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June 26, 2020 Digests

Posted By Administration, Monday, June 29, 2020

Kansas Supreme Court

Civil

PUBLIC DUTY—TORTS
MONTGOMERY V. SALEH
SHAWNEE DISTRICT COURT—COURT OF APPEALS IS AFFIRMED, DISTRICT COURT IS AFFIRMED IN PART, REVERSED IN PART
NO. 117,518—JUNE 26, 2020

FACTS: Trooper Saleh initiated a traffic stop when he was informed that a passenger in the vehicle had a knife and was acting erratically. The driver rapidly accelerated and drove recklessly, running stop signs and red lights while his speed reached near 100 miles per hour. Saleh decided to stop pursuit, but not before the driver ran a red light and hit a pickup truck, injuring Montgomery and another individual named Bennett. The plaintiffs filed separate petitions alleging that Saleh was negligent and that the State was liable for his actions. The State moved for summary judgment, arguing that even if the plaintiffs could prove negligence there was no duty owed by Saleh under the public duty doctrine. The district court granted the motion, rejecting application of both the public duty doctrine and Kansas Tort Claims Act immunity. But the district court ruled the plaintiffs failed to proffer evidence sufficient to support a finding of causation in fact. The Court of Appeals affirmed the district court's findings on immunity and the public duty doctrine but remanded the case for further action on proof of causation. The Supreme Court granted Trooper Saleh and the State's petition for review.

ISSUES: (1) Application of the public duty doctrine; (2) breach; (3) causation; (4) immunity

HELD: The plain language of K.S.A. 8-1506 required emergency vehicle drivers to "drive with due regard for the safety of all persons." This language shows that the legislature did not intend to exempt emergency vehicle drivers from the consequences of reckless conduct. This statute imposes a specific duty on law enforcement and individuals may sue if they believe this duty has been breached. In order to prevail, the plaintiffs must prove that Saleh acted with reckless disregard for the safety of others. The evidence presented to the district court showed there is a material issue of fact as to whether Saleh exhibited reckless disregard when continuing to pursue the fleeing driver. Law enforcement's conduct during a pursuit can be the legal cause of a third party's injuries. Given the evidence presented to the district court, a jury could have found that the driver knew he was being pursued by Saleh. Because there is a statutory duty created by K.S.A. 8-1506(d), the discretionary function exception does not apply to Saleh's pursuit of the fleeing driver.

DISSENT: (Rosen, J., joined by Stegall, J., and Green, J., assigned) Justice Rosen would reverse the Court of Appeals and affirm the district court's grant of summary judgment, holding that the plaintiffs failed to establish a prima facie case that Saleh breached his duty of care under K.S.A. 8-1506.

STATUTE: K.S.A. 8-1506, -1506(d), 75-6101(b), -6103(a), -6104, -6104(e), -6104(n)

CONTRACTS
RUSSELL V. TREANOR INVESTMENTS
DOUGLAS DISTRICT COURT—COURT OF APPEALS IS AFFIRMED, DISTRICT COURT IS AFFIRMED
NO. 117,973—JUNE 26, 2020

FACTS: In 1997, the owner of two adjacent properties executed and recorded an Operation and Easement Agreement. The OEA restricted the building size and prohibited either property from being used as a regular grocery store. The OEA allowed for amendment if all of the current owners agreed in writing, and the OEA was amended to alter the original site plan. The amendment allowed for the creation of a multi-unit buildings with condominiums and retail space; Russell purchased a unit in the building in 2010. Treanor Investments purchased part of the property covered by the OEA in 2015, with hopes to amend the OEA and enlarge the property footprint to encompass a grocery store. Russell filed suit, claiming the OEA could not be amended without condominium owner consent. The parties filed competing motions for summary judgment and the district court agreed with Treanor, finding that it had been designated as the responsible owner, who had authority to act on behalf of other owners. The Court of Appeals affirmed, finding that the OEA and its amendments were clear and unambiguous in allowing the responsible owner to act on others' behalf. Russell's petition for review was granted.

ISSUES: (1) Authority to amend the OEA; (2) can amendment materially change the character of the real estate

HELD: The language of the OEA is plain and unambiguous, and it allows for the designation of a responsible owner to act on others' behalf. This language existed before Russell purchased his condominium. Nothing in the language prevents the responsible owner from further amending the OEA to alter size and use restrictions. Russell failed to raise a genuine issue of material fact about whether the proposed changes to the property would cause a material change in circumstances.

STATUTES: No statutes cited.

criminal

appeals—constitutional law—criminal law—criminal procedure—evidence 
state v. George
finney district court—affirmed
no. 120,190—june 26, 2020

FACTS: George convicted of first-degree murder, attempted distribution of a controlled substance, attempted aggravated robbery, aggravated assault, and criminal possession of a firearm. He appealed claiming: (1) his convictions were multiplicitous, arguing three of his convictions “folded” into one another and became a single offense; (2) prosecutorial error during cross-examination of a witness by commenting on the witness’ credibility; (3) trial court erred by allowing a witness to invoke Fifth Amendment and refuse to testify where the witness had been convicted and sentenced but his appeal was still pending; and (4) cumulative error denied him a fair trial.

ISSUES: (1) Multiplicity; (2) prosecutorial error; (3) invocation of Fifth Amendment; (4) cumulative error

HELD: George’s convictions are not multiplicitous. Elements of each of three crimes arising from the same conduct but grounded in three different statutes are examined, finding: attempted aggravated robbery and aggravated assault are not multiplicitous; attempted distribution or possession with intent to distribute a controlled substance and attempted aggravated robbery are not multiplicitous; and attempted distribution or possession with intent to distribute a controlled substance is not multiplicitous with aggravated assault.

            George failed to preserve his evidentiary claim and cannot evade the contemporaneous objection requirement demanded by K.S.A. 60-404 by reframing the issue as one of prosecutorial error. Defense counsel objected to the State’s cross-examination question as going “beyond the scope” of direct examination, but did not argue any grounds relating to impeachment or character evidence. This was insufficient for appellate review of the issue now claimed.

            Error resulting from district court’s exclusion of a witness’ testimony, if any, was harmless. Court declines to decide whether a plea of nolo contendere waives the privilege against self-incrimination after sentencing but before the conclusion of direct appeals. Even if error is assumed in this case, the error is harmless because the substance of this witness’ proffered testimony was entirely presented at trial through the testimony of a detective.

            Cumulative error doctrine does not apply in case having only one assumed error.

STATUTES: K.S.A. 2019 Supp. 21-5301, -5301(a), -5412(a), -5412(b)(1), -5420, -5420(a), -5420(b), -5705(a)(1), -5705(d)(3)(C), 22-3601(b)(4), 60-261; K.S.A. 60-404, -422(c)

criminal procedure—evidence—sentencing—statutes
state v. satchell
sedgwick district court—affirmed in part and vacated in part
court of appeals—affirmed in part and reversed in part
no. 116,151—june 26, 2020

FACTS: Satchell charged with 2014 sexual offenses involving two children. To show his propensity to sexually abuse children, State was allowed to present evidence under K.S.A. 2019 Supp. 60-455(d) about Satchell’s 2010 abuse of three other children under similar circumstances. Jury convicted Satchell on all counts. Sentencing court ordered consecutive “hard 25” sentences for the eight off-grid offenses, followed by 100 months in prison for criminal sodomy. Court also ordered lifetime parole for the off-grid offenses and lifetime postrelease supervision for the on-grid offense. On appeal, Satchell claimed in part the district should not have allowed the 60-455 evidence because it was unduly prejudicial, and argued he should not have been given lifetime postrelease supervision. In unpublished opinion, Court of Appeals rejected both claims. Review granted

ISSUES: (1) K.S.A. 60-455 evidence; (2) sentencing

HELD: District court did not abuse its discretion by admitting evidence of the 2010 allegations. The 2010 evidence, if true, would be relevant. At issue is whether the probative value of this evidence was substantially outweighed by the risk of unfair prejudice. Factors in State v. Boysaw, 309 Kan. 526 (2019), to be considered in determining probative value and undue prejudice are analyzed on facts in this case. In balancing those factors, the district court can exclude otherwise admissible relevant evidence if its probative value is “substantially outweighed” by the risk of undue prejudice. Court acknowledges criticism of past decisions that have left out the term “substantially,” but finds the proper test has been applied despite the occasional shorthand references. Here, the risks of undue prejudice did not substantially outweigh the high probative value of the 2010 evidence.

            District court erred by ordering lifetime postrelease supervision. Under K.S.A. 2016 Supp. 21-6819, in effect at the time of Satchell’s offenses, the proper post release supervision term is lifetime parole when the district court imposed consecutive on-grid and off-grid sentences. The lifetime postrelease supervision portion of Satchell’s sentence is vacated. 

STATUTES: K.S.A. 2019 Supp. 60-455(d); K.S.A. 2016 Supp. 21-6627, -6819, -6819(b)(2), 22-3717, -3717(d)(1)(G), -3717(u); K.S.A. 60-406, -407(f), -445

 

Kansas Court of Appeals

Civil

AGENCY ACTION—MEDICAL EXPENSES
UNIVERSITY OF KANSAS HOSPITAL AUTHORITY V. BOARD OF COUNTY COMMISSIONERS OF FRANKLIN COUNTY, KANSAS
WYANDOTTE DISTRICT COURT—AFFIRMED IN PART, REVERSED IN PART, REMANDED
NO. 120,472—JUNE 26, 2020

FACTS: After seeing a man driving without headlights and with a suspended license, Ottawa police engaged in a high-speed chase. Officers lost track of the vehicle, and by the time they found it, the driver had crashed and the vehicle was fully engulfed in flames. Rescue personnel found the driver on the ground, suffering from severe injuries. Officers did not search the driver, and he was not placed under arrest, although a hold was placed while the man was in the hospital. After his release, the driver was taken to jail based on outstanding warrants that were unrelated to the police chase. After an investigation, the driver was charged with felony fleeing and eluding. The University of Kansas Hospital Authority filed suit against the City of Ottawa and the Franklin County Board of County Commissioners in an attempt to recoup some of the man's considerable medical bills. All parties filed motions for summary judgment. After considering arguments, the district court found that the driver was in the City's custody when medical treatment was initiated. But for the driver's injuries, he would have been arrested when the chase ended. The district court granted summary judgment in the Hospital's favor against the City but found that the County was not involved enough to be responsible for bills. The City appealed and the Hospital cross-appealed.

ISSUES: (1) Whether the driver was in custody; (2) existence of disputed material facts

HELD:  "Custody" has a broad definition. A formal arrest is not always necessary to show that a person is in custody. It is undisputed that County deputies did not witness any crimes being committed and did not participate in the chase. This means it is also undisputed that the driver was not in County custody when medical care was sought, and the County has no obligation to contribute to the driver's medical bills. There are lingering fact questions, though, about whether the driver was in the City's custody. Specifically, there was no stipulation that the driver was stopped by law enforcement, triggering the statutory obligation to take him into custody. Because there is a lingering fact question, summary judgment was not appropriate. The case must be remanded to clear up these issues.

STATUTE: K.S.A. 2019 Supp. 8-1568(b), -1568(c), 22-2202(d), -2202(i), -4612, -4612(a)

CONTRACTS—OIL AND GAS
THOROUGHBRED ASSOCIATES V. KANSAS CITY ROYALTY COMPANY
COMANCHE DISTRICT COURT—AFFIRMED IN PART, REVERSED IN PART, REMANDED
NO. 120,068—JUNE 26, 2020

FACTS: Beginning in 1997, Thoroughbred acquired oil and gas leases. After it struck a big well, Thoroughbred acquired leases on nearby property to prevent competition. However, there was a 1/3 mineral interest in one of these tracts which remained unleased. In an attempt to acquire that lease, Thoroughbred contacted the owner, Oxy USA Inc., about selling. The parties signed a lease in 1998 which allowed Thoroughbred to unitize the lease. The lease would continue for as long as Thoroughbred produced oil or gas in paying quantities, either from the tract or from the unit as a whole. Oxy had a 3/16 royalty on production from the tract. In 1999, Oxy sold its interest in the lease to KC Royalty. Tensions arose when KC Royalty believed that gas from the unit was being drained into another unit that was not covered by KC Royalty's lease and that KC Royalty believed that Thoroughbred owed it unpaid royalties. After extensive litigation and another appeal which was heard by the Kansas Supreme Court, the parties ended up back in district court. That court ruled in favor of KC Royalty, finding that the parties agreed to unitize the Lease, that KC Royalty had waived certain conditions, and that Thoroughbred was equitably estopped from enforcing the conditions. After ruling that all liquids produced in the unit were incidental byproducts of the gas, the court concluded that KC Royalty's interest included all unit production. Both parties appealed.

ISSUES: (1) Whether the parties included the lease in the unit by modification, waiver, or estoppel; (2) award of interest in oil production arising from gas lease; (3) attorney fees

HELD: Substantial evidence supported the district court's finding that the parties modified their lease to include the parcel in the larger unit. This is proven by both Oxy and KC Royalty accepting royalty payments. KC Royalty had the unilateral power to waive conditions and allow Thoroughbred to include the lease in the larger unit. All evidence shows that KC Royalty intended to modify the agreement. Because Thoroughbred represented that KC Royalty's lease was in the unit for over three years, it is estopped from changing its mind now. A portion of the unit included a parcel which was a separate, oil-producing formation where oil production far exceeded gas production. There was no evidence that the oil and gas in this particular parcel was condensate. The district court improperly included this parcel in its royalty calculations, and the case must be remanded for accurate calculations. The district court did not abuse its discretion by denying KC Royalty's motion for attorney fees.

STATUTE: K.S.A. 55-205, -1617

CLASS ACTIONS—OIL AND GAS
COOPER CLARK FOUNDATION V. OXY USA, INC.
GRANT DISTRICT COURT—AFFIRMED
NO. 120,371—JUNE 26, 2020

FACTS: This appeal involves a class-action lawsuit over natural gas leases. After extracting gas, Oxy sent most of it for processing. Cooper, representing the wells included within the class action, disputes the method Oxy was using to calculate royalties for all Class Leases. The class action petition was filed in 2017, alleging that Oxy underpaid royalties from July 2007 through April 2014. Cooper's specific grievances included Oxy passing through processing fees, improperly calculating volume, using the wrong price structure, and not paying interest on conservation fees. The district court certified Cooper's class, and Oxy appealed that certification.

ISSUE: (1) Whether class was properly certified

HELD: Gas produced from Class wells wasn't marketable until it was in a condition suitable for its intended market. This didn't occur until after it was processed. The district court did not abuse its discretion when it found that the class petition raised questions of law and fact that were common to all class members. All of the claims can be litigated classwide without individualized evidence; this includes a dispute over whether Oxy owes interest for conservation fees that were repaid to class members. There are similarly no individualized issues regarding Oxy's statute of limitations defense. The district court rigorously analyzed the requirements for class certification and correctly concluded that the class was appropriate.

STATUTES: K.S.A. 2019 Supp. 60-223, -223(a), -223(b); K.S.A. 16-201, 55-1614, -1615

criminal 

appeals—appellate procedure—constitutional law—criminal procedure— damages—insurance—restitution—sentencing
state v. robinson
lyon district court—affirmed
no. 120,903—june 26, 2020

FACTS: Robinson pled no contest to battery of law enforcement officer. Sentencing included requirement that Robinson pay $2,648.56 in restitution to reimburse workers compensation insurance carrier that paid medical expenses of officer injured as a result of the battery. Robinson appealed claiming the statutes authorizing the district court to order restitution violate Section 5 of Kansas Constitution Bill of Rights by depriving him of right to have a civil jury determine the amount of damages, and violate the Sixth Amendment of U. S. Constitution by allowing a judge to determine the amount of restitution to be awarded the victim. He also claimed district court erred in awarding restitution to be paid to an insurance carrier. State contends the constitutional issues, raised for first time on appeal, were not properly preserved.

ISSUES: (1) Unpreserved claims; (2) restitution—Section 5 of Kansas Constitution Bill of Rights; (3) restitution—Sixth Amendment of U.S. Constitution; (4) payment to insurance carrier

HELD: The issues not raised below are considered because they potentially implicate a claim to the fundamental right to a trial by jury under the Kansas and United States constitutions, and a decision on the merits would serve the ends of justice.

            Robinson failed to establish that Section 5 of the Kansas Constitution Bill of Rights requires that a jury impose criminal restitution under K.S.A. 2017 Supp. 21-6604(b)(1) and K.S.A. 2017 Supp. 21-6607(c)(2). Criminal restitution is not a civil remedy and no provision in the Kansas territorial statutes mentions criminal restitution.

            District court’s restitution order did not violate the Sixth Amendment. Court of Appeals panels have addressed whether Sixth Amendment applies to criminal restitution, and review of one unpublished opinion is currently pending. Under State v. Huff, 50 Kan.App.2d 1094 (2014), rev. denied 302 Kan. 1015 (2015), restitution is not punishment, but even if punishment is assumed, the Kansas statutes do not violate the Sixth Amendment. Huff is consistent with cited  federal and state court opinions, and courts have concluded that Southern Union Co. v. United States, 567 U.S. 343 (2012), does not extend Apprendi and its progeny to restitution. Kansas statutes governing restitution impose neither mandatory minimum amounts nor mandatory maximum amounts, so they do not trigger concerns in Apprendi or Alleyne.

            Neither K.S.A. 2017 Supp. 21-6604(b)(1) nor K.S.A. 2017 Supp. 21-6607(c)(2) prohibit a district court from awarding restitution to an insurance carrier that has suffered damage or injury as a result of the defendant’s crime.

DISSENT (Leben, J.): Would vacate the restitution award because Robinson had a right to have a jury determine the amount of damage or loss he caused any victim of his crime. Text of Sixth Amendment, history, and precedent support a holding that Sixth Amendment applies to restitution. Cases cited by the majority as rejecting the claim that Apprendi applies to restitution are criticized. The two Kansas restitution statutes violate Apprendi by allowing judges to increase the statutory maximum punishment for an offense beyond that authorized by the jury’s verdict or the plea agreement. Even if Robison had no jury-trial right under Sixth Amendment, he had one under Section 5 of Kansas Constitution Bill of Rights.

STATUTES: K.S.A. 2017 Supp. 21-5413(c)(3)(D), -6604, -6604(b)(1), -6604(b)(2), -6607(c)(2), -6608(c)(7), -6613(a), -6613(b), 60-238, -2401, -4304(b); K.S.A. 1991 Supp. 21-6607(c)(2); K.S.A. 60-4301

Tags:  Agency Action  Appeals  Appellate Procedure  Class Actions  Constitutional Law  Contracts  Criminal Procedure  Damages  Evidence  Insurance  Lyon  Medical Expenses  Oil and Gas  Public Duty  Restitution  Sentencing  Statutes  Torts 

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April 10, 2020 Digests

Posted By Administration, Monday, April 13, 2020

Kansas Supreme Court

Civil

EMERGENCY PROCEDURES—QUO WARRANTO
KELLY V. LEGISLATIVE COORDINATING COUNCIL
ORIGINAL ACTION—QUO WARRANTO GRANTED IN PART
NO. 122,765—APRIL 11, 2020

FACTS: Because of the global pandemic caused by the novel coronavirus, Governor Kelly issued an emergency proclamation and follow-up executive orders. Under statute, the state of disaster emergency could not last longer than 15 days unless ratified by a concurrent resolution of the Legislature. Within that 15-day window, the legislature adopted House Concurrent Resolution 5025, extending the Governor's declaration to May 1, 2020. Governor Kelly used her emergency powers to issue Executive Order 20-18 which temporarily prohibited "mass gatherings", defined as any event that would bring together more than 10 people in an enclosed space. Importantly, Executive Order 20-18 removed religious gatherings from a list of exempted activities. Acting under HCR 5025, the Legislative Coordinating Council convened, voted, and revoked Executive Order 20-18. Governor Kelly filed this original action in quo warranto, and expedited proceedings were allowed given the unusual circumstances.

ISSUE: (1) Authority of the LCC

HELD: Quo warranto is an appropriate procedure for questioning the LCC's authority to revoke Executive Order 20-18. The House of Representatives and the Senate are not appropriate parties to the action and are dismissed. But the governor has standing to pursue this action. HCR 5025 establishes a conditions precedent which must be met before the LCC can act if the Legislature is not in session, including input from the State Finance Council. The LCC cannot act until the State Finance Council acts. K.S.A. 46-1202 is a general statute which creates the LCC and gives it some authority. In this instance, that statute must give way to the more specific statute, which governs the revocation of executive orders during an emergency.

CONCURRENCE: (Biles, J.) While agreeing with both the outcome and rationale, Justice Biles questions whether HCR 5025 can confer oversight powers on the LCC at all.

CONCURRENCE: (Stegall, J.) The majority reached the right outcome using the right rationale. There are lingering issues with the Kansas Emergency Management Act relating to separation of powers. The plain language of HCR 5025 may produce absurd results, but the court has no authority to rewrite the resolution.

STATUTES: K.S.A. 2019 Supp. 48-925 -925(b); K.S.A. 46-1202, 48-924, -924(b), 60-1203

criminal 

criminal procedure—sentences—statutes
state v. coleman
saline district court—reversed and remanded 
court of appeals—affirmed
no. 118,673—april 10, 2020

FACTS: In 2013, 2014, and 2015 cases, Coleman granted downward dispositional departure sentences of probation with underlying prison terms. In November 2017 revocation hearing, district court ruled that because probation had been granted as the result of dispositional departures it had authority under K.S.A. 2017 Supp. 22-3716(c)(9)(B), effective July 1, 2017, to revoke probation and impose the underlying sentences without first imposing intermediate sanctions. Coleman appealed. In unpublished opinion, Court of Appeals reversed and remanded, holding the trial court erred in applying K.S.A. 2017 Supp. 22-3716(c)(9)(B) retrospectively. State’s petition for review granted.

ISSUE: Probation revocation

HELD: Court of Appeals judgment is affirmed. The K.S.A. 2017 Supp. 22-3716(c)(9)(B) exception, which allows a trial court to revoke a probationer’s probation without first imposing graduated sanctions if the probation was granted as a result of a dispositional departure, applies only to probationers whose offenses or crimes of conviction occurred on or after that statute’s effective date.  District court judgment is reversed and case remanded with directions.

STATUTES: K.S.A. 2017 Supp. 22-3716, -3716(c)(9)(B); K.S.A. 2014 Supp. 22-3716(c)(11); K.S.A. 20-3018(b), 60-2101(b)

 

Kansas Court of Appeals

Civil

CONTRACTS—EMPLOYMENT
HEFNER V DEUTSCHER
SHAWNEE DISTRICT COURT—REVERSED AND REMANDED
NO. 119,201—APRIL 10, 2020

FACTS: Hefner, Deutscher, and Rottinghaus worked together in their optometry practice as a corporation. As an employee of the corporation, Hefner signed a noncompete agreement barring him from employment within a set geographic area for three years following his employment with the corporation. The contract specified that damages would be awarded for any breach or "threatened breach" of the contract. Over time, Hefner and Deutscher's relationship soured, and both parties proposed strategies that would allow Hefner to leave the corporation. Before the details could be finalized, Hefner located new office space and registered a new tradename with the Kansas Optometry Board. Hefner ultimately resigned instead of finalizing his exit agreement. And instead of practicing, Hefner decided he would rather teach optometry. It was thought that Hefner would work for the corporation for an additional six months, but Deutscher fired him for violating the noncompete clause. Hefner filed suit for breach of contract and wrongful termination. All parties filed competing motions for summary judgment. The district court granted Hefner's motion for partial summary judgment on his breach of contract claim and granted the corporation's motion for summary judgment on Hefner's wrongful termination claim. After a bench trial on the remaining breach of fiduciary duty claim, the district court found that Deutscher and Rottinghaus breached their fiduciary duty to Hefner because their motives for terminating Hefner were not made in fairness and good faith to the corporation. The district court awarded Hefner in excess of $1 million in damages. The corporation, Deutscher, and Rottinghaus appealed.

ISSUE: (1) Hefner's breach of contract claim

HELD: The use of the phrase "threatened breach" in Hefner's employment contract did not mean the same thing as an anticipatory breach. It had a broader meaning under the plain language of the employment contract, and encompassed actions which would lead a reasonable person to believe that a breach is imminent and likely to happen. The district court incorrectly defined "threatened breach", and this error resulted in the district court wrongly granting Hefner's motion for summary judgment. This case must be remanded to the district court for further action.

STATUTES: No statutes cited.

RATEMAKING—UTILITIES
HANSON V. KCC
STEVENS DISTRICT COURT—AFFIRMED IN PART,
REVERSED IN PART, REMANDED TO KCC
NO. 119,834—APRIL 10, 2020

FACTS: TKO Gas, LLC provides limited natural gas service in Kansas, operating as a middleman to resell gas to customers. TKO assumed contract rights from a previous provider and never went through a formal rate-setting process. Over time, some customers complained that TKO improperly calculated the heat content of the gas it was selling, resulting in a consistent 9.5% overcharge. Staff found that TKO changed the pressure at which is delivered natural gas. TKO acknowledged that this happened, but claimed it was industry standard practice to do so, and that the practice was in its contracts which were approved by the KCC. The KCC held a hearing and determined that none of the customers were entitled to relief. Even though TKO admitted to all of the customers' claims, the KCC ultimately determined that the rates charged by TKO were still reasonable, resulting in no harm to the customers. The district court reversed this finding, ruling that the KCC improperly focused on rate making while ignoring TKO's improper billing practices. The district court ordered the KCC to calculate the exact amount of overbilling and require TKO to pay refunds. TKO appealed.

ISSUE: (1) KCC's ability to address overpayment

HELD: The KCC is not limited to ratemaking or rate-reviewing functions. It has broad authority to determine whether any action is unreasonable or unfair. The KCC erred by only focusing on whether TKO's rates were reasonable, ignoring TKO's flawed billing methodology. TKO's practice of changing the pressure at which gas is distributed resulted in an overcharge and was neither honest nor fair. The KCC erred by not addressing it. But the district court erred by directing the KCC on how to fix this error. The KCC has total statutory control over crafting an appropriate remedy, and the case is remanded to the KCC.

STATUTE: K.S.A. 66-1,201, -1,205, -1,205(a), -1,206, -1,206(a), -1,207, 77-621(a)(1), -621(c)(4)

OIL AND GAS—TAX
IN RE TAX APPEAL OF RIVER ROCK ENERGY COMPANY
BOARD OF TAX APPEALS—AFFIRMED IN PART, REVERSED IN PART, REMANDED
NO. 120,387—APRIL 10, 2020

FACTS: In 2016, River Rock acquired producing gas wells, leases, and other assets in Kansas. After taking possession, River Rock learned that the counties in which the wells were located assigned a total appraised value of over $13 million. River Rock appealed while paying its taxes under protest. But River Rock only paid filing fees for a small percentage of its wells. River Rock sought an abatement of the filing fees it did pay. The Property Valuation Division of the Kansas Department of Revenue intervened to defend its valuation methods. After a hearing based on written testimony, BOTA upheld the counties' valuations. River Rock appealed.

ISSUES: (1) Valuing wells based on minimum lease values; (2) minimum leave values creating arbitrary and erroneous valuations; (3) whether BOTA properly considered the evidence; (4) whether BOTA erred when valuing equipment in the wells; (5) filing fee abatements

HELD: Personal property must be appraised at its fair market value. The Kansas Oil and Gas Appraisal Guide does not comply with this statutory directive because it prevents the gross working interest in any producing well from ever dropping to zero. The use of a minimum lease value on limited-production wells creates an assessed value higher than the actual gross working interest value, arbitrarily substituting the higher of two possible values. The Guide does not allow for the proper reconciliation of market values when the working interest value differs greatly from the minimum leave value. When an appraiser uses the minimum lease value, deductions for actual costs and other expense allowances are no longer used. This prevents sufficient consideration of these costs and does not lead to a fair market value of the property. Actual evidence shows that River Rock has wells with negative gross working interest, but the assigned minimum lease values do not reflect fair market value. BOTA did not ignore relevant evidence, rather overly simplified the evidence. River Rock cannot tie the value of its equipment to variable market conditions which ultimately affect the price of natural gas. BOTA properly valued River Rock's equipment with one exception: BOTA erred when valuing segments of underground poly flow lines. BOTA disregarded uncontroverted evidence that the lines could not be salvaged without destroying them. Filing fees are not allowed if they exceed the reasonable costs of administering the appeals. Neither BOTA nor River Rock properly calculated River Rock's filing fees, but the record on appeal does not contain enough information to determine how much abatement should have been granted to River Rock. If BOTA wants to deny River Rock's request for abatement, it must explain why.

STATUTE: K.S.A. 77-603(a), -613(e), -621(a)(1), -621(c), 79-329, -331(a), -501, -503a

GARNISHMENTS
STORMONT-VAIL HEALTHCARE V. SIEVERS
SHAWNEE DISTRICT COURT—AFFIRMED
NO. 121,109—APRIL 10, 2020

FACTS: Stormont-Vail received a consent judgment against Sievers for unpaid medical expenses. The amount of the debt is undisputed. Sievers refused to set up a payment plan and instead asked Stormont-Vail to garnish him. Stormont-Vail took him up on his offer and filed two requests for orders of garnishment: one from his employer and one to attach Sievers' other property held in bank accounts. Sievers objected to the garnishment order at his bank, arguing that the funds in his bank account were exempt from attachment because the funds met the definition of "earnings." The district court disagreed with Sievers, finding that once Sievers' paycheck was deposited into a bank account the money became garnishable. Sievers appeals.

ISSUE: (1) Whether wages deposited into a bank account can be garnished

HELD: Kansas statutes create limits on how much of a debtor's earnings can be attached by a nonwage garnishment order. Only an employer can act as the garnishee for a wage garnishment. The meaning of "earnings" is expressly tied to an employer-employee relationship, and once money paid as earnings is deposited into a bank account it loses its status as earnings. The money in Sievers' bank account was garnishable, even if the funds originated from his earnings.

DISSENT: (Standridge, J.) Wages paid by an employer are earnings. So wages electronically paid to Sievers by his employer via direct deposit into his bank account meet the statutory definition of earnings and are exempt from attachment through garnishment.

STATUTE: K.S.A. 2019 Supp. 60-2310(a)(1), 61-3504(a), -3504(b), -3505(a), -3506(g), -3507, -3507(a), -3508, -3509, -3510; K.S.A. 61-3502, -3505

criminal

constitutional law—criminal procedure—evidence—juries—jury instructions
state v. albano
riley district court—affirmed
no.120,767—april 10, 2020

FACTS: Albano convicted of distribution of a controlled substance within 1,000 feet of a school. On appeal she claimed: (1) district court erred by failing to give a limiting instruction concerning the admission of evidence of Albano’s prior drug convictions; (2) district court undermined jury’s power of nullification by instructing jury that it “must” follow the law and that it was jury’s “duty” to do so; and (3) sentencing court’s use of judicial findings of prior convictions to sentence Albano violated section 5 of Kansas Constitution Bill of Rights - the right of trial by jury.

ISSUES: (1) limiting instruction—prior crimes; (2) jury instructions—power of nullification; (3) sentencing—Kansas Constitution

HELD: State’s argument that Albano invited the limiting-instruction error is rejected. A defendant does not waive applicability of a limiting instruction simply by introducing K.S.A. 60-455 evidence because a limiting instruction is required regardless of which party introduced the evidence. Here, district court erred in failing to give a limiting instruction, but this failure was not clearly erroneous. Unclear how jury could have impermissibly relied on Albano’s prior convictions as general propensity evidence when it was undisputed she committed the acts in question, and jury’s acquittal on one of the three charges establishes that jury did not impermissibly rely on the prior convictions to establish guilt.

            District court did not err in giving legally correct instructions. State v. Boothby, 310 Kan. 619 (2019), determined that the same “must follow the law” language Albano challenged in one instruction did not interfere with jury’s power to nullify. The “duty” language challenged   in a second instruction is substantively identical—telling jury to follow the law.

            There is no authority for the proposition that section 5 provides greater protection than the federal jury trial right by requiring a jury to determine criminal history. And the section 5 jury trial right does not prohibit judicial findings of prior criminal history because there was no common law right to have a jury determine criminal history when the Kansas Constitution was adopted.    

STATUTES: K.S.A. 2019 Supp. 22-3414(3); K.S.A. 60-455

constitutional law—criminal procedure—evidence
state v. R.W.
douglas district court—affirmed
no. 120,854—April 10, 2020

FACTS: Juvenile R.W. was interrogated several hours at police facility after being picked up from high school by two police officers. State later charged R.W. with multiple criminal counts including rape and aggravated battery, and district court certified R.W. for trial as an adult. R.W. filed motion to suppress statements he made during interrogation. District court granted the motion, finding R.W.’s statements were not the product of a free and independent will, and citing the officers’ promises, benefits, and reassurances as resulting in R.W.’s will being overborne. State filed interlocutory appeal.

ISSUE: Fifth Amendment—juveniles

HELD: District court’s suppression order is affirmed. Totality of circumstances in this case suggest that R.W.’s confession was not the product of a free and independent will. Standard of care to be exercised in assessing the validity of a juvenile’s statements during interrogation without counsel present is discussed. Here, substantial competent evidence supported district court’s factual findings, and district court applied the correct legal analysis. Agreement stated with specific findings and considerations in district court’s comprehensive memorandum decision. Officers may have had good intentions, but statements made to juveniles that are likely to mislead them regarding the nature and legal consequences of an interrogation have the potential to render a confession involuntary.

STATUTES: K.S.A. 2019 Supp. 22-3603, 60-460(f); K.S.A. 60-460(f)

Tags:  Constitutional law  contracts  criminal procedure  emergency procedures  employment  evidence  garnishments  juries  jury instructions  oil and gas  quo warranto  ratemaking  sentences  statutes  tax  utilities 

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January 9, 2015 Digests

Posted By Administration, Tuesday, January 13, 2015
Updated: Monday, February 10, 2020

Kansas Supreme Court

Attorney Discipline

DISBARMENT
IN RE BART A. CHAVEZ
ORIGINAL PROCEEDING IN DISCIPLINE
NO. 14,646 – DECEMBER 16, 2014

FACTS: In a letter signed on December 15, 2014, addressed to the clerk of the appellate courts, respondent Chavez, an attorney admitted to the practice of law in the state of Kansas, voluntarily surrendered his license to practice law in Kansas. At the time the respondent surrendered his license, complaints had been docketed by the disciplinary administrator's office in accordance with Supreme Court Rule 217. The complaints alleged that the respondent violated Kansas Rules of Professional Conduct 8.1(b) (2014 Kan. Ct. R. Annot. 670) (bar admission and disciplinary matters), 8.3(a) (2014 Kan. Ct. R. Annot. 678) (reporting professional misconduct), 8.4(a), (d), and (g) (2014 Kan. Ct. R. Annot. 680) (misconduct), Supreme Court Rule 207(a) (2014 Kan. Ct. R. Annot. 342) (cooperating with Disciplinary Administrator), and Supreme Court Rule 208(c) (2014 Kan. Ct. R. Annot. 356) (registration of attorneys).

HELD: The Court, having examined the files of the office of the disciplinary administrator, found that the surrender of the respondent's license should be accepted and that the respondent is disbarred.

Kansas Court of Appeals

Civil

OIL AND GAS, AND PLUGGING WELLS
JOHN M. DENMAN OIL CO. INC. ET AL. V. STATE CORPORATION COMMISSION ET AL.
SHAWNEE DISTRICT COURT – AFFIRMED
NO. 110,861 – JANUARY 9, 2015

FACTS: John M. Denman Oil Co. has appealed a Kansas Corporation Commission (KCC) order that Denman Oil must plug 41 abandoned oil wells. Denman Oil contends that only one party may be held legally responsible for the wells under K.S.A. 55-179 and that since another party (Bridwells) took over the mineral lease from Denman Oil, it is no longer responsible. The district court granted partial relief to the Bridwells, ordering that they were only responsible for plugging the three wells they had produced from. The district court affirmed the KCC's order that Denman Oil plug the remaining 41 wells, and Denman Oil has appealed. The Bridwells did not appeal, and the KCC has not appealed the district court's limitations of the agency's original order to the Bridwells.

ISSUES: (1) Oil and gas; and (2) plugging wells

HELD: Court stated that K.S.A. 55-179(b) provides that "a person who is legally responsible shall include, but is not limited to, one or more" of several parties defined in that statute. And one of those who may be held responsible is "the original operator who . . . abandoned such well." Court held there's no dispute that Denman Oil was the original operator who abandoned these wells, so the KCC's order requiring Denman Oil to plug them was proper.

STATUTES: K.S.A. 55-155, -156, -179; and K.S.A. 77-201 Third, -601, -621

Criminal

STATE V. MCGILL
SEDGWICK DISTRICT COURT – AFFIRMED
NO. 110,736 – JANUARY 9, 2015

FACTS: In 2009 McGill received a suspended sentence for felony convictions. After five revocations, the revocation proceeding at issue alleged May 2013 violations. District court revoked probation on July 24, 2013, finding McGill had committed a new crime by giving false paychecks to the probation officer. McGill appealed, arguing district court failed to make findings required under K.S.A. 2013 Sup. 22-3716(c) before revoking probation and thus should have imposed an intermediate sanction provided by that statute. He also claimed that "commits a new crime” language in K.S.A. 2013 Supp. 22-3716(c)(8) is vague, that he is entitled to rule of lenity, and that district court violated due process and lacked subject matter jurisdiction to revoke probation because revocation warrant did not allege McGill had committed a new crime.

ISSUES: (1) Application of K.S.A. 2013 Supp. 22-3716(c); (2) vagueness and rule of lenity; and (3) subject matter jurisdiction and due process

HELD: In 2014, legislature amended K.S.A. 2013 Supp. 22-3716(c) to make clear that graduated sanctions created therein apply to any violation of conditions of release or assignment or non-prison sanction occurring on or after July 1, 2013. McGill’s argument for application of the graduated sanctions fails because date of his violations occurred prior to July 1, 2013.

McGills’ vagueness and lenity claims are not considered because the challenged language is not in K.S.A. 2012 Supp. 22-3716, the applicable statute in this case.

Evidence supported district court’s finding that McGill violated his probation. District court had subject matter jurisdiction to proceed, McGill received minimum due process rights required under K.S.A. 2012 Supp. 22-3716, and no abuse of discretion in district court’s revocation of McGill’s probation.

STATUTES: K.S.A. 2013 Supp. 22-3716, -3716(c), -3716(c)(1)(A)-(D), -3716(c)(4), -3716(c)(8); K.S.A. 2012 Supp. 22-3716; and K.S.A. 22-3716

Tags:  Attorney Discipline  oil and gas  Sedgwick District Court  Shawnee District Court 

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