721 F.2d 922
Jane WHARTON-THOMAS, Appellant,
UNITED STATES of America, United States Post Office and
Pasquale J. Di Francisco, jointly, severally
and/or in the alternative, Appellees.
United States Court of Appeals,
Submitted Under Third Circuit Rule 12(6)
Sept. 13, 1983.
Decided Nov. 23, 1983.
As Corrected Dec. 1, 1983.
Rehearing and Rehearing In Banc Denied Dec. 20, 1983.
Lorraine A. Di Cintio, Ballen, Keiser & Denker, Camden, N.J., for appellant.
J. Paul McGrath, Asst. Atty. Gen., Washington, D.C., W. Hunt Dumont, U.S. Atty., Newark, N.J., Michael F. Hertz, Peter R. Maier, Attys., Appellate Staff, Civ. Div., Dept. of Justice, Washington, D.C., Bette E. Uhrmacher, Asst. U.S. Atty., Trenton, N.J., on brief, for appellee.
Before WEIS, HIGGINBOTHAM and SLOVITER, Circuit Judges.
OPINION OF THE COURT
WEIS, Circuit Judge.
This appeal is from a judgment entered by a magistrate after a bench trial. The parties had consented to trial and entry of judgment in accordance with 1979 amendments to Federal Magistrates Act. We conclude that this procedure does not violate Article III of the United States Constitution and, on the merits, we affirm.
Plaintiff brought suit against the United States under the Tort Claims Act, 28 U.S.C. Secs. 1346(b), 2671-2680 (1976 & Supp. V 1981), seeking compensation for personal injuries allegedly received in an automobile collision with a Postal Service vehicle. With the parties' consent, the case was tried before a federal magistrate, who found for plaintiff and entered a judgment of $7,500 in her favor. Plaintiff appealed directly to this court.
Within the space of five months, plaintiff was injured in two automobile accidents. The first, occurring on May 27, 1977, was a minor collision between the plaintiff's station wagon and the post office jeep. The testimony established that both vehicles were moving slowly, and plaintiff was not thrown against any part of the car's interior. In October 1977, plaintiff was again injured in a chain-reaction accident involving four cars.
The United States did not seriously contest liability for the May collision, but contended that the more serious October accident caused most of the plaintiff's injuries. The magistrate found that plaintiff failed to prove that any injuries manifested after October 7, 1977 were causally related to the collision with the postal vehicle. For damages arising out of the May 7 accident, he determined that $7,500 represented fair and reasonable compensation.
On appeal, plaintiff contends that the magistrate's findings of fact were clearly erroneous and that the award was inadequate. The appeal, however, presents two preliminary issues touching on jurisdiction.
* The first question is whether this court has been presented with an appealable order. Section 636(c)(3) of the Federal Magistrates Act, 28 U.S.C. Sec. 636(c)(3) (1976 ed., Supp. V), permits an appeal directly to this court from a judgment entered by a magistrate in a case tried by consent. Section 636(c)(4) allows an alternative procedure by which, at the time of reference to the magistrate, the parties may agree to take any appeal to a district judge. Thereafter, the court of appeals may review the case only upon its grant of a petition for leave to appeal. Id. Sec. 636(c)(5).
When the parties consented to have this case tried by a magistrate, they signed a form prepared by the clerk for the District of New Jersey. In addition to the reference to the magistrate, the form contained a separate provision allowing the parties to agree that any appeal would be to a judge of the district court. Although counsel for the parties signed both portions of the form, the appeal from the magistrate's judgment was taken directly to this court.
Under ordinary circumstances, a case appealed directly to this court, when the parties had agreed to initial review by a district judge, would be remanded for that disposition. In the matter at hand, however, counsel for both parties represent that they had not intended to appeal to the district judge and erroneously signed the consent to that procedure. Because the procedure is of recent origin and not yet well known to the bar, we will grant the parties' request to set aside the consent to appeal to the district judge. We caution, however, that in the future we will hold counsel to such agreements and our ruling on the point will not serve as precedent for similar leniency in subsequent cases.
The second preliminary matter is of more substance. The issue is whether section 636(c) violates Article III of the Constitution by authorizing a magistrate, on consent of the parties, to conduct trials and enter judgments. A panel of the United States Court of Appeals for the Ninth Circuit held that section 636(c) is unconstitutional. Pacemaker Diagnostic Clinic, Inc. v. Instromedix, Inc., 712 F.2d 1305 (9th Cir.1983), rehearing en banc granted 718 F.2d 971 (9th Cir.1983). In reaching that conclusion, the panel relied on the Supreme Court's decision in Northern Pipeline Construction Co. v. Marathon Pipeline Co., 458 U.S. 50, 102 S.Ct. 2858, 73 L.Ed.2d 598 (1982). Since the Pacemaker court characterizes the issue as one of jurisdiction, we raise the question sua sponte in the appeal at hand.
In Northern Pipeline, the Supreme Court held that in purporting to confer jurisdiction on bankruptcy judges to decide common law cases without the consent of the parties, the Bankruptcy Reform Act of 1978 violated Article III of the Constitution. The Court concluded that the Act "impermissibly removed most, if not all, of 'the essential attributes of the judicial power' from the Art. III district court, and vested those attributes in a non-Art. III adjunct." 458 U.S. at 50, 102 S.Ct. at 2880. The Court in particular noted that the constitutional protections provided by Article III's guarantee of life tenure and nondiminishable salary were not available to bankruptcy judges. Moreover, the Reform Act established a court, though labeled as an "adjunct", that was separate and apart from the district court. Id.
The rationale of Northern Pipeline led the Pacemaker panel to conclude that section 636(c) of the Magistrates Act likewise ran afoul of Article III. Magistrates are appointed for eight-year terms, 28 U.S.C. Sec. 631(c) (1976), may not serve beyond the age of 70 except with the approval of all the judges of the appointing court, id. Sec. 631(d), may be removed for specified cause by the appointing court, id. Sec. 631(a) (1976 ed., Supp. V 1981), and enjoy only limited salary protection, see id. Sec. 634 (1976 & Supp. V 1981). Thus, the office of magistrate does not enjoy Article III tenure and salary protections. The panel concluded that this disability was not cured by construing the magistrate's power to enter a judgment under section 636(c) as the exercise of an adjunct function of the district court. 712 F.2d at 1309-10.
Concluding that "litigants cannot waive the jurisdictional requirement of an Article III court," the Pacemaker panel also rejected the proposition that the consent requirement of section 636(c) could cure the constitutional problem. Id. at 1312. The reason advanced was that "Article III addresses institutional concerns of our system of government that due process addresses only incidentally." Id. The panel also turned aside the argument that the magistrate system simply involved delegation of power within the district court and thus presented no separation of powers problem. Id. at 1312-13.
The Pacemaker opinion is a thorough and thoughtful one, but it rests almost entirely on Northern Pipeline, which addressed the Article III issue only with respect to bankruptcy judges. However, the authority granted those judges under the Reform Act, as well as the conditions under which they exercise the power of their office, differs significantly from the provisions applicable to magistrates. The most important variance is that the litigants' consent is required before a magistrate may act under section 636(c). No such limitation applied to bankruptcy judges under section 241(a) of the Reform Act, 28 U.S.C. Sec. 1471.
Northern Pipeline did not produce a majority opinion. Justice Brennan wrote for a plurality of four and Justice Rehnquist concurred in an opinion which Justice O'Connor joined. The concurrence articulated a narrower basis for decision than the plurality opinion and thus sets forth the holding agreed on by a majority of the Court. As summarized by the Chief Justice, the holding was "limited to the proposition ... that a 'traditional' state common-law action, not made subject to a federal rule of decision, and related only peripherally to an adjudication of bankruptcy under federal law, must, absent the consent of the litigants, be heard by an 'Article III court' if it is to be heard by any court or agency of the United States." 458 U.S. at 92, 102 S.Ct. at 2882 (Burger, C.J., dissenting) (emphasis added). The lack of consent by the litigants is thus a critical element of Northern Pipeline, but in the case at hand there is consent--uncoerced and submitted pursuant to statutory safeguards.
As Pacemaker pointed out, jurisdiction in the usual sense may not be conferred by consent. The limits on the district court's subject matter jurisdiction, as set by the Constitution or by statute, may not be waived by agreement of the parties. See, e.g., American Fire & Casualty Co. v. Finn, 341 U.S. 6, 17-18, 71 S.Ct. 534, 541-542, 95 L.Ed. 702 (1951); Ahrens v. Clark, 335 U.S. 188, 193, 68 S.Ct. 1443, 1445, 92 L.Ed. 1898 (1948); United States v. Griffin, 303 U.S. 226, 229, 58 S.Ct. 601, 602, 82 L.Ed. 764 (1938). In this case, however, jurisdiction was given to the district court by Congress, see 28 U.S.C. Sec. 1346(b)--the consent of the litigants had no part in that process. The judgment in this Tort Claims Act case is that of the district court, the forum specified by the statute.
The parties' consent went not to the jurisdiction of the district court as an entity, but to the judicial officer within the court who conducted the trial. Waiver of a particular mode of trial or factfinder is not unknown. For example, Fed.R.Civ.P. 38(d) provides for an automatic waiver of a jury trial if no timely request is made. By the same rule, a demand for jury trial may be withdrawn on the consent of the parties. Under Rule 39(c), the district judge may, with consent of the parties, order a jury trial when it is not otherwise triable of right. To that extent there is long-standing recognition of the right of the parties to consent to a specific form of trial within the district court.
The relationship between the judicial officer conducting the trial and the district court points out another difference between Northern Pipeline and the case at hand. The Supreme Court recognized that although the Reform Act described the bankruptcy court as an adjunct of the district court, they were to a large extent independent of each other. Thus, unlike referees under the old Bankruptcy Act, who were "subordinate adjuncts of the district courts," see 458 U.S. at 80 n. 31, 102 S.Ct. at 2876 n. 31, the bankruptcy judges are independent of the district court. Rather than being appointed by district judges, bankruptcy judges under the new Act would be appointed by the President with the advice and consent of the Senate. 28 U.S.C. Sec. 152 (1976 ed., Supp. V 1981). Bankruptcy judges may be removed only by the Circuit Council for cause. Id. Sec. 153(b).
Under the Reform Act, cases were not referred to the bankruptcy court by the district court but went there directly by filing with the bankruptcy court's own clerk. The district court could not terminate references to the bankruptcy court. In short, the bankruptcy courts operated, not under the direction of the district court, but in their own separate sphere and with their own independently appointed personnel.
In contrast, the magistrate is truly a part of the district court, appointed by its judges, 28 U.S.C. Sec. 631(a) (1976 ed., Supp. V 1981), and subject to dismissal by them, id. Sec. 631(i). A magistrate may not conduct any proceeding in a civil matter unless "specifically designated to exercise such jurisdiction by the district court or courts he serves." Id. Sec. 636(c)(1). Even consensual reference of a case to a magistrate may be vacated by a district judge, either sua sponte or in some circumstances on motion of the parties. Id. Sec. 636(c)(6). As with matters handled by district judges, the clerk of the district court manages the records in cases referred to the magistrate. Thus, the magistrate does not function independently of the district court, but as an integral part of it.
One of the underlying bases for establishment of Article III courts mentioned in the Northern Pipeline plurality opinion is the necessity of independence from the legislative and executive branches of government. This separation of powers concept is not violated in the magistrate system. Those officers are not subjected to pressures from the legislature. Indeed, as Justice Blackmun wrote in Raddatz v. United States, 447 U.S. 667, 685, 100 S.Ct. 2406, 2417, 65 L.Ed.2d 424 (1980) (concurring opinion), "The only conceivable danger of a 'threat' to the 'independence' of the magistrate comes from within, rather than without the judicial department." See also Northern Pipeline, 458 U.S. at 79 n. 30, 102 S.Ct. at 2875 n. 30.
The possibility that the magistrates might be subjected to influence from Article III judges should not invalidate the reference procedure. The independence of the magistrate from outside influences is enhanced rather than frustrated by such a relationship. It is difficult to understand the concern of the Pacemaker panel that magistrates might be deterred from making decisions that would conflict with the policy of the district court. When the magistrate is assigned cases for hearing and recommendation, his work must be reviewed and approved by the district judge before becoming final. See 28 U.S.C. Sec. 636(b). That certainly represents the ultimate in influencing the decision. Yet, the Supreme Court found such procedures to be constitutional and voiced no concern about the magistrate's lack of independence from district judges. United States v. Raddatz, 447 U.S. 667, 100 S.Ct. 2406, 65 L.Ed.2d 424 (1980).
Under section 636(c), the magistrate enters the judgment rather than submitting the case to a district judge for review and entry. In Raddatz, the Court emphasized that delegation to a non-Article III judicial officer is permissible "so long as the ultimate decision is made by the district court." Id. at 683, 100 S.Ct. at 2416. Similarly, in Mathews v. Weber, 423 U.S. 261, 271, 96 S.Ct. 549, 554, 46 L.Ed.2d 483 (1976), the Court upheld a reference to a magistrate because "[t]he authority--and the responsibility--to make an informed, final determination ... remain[ed] with the district judge." Justice Brennan wrote in Northern Pipeline that "[c]ritical to the Court's decision to uphold the Magistrates Act [in Raddatz ] was the fact that the ultimate decision was made by the district court." 458 U.S. at 83, 102 S.Ct. at 2877. It must be noted, however, that in each of these cases, the reference to a non-Article III officer was non-consensual.
In Raddatz, a criminal defendant's motion to suppress evidence was referred to a magistrate over the defendant's objections. 447 U.S. at 669, 100 S.Ct. at 2409. In Weber, a standing order of a district court "require[d] initial reference to a magistrate" in all Social Security benefit cases. 423 U.S. at 264, 96 S.Ct. at 551. In Northern Pipeline, Congress itself had delegated case dispositive authority to the bankruptcy courts. Thus, although all three Supreme Court decisions emphasized that final decision-making authority rests in an Article III court, they did so in circumstances where the non-Article III officer was forced on the parties. Weber, Raddatz, and Northern Pipeline can be read as establishing that the decision making power must remain in the Article III district court when the parties have not consented to a determination by a non-Article III office. The cases do not provide a determinative principle in instances of consensual reference.
Moreover, these decisions can be contrasted with other, albeit older, Supreme Court decisions. In Kimberly v. Arms, 129 U.S. 512, 9 S.Ct. 355, 32 L.Ed. 764 (1889), the parties consented to the appointment of a special master "to hear the evidence and decide all the issues between" them. Id. at 516, 9 S.Ct. at 356. In concluding that the court had erred in failing to treat the master's findings of fact and law as presumptively correct, the Court noted that "[i]t [was] not within the general province of a master to pass upon all issues." Id. at 524, 9 S.Ct. at 359. However, "when the parties consent to the reference of a case to a master or other officer to hear and decide all the issues ..., the master is clothed with very different powers from those which he exercises upon ordinary references, without such consent." Id.
Kimberly recognizes, then, that the consent of the parties can robe a non-Article III officer with decision making authority. See also id. at 525, 9 S.Ct. at 359 ("By the consent ... it was intended that the master should exercise power beyond that of a reporter of testimony."); Silberman, "Masters and Magistrates Part II: The American Analogue," 50 N.Y.U.L.REV. 1297, 1351-52 and n. 322 (1975).
A consensual reference was given an even more pervasive effect in Heckers v. Fowler, 69 U.S. (2 Wall.) 123, 17 L.Ed. 759 (1864). There, the parties agreed to refer the case to a referee and further agreed "that the report of the referee have the same force and effect as a judgment of the court." The trial court ordered that "on filing the report of the said referee with the clerk of the court, judgment be entered in conformity therewith the same as if said cause had been heard before the court." Id. 69 U.S. (2 Wall.) at 127. The Supreme Court held the reference valid because it "does not directly involve the question of jurisdiction, but has respect to the mode of trial as substituting the report of the referee for the verdict of the jury.... Practice of referring pending actions is coeval with the organization of our judicial system." Id. 69 U.S. (2 Wall.) at 128.
Pacemaker declines to attribute significance to Heckers, stating that "the opinion makes clear that the court must review the report and decide whether or not to accept it." 712 F.2d at 1311 n. 12. Although Heckers does state that "[j]udgment ... cannot in general be entered in conformity to the report or award until it is accepted or confirmed by the court," 69 U.S. (2 Wall.) at 133 (emphasis added), the Supreme Court proceeded from this general rule to say that the "[p]resent case, however, must be determined upon the peculiar circumstances disclosed in the record," id.
The circumstances in Heckers were that the parties had agreed that the referee's report was to have the same force and effect as a judgment of the court, the losing party had made no objections to the report, and the clerk of the court had entered the judgment as agreed to by the parties. Thus, the very point of Heckers is that, because of the agreement of the parties, the judgment was valid even though an Article III judge did not review and accept the report.
In an earlier case, Alexandria Canal Co. v. Swann, 46 U.S. (5 Howard) 83, 88, 12 L.Ed. 60 (1847), the Court said that "a trial by arbitrators, appointed by the court with the consent of both parties, is one of the modes of prosecuting a suit to judgment as well established and as fully warranted by law as a trial by jury." In that case, it appears that an arbitrator's award automatically became a final judgment when no objections were filed.
Several courts of appeals upheld consensual references to magistrates for a trial on the merits before the 1979 amendments to the Magistrates Act. See Calderon v. Waco Lighthouse for the Blind, 630 F.2d 352 (5th Cir.1980); Muhich v. Allen, 603 F.2d 1247 (7th Cir.1979); DeCosta v. Columbia Broadcasting System, Inc., 520 F.2d 499 (1st Cir.1975); see also Banks v. United States, 614 F.2d 95, 97 (6th Cir.1980) ("absent consent, the magistrate cannot conduct the trial itself"). They did so under section 636(b) of the Magistrates Act, which provides that "[a] magistrate may be assigned such additional duties as are not inconsistent with the Constitution and laws of the United States." 28 U.S.C. Sec. 636(b)(3).
The concept of a decision becoming final and binding without Article III implementation is not unknown even in non-consensual situations. For example, orders of some administrative agencies, such as the Federal Trade Commission and the Interstate Commerce Commission, become enforceable without judicial action if there is no appeal to an Article III court. See 15 U.S.C. Sec. 45(g); 49 U.S.C. Sec. 10322(e). See also Redish, Legislative Courts, Administrative Agencies and the Northern Pipeline Decision, 1983 DUKE L.J. 197, 217 (1983). In addition, when a district court refers a matter to a master under Fed.R.Civ.P. 53, the parties can stipulate that the master's findings of fact shall be final. If they do so, "only questions of law arising upon the [master's] report shall thereafter be considered." Fed.R.Civ.P. 53(e)(4).
We are convinced that the requirement of consent and the power of the district judge to vacate the reference to a magistrate are substantial factors which make both Northern Pipeline and the Raddatz language inapplicable here.
In sum, section 636(c) does not violate Article III because:1. The reference to a magistrate is consensual;
2. The district judge has the power to vacate the reference;
3. The magistrate is appointed by the district judges, is a part of the district court, and is specially designated to try cases;
4. The parties have a right of appeal to a district judge or the court of appeals.
We decline to follow the Pacemaker panel decision because it reads too much into Northern Pipeline. The distinctions between the magistrate system incorporated into the district court and the independent bankruptcy courts are such that Northern Pipeline's ban against non-Article III tribunals in private rights cases does not apply here.
The government has suggested an alternative and narrower base for affirmance in this case, relying upon the public and private rights dichotomy discussed in Northern Pipeline. See 458 U.S. at 69-71, 102 S.Ct. at 2870-71. The Supreme Court in general endorsed the concept that in surrendering sovereign immunity the government may choose to relegate adjudication of a claim, at least preliminarily, to an administrative agency or Article I court. The government therefore argues that a Tort Claims Act case need not be decided initially by an Article III court. We choose not to address that argument but rather decide the issue on the broader basis we have discussed earlier. We do so because in a companion case before this court, Williams v. Mussomelli, No. 83-5035, the public rights exception would not apply.
We do not deny that there may be basis for concern about the wisdom of large scale delegation of adjudication to magistrates. Wholesale reference of cases even by consent does pose dangers to the district courts as now organized. As the practice continues and becomes more wide spread, it will tend to become routine. Pressure will naturally follow to increase the number of magistrates rather than encounter the slow and often frustrating process of securing congressional action to add the needed numbers of district judgeships, as well as the more probing inquiries by the attorney general and in the Senate confirmation and approval of nominees for federal district judgeships.
Overworked district judges are unlikely to oppose the addition of more magistrates and may in fact initiate such requests. The possibility of large scale dilutions of district courts to the point where magistrates would outnumber district judges is not inconceivable. Whether such a rearrangement of the federal system is desirable is, to say the least, highly debatable.
Having concluded that the magistrate could properly enter judgment, we now address the merits. Little discussion is warranted. The issues were purely factual and concerned with the causal relationship between the two automobile collisions and the plaintiff's injuries. The resolution of those matters depended to a large extent upon judgments of credibility and weight of the evidence. The scope of review is whether the factual findings are clearly erroneous. The findings are amply supported by the evidence, and the legal conclusions flowing from them are not erroneous.
Accordingly, the judgment of the district court will be affirmed.