Estate of Marie A Merkel v. Rupert Pollard ( 2009 )

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
November 16, 2009
No. 09-10203 Charles R. Fulbruge III
Clerk
ESTATE OF MARIE A MERKEL, MATTHEW R POLLARD, Independent
Executor
Plaintiff-Appellant
v.
RUPERT M POLLARD
Defendant-Appellee
Appeal from the United States District Court
for the Northern District of Texas
USDC 3:06-CV-1891-D
Before BARKSDALE, SOUTHWICK, and HAYNES, Circuit Judges.
PER CURIAM:*
For this appeal, because the only issue raised is a question of Texas
divorce law, the linchpin is whether our court should abstain sua sponte.
VACATED and DISMISSED.
*Pursuant to 5TH CIR . R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR .
R. 47.5.4.
No. 09-10203
I.
Drs. Marie Merkel and Rupert Pollard married in 1964. Twenty-eight
years later, Merkel filed for divorce in Dallas, Texas. The divorce proceedings’
extended history follows.
A.
After Merkel filed for divorce in 1992, the parties mediated a settlement;
and, pursuant to it, the Dallas divorce court entered a decree in 1995, dissolving
the marriage and dividing the property. Pollard appealed and filed a lis pendens
notice, asserting a community interest in the property.
On appeal, Pollard contested the property division on several grounds, but
stated in his brief that he did not contest the dissolution of marriage. The Texas
Court of Appeals held the divorce court “erred in entering judgment pursuant to
the mediated settlement agreement” and reversed and remanded. Pollard v.
Merkel, No. 05-96-00795-CV, 1999 WL 72209, at *1 (Tex. App.—Dallas 12 Feb.
1999, no pet.) (not designated for publication).
On remand, the divorce action was tried to a jury; and the Dallas divorce
court entered a second divorce decree in 2001. The jury awarded the marital
home at issue here (the house) to Merkel.
Pollard again appealed, taking issue with the divorce court’s failure to
disqualify Merkel’s attorney. The Texas Court of Appeals again reversed and
remanded. Pollard v. Merkel, 114 S.W.3d 695 (Tex. App.—Dallas 2003, pet.
denied).
In 2004, before the divorce court could act on remand, Merkel died. In
2005, the divorce court dismissed the action for want of prosecution.
B.
After Merkel died, her will was admitted to probate, with her son being
appointed executor. Pollard again filed lis pendens notices, asserting community
and homestead interests in the house. The executor moved the probate court to
2
No. 09-10203
cancel those notices and order Pollard to execute a request for a tax lien pay-off
from the Internal Revenue Service. (The pay-off request was premised on
Pollard’s having failed to pay his federal income taxes while the divorce
proceedings were pending. Therefore, in 1993, 1994, 1995, and 2003, the United
States had filed tax-lien notices against any property Pollard owned.)
In 2005, pursuant to the executor’s motion, the probate court ordered
Pollard to show cause why the lis pendens notices should not be cancelled and
why he should not be compelled to execute the pay-off request. Subsequently,
that court ordered Pollard to execute the latter. Pollard refused to do so and,
in October 2005, instead filed another lis pendens notice against the house.
That October, Pollard also petitioned the probate court to determine the
status of the Merkel and Pollard marriage as of Merkel’s death. That court held
Merkel and Pollard were divorced when Merkel died. Pollard appealed this
ruling; the appellate court held it was “not a final judgment or an appealable
order” and dismissed the appeal. Pollard v. Pollard, No. 05-06-00375-CV, 2007
WL 1366040, at *1 (Tex. App.—Dallas 10 May 2007, no pet.). The probate
proceedings apparently remain open. See Estate of Merkel, No. 05-0375-P3
(Prob. Ct. No. 3, Dallas County, Tex. filed 14 Feb. 2005).
C.
In October 2006, Merkel’s estate filed this federal-question action against
the United States and Pollard, pursuant to 28 U.S.C. § 2410(a)(1). The estate
sought to quiet title to the house and “establish that Pollard has no interest in
the . . . House and, therefore, the . . . House is not subject to any federal tax lien
issued against Pollard or his property”. Pollard counter-claimed, seeking a
declaration that he and Merkel were married as of her death and that,
accordingly, Pollard owned an undivided one-half interest in the house.
The parties filed cross-motions for summary judgment on whether Merkel
and Pollard were married when Merkel died. The estate contended: Merkel
3
No. 09-10203
and Pollard were finally divorced as of the first divorce decree in 1995 because
Pollard only appealed the property division. Pollard maintained: the dissolution
of the marriage was not severable from the property division; and, therefore, the
divorce was never final. In July 2008, the district court awarded partial
summary judgment to Pollard, holding, inter alia, he and Merkel were married
at her death. Estate of Merkel v. Pollard, No. 3:06-CV-1891-D (N.D. Tex. 29 July
2008).
Accordingly, the action proceeded to trial on whether Pollard had
abandoned his homestead interest in the house. In January 2009, a jury
returned a verdict for Pollard, finding the estate had failed to prove
abandonment.
A final judgment was entered in February 2009. It provided, inter alia:
Pollard and Merkel were married as of her death; and, Pollard had a one-half
community property interest and a homestead interest in the house. Estate of
Merkel v. Pollard, No. 3:06-CV-1891-D (N.D. Tex. 4 Feb. 2009).
D.
In addition to the above-recounted facts and proceedings found in the
record on appeal, we take judicial notice of these five actions pending in state
court, all of which are related to Merkel and Pollard’s divorce. Pollard ex rel.
Estate of Merkel v. Pollard, No. 05-09-01087-CV (Tex. App.—Dallas filed 10 Sept.
2009) (appeal of probate court’s denial of Pollard’s motion for accounting); In re
Marriage of Merkel & Pollard, No. 05-08-01615-CV (Tex. App.—Dallas filed 26
Nov. 2008) (appeal of divorce court’s dismissal of divorce proceedings); Estate of
Merkel, No. 05-0375-P3 (Prob. Ct. No. 3, Dallas County, Tex. filed 14 Feb. 2005)
(administration of Merkel’s estate); Pollard v. Pollard ex rel. Estate of Merkel,
No. 05-0375-P3(A) (Prob. Ct. No. 3, Dallas County, Tex. filed 8 Aug. 2005)
(petition for declaratory judgment on whether Merkel and Pollard were divorced
at Merkel’s death); Pollard v. Pollard ex rel. Estate of Merkel, No. 05-0375-P3(B)
4
No. 09-10203
(Prob. Ct. No. 3, Dallas County, Tex. filed 21 Oct. 2005) (Pollard’s unsecured
claims against the estate for various personal property).
II.
In this appeal, the estate challenges only that part of the judgment
awarded Pollard on the marital status; in short, not contested is that part of the
judgment concerning the jury verdict (Pollard’s not having abandoned his
homestead interest in the house). In other words, no relief regarding tax liens,
determination of property ownership, the Government’s rights as to each side,
or similar relief is sought. The United States has not even participated in this
appeal. In essence, the only result of our ruling on the merits would be a decree
of divorce or a declaration of marriage.
Therefore, at issue, as raised by the estate, is only a state-law question,
involving an area of special state interest: domestic relations. Accordingly, of
immediate concern is whether we should abstain sua sponte from deciding this
matter. In that regard, we may do so for the first time on appeal. Munich
Am. Reinsurance Co. v. Crawford, 141 F.3d 585, 588 (5th Cir. 1998) (“[W]e
agree . . . that Burford abstention may be raised at any time. . . .”); Martin Ins.
Agency, Inc. v. Prudential Reinsurance Co., 910 F.2d 249, 255 (5th Cir. 1990)
(“Where Burford-type abstention is appropriate . . . it can be ordered on appeal
even if not raised in the trial court.”); BT Inv. Managers, Inc. v. Lewis, 559 F.2d
950, 954 n.16 (5th Cir. 1977) (“By its nature, the abstention issue is raised either
by a defendant or by the court sua sponte.”).
A.
For obvious reasons, “in general it is appropriate for the federal courts to
leave delicate issues of domestic relations to the state courts”. Elk Grove Unified
Sch. Dist. v. Newdow, 542 U.S. 1, 13 (2004) (holding father lacked standing to
bring a First Amendment challenge to his daughter’s school’s policy of reciting
the Pledge of Allegiance where father was involved in an underlying custody
5
No. 09-10203
dispute over the daughter). Along this line, there are two ways in which federal
courts may defer to state courts and thereby avoid adjudication of domestic
issues.
First, under the domestic-relations exception, federal courts lack
jurisdiction to “issue divorce, alimony, and child custody decrees”. Ankenbrandt
v. Richards, 504 U.S. 689, 703 (1992). Second, even where the elements of the
domestic-relations exception are not precisely met, abstention is nonetheless
called for under Burford v. Sun Oil Co., 319 U.S. 315 (1943), “when a case
presents ‘difficult questions of state law bearing on policy problems of
substantial public import whose importance transcends the result in the case
then at bar’”. Ankenbrandt, 504 U.S. at 705–706 (quoting Colo. River Water
Conservation Dist. v. United States, 424 U.S. 800, 814 (1976)). “Such might well
be the case if a federal suit were filed prior to effectuation of a divorce, alimony,
or child custody decree, and the suit depended on a determination of the status
of the parties.” Id. at 706.
For starters, the domestic-relations exception to federal jurisdiction is not
applicable in this federal-question action to quiet title. As provided in United
States v. Bailey, 115 F.3d 1222, 1231 (5th Cir. 1997): “The domestic relations
exception obtains from the diversity jurisdiction statute . . . and therefore it has
no application where, as here, there exists an independent basis for federal
jurisdiction”. Compare with Jones v. Brennan, 465 F.3d 304, 307 (7th Cir. 2006);
Thompson v. Thompson, 798 F.2d 1547, 1558 (9th Cir. 1986), aff’d, 484 U.S. 174(1988). As a result, the principal question at hand is whether, pursuant to
Ankenbrandt, Burford abstention controls.
The Ankenbrandt Court considered whether the domestic-relations
exception deprived the district court of its diversity jurisdiction over a sexual-
abuse tort action by a mother against her ex-husband on behalf of her children
or, alternatively, whether abstention was required. Id. at 691. The Court held:
6
No. 09-10203
the domestic-relations exception was not met; and, further, abstention was not
required because “the status of the domestic relationship [had] been determined
as a matter of state law, and in any event [had] no bearing on the underlying
torts alleged”. Id. at 706.
In contrast, the parties here vigorously dispute the status of the domestic
relationship—the only issue raised on appeal. Again, as the Ankenbrandt Court
noted, abstention might be proper “if a federal suit were filed prior to
effectuation of a divorce, alimony, or child custody decree, and the suit depended
on a determination of the status of the parties”. Id. at 706. That is the situation
at hand. (As discussed supra, the probate court ruled in 2005 that the parties
were divorced at Merkel’s death. Due to the nature of those proceedings,
however, that decision was not a final judgment and, as such, did not render the
issue res judicata. Hence, the question was at issue in, and decided by, the
district court in 2008, when it granted partial summary judgment to Pollard.
See Medina v. I.N.S., 993 F.2d 499, 504 (5th Cir. 1993) (holding res judicata
requires a final judgment); Pollard v. Pollard, No. 05-06-00375-CV, 2007 WL
1366040 (Tex. App.—Dallas 10 May 2007, no pet.) (dismissing Pollard’s appeal
of probate court’s order holding parties divorced at Merkel’s death because that
order was not a final judgment); see also Estate of Merkel v. Pollard, No.
3:06-CV-1891-D, slip op. at 3 n.2 (N.D. Tex. 29 July 2008) (citing In re
Ark-La-Tex Timber Co., 482 F.3d 319, 330 (5th Cir. 2007)). Therefore, for our
purposes, the issue is effectively undetermined by a state court.)
Moreover, whether the parties were divorced as of Merkel’s death had
bearing on the quiet-title action. Neither party having briefed this issue, it is
unclear to what extent Pollard’s marital status would affect the house being
subject to the Government’s liens. It is clear, however: if Pollard and Merkel
were still married as of Merkel’s death, Pollard was a surviving spouse under the
Texas constitution; and, barring abandonment, he would be entitled to the
7
No. 09-10203
homestead exemption against federal taxes. See Ferguson v. Ferguson, 111
S.W.3d 589, 597–98 (Tex. App.—Ft. Worth 2003, no. pet.); T EX. C ONST. ART. XVI,
§ 52; T EX. P ROB. C ODE A NN. § 283. Under Ankenbrandt, therefore, Burford
abstention must be considered sua sponte.
B.
As a prerequisite to Burford abstention, “timely and adequate state-court
review [must be] available”. New Orleans Pub. Serv., Inc. v. City Council of New
Orleans, 491 U.S. 350, 361 (1989) (“NOPSI”). Such review of whether Merkel
and Pollard were married at the time of Merkel’s death is available. As
previously discussed, that very issue has been decided by the Texas probate
court; and, based on available court records, that ruling apparently is subject to
review on appeal in state court.
The doctrine also requires that, before the court may abstain, the federal
court be sitting in equity or otherwise petitioned for discretionary relief. Id.;
Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 730 (1996). An action to quiet
title is an equitable action. Humble Oil & Refining Co. v. Sun Oil Co., 191 F.2d
705, 711 (5th Cir. 1951). Further, both parties sought declaratory judgments
regarding the status of Pollard and Merkel’s marriage as of her death, and such
judgments are considered discretionary relief. Quackenbush, 517 U.S. at 719.
If, as they are here, these prerequisites are met, “a federal court . . .must
decline to interfere . . . : (1) when there are ‘difficult questions of state law
bearing on policy problems of substantial public import whose importance
transcends the result in the case then at bar’; or (2) where the ‘exercise of federal
review of the question in a case and in similar cases would be disruptive of state
efforts to establish a coherent policy with respect to a matter of substantial
public concern’”. NOPSI, 491 U.S. at 361 (quoting Colo. River, 424 U.S. at 814).
(Although NOPSI speaks of interference “with the proceedings or orders of state
administrative agencies”, the Supreme Court has “since provided more
8
No. 09-10203
generalized descriptions of the Burford doctrine”, Quackenbush, 517 U.S. at 725;
and, as such, our court has held Burford abstention is not limited to “where the
state regulatory scheme is fully in place”. Sierra Club v. City of San Antonio,
112 F.3d 789, 796 (5th Cir. 1997).)
Our court considers five factors to determine whether Burford abstention
is appropriate: “(1) whether the cause of action arises under federal or state law;
(2) whether the case requires inquiry into unsettled issues of state law or into
local facts; (3) the importance of the state interest involved; (4) the state’s need
for a coherent policy in that area; and (5) the presence of a special state forum
for judicial review”. Moore v. State Farm Fire & Cas. Co., 556 F.3d 264, 272 (5th
Cir. 2009) (internal citation omitted). Each of these factors overwhelmingly
favors abstention here.
Regarding the first factor, although this case nominally arises under
federal law, we have held: “Burford abstention does not so much turn on
whether the plaintiff’s cause of action is alleged under federal or state law, as it
does on whether the plaintiff's claim may be in any way entangled in a skein of
state law that must be untangled before the federal case can proceed”. Sierra
Club, 112 F.3d at 795 (internal quotation marks omitted); see also Koerner v.
Garden Dist. Ass’n, 78 F. App’x 960, 963 (5th Cir. 2003) (unpublished) (holding
Burford abstention appropriate and stating: “Even though Koerner has framed
his claims as arising under federal law, the underlying issues presented are
purely state law issues”.). The estate’s federal quiet-title claim is clearly
“entangled in a skein of state law”. No one disputes Pollard is liable for unpaid
federal income taxes; the only issue is the degree and nature of his ownership
interest in the house. For this appeal, and the only issue raised for it, this issue
turns entirely on Texas domestic-relations law.
For the second factor, whether unsettled issues of state law are raised, the
only issue briefed here by both parties is, again, whether Merkel and Pollard
9
No. 09-10203
were married when Merkel died. The estate maintains: the divorce court’s first
decree was a final judgment, subject only to modification on appeal; therefore,
when Pollard appealed that judgment, but failed to raise dissolution of marriage
as a point of error, the appellate court lacked jurisdiction to consider dissolution
of marriage. Pollard counters: although an appellate court may have the power
to sever dissolution of marriage from property division, that did not occur
because Pollard did not file a notice of limitation of appeal; therefore, the entire
case was before the appellate court. The district court stated that Texas law
contains contradictory precedent on whether the dissolution of marriage must
be expressly excluded in the notice of appeal. This, therefore, is an unsettled
issue of Texas state domestic law and appellate procedure.
For the third factor, the importance of Texas’ interest in its own domestic-
relations law is obvious. “Family relations are a traditional area of state
concern.” Moore v. Sims, 442 U.S. 415, 435 (1979); see also Begum v. Miner,
2000 WL 554953, at *3 (5th Cir. 2000) (unpublished) (holding abstention
appropriate in a case involving adoption because, inter alia, a State has an
important interest in a “key issue of state family law”). Further, in DuBroff v.
DuBroff, 833 F.2d 557, 562 (5th Cir.1987), our court recognized the importance
of Texas’ interest in its divorce law, holding Burford abstention was appropriate
where the plaintiff alleged her ex-husband and others had violated RICO by
deceiving her in a divorce settlement. (As our court noted in Begum, DuBroff
was decided before Ankenbrandt, which narrowed the reach of Burford
abstention in domestic-relations cases; we “therefore do not base our decision on
[this] Fifth Circuit precedent[], though we note that [it is] consistent with our
holding”. 2000 WL 554953, at *3 n.6.)
In addition, concerning the fourth abstention factor, Texas obviously needs
a coherent domestic-relations policy, and, more narrowly, a coherent policy for
10
No. 09-10203
when, and how, a divorce ruling may be severed on appeal. Therefore, the third
and fourth factor weigh heavily in favor of Burford abstention.
Finally, for the fifth factor, Texas has created “a special state forum for
judicial review” of divorce actions. See T EX. G OV. C ODE A NN. § 24.601 et. seq.
(establishing a comprehensive system of family courts). It goes without saying
that these courts have the experience and expertise in Texas divorce law that
federal courts lack. See Ankenbrandt, 504 U.S. at 704 (noting “the special
proficiency developed by state tribunals over the past century and a half in
handling issues that arise in the granting of [divorce, alimony, and child
custody] decrees”).
Again, each of the five Burford factors overwhelmingly favors abstention.
And, although “the doctrine of abstention . . . is an extraordinary and narrow
exception to the duty of a [federal] [c]ourt to adjudicate a controversy properly
before it”, Colorado River, 424 U.S. at 813 (internal quotation omitted), this
married vel non issue arising in Texas divorce proceedings easily falls within
this narrow exception. Therefore, we hold sua sponte that Burford abstention
should be applied.
III.
For the foregoing reasons, the judgment is VACATED and this action is
DISMISSED.
11