSTICES OF THE SUPREME COURT OF
THE UNITED STATES:
MAY IT PLEASE THE COURT,
The State of Louisiana, as Amicus Curiae, through its
Attorney General, hereby supports the Petition for a Writ
of Certiorari in this matter, and respectfully prays that a
Writ of Certiorari issue to review the Opinion and Judg-
ment of the United States Court of Appeals for the Fifth
Circuit entered in this matter on August 22, 2000.
OPINIONS BELOW
The Opinion and Judgment of the three-judge panel
of the United States Court of Appeals for the Fifth Circuit
was entered August 22, 2000, and is reported as Regions
Bank of Louisiana v. Rivet, 224 F.3d 483 (Sth Cir. 2000). The
Opinion is also reprinted in the Appendix to the Petition
for a Writ of Certiorari (hereinafter “Petition”), at pages
A-1 through A-25. The Judgment and Order and Reasons
of the United States District Court for the Eastern District
of Louisiana, entered April 14, 1999, are reprinted in the
Appendix to the Petition at pages A-25 through A-39. For
briefing purposes, the term “opinion below” will refer to
the Fifth Circuit’s opinion.
STATEMENT OF JURISDICTION
The judgment of the oral argument at the United
States Court of Appeals for the Fifth Circuit was entered
on August 22, 2000, affirming in part and reversing in
part the Order and Reasons of the United States District
Court for the Eastern District of Louisiana, dated April
13, 1999. The jurisdiction of this Court is invoked by the
Petition under 28 U.S.C. § 1254(1). This Brief is filed on
behalf of the State of Louisiana, as Amicus Curiae, by its
Attorney General, pursuant to Rule 37.4 of the Rules of
the Supreme Court of the United States.
2
INTEREST OF THE STATE OF LOUISIANA
AS AMICUS CURIAE
The State of Louisiana has a direct and specific inter-
est in the resolution of the matters raised in this case in
two respects:
(1) to ensure that the State’s valid statutory enact-
ments may not be ignored on the basis of the appellate
court’s interpretation that an order by a federal bank-
ruptcy court is “self-executing” upon entry, and therefore
that Louisiana’s statutes relating to domestication and
enforcement of such judgments may be ignored; and
(2) to ensure that the integrity of the State’s public
records is not compromised by the appellate court’s inter-
pretation of the effect of the entry of an order by a federal
bankruptcy court.
The State of Louisiana also appeared as Amicus Cur-
iae, in the United States Court of Appeals for the Fifth
Circuit, to assert these same interests.
CONSTITUTIONAL AND
STATUTORY PROVISIONS INVOLVED
In addition to those Constitutional and statutory pro-
visions set forth in the Petition (Petition, at 2-4), the State
believes that this case also involves the following provi-
sion of the United States Code, which is set forth in
pertinent part:
Title 28 U.S.C. § 1738:
The Acts of the legislature of any State . . . of the
United States . . . [and] The records and judicial
proceedings of any court of any such State...
[when] authenticated [pursuant to this Act],
shall have the same full faith and credit in every
court within the United States . . . as they have
by law or usage in the courts of such State-
. . . from which they are taken.
3
STATEMENT OF THE CASE
I. Basis for Federal Jurisdiction in the Court of First
Instance
This action was originally commenced by Respon-
dents pursuant to The Anti-Injunction Act, 22 U.S.C.
§ 2283, and The All Writs Act, 22 U.S.C. § 1651.
II. Statement of the Facts
The State of Louisiana hereby adopts the Statement
of Facts contained in the Petition for a Writ of Certiorari.
See Petition, at 4-8.
III. Course of proceedings and disposition in the
Court below.
The State of Louisiana hereby adopts the statement of
these items as contained in the Petition for a Writ of
Certiorari. See Petition, at 4-8.
IV. The Opinion Below.
Similarly, the State of Louisiana concurs in Peti-
tioners’ description of the opinion below. See Petition, at
8-9. In addition, Louisiana believes that the following
aspects of the opinion below will be of particular impor-
tance when considering the Petition for a Writ of Cer-
tiorart:
1. The opinion below creates a unique species of
self-executing judgment, which finds no precedential
support in any reported opinion. Petition, at A-11 to A-15,
224 F.3d at 490-491.
2. The opinion below effectively invalidates two
Louisiana statutory enactments, La. R.S. 9:5251 and
9:5031, with no finding that they are unconstitutional, or
that they have been preempted by an Act of Congress.
Petition, at A-11 to A-15, and nn. 10 & 11; 224 F.3d at
490-491, nn. 10 & 11.
+
3. The opinion below invalidates, at least in part,
Louisiana’s statutory scheme for the domestication and
enforcement of foreign judgments - also with no finding
of unconstitutionality and no preemption analysis — by
the unwarranted expedient of assuming that all items
which might otherwise be determined by a State judge at
a domestication hearing will have been conclusively
decided by the rendering court. Petition, at A-11 to A-15,
224 F.3d at 490-491.
ARGUMENT FOR ALLOWANCE OF THE WRIT
I. Summary of Argument.
Stated succinctly, there are two basic reasons why the
State of Louisiana believes that a Writ of Certiorari
should be granted to review the opinion below, and that
the decision should be vacated: (1) Louisiana cannot
accept a situation where the order of a federal bankruptcy
court is held to authorize private parties to ignore the
State’s valid statutory enactments. (2) The State of Louisi-
ana cannot accept a situation where the issuance of a
federal bankruptcy order is interpreted so as to compro-
mise the integrity of the State’s public records.
The opinion below has the effect of invalidating a
State statutory scheme regulating both the domestication
and enforcement of foreign judgments, including federal
judgments, in Louisiana as well as the existence of liens
and mortgages on Louisiana real property interests fol-
lowing the entry of the sale order of a federal bankruptcy
court. The statutory scheme in question - consisting of
La. R.S. 9:5031 and 9:5251; La. R.S. 13:4241 and 13:4242;
and La. C.C.P. art. 2541 - is a hybrid. On the one hand
this scheme is part of the State’s system of regulating real
property interests. La. R.S. 9:5031 and 9:5251. On the
other hand it consists of the means by which the State
provides for the domestication and enforcement of
5
foreign judgments in Louisiana.! Louisiana has a vital
interest in both of these aspects of its statutory scheme
and cannot accept a situation such as the one created by
the opinion below, unless and until this validly enacted
statutory scheme is held to have been preempted by the
United States Congress. Heretofore, such preemption has
not been found, and the opinion below does not even
engage in a preemption analysis before it implicitly
sweeps aside these legislative enactments.
In addition, the opinion below will inevitably have
the effect - perhaps unintended, but nevertheless very
pointed - of compromising, if not destroying, the integ-
rity of the public records of Louisiana. If the integrity of
Louisiana’s public records remains thus compromised,
the very foundation of Louisiana’s entire civil-law system
of property holding will also be called into question.
Thus, not only is the integrity of Louisiana’s public
records at issue, but the opinion also infringes imper-
missibly on Louisiana’s right, secured by the Tenth
Amendment, to regulate the real property within her
borders.
Conversely, no legitimate federal interest, nor any
interest secured by the Bankruptcy Code, is served by the
opinion below. Louisiana does not question the right of a
bankruptcy court to enter an order, pursuant to the Bank-
ruptcy Code, mandating that property of a bankrupt estate
be sold free and clear of liens and encumbrances, nor does
it question the effectiveness of that order as between the
parties thereto. Rather, the Louisiana statutory scheme
merely places such orders in the same position as all other
federal judgments, as well as all sister-state judgments, by
requiring that the rights granted thereunder must be
secured through the remedy of domestication and enforce-
ment of the judgment in Louisiana.
1 In conformity with the Uniform Enforcement of Foreign
Judgments Act (revised 1964), La. R.S. 13:4241 defines the term
“foreign judgment” to include all federal judgments.
6
II. The State of Louisiana cannot accept a situation
where its valid statutory enactments are simply
ignored based upon the entry of a bankruptcy court
order.
La. R.S. 9:5031 and 9:5251 clearly mandate that no
mortgage or other form of security interest in Louisiana
real property may be “in any manner affected”, as the
result of a sale in bankruptcy, except through the domes-
tication and enforcement in Louisiana of the bankruptcy
order and judgment. La. R.S. 13:4241 and 13:4242, and La.
C.C.P. art. 2541, provide a clear and orderly procedure for
the domestication and enforcement in Louisiana of all
foreign judgments, including federal bankruptcy judg-
ments. The effect of the decision below is, by judicial fiat,
to invalidate completely La. R.S. 9:5031 and 9:5251, and to
invalidate at least partially La. R.S. 13:4241 and 13:4242,
and La. C.C.P. art. 2541.
The State of Louisiana concurs with Petitioners that
such invalidation of the valid legislative enactments of a
State may not be accomplished by the federal courts,
absent a ruling that the statutes are unconstitutional or
that they have been preempted by an Act of Congress. See
Petition, at 15-19. The State also concurs in Petitioner’s
assessment of the decision below that no such rulings
have been made. Id.? In the interest of brevity, these
* The opinion below did not engage in a preemption ,
analysis. It simply dismisses that doctrine by holding, in
essence, that Louisiana’s system of domestication and
enforcement did not need to be preempted since Respondents '
“did not need to take further steps to ‘execute’ the bankruptcy
court’s orders”. Petition, at A-14 to A-15, 224 F.3d at 491. This
ruling, however, embodies the very essence of preemption. The
Louisiana statutory scheme clearly mandates that the
bankruptcy order did have to be executed through
domestication and enforcement. This scheme is rendered
nugatory through the creation of a species of “self-executing”
judgment based upon the Bankruptcy Code. See Petition, at
7
arguments will not be repeated. The purpose of this brief
is to add Louisiana’s voice to Petitioner’s request for a
Writ of Certiorari, and to request that the decision below
be vacated. The purpose of this section is to present the |
interest of the State of Louisiana underlying its statutory
scheme for the domestication and enforcement of foreign
judgments. The State deems this discussion to be neces-
sary, because of the short shrift given this position by the
opinion below. See Petition, at A-12 to A-14, and 224 F.3d
at 491.
Louisiana agrees with Petitioners that this case
should be controlled by the analysis of Baker by Thomas v.
General Motors Corp., ___ U.S. __, 118 S.Ct. 657, 664-665,
668 (1998) (Ginsburg, J.) (Scalia, J., concurring), a case
and an issue which the opinion below declines even to
discuss, despite extensive briefing by Petitioners and the
State as Amicus. Thus, the opinion below fails to recog-
nize the most basic principle in the law of judgments: the
dichotomy between right and remedy. A judgment
declares rights, but those rights must be secured through
12-15. Thus, the Louisiana statutory scheme is invalidated bya
ruling under the Bankruptcy Code, and that, by any other name,
is preemption. Yet, the opinion below expressly disavows even
any attempt at a preemption analysis, merely stating the
obvious precept that “[P]reemption may be implied if state and
federal laws conflict. . . . ”. Petition, at A-14, n. 13, 224 F.3d at
491. This passing reference, however, falls far short of the
rigorous analysis required by this Court’s precedents in order to
decide whether or not a state statute has been preempted by an
Act of Congress. See, e.g., Davis v. Davis (In re Davis), 170 F.3d
475, 482, 483 (Sth Cir.) (en banc) (Jones, J.), cert. denied, 120 S.Ct.
67 (1999). Petition, at 15-19. Even if such an analysis were to be
undertaken, it cannot rationally be said that the Louisiana
statutory scheme in question “thwarts the ‘accomplishment and
execution’ of Congressional intent”, as expressed in the
Bankruptcy Code. See Davis v. Davis, supra, 170 F.3d at 483,
quoting, Pacific Gas & Elec. Co. v. State Energy Resources
Conservation and Dev. Comm'n, 461 U.S. 190, 204, 103 S.Ct. 1713,
1722, 75 L.Ed.2d 752 (1983).
8
the remedy of enforcement. This principle has long been
recognized by the decisions of this Court, which, in 1873,
for example, held that:
“No execution can issue upon [foreign] judg-
ments without a new suit in the tribunals of
other states. And they enjoy not the right of
priority or lien which they have in the state
where they are pronounced, but only that which
the lex fori gives to them by its own laws in
their character of foreign judgments.”
Thompson v. Whitman, 85 U.S. 457 (18 Wall), 462-463, 21
L.Ed. 897 (1873), quoting, J. Story, Conflicts of Laws, § 609
(7th ed. 1872), quoted in, Wisconsin v. Pelican Ins. Co. of
New Orleans, 127 U.S. 265, 292, 8 S.Ct. 1370, 1375, 32 L.Ed.
239 (1888), and in Baker by Thomas, supra, 118 S.Ct. at 668
(Scalia, J., concurring).
Perhaps even more pointedly, as Justice Scalia put it:
It has long been recognized that “the judgment
of a state Court cannot be enforced out of the
state by an execution issued within it.”
Id., quoting, McElmoyle ex rel. Bailey v. Cohen, 13 Pet. 312,
325, 10 L.Ed. 177 (1839). See also Restatement (Second) of
Conflicts of Laws § 99 (1971) (“The local law of the forum
determines the methods by which a judgment of another
state is enforced”).3
Petitioners have convincingly demonstrated that the
opinion below reaches its result through the expedient of
3 Strictly, Baker by Thomas applies only to the situation
where the judgment of one state is to be enforced in another
state, and indeed this is the extent of the Constitution’s Full
Faith and Credit Clause. U.S. Const., art. IV, § 1. It is respectfully
submitted, however, that this analysis must also embrace the
situation at bar, where the judgment of a federal court is to be
enforced in a state. The first Congress essentially brought the
federal courts within the ambit of full faith and credit with the
passage of the Full Faith and Credit Act, 28 U.S.C. § 1738.
aeniileermneneemincininitetat
" 9
creating a “self-executing” judgment, which finds no sup-
port in the decisions of this Court. See Petition, at 12-15.4
To this, the State would add that such a species of judg-
ment violates further the decisions of this Court, as dis-
cussed above, by its very nature, in failing to recognize
the right/remedy dichotomy. A “self-executing” judg-
ment presents no different a situation than that so force-
fully disavowed by Justices Ginsburg and Scalia. Such a
judgment is in reality no more than an execution, albeit, a
“self-execution”, issued by one sovereign (the United
States) which that sovereign decrees must be enforced
within the jurisdiction of another sovereign (Louisiana).
Based upon this Court’s precedents, such a decree cannot
be allowed to stand.
We may state in plain terms why Louisiana’s interest
is concurrent with that of Petitioners: Petitioners seek a
recovery precisely because the procedures mandated by
Louisiana statutes for the cancellation of mortgages were
not followed by parties who had obtained the right to
have their mortgage cancelled. Thus, according to Louisi-
ana law, Petitioners’ mortgage was not cancelled or “in
any manner affected”. La. R.S. 9:5251. The federal courts
have declared that the statutes embodying these pro-
cedures are meaningless and may be ignored by the par-
ties who had obtained the right to have Petitioners’
mortgage cancelled. This is unacceptable to Louisiana,
and indeed should be unacceptable to any other state.
Under the Court of Appeals’ logic, the “self-executing”
| rationale need not be limited to bankruptcy courts. Vir-
tually any federal judgment declaring the respective
rights of private parties could next be deemed “self-
* Indeed, this is plain from the language of the opinion
itself: “At the heart of [Petitioners’] argument is the assumption
that the bankruptcy court’s orders were not self-executing.
... [T]he Bank did not need to take further steps to ‘execute’ the
bankruptcy court’s orders.” Petition, at A-12, A-15, 224 F.3d at
490-491.
10
executing”, thus relieving litigants of following Louisi-
ana’s statutes on anything from automobile title transfer
to corporate formalities.5 This departure from the funda-
mental basis of federalism is as far-reaching as it is
unwise.
Indeed, the en banc Fifth Circuit itself, a mere seven-
teen months prior to the decision below, enunciated the
principle that a self-executing judgment would violate
the right-remedy dichotomy, specifically in the context of
the Bankruptcy Code, in holding that the Code did not
authorize the “self-execution” of a bankruptcy order in
violation of the laws of the State where enforcement is
sought. In Davis v. Davis, supra, the Fifth Circuit dis-
missed out of hand the argument that judgments pur-
suant to the Bankruptcy Code were “literally self-
executing [because in so arguing] [appellant] has con-
fused her right with her remedy”. 170 F.3d at 481. See also
Riley v. New York Trust Co., 315 U.S. 343, 62 S.Ct. 608, 86
L.Ed. 885, rehearing denied, 315 U.S. 829, 62 S.Ct. 903, 86
L.Ed. 1223 (1942); Milwaukee County v. M. E. White Co., 296
U.S. 268, 56 S.Ct. 229, 80 L.Ed. 220 (1935) (holding that, at
common law, a judgment of a sister state could not be
enforced without the commencement of an action based
thereon).
The confluence of the right/remedy dichotomy and
our system of dual sovereignty is expressed in the Full
Faith and Credit Clause, U.S. Const., art. IV, § 1, and the_
Full Faith and Credit Act, 28 U.S.C. § 1738, which essen-
tially brings the United States and the federal court sys-
tem within the ambit of Full Faith and Credit. The
inherent conflicts therein have been resolved by the wide-
spread adoption of the Uniform Enforcement of Foreign
5 For example, this office opined in 1993 that a foreign
paternity judgment must be made executory in Louisiana before
it may be used to alter State administrative records and vital
statistics. Op.Atty.Gen., No. 93-554, August 13, 1993.
11
Judgments Act (revised 1964) (“Uniform Act”). A com-
prehensive discussion of the Uniform Act is beyond the
scope of this brief, but the State feels it necessary to make
the following points:
Two of the three Louisiana enforcement statutes at
issue, La. R.S. 13:4241 and 13:4242, have been passed by
the legislature in conformity with, and adoption of the
Uniform Act, and the third, La. C.C.P. art. 2541, actually
provides an even more streamlined method of enforcing a
foreign judgment. The more recent, and more well-rea-
soned, state cases have held that the Uniform Act applies
to federal judgments as well as to those of sister states.
See, e.g., Osteoimplant Technologies v. Rathe Products, 107
Md.App. 114, 666 A.2d 1310, cert. denied, 341 Md. 648, 672
A.2d 623 (1995) (holding that a default money judgment
awarded in federal court could not be vacated, altered or
amended in state court, under full faith and credit princi-
ples). Louisiana has no judicial authority to the contrary.
In this light, then, we may posit that Louisiana, by virtue
of her own laws, as well as 28 U.S.C. § 1738, would have
been required to give full faith and credit to the bank-
ruptcy order (or at least the eventual judgment of the
district court), had that judgment been presented to a
Louisiana court for enforcement. Indeed, this principle is
of ancient provenance. See, e.g., Mills v. Duryee, 11 U.S. (7
Cranch) 481, 484 (1813) (Storey, J.); Hampton v. McConnell,
16 U.S. (3 Wheat) 234, 236-237, 4 L.Ed. 378 (1818) (Mar-
shall, C.J.). The sole point at issue here, however, is
whether or not that judgment had to be so presented to a
Louisiana court for domestication and enforcement.” The
State respectfully submits that it did.
6 At all times pertinent to this matter, Louisiana had
adopted the Uniform Act. See La. R.S. Ann. Title 13, Part Ill
(Table) (West Supp. 2000) (including laws enacted through the
1999 Regular Session of the Louisiana legislature), La. R.S.
13:4241 to 13:4247, as added by Acts 1985, No. 464, § 1.
7 Petitioners maintain that the bankruptcy court order may
not now be enforced because the right to seek enforcement has
en ae ae
12
The opinion below essentially brushes aside the
State’s interest by stating, without evidence or analysis,
that domestication and enforcement are unnecessary, and
mere surplusage, since the items which may be raised as
valid defenses at a domestication hearing, at least in this
instance, were “determined by the bankruptcy court and
by the district court”. Petition, at A-13 to A-14, 224 F.3d at
490-491 (footnote omitted). In so doing, the opinion
below misapprehends the very purpose of such a hearing
in our system of multiple sovereignties, by ignoring the
valid interest of the State in ensuring that potential
defenses, as well as other issues incident to domestica-
tion, be determined by a Judge and not through the
expedient - implicit in the opinion below - of casting a
Parish Recorder of Mortgages in a quasi-judicial role by
merely presenting her with a bankruptcy court order and
a request to cancel the subject lien or encumbrance.®
It is well-settled that full faith and credit is not abso-
lute, and that there may be valid defenses to the domes-
tication and enforcement of a foreign judgment. For a
expired under Louisiana law. Petition, at 19, n. 11. The State
takes no position with respect to the merits of this contention.
The State does concur, however, that this contention is one that
must be decided pursuant to Louisiana law.
8 While it is true that most of the precedents in this area,
have, per force, dealt with the enforcement of money judgments,
Baker by Thomas, supra, makes it clear that this principle also
applies as well to the enforcement of other kinds of judgments.
See 118 S.Ct. at 664-665 (Ginsburg, J.) (“The Court has never
placed equity decrees outside the full faith and credit domain”).
Justice Scalia, concurring, also makes this clear in stating that
“neither the Full Faith and Credit Clause nor its implementing
statute requires [the forum state] to execute the [sister-state]
injunction” (118 S.Ct. at 668-669), and by relying, inter alia, upon
Watts v. Waddle, 6 Pet. 389, 392, 8 L.Ed. 437 (1832) (a case
involving a suit to obtain an equity decree ordering the
conveyance of land, duplicating such a decree already issued in
another state).
13
discussion of the various reasons why a foreign judg-
ment, though entitled to full faith and credit, may validly
be denied enforcement in the forum state, see William L.
Reynolds, The Iron Law of Full Faith and Credit, 53
Md.L.Rev. 412 (1994). See also Tennessee ex rel. Sizemore v.
Surety Bank, 200 F.3d 373 (5th Cir. 2000) (holding that,
under the Uniform Act, a Texas bank was entitled to
challenge the jurisdiction of a Tennessee court to order
liquidation of an insurance company, even after Texas
had issued a domestication order); Fed.R.Civ.P. 60(b)(3),
which permits verdicts to be set aside if they were pro-
cured by “fraud (whether heretofore denominated intrin-
sic or extrinsic), misrepresentation or other mis-
representation of an adverse party”.
Similarly, Louisiana courts have denied enforcement
to foreign judgments for lack of personal or subject mat-
ter jurisdiction in the rendering court, extrinsic fraud in
the procurement of the judgment, satisfaction, or lack of
due process in the rendering court. See WellTech, Inc. v.
Abadie, 666 So.2d 1234 (La. App. 5th Cir.), rehearing denied,
writ denied, 672 So.2d 690 (La. 1996), writ denied, 712 So.2d
864 (La. 1998). See also Lepard v. Lepard, 722 So.2d 367 (La.
App. 2nd Cir. 1998) (holding that full faith and credit may
be denied for lack of jurisdiction in the rendering court or
where collateral attack would have been permitted in the
jurisdiction that rendered the judgment). Louisiana’s
point here is that these defenses, if available and properly
raised, must be heard and determined by a Louisiana
court when enforcement is sought in Louisiana. One
would expect this to be a routine matter in the vast
majority of cases, but it is an important step which may
not and must not be ignored. These issues may not be
conclusively presumed to have been determined by the
rendering court, as the opinion below posits is the case
14
for bankruptcy court orders. Petition, at A-13 to A-14, and
n. 12; 224 F.3d at 4990-491.9
Finally, the foregoing, though an accurate synopsis,
has perhaps been unduly emphasized here, given the
context of the facts of this matter. The basic purpose of
Louisiana’s appearance as amicus curiae is to protest vig-
orously against the appellate court’s creation of a self-
executing judgment. Nevertheless, while Louisiana
insists on her right not to enforce foreign judgments until
they have been properly domesticated, she does not sug-
gest that bankruptcy court orders such as the one in
question would not be enforced in Louisiana. There is
nothing in La. R.S. 9:5031 or 9:5251 which contemplates
that such orders would not ultimately be enforced.
Indeed, those statutes expressly refer the reader to the
statutory provisions which constitute Louisiana’s adop-
tion of the Uniform Act. La. R.S. 13:4241 through 13:4247.
See also La. C.C.P. art. 2541. Louisiana does insist, how-
ever, that proper supervision of her civil-law system of
property holding, embodied in part by the public records
doctrine, requires that the cancellation of mortgages, and
the erasure of inscriptions from the public records, pur-
suant to a non-Louisiana judgment, be placed in the
hands of a Judge, and not those of a Parish Recorder of
Mortgages. The appellate court’s creation of a self-execut-
ing judgment actually coniemplates that a bankruptcy
court may invalidate a Louisiana real property right,
9 Nothing in this discussion is intended to suggest that a
party against whom domestication of a judgment is sought
would not be precluded from re-asserting any of these issues
that were actually determined by the rendering court. See Durfee
v. Duke, 375 U.S. 106, 116, 84 S.Ct. 242, 11 L.Ed.2d 186 (1963)
(noting that when the “jurisdictional issues [have] been fully
and fairly litigated by the parties and finally
determined . . . further litigation [is] precluded”). See also
William L. Reynolds, The Iron Law of Full Faith and Credit, 54
Md.L.Rev. 412, 427-433 (1994).
15
which is recorded in the public records, and that Louisi-
ana not even need be informed. Put simply, that is unaccept-
able.1°
III. The State of Louisiana cannot accept a situation
where the integrity of its public records is compro-
mised by the entry of a bankruptcy court order.
It is simply unacceptable for a federal court to ignore,
indeed to authorize non-compliance with, valid State stat-
utory enactments unless and until those statutes have
either been held to be unconstitutional or to have been
preempted by the Congress. For the opinion below to do
so, under the specific facts and circumstances at bar, is
particularly egregious. This is so because the most poten-
tially far-reaching effect of the opinion below is to com-
promise, if not destroy, the integrity of Louisiana’s public
records.
The Louisiana Constitution, Civil Code, and Revised
Statutes, in effect, work together to create the “public
records doctrine” by declaring that a variety of security
and ownership interests in immovable property are inef-
fective against third persons in the absence of recorda-
tion, in the appropriate public records, of the documents
creating or asserting those interests. See William V. Red-
mann, Fhe Louisiana Law of Recordation: Some Principles and
Some Problems, 39 Tul.L.Rev. 491 (1965); La. Const. art. 19,
§ 19 (1974); La. Civil Code art. 2266; La. R.S. 9:2721.
Among the objectives of this doctrine directly pertinent
here is to establish a positive force to recorded instru-
ments, so as to allow non-parties to rely on the recorded
10 Moreover, it is undisputed that the mortgage in question
was never actually cancelled under State law, its inscription
never erased from the public records, and that it remains
recorded there to this day. Petition, at 14, n. 7. This fact brings
squarely into focus Louisiana’s vital interest in the integrity of
her public records. This aspect of the decision below will be
discussed in the next and concluding section.
16
document and to be protected in acquiring rights based on
those documents. See Lee Hargrave, Public Records and
Property Rights, 56 La.L.Rev. 535, 537 (1996).
In Louisiana, as long as a mortgage has been validly
recorded and not erased, that mortgage is conclusively
presumed to exist in the eyes of the State. See Phillips v.
Parker, 483 So.2d 972, 975 (La. 1986). The basic notion is
that in creating real rights that bind property in the hands
of subsequent owners, fairness requires that one give the
subsequent owners an opportunity to learn from an
authoritative source that the property is so bound. See
Alejandro M. Garro, The Louisiana Public Records Doctrine
and The Civil Law Tradition, 97-98 (1989)."}
It is indisputable that the “public records doctrine” is
absolutely basic to the Louisiana civil-law system of prop-
erty holding. See McDuffie v. Walker, 51 So. 100 (La. 1909)
(establishing the principle that Louisiana is a “record
notice” jurisdiction). It follows, therefore, a priori, that the
State of Louisiana has a vital public interest in the integrity
of the public records in order to ensure, as nearly as
possible, that Louisiana citizens, and indeed all persons
dealing in property in Louisiana, be able to rely on the
accuracy of those records. See, e.g., Matter of De La Vergne,
156 B.R. 773, 776 (Bkrtcy.E.D.La. 1993) (holding that all
persons are conclusively presumed to have notice of the
existence of all mortgages recorded on the mortgage rolls);
Amoskeag Bank v. Chagnon, 133 N.H. 11, 572 A.2d 1153
(1990) (discussing the necessity to maintain the integrity of
11 Ownership of an immovable is the basic “real right”, and
any agreement transferring ownership of immovables is subject
to the recordation rule in Louisiana. La. Civil Code, art. 517.
Similarly, the right of mortgage, such as the mortgage rights
underlying the instant controversy, is also a real right which the
Civil Code requires to be recorded in the registry for recording
mortgages. La. Civil Code, art. 3271. See also 1 Peter S. Title,
Louisiana Real Estate Transactions, § 8.13, at 181 (1991).
17
the public records). Moreover, the administration of the
public records, through legislation such as the statutes
involved herein, is among the ways in which Louisiana
regulates the real property interests within her borders,
and the right to so legislate is reserved to the State by the
Tenth Amendment. Sunderland v. United States, 266 U.S.
226, 227, 45 S.Ct. 64, 69 L.Ed. 259 (1924) (“[t]he Tenth
Amendment gives to the State the exclusive right to legis-
late concerning the lands within her borders . . . ”); United
States v. Fox, 94 U.S. 315, 320 (1876). See also Clarke v.
Willard, 294 U.S. 211, 55 S.Ct. 356, 79 L.Ed. 865 (1935);
Security Trust Co. v. Dodd, Mead & Co., 173 U.S. 624, 19 S.Ct.
545, 43 L.Ed. 835 (1899); Hervey v. Rhode Island Locomotive
Works, 93 U.S. (3 Otto) 664, 23 L.Ed. 1003 (1876); Green v.
Bushkirk, 72 U.S. (5 Wall.) 307, 18 L.Ed. 599 (1866) (estab-
lishing the proposition that every state has the jurisdiction
to determine for itself the nature and extent of property
within its territorial limits which will be considered liable
to seizure and sale under the process of its courts).
In this light, even if the panel below had engaged in a
preemption analysis with respect to La. R.S. 9:5031 and
9:5251, both this Court and the Fifth Circuit, en banc, have
made it clear that, in any such analysis, Courts must apply:
. .. @ presumption that areas of law traditionally
reserved to the states, like police powers or prop-
erty law, are not to be disturbed absent the “clear and
manifest purpose of Congress”.
Davis v. Davis, supra, 170 F.3d at 482, quoting, Rice v. Santa
Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146, 1152, 91
L.Ed.2d 1447 (1947) (emphasis added).
12 Indeed, this very principle, while particularly pertinent
in the modern day to state law, may in fact be gleaned from the
early jurisprudence of this Court. See, e.g., Anthony v. Butler, 38
U.S. (13 Pet.) 423, 10 L.Ed. 229 (1939); Dick v. Balch, 33 U.S. (8
Pet.) 30, 1 L.Ed. 856 (1834); Levinz v. Will, 1 U.S. (1 Dall.) 430, 1
L.Ed. 209 (1789); Parker v. Wood, 1 U.S. (1 Dall.) 436, 1 L.Ed. 212
(1789).
18
This presumption militates against any finding that
La. R.S. 9:5031 and 9:5251 have been impliedly preempted
by Congress by enacting the Bankruptcy Code. Moreover,
it would seem clear that the Bankruptcy Code does not
expressly preempt state laws regulating real property
interests. See Davis v. Davis, supra, 170 F.3d at 483.
Here, we emphasize once again that La. R.S. 9:5031
and 5251 clearly mandate that no mortgage or other form
of security interest in Louisiana real property may be “in
any manner affected” as the result of a sale in bankruptcy,
except through the domestication and enforcement in Lou-
isiana of the bankruptcy order and judgment.!° Partic-
ularly in light of the constitutional principles, and the
fundamental importance of the public records doctrine,
the appellate court should not have simply ignored the
effect its ruling would have on the integrity of that doc-
trine. Indeed, the public records doctrine is not even
addressed by the opinion below, despite extensive briefing
by the parties and the State as Amicus Curiae. Yet, there can
be no dispute that the effect of this ruling, in addition to
judicially invalidating valid legislative enactments that
have not been found to be unconstitutional or preempted
by Congress, will be to destroy the integrity of Louisiana's
public records.
Indeed, there can be little doubt that the opinion
below, if allowed to stand, will have the deleterious effect
we have outlined. The mortgage remains on the public
records after fourteen years, and the opinion below has in
effect authorized the owners of the mortgaged property to
13 Louisiana law also provides that a mortgage shall not be
erased as the result of the discharge in bankruptcy of the
mortgagor. See Socony Mobile Oil Co. v. Burdette, 309 So.2d 655,
656-657 (La. 1975); Ferguson v. Porter, 359 So.2d 676 (La. App. 1st
Cir. 1978). See also Property Asset Management v. Pirogue Cove
Apts., 693 So.2d 1217 (La. App. 4th Cir. 1997) (holding that a
mortgage, as an accessory obligation, is enforceable, whether or
not the mortgagor is personally responsible for the obligation
the mortgage secures).
in So rl ta te
19
treat it as if the mortgage did not exist. Petitioners main-
tain that the order of the bankruptcy court cannot now be
enforced, so as to have the mortgage cancelled and its
inscription removed from the public records. See Petition,
at 19, n. 11. If Petitioners are correct, and if the opinion
below is allowed to stand, then, at least in this instance,
the public records of Louisiana will be demonstrably inac-
curate.14 It does not take a great leap of imagination to
posit that there may be many and numerous other
instances where the public records will also be rendered
incorrect as the result of similar bankruptcy court orders.!>
We must therefore conclude yet again that the actual and
potential harm done to vital interests of the State of Louisi-
ana is not offset by any reciprocal federal interest in letting
stand the opinion below. The State statutes involved
attempt in no way to negate ultimately the order of the
bankruptcy court. Indeed, La. R.S. 9:5031 and 9:5251 pro-
vide by express language that the cancellation of mort-
gages, and the removal of their inscription from the public
records, as ordered by a bankruptcy court, may be fully
accomplished through the simple expedient of domestica-
tion and enforcement of the bankruptcy order.!© This puts
14 The State of Louisiana concurs in Petitioners’ exposition
of the various ill effects that this state of affairs will have on
Louisiana’s public records. See Petition, at 21-23. In the interest
of brevity, this discussion will not be repeated here.
15 Similarly, as discussed in the preceding section, one
might imagine, and one must ponder, what other legislative
enactments of the State of Louisiana may be effectively
invalidated by the fiat of a bankruptcy court, or any other
federal court, if the power implicit in the opinion below is
allowed to stand unchecked.
16 In the normal and anticipated circumstance, when a sale
of property is ordered free and clear of liens and encumbrances,
pursuant to 11 U.S.C. § 363(f)(3), the proceeds of the sale will be
sufficient to satisfy all such liens and encumbrances. The lien or
encumbrance then is not merely extinguished but transferred to
the proceeds of the sale, and ultimately satisfied. In this
20
the holder of a bankruptcy judgment in no different a
position than the holder of any other federal judgment,
while at the same time allowing the Louisiana courts to
monitor the integrity of the public records. If one were to
weigh the interests advanced by Congress in the Bank-
ruptcy Code against those of the State of Louisiana in the
integrity of her public records, the scales would seem to
tip decisively in Louisiana’s favor.
CONCLUSION
For the reasons set forth herein, the Petition should be
granted, and a Writ of Certiorari should issue to review
the opinion and judgment of the United States Court of
Appeals for the Fifth Circuit. Further, the decision below
should be vacated, and the Louisiana statutory scheme in
question should be upheld.
Respectfully submitted,
RicHArD P. IEYous
Attorney General
Counsel of Record
AnciE Rocers LAPLACE
Assistant Attorney General
LouIsiANA DEPARTMENT OF JUSTICE
P.O. Box 94005
Baton Rouge, Louisiana 70804
(225) 342-1134
Attorneys for The State of Louisiana
as Amicus Curiae
situation the purchaser of the property may, if necessary, simply
convoke a summary mandamus proceeding to procure the order
of a State court that the mortgage be cancelled and that the
Recorder of Mortgages erase the inscription thereof, based upon
satisfaction. La. Civil Code art. 3337. Moreover, under La. RS.
9:5385, the holder of a Mortgage note who fails to surrender the
note when it is satisfied is liable for damages resulting from
such failure. As far as the State is aware, however, during the
seven-year course of this litigation, Respondents have advanced
no claim that the subject mortgage was in fact satisfied in the
bankruptcy proceeding.
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.