Arnold v. Eastern Air Lines, Inc.

PER CURIAM:

By way of summary the Court states its conclusions on the issues considered at the en banc rehearing which took place on February 8, 1983:

I. The vote of five members for, four against, and one member disqualified, and hence not voting, which had previously taken place, constituted a determination by a majority of the circuit judges who are in regular active service ordering rehearing en banc.

On that issue, the vote was six (Chief Judge Winter, Judge Russell, Judge Hall, Judge Murnaghan, Judge Sprouse, and Judge Chapman) for and two (Judge Widener and Judge Phillips) against.

2. The judgments of the district court in the Arnold and Mihalek¹ personal injury actions against Eastern are reversed and remanded for retrial on the issue of the proper amounts of compensatory damages.

On that issue, the vote was five (Chief Judge Winter, Judge Russell, Judge Widener, Judge Murnaghan and Judge Chapman) for and four (Judge Hall, Judge Phillips, Judge Sprouse and Judge Bryan) against.

It should be noted that Judge Ervin was disqualified and therefore did not participate in any of the proceedings in the case. Furthermore, Judge Bryan, as a Senior Circuit Judge who sat as a member of the three-judge panel, took part in the consideration as to issue 2, pursuant to 28 U.S.C. § 46(c). Judge Bryan, there being no statutory authorization for him to do so, did not take part in the consideration as to issue 1.

The several opinions of Judges Widener, Hall, Phillips and Murnaghan which follow are devoted to the various rationales which prompted the votes of the several members of the Court.

MURNAGHAN, Circuit Judge:

In the United States District Court for the Western District of North Carolina, there were consolidated for trial several actions arising as a consequence of an Eastern Air Lines airplane crash at Charlotte, North Carolina on September 11, 1974:

1) Three personal injury actions against Eastern.

2) An action for indemnification or contribution by insurance carriers of Eastern against the United States and four air traffic controllers.

3) Third party claims against the United States for contribution filed by Eastern in two of the accident cases.

The panel of the Fourth Circuit which heard the appeal affirmed judgments on behalf of the plaintiffs in two of the accident cases, reversed and remanded the third for a new trial on the issue of compensatory damages and affirmed judgments in favor of the United States and the air traffic controllers. Arnold v. Eastern Airlines, Inc., 681 F.2d 186 (4th Cir.1982). There was a dissent at the panel level limited to the affirmance of awards for plaintiffs in the two accident cases. Id. at 206.

The case is now before the Court as a consequence of Eastern’s request for rehearing en banc, contesting the judgments for the two accident case plaintiffs.

As a matter preliminary to consideration of the issues on the merits, we have to decide whether the case has in fact achieved the status of one entitled to en banc rehearing. The Federal Rules of Appellate Procedure in Rule 35 provide that a “majority of the circuit judges who are in regular active service may order that an appeal ... be ... reheard by the court of appeals in banc.”

At the time of voting on the suggestion for en banc rehearing there were ten individuals occupying positions with the court satisfying description as circuit judges in regular active service. When the poll was taken, one court member, Judge Ervin, recused himself, did not vote, and has since that time remained disqualified. Of the nine remaining circuit judges in regular active service five (Chief Judge Winter, Judge Russell, Judge Widener, Judge Murnaghan and Judge Chapman) voted in favor of rehearing en banc; four circuit judges in regular active service (Judge Butzner, Judge Hall, Judge Phillips and Judge Sprouse) voted to deny rehearing en banc.

The court tentatively determined that the case had achieved en banc rehearing status, and now, following consideration of arguments from counsel, confirms that tentative determination. Joining the author of this opinion in that conclusion are Chief Judge Winter, Judge Russell, Judge Hall, Judge Sprouse and Judge Chapman. Judge Widener and Judge Phillips are of the contrary view and would hold that the vote on the suggestion of an en bane rehearing failed for want of a majority of the circuit judges in regular active service. Five, Judge Widener and Judge Phillips contend, do not constitute a majority of ten.¹

At the outset, it should be observed that the majority’s decision has been taken for the purposes of the present case. It is, of course, entitled to the precedential weight attaching to any decision of the court. However, in Shenker v. Baltimore & Ohio R. Co., 374 U.S. 1, 4-5, 83 S.Ct. 1667, 1670-1671, 10 L.Ed.2d 709 (1963), there appears a suggestion that the area may well be one in which achieving fulfillment of our administrative responsibilities would allow us by rule to select, as a quorum for purposes of ascertaining a majority, when votes on suggestions for hearings or rehearings en banc are taken, either (a) all judges in regular active service, including those disqualified for the purposes of the particular case or (b) all judges otherwise in regular active service who are not, for the purposes of the particular case, disqualified from participating in any way.² Accordingly, we do not, by our decision today preclude a possible change in practice, brought about by adoption of a rule of general applicability. Nor, of course, do we have occasion to determine whether applicable statutory language would permit or forbid such a change in practice. The uncertainties are not minimized by the Supreme Court’s observation in Western Pacific Rr. Corp. v. Western Pacific Rr. Co., 345 U.S. 247, 260, 73 S.Ct. 656, 662, 97 L.Ed. 986 (1953):

The en banc power ... is ... a necessary and useful power — indeed too useful that we should ever permit a court to ignore the possibilities of its use in cases where its use might be appropriate.

We now have no general rule, and must decide without the benefit of such a generally promulgated guide to practice,³ the proper result in the case sub judice.

We find the answer primarily in the language of the applicable statute. 28 U.S.C. § 46(c):

Cases and controversies shall be heard and determined by a court or panel of not more than three judges, unless a hearing or rehearing before the court in banc is ordered by a majority of the circuit judges of the circuit who are in regular active service. A court in banc shall consist of all circuit judges in regular active service.... ⁴

Concentrating on the second sentence of § 46(c), we perceive insoluble difficulties in any other reading of the statute, at least in its present posture, without any contrary indication from a rule or regulation, than that there shall be excluded, for quorum ascertainment purposes, any disqualified judge when a vote on a suggestion for hearing or rehearing en banc takes place. Judge Ervin has not sat when the case was reheard en banc. No responsible suggestion could be made that he, who was disqualified and consequently took no part whatever in the en banc rehearing, the decision of which is here reported, acted otherwise than properly. 28 U.S.C. § 455 (“Any ... judge ... shall disqualify himself in any proceeding in which his impartiality might reasonably be questioned.”). Patently a judge who is disqualified from acting must not be able to affect the determination of any cause from which he is barred.⁵

The court en banc, therefore, could not have had among its members Judge Ervin. He, in recusing himself, has not infringed the statutory mandate that all circuit judges in regular active service shall comprise an en banc court. Any seeming contradiction between court action and statutory language is at most apparent; it is not real. There is a ready explanation. Judge Ervin is regular and active,⁶ and as a general proposition is in service. However, should he, or any other regular, active member of the court, recuse or disqualify himself at any time, he is out of service insofar as that particular case is concerned. To disqualify means to debar legally. See Webster’s New International Dictionary, 2d ed., p. 753. That is synonymous with lack of legal capacity, i.e., with inability to serve. Hence, Judge Ervin properly did not sit during the en banc rehearing, because, for the particular case, he was not one of the circuit judges in regular active service.

With that proposition established, we turn to the language describing the body, a majority of which is required to order hearing or rehearing en banc. In § 46(c), in a sentence immediately preceding the one stating who shall sit in an en banc hearing or rehearing, the body is described in substantially identical terminology: “the circuit judges of the circuit⁷ who are in regular active service.” Again Judge Ervin does not meet the description because, for purposes of the present case, he is “out of service.” It would obviously contradict the purpose of disqualification to treat the situation precisely as though the disqualified judge had voted “No.” The canon of construction is well established that words repeated within the same statutory section have an identical meaning in the several places employed. Eg., United States v. Nunez, 573 F.2d 769, 771 (2d Cir. 1978), cert. denied, 436 U.S. 930, 98 S.Ct. 2828, 56 L.Ed.2d 774 (1978).

We are not unmindful of authority to the contrary. Zahn v. International Paper Co., 469 F.2d 1033, 1041 (2d Cir.1972), affirmed on other grounds, 414 U.S. 291, 94 S.Ct. 505, 38 L.Ed.2d 511 (1973).⁸ However, the opinions in that case, both majority opinions and a dissent, concentrate on the policy considerations and do not allude to the language of the second sentence in § 46(c) or to the problems of directly conflicting meanings assigned to the same language, appearing cheek by jowl in adjacent sentences in a single statute. It is perhaps possible that members of the Second Circuit concentrated their attention, reasonably enough, on FRAP 35(a). That rule, headed “When Hearing or Rehearing in Banc Will be Ordered,” restricts itself, so far as present purposes are concerned, to a setting forth in haec verba of the language of the first sentence of § 46(c). Consequently, the conflict between the conclusion reached in Zahn and the language of the second sentence of § 46(c) was not so readily apparent.

The result later reached in Zahn had been described as the correct one in En Banc Hearings in the Federal Courts of Appeals: Accommodating Institutional Responsibilities, 40 N.Y.U.L.Rev. 563 (Part I), 726 (Part II) (1965):

Section 46(c) vests the power to provide for en banc proceedings exclusively in the active circuit judges of the circuit. Even if an active judge is disqualified from participation in an en banc decision, he still should be able to vote on the question of whether to hear the case en banc. A vote to sit en banc involves considerations of effective judicial administration and does not constitute a vote on the litigant’s claim. Also, allowing the disqualified judge to vote on the en banc question has the further advantage of allowing the full membership to determine more accurately the likelihood of subsequent disagreement with the panel decision.

Id. at 736.

However, the logic is badly frayed inasmuch as it is assumed that a recused judge would vote on whether a case should be heard or reheard en banc even though disqualified from voting on the merits.⁹ The Fourth Circuit has simply not operated in that fashion,¹⁰ and we do not perceive how a disqualified judge could do so without infringing the rule that he should take no action which would possibly affect the outcome of a case. To count as a vote his non-vote might well be decisive as to whether the case would be reheard.

Better reasoned, we find, are two law review notes favoring a result contrary to that reached in Zahn: Comment, Federal Jurisdiction and Practice, 47 St. John’s L.Rev. 339, 348 (1972) (“Upon disqualification, the Chief Judge should have properly been accorded no weight; his vote should have been neutralized by reducing the count of the regular active bench to seven and, thus, the four judges who voted for en banc reconsideration of Zahn should have .carried the day.”); Comment, In Banc Procedures in the United States Courts of Appeals, 43 Fordham L.Rev. 401, 420 (1974).¹¹

Since a disqualified judge under § 46(b) is explicitly recognized as unable to sit on a three member panel and since a disqualified judge manifestly, for the reasons heretofore given, cannot sit on an en banc hearing or rehearing, it would ascribe to Congress a petulant inconsistency, devoid of any apparent explanation, were we to hold that a judge, though disqualified, should be treated as though he were part of the quorum for the purposes of the vote on whether to hear or rehear the case en banc. The inconsistency aspect would also apply should we turn to general customary practice. See H. Robert, Robert’s Rules of Order 339 (Section 43) (S. Robert ed. 1970):

Majority Vote — the Basic Requirement [T]he basic requirement for approval of an action or choice by a deliberative assembly, except where a rule provides otherwise, is a majority vote. The word majority means “more than half”; and when the term majority vote is used without qualification — as in the case of the basic requirement — it means more than half of the votes cast by persons legally entitled to vote, excluding blanks or abstentions, at a regular or properly called meeting at which a quorum is present.

(Emphasis supplied.)

Accordingly, we have proceeded to rehear the case en banc. As a consequence, five court members (Chief Judge Winter, Judge Russell, Judge Widener, Judge Murnaghan and Judge Chapman) have concluded that there were errors mandating reversal for new trials as to the correct amount of compensatory damages of the judgments below in the Arnold and Mihalek accident cases.¹² Judges Hall, Phillips, Sprouse and Bryan, dissenting, would affirm. Undisturbed since no en banc rehearing was sought, or because we did not regard them as meriting en banc reconsideration, however, were the aspects of the consolidated case as to which the panel opinion was unanimous: (a) the award of a new trial as to compensatory damages in the Weston accident case and (b) affirmance of the judgments entered in favor of the United States and the air traffic controllers on the claims for indemnification or contribution.

The rationale for the majority decision en banc is largely to be found in the panel dissenting opinion. See Arnold v. Eastern Air Lines, Inc., 681 F.2d 186, 206 (4th Cir.1982). It would serve no purpose to repeat. However, it must be added that, although the panel dissent restricted itself to a description of perceived reversible error solely on the basis of improper conduct of counsel for the plaintiffs and the United States, we en banc, see substantial error in the joinder for trial or refusal to sever of the accident cases on the one hand and the indemnification or contribution actions on behalf of Aetna and other insurers of Eastern.

Of course, our judicial system could hardly function if appellate courts liberally indulged in second guessing of trial judges. The trial judges are on the scene, and properly are allowed extensive discretion in deciding such questions as whether the disclosure that a defendant is insured, while normally a grounds precluding consolidation or mandating severance, may be overborne by other considerations such as those relied on by the panel majority.¹³ Nevertheless, a trial must remain fair to both parties, and such considerations of convenience may not prevail where the inevitable consequence to another party is harmful and serious prejudice. Molever v. Levenson, 539 F.2d 996, 1003 (4th Cir.1976), cert. denied, 429 U.S. 1024, 97 S.Ct. 643, 50 L.Ed.2d 625 (1976). Consolidation, or refusal to sever, where prejudice results under the facts and circumstances of the particular case, amounts to abuse of discretion, constituting reversible error. Dupont v. Southern Pacific Co., 366 F.2d 193, 196 (5th Cir.1966), cert. denied, 386 U.S. 958, 87 S.Ct. 1027, 18 L.Ed.2d 106 (1967).

There is no need for us to announce a rule of universal applicability, imposing as an absolute necessity the separate trial of every case which is a candidate for consolidation if consolidation results in revelation to the jury of insurance coverage for a defendant.¹⁴ Nevertheless, looking at the facts and circumstances of the particular case, we are satisfied that knowledge of Eastern’s insurance coverage, and awareness of the approximate quantum of recovery for virtually every other crash victim, implanted in the minds of the jury resulted in prejudice, almost surely prejudice from the outset and certainly prejudice after the trial had wended its way to conclusion.

Had the cases not been consolidated, or after consolidation for discovery had they been severed for trial, there would have been no opportunity for counsel for one of the crash victims to make his uncouth observation about: “the 19 insurance companies that have been busy buying off the claims of the other people.” 681 F.2d at 211.

Looking alone at the size of the verdicts for compensatory damages in the three accident cases: Arnold ($3,027,500), Mihalek ($1,137,500) and Weston ($847,000), they cause the average for 70 other victims, $314,000, to pale by comparison. While peculiar characteristics of the three cases might afford an explanation, the other possibility simply cannot be eliminated that the jury, freed from any restraining concerns that it should not irresponsibly overstate damages and possibly unduly interfere with Eastern’s capability to continue to do business, contemplated the pockets — so deep as to seem virtually bottomless — of large insurance companies (several of whom, it was emphasized, were “foreign”) as a capacious source for benefactions rather than as only a spring supplying just compensation for injuries actually suffered.

In my panel dissent, I was “ready to assume, for the purposes of this case that, despite difficulties which customarily would dictate separate trials, consolidation of all the cases was, nevertheless, at least theoretically proper, in view of the great dislocations that otherwise were in store for the Western District of North Carolina.” 681 F.2d at 207. However, since consolidation “necessarily meant a disclosure to the jury that Eastern Airlines was insured, and that insurance carriers, rather than Eastern Airlines itself, would bear all or a substantial portion of any award to Arnold, Mihalek or Weston” (681 F.2d at 207), I emphasized that consequently there was “a heightened need to insist on scrupulous fairness in all other aspects of the trial of the consolidated cases.” 681 F.2d at 208. In the actual proof of the pudding, it has now become clear to me that the fairness required was not possible to attain. So I am entirely content to join with my four colleagues in a determination that the consolidation also amounted to reversible error.

That then presents the question of whether Aetna and the other insurers as parties to cases also held to have been improperly consolidated logically are likewise entitled to reversal and remand for a new trial. We are satisfied that the answer to be given is in the negative, for the consolidation prejudiced Eastern, but not the insurers. The fact of insurance had to be disclosed in the insurers’ cases, and the fact of indemnification of Eastern by its insurers would not prejudice the insurance companies.

REVERSED AND REMANDED FOR FURTHER PROCEEDINGS IN CONFORMITY WITH THE VIEWS HEREIN EXPRESSED.

1 . The petition for rehearing with suggestion for rehearing en banc of Eastern Air Lines granted by us was restricted to those two cases. The Weston personal injury action had, by unanimous action of the three-judge panel, for distinct reasons peculiar to that case, been reversed and remanded for a new trial as to the proper amount of compensatory damages. No petition for rehearing has been sought, or granted, with respect to the Weston case.

1 . In light of the decision we have reached, it is unnecessary to decide, and we purposely have avoided deciding, whether the taking of senior status by Judge Butzner on November 1, 1982, after the voting on whether to rehear the case en banc had been completed, but before an order was promulgated recording the vote, changed the equation so that the vote was, whatever view was taken, five of at most nine, and hence, in all events, a majority. Cf. United States v. Martorano, 620 F.2d 912, 920 (1st Cir.1980); United States v. American-Foreign Steamship Corp., 363 U.S. 685, 80 S.Ct. 1336, 4 L.Ed.2d 1491 (1960); Burns v. Estelle, 626 F.2d 396, 397 (5th Cir.1980).

2 . In Shenker, it was said that the denial of rehearing en banc fell within the discretion of the Third Circuit “to devise its own administrative machinery to provide the means whereby a majority may order such a rehearing.” Western Pacific Rr. Corp. v. Western Pacific Rr. Co., 345 U.S. 247, 250, 73 S.Ct. 656, 658, 97 L.Ed. 986 (1953).

3 . The other circuits have not been uniform in their decisions. The Eighth Circuit has clearly gone one way, providing in its Local Rule 16(a) as follows:

How Ordered; Panel for Hearing or Rehearing. A majority of the judges of this court in regular active service who are actively participating in the affairs of the court and who are not disqualified in the particular case or controversy may order a hearing or rehearing en banc upon request by a party or judge of this court in regular active service. The panel for the hearing or rehearing consists of the judges of this court in regular active service who are actively participating in the affairs of the court at ¿he time of the hearing or rehearing and who are not disqualified in the particular case or controversy.

Cf. Ford Motor Co. v. FTC, 673 F.2d 1008, 1012 n. 1 (9th Cir.1982). Other circuits, without being so unequivocally explicit, have adopted and construed rules requiring that disqualified judges be counted for purposes of a quorum when the question is whether or not to hear or rehear a case en banc. For example, the Third Circuit has, by its Rule 2(3) essentially picked up the language of the applicable statute, 28 U.S.C. § 46. We are informed that the interpretation in the Third Circuit has uniformly been to require, to set a case for en banc hearing or rehearing, a majority of all judges in regular active service, even those altogether disqualified in the case concerned. Respecting the Third Circuit, we note that Shenker was a case from that Circuit where rehearing was held to have failed, when two judges abstained and counting them as voting against rehearing resulted in a 4-4 split. The Supreme Court regarded the abstainers as voluntary non-voters, however, and that distinguishes the facts in Shenker from those of a case dealing with a disqualified judge who is under a binding compulsion not to vote.

The Sixth Circuit by order in a specific case which made clear that it was dealing with the question in the circumstances of a disqualified judge, Clark v. American Broadcasting Co., Inc., 684 F.2d 1208 (6th Cir.1982), and the D.C. Circuit and the Seventh Circuit, in Copper and Brass Fabricators Council, Inc. v. Department of Treasury, 679 F.2d 951 (D.C.Cir.1982) and Porter County Chapter oflzaak Walton League v. Atomic Energy Comm., 515 F.2d 513, 533 (7th Cir.1975), have also required for a majority more than one-half of all the judges in regular active service, including those “disqualified” (6th Cir.), “not participating” (D.C.Cir.) or “talcing no part” (7th Cir.).

4 . The balance of § 46(c) deals with a problem peculiar to the Fifth and Eleventh Circuits and further provides for participation in the decision of a case reheard en banc on the merits by a senior circuit judge who sat on the panel once a vote on a suggestion for rehearing en banc participated in solely by circuit judges in regular active service has conferred en banc rehearing status. It is in light of that statutory provision that Judge Bryan has participated in the en banc rehearing in the present case, but not in the determination whether the case should have an en banc rehearing.

5 . Cf, the language of 28 U.S.C. § 46(b):

In each circuit the court may authorize the hearing and determination of cases and controversies by separate divisions, each consisting of three judges, at least a majority of whom shall be judges of that court, unless such judges cannot sit because recused or disqualified.....

The recent amendment by the Federal Courts Improvement Act of 1982 added the language evidencing Congressional understanding that a recused or disqualified judge cannot sit. That approach finds collateral support also in 28 U.S.C. § 47 which forbids a trial judge to hear or determine an appeal from a decision reached by him.

6 . I.e., not senior or retired. United States v. American Foreign Steamship Co., 363 U.S. 685, 688, 80 S.Ct. 1336, 1338, 4 L.Ed.2d 1491 (1960); Moody v. Albemarle Paper Co., 417 U.S. 622, 94 S.Ct. 2513, 41 L.Ed.2d 358 (1974).

7 . The words “of the circuit” appear in the first sentence of § 46(c), but not in FRAP 35 where the language of that first sentence is repeated. (The following, or second, sentence from § 46(c) describing who shall sit on an en banc court is not contained in FRAP 35.)

8 . Zahn was applied in Boyd v. LeFrak Organization, 517 F.2d 918 (2d Cir.1975).

9 . To accept as persuasive the opinion in the New York University law review article would inferentially criticize Judge Ervin for not voting on the suggestion of a poll on rehearing en banc, and indeed criticize ourselves for agreeing that he should, since disqualified, not vote.

10 . Chief Judge Friendly of the Second Circuit, the disqualified judge in Zahn, did not vote on whether there should be a rehearing en banc.

11 . The Judicial Conference of the United States in 1973 took action on the subject which we regard as inconclusive. On the one hand, it expressed a clear preference for the reading of § 46(c) which we have concluded is correct. On the other hand, it indicated that a statute might be required. The report of the 1973 proceedings provided:

EN BANC HEARINGS

The Conference approved a proposal for legislation to amend Section 46(c) of Title 28, United States Code, and authorized the transmittal thereof to the Congress. The amendment would make clear that a majority of the judges in regular active service who are entitled to vote should be sufficient to en banc a case. Under the present statute, there must be a vote of a majority of the circuit judges in regular active service which has been construed to mean that if there is a vacancy a majority of the judges actually on the court will suffice but if a judge disqualified himself there must still be a majority of the entire membership voting for an en banc sitting.

12 . Eastern Airlines does not contest liability, restricting controversy to the amount of compensatory damages.

13 . In this case “the risk of inconsistent adjudications of common factual and legal issues, the burden on parties, witnesses and available judicial resources posed by multiple lawsuits, the length of time required to conclude multiple suits as against a single one, and the relative expense to all concerned of the single-trial, multiple-trial alternatives.” 681 F.2d at 193.

14 . See, however, Langley v. Turner’s Express, Inc., 375 F.2d 296, 297 (4th Cir.1967) (“... [W]e are in accord with Virginia law, which has consistently held that evidence as to insurance coverage is inadmissible and prejudicial to a defendant and the admission of such testimony or argument of counsel disclosing insurance coverage is reversible error.”).