Tunheim v. Bowman

• Decision Date: 28 November 1973
• Docket Number: No. LV-2000.,LV-2000.
• Citation: 366 F. Supp. 1392
• Parties: Renee TUNHEIM et al., Plaintiffs, v. Loretta BOWMAN, Individually and as Clerk of the Eighth Judicial District Court of Clark County, Nevada, et al., Defendants.
• Court: U.S. District Court — District of Nevada

366 F. Supp. 1392

Renee TUNHEIM et al., Plaintiffs, v. Loretta BOWMAN, Individually and as Clerk of the Eighth Judicial District Court of Clark County, Nevada, et al., Defendants.

No. LV-2000.

United States District Court, D. Nevada.

November 28, 1973.

Clark County Legal Services, Thomas L. Leen, James W. Rourke, B. Mahlon Brown, III, Jack F. Anderson, Las Vegas, Nev., for plaintiffs.

Roy A. Woofter, Dist. Atty., Thomas R. Severns, Deputy Dist. Atty., Clark County, Nev., for defendants Loretta Bowman, Ralph Lamb.

Beckley, DeLanoy & Jemison, Las Vegas, Nev., for defendant Jay H. Brown.

Cromer & Barker, Las Vegas, Nev., for defendant Credit Bureau Central.

Before MERRILL, Circuit Judge, and EAST and THOMPSON, District Judges.

ORDER DISSOLVING THREE-JUDGE COURT

This action was instituted for declaratory relief adjudging Nevada's confession of judgment statutes¹ to be per se unconstitutional, and to enjoin enforcement of certain judgments obtained by confession. A three-judge court has been convened.

In addition to alleging that the Nevada statutes are facially unconstitutional because the procurement of a judgment and the levy of execution thereon without prior notice and an opportunity to be heard deprive plaintiffs of property without due process of law, plaintiffs allege that procedures employed as to them resulted in the procurement of judgments by unconstitutional means because of affirmative misrepresentations made by defendant Credit Bureau Central at the time the documents were executed and because the plaintiffs were caused unintentionally and unknowingly to waive their constitutional right to notice and hearing.

After a review of the controlling precedents, our first conclusion is that the three-judge court was improvidently convened and should be dissolved. A three-judge court is required only when an injunction is sought restraining the enforcement or execution of a state statute "upon the ground of the unconstitutionality of such statute." 28 U.S. C. § 2281. Such a court should not be convened when the prior controlling decisions render insubstantial a claim that the statute is, on its face, unconstitutional. Bailey v. Patterson, 369 U.S. 31, 82 S.Ct. 549, 7 L.Ed.2d 512 (1962);² Ex parte Poresky, 290 U.S. 30, 54 S.Ct. 3, 78 L.Ed. 152 (1933).

The allegation that the Nevada confession of judgment statutes are on their face unconstitutional because they do not incorporate a requirement of prior notice and hearing before judgment is entered falls before the decision of the Supreme Court in D. H. Overmyer Co. v. Frick Co., 405 U.S. 174, 92 S.Ct. 775, 31 L.Ed.2d 124. The Ohio statutes there involved are not materially different from the Nevada provisions. They do include a requirement, which Nevada does not, of prompt notice of the entry of judgment, but this is an insubstantial difference because by that time the harm has been done. The Overmyer case specifically holds that statutes legalizing cognovit clauses without a requirement of prior notice and hearing are not per se unconstitutional under the due process clause of the Fourteenth Amendment.

Plaintiff has called our attention to the series of opinions in Osmond v. Spence, 327 F.Supp. 1349 (D.C.Del. 1971). A three-judge court there held Delaware's confession of judgment statutes to be unconstitutional "by failing to provide for notice and hearing preceding entry of judgment" (p. 1359). On direct appeal, the Supreme Court ordered: "Judgment vacated and case remanded for further consideration in light of Swarb v. Lennox 405 U.S., ante, p. 191 92 S.Ct. 767, 31 L.Ed.2d 138, and D. H. Overmyer Co., Inc., of Ohio v. Frick Co. 405 U.S., ante, p. 174 92 S.Ct. 775, 31 L.Ed.2d 124" (405 U.S. 971, 92 S.Ct. 1189, 31 L.Ed.2d 245). On remand, the Delaware Court adhered to its original opinion, holding that notice and hearing prior to entry of a judgment by confession are required, the hearing to encompass not only the merits but also the question of whether the debtor had knowingly, intelligently and voluntarily waived his due process rights. Osmond v. Spence, 359 F.Supp. 124 (D.C.Del. 1972).

With due respect for the Delaware Court, we cannot so interpret the opinions and rulings of the Supreme Court. The Overmyer case did not leave the question open. It specifically held that a statutory scheme which did not provide for notice and hearing prior to entry of a confessed judgment did not run afoul of due process requirements. Swarb v. Lennox, 405 U.S. 191 at 200, 92 S.Ct. 767 at 772, 31 L.Ed.2d 138 (1972):

"A holding of facial unconstitutionality, of course, wholly apart from any class consideration, would afford relief to every Pennsylvania cognovit obligor. Today's decision in Overmyer, although it concerns a corporate and not an individual debtor, is adverse to this contention of the plaintiff-appellants. In Overmyer it is recognized, as the District Court in this case recognized, that, under appropriate circumstances, a cognovit debtor may be held effectively and legally to have waived those rights he would possess if the document he signed had contained no cognovit provision."

We believe that, as properly viewed under controlling precedents, the true thrust of plaintiffs' Complaint is to obtain a declaration that the judgments by confession rendered against them were obtained by unconstitutional means in violation of their rights to...