Hudak v. Woods, Civ. A. No. 87-1999.

• Decision Date: 23 July 1990
• Docket Number: Civ. A. No. 87-1999.
• Citation: 743 F. Supp. 374
• Parties: Joseph E. HUDAK, Plaintiff, v. Robert WOODS, Michael S. Geisler and Richard O'Brian, Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

743 F. Supp. 374

Joseph E. HUDAK, Plaintiff, v. Robert WOODS, Michael S. Geisler and Richard O'Brian, Defendants.

Civ. A. No. 87-1999.

United States District Court, W.D. Pennsylvania.

July 23, 1990.

Joseph Hudak, Pittsburgh, Pa., pro se.

Michael Geisler, Pittsburgh, Pa., for defendants.

Robert Woods, Pittsburgh, Pa., pro se.

MEMORANDUM OPINION

LEE, District Judge.

The matters before the Court for disposition are the "Exceptions to Master's Report" of the defendant Robert Woods (Woods)¹ and "Exceptions to Master's Second Report and Recommendation" of the defendant, Michael S. Geisler (Geisler).

The Special Master, Robert L. Federline, was originally appointed by an Order of this Court (Rosenberg, J.) dated December 22, 1988, wherein Woods, Geisler and Richard O'Brian, who is not involved in the matters presently before the Court, were either enjoined from certain conduct or ordered to perform certain acts.

An appeal was taken by Woods, Geisler and O'Brian.

Following full consideration of the appeal, the Court of Appeals affirmed, with some modifications, the Order of December 22, 1988.

On July 26, 1989, this Court (Rosenberg, J.) issued an Order modifying the Order of December 22, 1988, in accordance with the June 28, 1989, Order of the United States Court of Appeals for the Third Circuit.

Paragraph 6 of the Order of July 26, 1989, provides:

"6. Within 15 days of the date of this order, Woods shall deposit with the Clerk of Court the sum of $10,000 in cash or certified funds. This fund shall be used for costs and expenses for those of the Hudak bankruptcy and divorce cases requiring filing costs and other litigation expenses as well as for the payment of the costs and fees of any substitute counsel appointed by the court or the Master on any of the Hudak bankruptcy or divorce cases and for the payment of the Master's fees and expenses. Woods shall provide necessary funds to maintain or replenish this account at the level of $10,000 at all times by supplying such funds to the Clerk of Court in cash or certified form within 24 hours of notice of this court or of the Master. Any funds remaining when these costs and expenses have been paid shall be returned to Woods;"

Paragraph 7 of the Order of July 26, 1989, provides:

"7. Woods shall provde (sic) all the funds necessary for the Hudak bankruptcy and divorce cases except for those which Geisler shall be directed to provide for furthering all the cases to their completion. Such amounts shall be presented for payment of such expenses to the Clerk of Court and shall be paid only upon approval of this court after recommendation of the Master;"

In that same Order, Robert L. Federline, Esquire, was appointed as a Master of this Court pursuant to Federal Rule of Civil Procedure 53, and not only was delegated the authority and duty of supervising compliance with that Order and reporting on compliance to the Court, but also was specifically delegated the authority to recommend that any party be held in contempt should there be a non-compliance with the Order, including

"specifying recommendations for appropriate relief as a result of any failure to comply with this Order and any actions taken in contempt of this Order."

Because of Woods' subsequent failure to pay the required funds to the Clerk of Court, the plaintiff, Joseph E. Hudak, requested the Master to hold Woods in criminal contempt of the Order of July 26, 1989.

The Special Master denied the request of Hudak to prosecute Woods for criminal contempt but scheduled a contempt hearing to address the question of Woods' failure or refusal to pay the $10,000 deposit required of him.

After a full hearing, the Master entered the "Master's First Report" wherein he found, inter alia:

"16. Woods has failed to abide by or comply with this purgation Order (Order of July 26, 1989).

"17. Woods' failure or refusal to pay the $10,000 to the Clerk of Courts is unexcused and without justification."

At the hearing, Woods appeared without counsel and notwithstanding his being advised by the Master that his decision could lead to his incarceration, nevertheless, persisted in his election to represent himself.

The Master found that while Woods raised only one defense, that is his inability to pay, no evidence concerning his inability to pay and no evidence which would conflict with or contradict the prior findings of the Court (Rosenberg, J.) that Woods had the ability to make the payments ordered by the Court, was adduced by Woods.

In conclusion, the Master recommended that Woods be incarcerated until he complied with Paragraph 6 of the Order of July 26, 1989. In addition, the Master recommended that Woods be required to file a complete listing of all assets which he holds either individually, jointly with any other person or corporation or which may be held in the name of any corporation in which he has an interest and whether or not such assets are titled in his name or in names of another or whether under veil or pseudonym names.

This case was reassigned to Honorable William Standish who recused and the case was thereupon reassigned to this member of the Court.

This member of the Court held a full hearing on May 31, 1990, on the Exceptions of both Woods and Geisler to the Master's Reports.

Woods again appeared without counsel and not only did he not produce any evidence of indigency on his part, to the contrary, the testimony he chose to give concerning his assets indicated that he had not made a full disclosure of all of his assets in a list submitted to the Master. In fact, he testified about additional assets and property in Somerset County and a fund created by rents collected which had not been reported by him in either his prior testimony or his report of assets.

Woods did testify that he had paid the sum of $3,103.70 into the Clerk of Court on April 5, 1990, but was financially unable to pay the balance of the required funds into Court.

Moreover, Woods again asserted his Fifth Amendment privilege in response to various questions concerning his involvement in certain businesses, allegedly, because of an IRS investigation of his and his wife's affairs.² While he claimed that he had no income, Woods admitted that he spends an inordinate amount of time on his wife's businesses, including a coal business he had allegedly previously transferred to her in 1982.

In the "Master's Second Report and Recommendation," the Master found that Geisler failed to comply with the obligations imposed upon him by the Order of July 26, 1989, as well as the request of the Master for reports on cases which Geisler is handling, and that no excuse "has been proffered by Michael Geisler for his failure to comply with the request for information of the Master or with the Order of July 26, 1989."

At the hearing before this Court, Geisler testified that he has attempted a good faith compliance with the Master's request, but because of the nature of the case load and because he is working without compensation, complete compliance was not practical or indicated.

The Master recommended that sanctions be imposed on Geisler either in the form of a daily fine for each day in which he continues to fail to have filed full and complete reports (such fines to be used to pay costs and expenses in this case — such costs and expenses to include, but not necessarily to be limited to, Masters' fees, Court costs and reimbursement of any client funds which may be necessary) or, in the alternative, that Geisler be imprisoned until such time as he complies with the reporting requirements ordered by this Court, or, that such other sanctions be imposed as to the Court seem right and proper under the circumstances and as designed to compel compliance with this Court's Order.

Findings of the Court Re: Master's First Report

1. The first report filed by the Master in the above case is found to be based upon credible facts and is therefore confirmed and adopted by this Court.

"Rule 53(e)(2) of the Federal Rules of Civil Procedure provides that `the Court shall accept Master's Findings of Fact unless clearly erroneous.'" NLRB v. Local 825 A.B.C.D. Intern. Union etc., 659 F.2d 379 (3d Cir.1981).

The party objecting to Master's Findings, carries burden of proving them to be clearly erroneous. Ohio, Chemical and Atomic Workers Inter. Union, AFLCIO v. NLRB 1976, 547 F.2d 575, 178 U.S. App.D.C. 278 (1976) cert. denied, 431 U.S. 966, 97...