author: JAMES McGIRR KELLY, District Judge.

text:
    In re ASBESTOS SCHOOL LITIGATION.
    This Document Relates to: All Actions.
    No. 83-0268.
    United States District Court, E.D. Pennsylvania.
    Aug. 2, 1985.

      David Berger, Herbert P. Newberg, Philadelphia, Pa., for plaintiffs.
    Lawrence T. Hoyle, Jr., Philadelphia, Pa., for defendants (who do not oppose court’s Order of April 13,1984).
    Ralph W. Brenner, Philadelphia, Pa., for defendants (who oppose the court’s Order of April 13, 1984).
   MEMORANDUM AND ORDER

JAMES McGIRR KELLY, District Judge.

Presently before me is stipulating defendants’ motion for a preliminary injunction. Stipulating defendants seek to enjoin Spartanburg County, South Carolina School District Seven (School District) whose case is listed for trial on August 5, 1985, from: introducing any evidence that is relevant solely to plaintiffs’ punitive damages claims; arguing the punitive damage claim to the jury; and requesting that the jury be charged on the issue of punitive damages.

In my Memorandum and Order of September 28, 1984, 104 P.R.D. 422, I certified the class as to punitive damages, under Fed.R.Civ.P. 23(b)(1)(B) which, although allowing a plaintiff class member to opt out of the punitive damage class, I restricted the remedies available to the party who opted out by prohibiting separate litigation of punitive damages. 104 F.R.D. at 438. The essence of my ruling was fairness to the defendants as well as to the plaintiffs.

The purpose of punitive damages claims “are not compensation for injury. Instead, they are private fines levied by civil juries to punish reprehensible conduct and to deter. its future occurrence.” Gertz v. Robert Welch, Inc., 418 U.S. 323, 350, 94 S.Ct. 2997, 3012, 41 L.Ed.2d 789 (1974); International Brotherhood of Electrical Workers v. Foust, 442 U.S. 42, 48, 99 S.Ct. 2121, 2125, 60 L.Ed.2d 698 (1979). Plaintiff School District has contended that South Carolina law would apply to the products liability suit which was brought in the District Court of South Carolina because of the various contacts plaintiff has with the state. I do not rule on this matter, but for the instant matter I will assume that South Carolina law applies. Plaintiff School District argues in its brief in opposition to the instant motion that South Carolina law is distinguishable from the general premise of punitive damages. Plaintiff suggests that punitive damages under South Carolina law are compensatory in nature, in that it compensates for a right of a party which is taken away. Plaintiff cites, inter alia, Oliver v. Columbia, N. & L.R. Co., 65 S.C. 1, 43 S.E. 307 (S.C.1902) to support its position. I do not agree with plaintiff’s argument. The Supreme Court of South Carolina in Oliver overruled exceptions to the trial court’s charge to the jury concerning punitive damages. Id. at 320-323. The portion of the jury charge which was the focus of the exception stated:

The second kind of damages, called “punitive damages”, are sometimes spoken of as “vindictive damages” and “exemplary damages.” Indeed, they are sometimes referred to as “smart money” and “blood money.” They are called “punitive damages” because of the theory that such damages will act as a sort of punishment of the defendant for such wrongdoing; not only as a punishment for past wrongdoing, but to deter the defendant and others in similar business from repeating such wrongdoing in the future. Such damages are allowed in law, and they operate almost like fines in the criminal court. They are allowed not so much to compensate the plaintiff or to enrich the plaintiff, but for the public good, to punish the defendant.
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Therefore, gentlemen, if in this case it is established to your satisfaction, by the preponderance of the evidence, then your verdict would be a sum of money representing not only actual injury sustained, or compensation for this injury, but also an additional amount, as I have said before, to punish the defendant, to make an example, so as to keep the defendant and others in the same kind of business from such wrongdoing, if such be proven.

Oliver at 320-321.

The Supreme Court of South Carolina in Oliver commented on the jury charge, indeed upholding it:

“Exemplary or punitive damages go to the plaintiff, not as a fine or penalty for a public wrong, but in vindication of a private right which has been willfully invaded; and, indeed, it may be said that such damages in a measure compensate or satisfy for the willfulness with which the private right was invaded, but, in addition thereto, operating as a deterring punishment to a wrongdoer and as a warning to others.” While, therefore, exemplary damages are not awarded “as a fine or penalty for a public wrong,” they are awarded as a “punishment” to the wrongdoer for the willful invasion of a private right, “and as a warning to others.” And this, as Judge Benet charged, is “for public good,” — ah example — “for the benefit of others.” These two exceptions are overruled.

Id. at 321-322 (citations omitted).

Indeed, all the court was stating was that the private person/party who was injured had the right/standing to sue for punitive damages, rather than the general public. However, the purpose of punitive damages is to provide for the benefit of the public. See also Rogers v. Florence Printing Company, 233 S.C. 567, 106 S.E.2d 258, 261 (1958) (Individual has standing to bring punitive damage claim rather than public; punitive damages are gauged or allocated as to the “willfulness” of a defendant and operate to punish the wrongdoer, and warn others).

In certain situations where wanton or intentional wrongdoings are found, punitive damage claims may arise to a “right” of a plaintiff; however, equally balanced against this “right”, is the obligation that the defendant be punished fairly. In Re Asbestos School Litigation, 104 F.R.D. 422, 434-438 (E.D.Pa.1984). Fairness is the cornerstone of equity. Thus, the fairness which defendant receives in not being subject to successive claims to punish for purported wrongs also benefits the many plaintiffs who may be late comers seeking punitive damages when the “pot of gold is gone”.

Indeed, the fairness which I seek in this action concerning punitive damages is analogous to the equitable devices such as an interpleader action or bill of peace. Cf. Boice v. Boice, 48 F.Supp. 183, 186 (D.N.J.1943) (“Interpleader is a well-established equitable remedy ...” quoting Judge Maris in Metropolitan Life Ins. Co. v. Mason, 21 F.Supp. 704, 706 (E.D.Pa.1937)) aff'd. 135 F.2d 919 (3d Cir.1943).

The Supreme Court in State Farm Fire & Casualty v. Tashire, 386 U.S. 523, 87 S.Ct. 1199, 18 L.Ed.2d 270 (1967) observed:

There are situations, of a type not present here, where the effect of inter-pleader is to confine the total litigation to a single forum and proceeding. One such case is where a stakeholder, faced with rival claims to the fund itself, acknowledges — or denies — his liability to one or the other of the claimants. In this situation, the fund itself is the target of the claimants. It marks the outer limits of the controversy. It is, therefore, reasonable and sensible that interpleader, in discharge of its office to protect the fund, should also protect the stakeholder from vexatious and multiple litigation.

Id. at 534, 87 S.Ct. at 1205. (footnote omitted).

The imposition of the injunction implicit in my Pretrial Order No. 20, precluding separate suits for punitive damages is as much a product of fairness and due process as it is of equity.

The plaintiffs here contend that the United States Supreme Court holding in Phillips Petroleum Company v. Shutts, — U.S. —, 105 S.Ct. 2965, 86 L.Ed.2d 628 (1985) compels the denial of the instant motion. The Court in Shutts was faced, inter alia, with the issue of whether or not a state court presiding over a class action for damages can exercise jurisdiction over out of state class plaintiffs who do not voluntarily subject themselves to the court’s jurisdiction. The Court held:

[T]hat a forum State may exercise jurisdiction over the claim of an absent class-action plaintiff, even though that plaintiff may not possess the minimum contacts with the forum which would support personal jurisdiction over a defendant. If the forum State wishes to bind an absent plaintiff concerning a claim for money damages or similar relief at law, it must provide minimum procedural due process protection. The plaintiff must receive notice plus an opportunity to be heard and participate in the litigation, whether in person or through counsel. The notice must be the best practicable, ‘reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.’ The notice should describe the action and the plaintiffs’ rights in it. Additionally, we hold that due process requires at a minimum that an absent plaintiff be provided with an opportunity to remove himself from the class by executing and returning an ‘opt out’ or ‘request for exclusion’ form to the court. Finally, the Due Process Clause of course requires that the named plaintiff at all times adequately represent the interests of the absent class members.

Id. at-, 105 S.Ct. at 2975 (citation omitted) (emphasis added and in original).

The caveat expressed by the Shutts Court in footnote three suggests possible variances of the obligations plaintiffs may be burdened with to fulfill due process where the relief sought is different than compensatory damages. Here the 23(b)(1) class for punitive damages does not preclude opting out, but rather precludes the party which opts out from individually litigating punitive damages. Punitive damages, although an ancient legal remedy, is more similar to equitable relief in that it seeks to provide for a public good as does a criminal fine. Indeed, the purpose of punitive damages is punishment and the coercive effect it may have on the rest of society. The fact that the theory of punitive damages developed on the legal side of jurisprudence rather than the equity side is not sufficient to categorize it with a suit seeking compensatory relief such as the matter in Shutts. The compensatory damages portion of this class action provides all the safeguards required by the Shutts Court. The punitive damages portion does not provide for separate litigation outside the class. Moreover, the defendants must be given credit for any punitive damage claim that is settled outside the class. While claims for compensatory damages seek to make a plaintiff whole and, therefore, certain due process safeguards must be afforded the plaintiff, symmetry of the law would require no less when punitive damages are leveled against a defendant. Because punitive damages seek to punish and set an example, due process would require it be done fairly. In punitive damage actions it is the defendant which is the subject of the action, while in compensatory damages claims, it is the plaintiffs rights which are the subject of the action. I have provided for adequate representation of plaintiffs’ cause, and notice will be provided. This is all that due process requires where it is the defendants’ rights which are the subject of the punitive damages claims.

An appropriate order follows.

ORDER NO. 52

AND NOW, this 2nd day of August, 1985, in consideration of the motions of National Gypsum Company and United States Gypsum Company for an Order temporarily restraining and for a preliminary injunction enjoining Spartanburg County, South Carolina School District Seven from individually litigating its claim to punitive damages against these defendants, and the responses filed thereto, and after telephone conference with counsel, for the reasons set forth in the foregoing Memorandum, it is ORDERED that:

1. Spartanburg County, South Carolina School District Seven is enjoined from litigating its claim to punitive damages against these defendants in any forum other than this court until such time as the court can determine whether to permanently enjoin plaintiff here from individually litigating its claim to punitive damages.

2. In the case captioned Spartanburg County School District Seven v. National Gypsum Company and United States Gypsum Company, No. 83-1744-14 (D.S.C.) Spartanburg County School District Seven is enjoined from introducing any evidence that is relevant solely to plaintiff’s punitive damages claim, or arguing the punitive damages claim to the jury.

      . National Gypsum Company and United States Gypsum Company. Although W.R. Grace & Co. was included in the original motion, because the instant matter only concerns the two above mentioned firms, W.R. Grace & Co. was withdrawn as a movant on the instant matter before me.

      . On August 1, 1985 a telephone conference was afforded the parties concerning a temporary restraining order in this matter; the parties agreed that the telephone conference, in which argument was entertained by the court, would be in place of a hearing for preliminary injunction. The parties agreed a separate hearing for a preliminary injunction is not required.

      . Spartanburg County School District Seven v. National Gypsum Company and United States Gypsum Company, No. 83-1744-14 (D.S.C.).

      . I imposed no restriction as to the compensatory claims.

      . Either the assets of defendants will be exhausted, or courts will hold that defendants have been sufficiently punished. See In Re School Asbestos Litigation, 104 F.R.D. at 434.

      . Including the class representative Barnwell School District.

       Our holding today is limited to those class actions which seek to bind known plaintiffs concerning claims wholly or predominately for money judgments. We intimate no view concerning other types of class action lawsuits, such as those seeking equitable relief. Nor, of course, does out discussion of personal jurisdiction address class actions where the jurisdiction is asserted against a defendant class.


source: Caselaw Access Project

author: CARL B. RUBIN, Chief Judge.

license: Public Domain

text:
    John PENNINGTON, et al., Plaintiff, v. Robert BUCAN, Agent, et al., Defendant.
    Civ. No. C-1-84-1038.
    United States District Court, S.D. Ohio, W.D.
    Aug. 16, 1985.

      James A. Rader, Cincinnati, Ohio, for plaintiff.
    Elizabeth Gere Whitaker, Asst. U.S. Atty., Thomas R. Smith, Cincinnati, Ohio, for defendant.
   ORDER GRANTING DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT

CARL B. RUBIN, Chief Judge.

This matter is before the Court on the Motions of defendants Robert A. Bucan, George W. Connell III, Valerie L. Vella, Louis P. Russo and Michael A. Campi for Summary Judgment (Doc. no. 22), and upon the separate Motion for Summary Judgment filed by defendant Jeffrey Lang (Doc. no. 21). Supporting such motions are affidavits of all defendants as well as affidavits of nondefendants Lori Grimes, David Sommer, Vincent Presutti and Bart West.

In opposition to such motions the plaintiffs have filed a memorandum supported by affidavits of plaintiffs John and Norma Pennington. (Doc. 30)

The background facts in this matter, which are not in dispute disclose that agents of the Federal Bureau of Investigation were attempting to locate one Johnny Grimes sought in an attempted murder in Kentucky. The agency had reason to believe that Grimes might be armed and dangerous. In an effort to locate him, agents had conducted stakeouts of his estranged wife’s home at 6231 Mernic Drive. One such stakeout on June 30, 1984 proved to be unsuccessful.

During the evening of July 2, 1984, off duty defendant Robert Bucan, while attending a social gathering with other FBI agents, received a call from Mrs. Grimes that the fugitive Johnny Grimes might be in the area. Agent Bucan sought the assistance of other agents who were present and likewise off duty. It is uncontroverted that at the social gathering some of the agents had consumed small quantities of beer.

A surveillance of the Grimes residence and neighborhood was begun and proved uneventful until approximately midnight. At that time, a cream colored station wagon was repeatedly observed slowly passing in front of the Grimes residence. Upon inquiry of Mrs. Grimes, the defendants were advised that Johnny Grimes did have access to a similar automobile. The agents were directed to stop the vehicle and determine whether or not Johnny Grimes was in it.

Two F.B.I. vehicles equipped with flashing lights thereupon followed the vehicle and ultimately required it to stop. The occupants were ordered out of the vehicle, required to produce identification, and released. The occupants of the vehicle proved to be the plaintiffs in this case. No arrests were made and no effort to detain the plaintiffs was made, once it was determined that Johnny Grimes was not present.

Predictably, the affidavits of the parties disagree. For example, it is the assertion of the defendants that during the efforts to stop the vehicle, blue lights were flashed, the defendants identified themselves as F.B.I. agents, and the plaintiffs sought to escape by attempting to run down one of the agents. Defendants deny that there were any blue lights, deny that the defendants identified themselves, and deny that they sought to escape. The variance of these details is not material. Whether or not the agents had consumed alcoholic beverages three houres earlier is not significant. What is significant is the examination of defendants’ conduct in accordance with Harlow v. Fitzgerald, 457 U.S. 800, 102 S.Ct. 2727, 73 L.Ed.2d 396 and Mitchell v. Forsyth, — U.S. —, 105 S.Ct. 2806, 86 L.Ed.2d 411 (1985).

The defendants have asserted a qualified immunity and under such circumstances the inquiry by a trial court in a motion for summary judgment is different from an inquiry into such a motion under all other circumstances. The Mitchell Court pointed out that “The entitlement is an immunity from suit rather then a mere defense to liability; and like an absolute immunity, it is effectively lost if a case is erroneously permitted to go to trial.” Mitchell v. Forsyth supra, at —, 105 S.Ct. at 2816 (emphasis not added).

The Harlow Court established the standard in a qualified immunity defense. “We have held that qualified immunity would be defeated if an official ‘knew or reasonably should have known that the action he took within his sphere of official responsibility would violate the constitutional rights of the [plaintiff] or if he took the action with the malicious intention to cause a deprivation of constitutional right or other injury.’ ” (457 U.S. at 815, 102 S.Ct. at 2737 citing Wood v. Strickland, 420 U.S. 308, 322, 95 S.Ct. 992, 1001, 43 L.Ed.2d 214 (1975) (emphasis not added)).

Both Harlow and Mitchell dealt with situations where it was not clear that the defendant’s action violated the constitutional rights of the plaintiff. In the matter at hand, the situation differs. There is a right and indeed a duty of law enforcement officers to apprehend persons charged with crimes, to pursue them if necessary, to search them for weapons, and to require that they produce identification. The Fourth Amendment to the constitution of the United States does not prohibit all searches and seizures. It only prohibits unreasonable searches and seizures. Whether or not defendants conducted the search of plaintiffs and their vehicle in a fashion gentle enough to be acceptable to plaintiffs is not at issue. The question deals only with the right of defendants to stop and search. The Court’s inquiry must be directed to the facts as the defendants knew them and the action that they took in accordance therewith. It is undisputed that they had seen a vehicle late at night slowly and repeatedly passing a house under surveillance. It is likewise undisputed that the defendants were advised that the suspect they sought had access to a similar vehicle. It is further undisputed that the suspect was wanted for a crime of violence and might be armed and dangerous. Under such circumstances, apprehension and search of plaintiffs is a reasonable action based upon that information available to them.

In discussing an investigatory stop, the Supreme Court of the United States, in United States v. Cortez, 449 U.S. 411, 417, 418, 101 S.Ct. 690, 694, 695, 66 L.Ed.2d 621 (1980), made observations that are pertinent herein. In footnote that follows the statement on page 417, 101 S.Ct. at 695 “An investigatory stop must be justified by some objective manifestation that the person stopped is or is about to be engaged in criminal activity,” is the following: “Of course an officer may stop and question a person if there are reasonable grounds to believe that person is wanted for past criminal conduct”. (Emphasis added) The Cortez Court went on to discuss the “illusive concept of what cause is sufficient to authorize police to stop a person.” The Court pointed out on page 418: “the process does not deal with hard certainties but with probabilities. Long before the law of probabilities was articulated as such, practical people formulated certain common sense conclusions about human behavior; jurors as fact finders are permitted to do the same — and so are law enforcement officers. Finally, the evidence thus collected must be seen and weighed not in terms of library analysis by scholars, but as understood by those versed in the field of law enforcement.” Law enforcement officers are not held to a standard of perfection. If they act in good faith, they are protected from liability even though it turns out that their assumption was mistaken. See Baker v. McCollan, 443 U.S. 137, 99 S.Ct. 2689, 61 L.Ed.2d 433 (1979).

The “library analysis by scholars” referred to in Cortez is particularly applicable here. It is easy for attorneys and judges in the comfort and calm of their chambers to ponder in a detached fashion as to how conduct by law enforcement officers could have been improved. Indeed, after the fact and after due deliberate reflection, some improvement can always be suggested. Unfortunately, the problems of law enforcement do not occur in the cloistered environment of the legal system. They occur with great frequency at night, in strange surroundings and under circumstances of stress, noise, confusion, and a potential for great personal danger. The persons with whom law enforcement officers customarily deal are not impressed by abstract arguments or detached reflection. They are neither hampered by nor concerned with law, ethics, or constitutional rights. They can and do kill. This is the real world and the “totality of circumstances” that the Cortez Court speaks of, under which conduct must be judged. Confronted as defendants were by a vehicle that acted suspiciously, and which resembled a vehicle available to a suspect wanted in an attempted murder charge, they acted in a reasonable and appropriate fashion. They apprehended the vehicle and questioned the occupants. It is clear that the Court in Mitchell and Harlow has instructed District Courts that qualified immunity may be tested by summary judgment motions in order to “permit the resolution of many insubstantial claims on summary judgment and to avoid subjecting government officials either to the costs of trial or to the burdens of broad reaching discovery.” Harlow at 817, 818, 102 S.Ct. at 2737, 2738; Mitchell at —, 105 S.Ct. at 2815. In accordance with the foregoing, the Court determines that the defendants’ Motions for Summary Judgment should be GRANTED, and plaintiffs’ Complaint is hereby DISMISSED at plaintiffs’ costs.

IT IS SO ORDERED.

      . The affidavits of defendants assert that the automobile passed in front of the residence “three to four times”. Plaintiffs admit passing the residence at least twice. (Declaration of Norma Pennington ¶ 5; Declaration of John Pennington ¶ 5)

      . Had they done otherwise they might well have been derelict in their sworn duty.


author: CASSIBRY, Senior District Judge:

text:
    MARSH INVESTMENT CORPORATION, Plaintiff, v. John A. LANGFORD, et al, Defendants. PONTCHARTRAIN STATE BANK, Defendant-Third-Party Plaintiff, v. CRUMP LONDON UNDERWRITERS, INC. and Eunice K. Langford, Third-Party Defendants.
    Civ. A. No. 79-2020.
    United States District Court, E.D. Louisiana.
    Aug. 30, 1985.

      Don M. Richard, New Orleans, La., for third-party defendant Eunice K. Langford.
    Michael R. Allweiss, New Orleans, La., for defendant & third-party plaintiff Pontchartrain State Bank.
   OPINION ON REMAND

CASSIBRY, Senior District Judge:

The judgment of this court has been affirmed in part and vacated in part, and remanded for further proceedings. Marsh Inv. Corp. v. Langford, 721 F.2d 1011 (5th Cir.1983). The single question presented on remand is whether the prior indebtedness of Eunice Langford Bristow (Mrs. Bristow) to the Pontchartrain State Bank (Bank) should be reinstated. Having carefully studied the record and the applicable Louisiana law, I conclude that the answer is no and enter the following in support of my judgment.

I.

The facts surrounding the cancellation of Mrs. Bristow’s debt were never seriously disputed. Mrs. Bristow’s obligation to the Bank arose from her execution of two promissory notes for $74,766.32 and $263,-481.78 respectively. Mrs. Bristow executed the notes on behalf of her son, John Langford, and never received any of the proceeds from them. In 1976, the Bank filed suit against Mrs. Bristow to collect these notes. At this point, Langford entered into an agreement with the Bank to restructure his debts as well as those of his mother. The Bank agreed to dismiss the suit against Mrs. Bristow and cancel her notes in exchange for a new note, representing the combined indebtedness of mother and son, executed by Langford and secured by a collateral mortgage on property owned by Marsh Investment Corporation (Marsh). The parties have stipulated that the recollaterization agreement between Langford and the Bank constituted a novation of Mrs. Bristow’s debt.

II.

Langford had no authority to encumber Marsh’s property, and Marsh sued to cancel the mortgages. I granted Marsh’s motion for summary judgment and ordered cancellation of the mortgages finding they were acquired either through error or fraud and were, therefore, “illegal, null, and void.” Marsh Inv. Corp. v. Langford, 490 F.Supp. 1320, 1328 (E.D.La.1980), aff'd 652 F.2d 583 (5th Cir.1981). In a third party demand, the Bank sought to recover on a blanket bond and to reinstate Mrs. Bristow’s released debts. I denied all relief to the Bank. See Marsh Inv. Corp. v. Langford, 554 F.Supp. 800 (E.D.La.1982). On appeal, the Court of Appeals vacated the judgment in favor of Mrs. Bristow and remanded for reconsideration of the Bank’s claim against her in light of several contentions grounded in Louisiana law. 721 F.2d at 1015.

III.

Under the Louisiana law of obligations, legally given consent of both parties is essential to the validity of a contract. La.Civ.Code Ann. art. 1779 (West 1952) (amended and reenacted by Acts 1984, No. 331). When consent has been produced by error, on the part of one or both parties, or by fraud, the consent may be vitiated and the contract invalidated or rescinded. La. Civ.Code Ann. art. 1819 (West 1952) (amended and reenacted by Acts 1984, No. 331); see also Ferace v. Fullerton, 425 So.2d 393, 395 (La.App.3d Cir.1982). Not every error will invalidate a contract, but only error as to some point “which was the principal cause” or “motive” for making the contract, La.Civ.Code Ann. art. 1823 (West 1952) (amended and reenacted by Acts 1984, No. 331). This concept of Louisiana law is often referred to as failure of cause. See Carpenter v. Williams, 428 So.2d 1314, 1316 (La.App. 3d Cir.1983). Fraud, as applied to contracts, is the cause of an error “bearing on a material part of the contract.” La.Civ.Code Ann. art. 1847 (West 1952) (amended and reenacted by Acts 1984, No. 331). Either error or fraud, depending upon proof of intent or deliberateness, may be the basis of a rescissory action prompted by discovery of a contractual misrepresentation.

The Bank asserts that the facts of this case present a classic example of the Louisiana doctrine of failure of cause. The Bank agreed to the novation of Mrs. Bris-tow’s debt solely on the basis of receiving valid security in the form of a mortgage on the Marsh property. Because the mortgages were invalid, there was no consent on the part of the Bank, and therefore, no contract. Thus, the Bank argues that because it labored under an error of fact, and because of Langford’s fraudulent misrepresentations, the novation must be rescinded and Mrs. Bristow’s debts reinstated.

In response to the Bank’s argument of failure of cause, Mrs. Bristow contends that the Bank’s own fault in this matter bars the relief it now seeks. Proclaiming her status as an innocent third party, Mrs. Bristow asserts that the Louisiana jurisprudence and the Civil Code support the proposition that contractual negligence on the part of the party seeking rescission counteracts its claim of contractual error. Before delving into a discussion of the effect of the Bank’s fault on its claim for relief, it is necessary to address the Bank’s contentions that the issue is not properly before the court.

IV.

Citing Rule 8(c) of the Federal Rules of Civil Procedure, the Bank contends that Mrs. Bristow’s contractual negligence argument was not affirmatively plead and therefore must be considered waived. However, the requirement that an affirmative defense must be pleaded or waived must be applied in the context of the liberal pleading and amendment policy of the Federal Rules. This policy is embodied in Rule 15(b) which provides that an unpleaded issue, tried by the express or implied consent of the parties, is to be treated as if it had been raised. Thus, Rule 15(b) may permit consideration of an affirmative defense in a ease even when not asserted in the pleadings. See 6 C. Wright and A. Miller, Federal Practice and Procedure: Civil § 1492 (1971). In such a case, the pleadings may be amended to include issues tried by consent, either by motion or through the judgment of the court, at any time, even on remand following an appeal. See 6 Wright & Miller, supra, § 1494, at 475.

Express consent to the issue of the Bank’s negligence exists in this case because it is raised in the pretrial order. See 6 Wright & Miller, supra, § 1493, at 461. Furthermore, Mrs. Bristow raises the issue in her pretrial memorandum. Thus, the Bank’s contention that Mrs. Bristow failed to raise such an argument until appeal is erroneous. The Bank’s conduct and fault have been at issue in this case from the beginning. Under these circumstances, no unfair surprise or prejudice will result from the court’s consideration of the Bank’s fault in reaching a decision in this matter.

V.

The Bank also contends that the issue of contractual negligence or fault is not properly before the court because it is a defense which only the parties to the contract may raise. The Bank cites no law in support of its position, but rather simply argues that Mrs. Bristow was not a party to the novation agreement and, therefore, may not assert a contractual defense. In my previous disposition of this matter, I held that Mrs. Bristow was an “innocent party in the restructuring of the loans, did not participate in any of the negotiations, and received none of the funds from the notes she had previously signed.” 554 F.Supp. at 807. Although the Court of Appeals did not overturn this factual finding of third party status on the part of Mrs. Bristow, the Court stated that Mrs. Bristow had “constituted Langford her universal agent to deal with the bank.” 721 F.2d at 1015. If Mrs. Bristow clothed her son with the power to act as her agent, she is entitled to raise any issue concerning the contract confected by her agent. However, even if she cannot properly be characterized as a “party” to the novation agreement, the issue of the Bank’s fault in this matter is properly before the court on remand. The Bank’s fault goes to the heart of its case in chief and negates one of the essential elements of its claim for rescission of the novation agreement: its right to rely on Langford’s misrepresentations.

VI.

Neither I nor the parties have uncovered any Louisiana law directly on point with this ease which concerns the rescission of a novation agreement and the reinstatement of a released debt. However, my conclusion that the Bank is not entitled to rescission of the novation agreement finds support in the jurisprudence and Civil Code articles concerning sales contracts. Typi-eally, a purchaser seeks to rescind a contract of sale based on alleged defects in the thing bought or on misrepresentations by the seller. Where the purchaser brings a rescissory action in redhibition based on a defective condition, relief is denied where the defect is one which the buyer might have discovered by simple inspection. La. Civ.Code Ann. art. 2521 (West 1952); see also Wax v. Woods, 209 So.2d 329, 336 (La.App. 4th Cir.1968). In the case of a misrepresentation, relief is denied where the purchaser had every reasonable opportunity to become informed about the facts and has failed to do so. White v. Lamar Realty, Inc., 303 So.2d 598, 601 (La.App.2d Cir.1974); Packwood v. Johnson, 264 So.2d 663, 666 (La.App. 1st Cir.1972).

To establish a right to rescission of a contract based on fraud, the party seeking relief must show a material misrepresentation of fact upon which that party had “a right to rely and actually did rely.” La Croix v. Recknagel, 230 La. 842, 89 So.2d 363, 367 (1956); Luquette v. Floyd, 147 So.2d 894, 899 (La.App.3d Cir.1963). Likewise, in a case of nonfraudulent misrepresentation, or “innocent misrepresentation,” a contract may be rescinded when there has been justifiable reliance. Cryer v. M & M Mfg. Co., Inc., 273 So.2d 818, 823 (La. 1973). Thus, “[wjhere the means of knowledge are at hand, and equally available to both parties, and the subject of purchase is alike open to their inspection, if the purchaser does not avail himself of these means and opportunities, he will not be heard to say ... that he was deceived by the vendor’s misrepresentations.” Rocchi v. Schwabacher & Hirsch, 33 La.Ann. 1364, 1368 (1881) (quoting Slaughter’s Administrator v. Gerson, 80 U.S. (13 Wall.) 379, 383, 20 L.Ed. 627 (1871)).

The Bank’s conduct in this case clearly establishes that it had no right to rely on Langford’s representations of agency and authority, whether made fraudulently or with reckless disregard of their veracity. The Bank recognized that it needed more than Langford’s bald assertions of authority to encumber Marsh’s property, but it took no steps to verify the documents which purported to give him that authority. As I have previously held, the Bank was not justified in relying on either the corporate resolution or the shareholder consents. Although the shareholder consents were readily available for inspection, the Bank failed to take steps either to see them or to obtain further information about their validity. 554 F.Supp. at 805. As to the corporate resolution, a ’‘cursory examination of Marsh’s corporate records” would have revealed the falsehood. 490 F.Supp. at 1325. “Moreover, the Bank could not have justifiably relied on the opinion by Lang-ford’s counsel, Mr. Stassi, which was so qualified that it should have waved a sea of red flags indicating that additional investigation was necessary.” Id. The means of checking Langford’s authority to act as Marsh’s agent lay as “near as the closest telephone.” 721 F.2d at 1014. Having failed to make the slightest inquiry into the nature, extent, and very existence of Lang-ford’s agency, the Bank is held to have dealt with him at its risk. See Carey Hodges Associates v. Continental Fidelity Corp., 264 So.2d 734, 736 (La.App. 1st Cir. 1972), quoted in 490 F.Supp. at 1324.

I have previously held that the Bank failed to act in good faith in the restructuring transaction. I now hold that the Bank has failed to establish its right to a rescission of the novation agreement and the reinstatement of Mrs. Bristow’s debts. The Bank has failed to show that it had a right to rely, or in some instances, in fact did rely, on Langford’s misrepresentations of authority. If there was error or fraud in this case it was readily apparent. Bank officials knew that Langford was a poor credit risk, knew that he had no connection with the Marsh corporation other than his asserted agency, and expressly discussed the possibility that Langford was attempting to defraud the Bank. The Bank, schooled in financial dealings and fully assisted by counsel, chose to proceed in ignorance in this matter. 721 F.2d at 1014. Such a conscious course of conduct under the suspicious circumstances of this case may properly be characterized under Louisiana law as gross fault or negligence. The result of the Bank s failure to apprise itself of the facts behind Langford’s patent misrepresentations can be laid at no doorstep except its own.

My decision to deny the Bank’s claim against Mrs. Bristow remains the same regardless of whether she is an innocent party in the restructuring transaction or “the beneficiary of her agent’s calculated fraud.” This case is dismissed not because Mrs. Bristow’s defense succeeded, or because the equities lie in her favor, but because the Bank failed to establish its right to the relief requested.

Therefore, IT IS ORDERED that the Bank’s case against Eunice K. Langford be dismissed. The Clerk of Court shall enter judgment accordingly.

      . Mrs. Bristow has been referred to as Mrs. Langford in the prior opinions of this court.

      . For the full details of this case, see the opinion of the Court of Appeals, 721 F.2d 1101, as well as the prior opinions of this court reported at 490 F.Supp. 1320 and 554 F.Supp. 800.

      . In 1984 the Louisiana legislature amended the Civil Code articles dealing with obligations.
      The amended law became effective January 1, 1985. However, this case arose and will be decided under the prior law. The revisions were substantive in nature and there is no indication that they were intended to apply retroactively. See Frito-Lay, Inc. v. WAPCO Constructors, Inc., 520 F.Supp. 186, 189 (M.D.La.1981) (citations omitted).

      . In her ultimate memorandum, Mrs. Bristow points out that under the Louisiana Code, as amended in 1984, novation is no longer defined as a contract. See La.Civ.Code Ann. art. 1879 (West Supp.1985). Therefore, she reasons that the contractual defense of failure of cause is inapplicable to a novation. Mrs. Bristow's reasoning is faulty in several respects. The fact that a novation is no longer defined as a contract does not change the fact that a contractual agreement is involved in this case. Further, the revised article "still contemplates a novation effectuated by agreement, as is the case in the vast majority of instances." La.Civ.Code Ann. art. 1879 comment (a). Finally, as previously explained, the new article is not retroactive and thus is not implicated in this case. See supra note 3.

      . Mrs. Bristow has directed the court to authority in the civil law which supports her position.
      If the new obligation were to be annulled because of error, violence or fraud, the novation itself should be considered as not made except if the new obligation were declared by reason of a fact imputable to the creditor himself, in which case the novation would continue to subsist.
      C. Aubry & C. Rau, Cours de Droit Civil Fran-cais, Obligations § 324, at 233 (6th ed. 1965) (emphasis added).

      . For a recent case involving the denial of rescission of a contract for services based on contractual negligence, see Hebert v. Livingston Parish School Board, 438 So.2d 1141 (La.App. 1st Cir.1983). In that case, the plaintiff brought suit for breach of a service contract under which the plaintiff was to provide the musical entertainment for a junior prom. The defendants alleged error of fact, arguing that their consent to the contract was vitiated since, at the time of contracting, they had erroneously believed that the plaintiff was a live band. The Court of Appeals for the First Circuit held that the defendants were not entitled to rescission because the "lack of diligence [on the part of the defendant employee] toward his responsibilities as class sponsor resulted in his erroneous assumption that the plaintiff was a band. In view of this carelessness, defendants cannot now avoid the obligations of the contract by claiming error of fact.” 438 So.2d at 1146 (citations omitted).

      . This case is cited in the comments to new article 1954 of the Louisiana Civil Code which provides that fraud does not vitiate consent where the complaining party could have ascertained the truth without difficulty, inconvenience, or special skill. Article 1954 changes the law in that it generalizes the principles enunciated in former article 1847(3) and (4). Although the change is not retroactive, it is considered to be consistent with views expressed by the Louisiana jurisprudence. See La.Civ.Code Ann. art. 1954 comment (a) (West Supp. 1985).

      . Although this court has never held that Lang-ford's representations were fraudulent, in the bankruptcy proceedings before the Bankruptcy Court for the Eastern District of Louisiana, the court held that "Langford did either knowingly or in wreckless disregard cause to be issued this bogus mortgage.” In addition, the Fifth Circuit Court of Appeals characterized Langford’s actions in this case as “calculated fraud.” 721 F.2d at 1015.

      . For authority supporting the denial of rescission of a contract based on this finding alone, see Restatement (Second) of Contracts §§ 164, 172 (1979).

      . The Louisiana Civil Code defines gross fault as "that which proceeds from inexcusable negligence or ignorance; it is considered as nearly equal to fraud.” La.Civ.Code Ann. art. 3556 (13) (West 1953). The Louisiana jurisprudence provides the following edification:
      Gross fault undoubtedly implies wanton or wilful negligence.

        Sullivan v. Hartford Accident & Indem. Co., 155 So.2d 432, 436 (La.App.2d Cir.1963).
      The terms "willful", "wanton", and "reckless” have been applied to that degree of fault which lies between intent to do wrong, and the mere reasonable risk of harm involved in ordinary negligence. These terms apply to conduct which is still merely negligent, rather than actually intended to do harm, but which is so far from a proper state of mind that it is treated in many respects as if harm was intended. The usual meaning assigned to the terms is that the actor has intentionally done an act of unreasonable character in reckless disregard of the risk known to him, or so obvious that he must be taken to have been aware of it, and so great as to make it highly probable that harm would follow. It is usually accompanied by a conscious indifference to consequences, amounting almost to a willingness that harm should follow.

        Cates v. Beauregard Elec. Coop.,Inc., 316 So.2d 907, 916 (La.App.3d Cir.1975) (citations omitted).
      [RJeckless misconduct requires a conscious choice of a course of action either with knowledge of the [harm] involved ... or with knowledge of facts which would disclose this danger to any reasonable man.
      Restatement (First) Torts § 500 comment g, quoted in Sullivan, 155 So.2d at 436, n. 2.


author: POLOZOLA, District Judge.

text:
    Billy COLE and Mrs. Sherry Cole v. CIRCLE R. CONVENIENCE STORES, INC., a corporation, J.C. Roberts Oil Company, Inc., a corporation, James C. Roberts, Jr., and Mrs. Sylvia Roberts.
    Civ. A. No. 84-903-B.
    United States District Court, M.D. Louisiana.
    Aug. 30, 1985.

      Ralph Brewer, Baton Rouge, La., for plaintiffs.
    Sam J. D’Amico, D’Amico, Curet & Dampf, Baton Rouge, La., for defendants.
   POLOZOLA, District Judge.

On January 30, 1985, the Court issued a minute entry converting the motion of the defendants, Circle R. Convenience Stores, Inc., J.C. Roberts Oil Company, Inc., James C. Roberts, Jr. and Mrs. Sylvia Roberts, to dismiss to a motion for summary judgment. In the same order the Court ordered the plaintiffs, Billy Cole and Mrs. Sherry Cole to amend their complaint with regard to their claims filed under the Racketeering Influenced and Corrupt Organization Act (“RICO”), 18 U.S.C. §§ 1961-1964, within 15 days. The motion of the defendants to dismiss the RICO claims for failure to state a claim upon which relief can be granted was stayed pending a decision by the plaintiffs to amend the complaint.

I. The Petroleum Marketing Practices Act

Under the Petroleum Marketing Practices Act (“PMPA”) a franchisor may neither terminate nor fail to renew a franchise unless there has been compliance with specified conditions and then only for the specific grounds permitted by the Act. See Billy Cole v. Circle R. Convenience Stores, Inc., 602 F.Supp. 1108 (M.D.La.1985). Furthermore, a franchisee may bring a civil action against a franchisor for alleged violations of the Act. See 15 U.S.C. § 2805(a).

The defendants contend that they are entitled to a motion for summary judgment on the PMPA claims because the plaintiffs are not franchisees within the meaning of PMPA. A franchisee is a “re-tailor or distributor (as the case may be) who is authorized or permitted, under a franchise, to use a trademark in connection with the sale, consignment or distribution of a motor fuel.” 15 U.S.C. § 2801(4). According to defendants, the plaintiff fails to come within this definition for two reasons: (1) the plaintiff is neither a retailer nor a distributor; and (2) the agreement did not authorize the plaintiffs to use a refiner’s trademark.

The defendants’ contention that the plaintiff is not a retailer within the meaning of PMPA is without merit. This contention is based upon the premise that the Gasoline Supply Agreement, entered into on August 10, 1981 is an agreement whereby gasoline was merely “consigned” to the plaintiff and not sold to him. Therefore, according to the defendants, since the plaintiff was merely a “consignee” of the gasoline and not a purchaser, he cannot be a retailer because one must “purchase” gasoline to be classified as such.

The Court finds that there was a contract of sale whereby the plaintiff purchased gasoline from the defendants. Louisiana Civil Code article 2439 identifies three prerequisites for the perfection of a contract of sale: (1) the thing sold, (2) the price and (3) the consent. Benglis Sash & Door Co. v. Leonards, 387 So.2d 1171 (La.1980) and In re Evangeline Refining Co., Inc., 37 B.R. 450 (W.D.La.1984). The Gasoline Supply Agreement is a written agreement manifesting the consent of the parties to the sale of a thing [gasoline and automotive supplies] at a price which was to be determined as provided in Sections 3A and 3B. The fact that the price was not more specifically stated does not preclude the perfection of the contract of sale. Ball Marketing, Inc. v. Sooner Refining Co., 422 So.2d 582 (La.App. 3rd Cir.1982). The Louisiana Supreme Court has stated that “the parties can consent to buy and to sell a certain thing for a reasonable price, and when they do, the contract of sale has been perfected. The essential thing is that there be a meeting of the minds (as opposed to a disagreement) as to price.” See Benglis Sash & Door Co. v. Leonards, 387 So.2d at 1172. However, since the gasoline, which is the object of the contract, had not been individualized at the time of the signing of the Gasoline Supply Agreement, there is an obstacle to the general principle stated in article 1909 of the Louisiana Civil Code that would have made the plaintiff the owner of the gasoline upon mere consent. The Louisiana courts have held that a contractual object becomes sufficiently individualized when it has been “appropriated to the contract.” See, e.g., State v. Shields, 110 La. 547, 34 So. 673 (1903). To determine when an “appropriation” has oc-eurred, the Louisiana Supreme Court has set forth the following guidelines:

... in the absence of a more specific agreement on the subject, ... such appropriation takes place only when the goods as ordered are delivered to public carriers at the place from which they are to be shipped, consigned to the person by whom the order is given, at which time and place, therefore, the sale is perfected and the title passes.

George D. Witt Shoe Co. v. J.A. Seegars & Co., 112 La. 145, 47 So. 444, 446 (1908). Therefore, in this case, once the gasoline had been identified or segregated from the mass and designated as the thing being sold, i.e. “appropriated to the contract”, the sale was perfected with regard to that quantity of gasoline. In re Evangeline Refining Co., 37 B.R. 450 and Succession of Welsh, 111 La. 801, 35 So. 913 (1904). See also 2 Litvinoff, Obligations § 40 (1975).

The defendants have submitted affidavits in support of their contention that they did not sell gasoline and plaintiffs did not purchase it. In these affidavits, affiants state that they have compared their gasoline supply contract with the one at issue in this case or have reviewed the contract at issue in this ease and have concluded that “gasoline was consigned to Billy Cole and title remained the property of J.C. Roberts Oil Co., Inc.” Without deciding whether these affidavits meet Federal Rule of Civil Procedure 56(e)’s mandate that they “set forth such facts as would be admissible in evidence”, the Court is unable to accept defendants’ contention that the Gasoline Supply Agreement was a contract of consignment and as such cannot be considered a sale. In general, a consignment contract is considered “the consignment of goods to another (consignee) for sale under agreement that consignee will pay consign- or for any goods sold and will return any unsold goods.” Black’s Law Dictionary, 5th Edition, West Publishing Co. (1979). Under Louisiana law, the courts refer to the above described consignments as sales and have stated that “the fact alone that the goods were sold on consignment does not preclude these dealings from being an open account.” (Emphasis added.) United Distributors, Inc. v. Redfern, 449 So.2d 580 (La.App. 1st Cir.1984). See also Goldberg v. Borenstein, 59 So.2d 172 (Orl.La.App.1952). In addition, the Court must assume and conclude that these affidavits are attempts to vary the terms of the Gasoline Supply Agreement by implying that although the agreement uses terms such as seller, purchaser, etc., there was really no intent to transfer ownership of the gasoline and the title to the gasoline remains with J.C. Roberts Oil Co. Parole evidence is inadmissible to vary the terms of a written contract, unless such contract is ambiguous. The defendants have not asserted that the contract was ambiguous. However, without determining whether the contract is ambiguous, the Court notes that even if the Gasoline Supply Agreement would be found ambiguous, the Court could not grant the present motion for summary judgment.- A motion for summary judgment is appropriate only when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Dorden v. C.H. Heist, 743 F.2d 1135 (5th Cir.1984) and Williams v. Shell Oil Company, 677 F.2d 506 (5th Cir.1982), cert. denied, 459 U.S. 1087, 103 S.Ct. 570, 74 L.Ed.2d 933 (1982). The parties intent as to whether there was to be a transfer of ownership under the agreement is an issue which cannot be determined on the present motion for summary judgment. Henry v. Ballard & Cordel Corp., 418 So.2d 1334 (La.1982). Therefore, since there is a genuine issue of material fact in dispute which must be resolved at the trial, it would be inappropriate to grant a summary judgment at this time. Dorden v. C.H. Heist, 743 F.2d 1135 and Williams v. Shell Oil Company, 677 F.2d 506.

In conclusion, the Court finds that the defendants’ contention that the plaintiff is not a purchaser of motor fuel (and thus not a retailer within the meaning of PMPA) cannot be determined at this time for the following reasons. First, the Gasoline Supply Agreement can be considered a contract of sale which was perfected upon the “appropriation” of the gasoline as discussed previously. If this is the case, the plaintiff would have to be considered a purchaser of motor fuels. Secondly, if the Gasoline Supply Agreement would be found to be ambiguous and parole evidence admissible on the issue of intent to transfer ownership of the gasoline, there would be a question of fact which would preclude a motion for summary judgment. And finally, even if one would totally disregard the Gasoline Supply Agreement, affidavits were filed by the plaintiffs stating that they had purchased gasoline from the defendants, thereby creating a genuine issue of material fact which must be resolved at trial. Dorden v. C.H. Heist, 743 F.2d 1135 and Williams v. Shell Oil Company, 677 F.2d 506.

The second ground upon which the defendants based their motion for summary judgment is that the plaintiffs are not franchisees because the agreement upon which this suit is based does not authorize the plaintiffs to use a “refiner’s” trademark. As stated previously, a franchisee is defined as a “retailer or distributor (as the case may be) who is authorized or permitted, under a franchise, to use a trademark in connection with the sale, consignment or distribution of a motor fuel.” 15 U.S.C. § 2801(4). Although the definition of a franchisee does not require the authorization to use a “refiner’s” trademark, the definition of a franchise, which is by necessity incorporated into the definition of a franchisee (because one must be authorized under a franchise) does require such. A franchise is defined as any contract

between a distributor and a retailer, under which a refiner or distributor (as the case may be) authorizes or permits a retailer or distributor to use, in connection with the sale, consignment, or distribution of motor fuel, a trademark which is owned or controlled by such refiner or by a refiner who supplies motor fuel to the distributor which authorizes or permits such use.

15 U.S.C. § 2801(l)(A)(iv).

As the record now stands, the Court has no written contract before it in which the defendants have authorized the plaintiffs to use, in connection with the sale of a motor fuel, a refiner’s trademark. However, eight of the ten affidavits submitted by the defendants in support of this motion for summary judgment state that the outlet “operated” by Billy Cole was doing business as Westside Gulf. In addition, the Franchise Disclosure Statement describes J.C. Roberts as “Gulf distributor since 1941.” The definition of a franchise contemplates that a distributor could authorize the use of a refiner’s trademark. See 15 U.S.C. § 2801(l)(A)(iv). Although the Court ordered in its minute entry of January 30, 1985, that the parties file, within 20 days of such date, evidence in support of or in opposition to the motion for summary judgment, there is no written contract filed in the record regarding the use of a refiner trademark. However, there is a genuine issue of material fact as to the existence of an agreement by which the defendants authorized the plaintiffs to use a refiner’s trademark in this case in connection with the sale of a motor fuel. Because there is a material issue of fact in dispute, defendants’ motion for summary judgment on this issue must be denied.

II. Racketeering Influenced and Corrupt Organization Act

The defendants filed a motion to dismiss those claims brought pursuant to RICO for failure to state a claim upon which relief could be granted. The plaintiffs’ complaint, at the time the motion was filed, failed to allege that the defendants had engaged in a pattern of racketeering, an essential element necessary to state a claim under RICO upon which relief can be granted. Alcorn County, Miss. v. U.S. Interstate Supplies, 731 F.2d 1160 (5th Cir.1984); United States v. Martino, 648 F.2d 367 (5th Cir.1981), cert. denied, 456 U.S. 943, 102 S.Ct. 2006, 72 L.Ed.2d 465 (1982) and United States v. Uni Oil, 646 F.2d 946 (5th Cir.1981), cert. denied 455 U.S. 908, 102 S.Ct. 1254, 71 L.Ed.2d 446 (1982). On January 30, 1985, the Court ordered that the complaint be amended within fifteen days to correct this omission. On February 18, 1985, the Court was informed, by letter from plaintiffs’ counsel, that the plaintiffs were unable to amend the complaint to allege that the defendants had engaged in a pattern of racketeering. Since the plaintiffs have failed to amend the complaint to allege an essential element of a claim pursuant to RICO, the Court must grant the defendants’ motion to dismiss for failure to state a claim because it is now evident that the plaintiffs would be unable to prove a set of facts in support of a RICO claim that would entitle them to relief. Watts v. Graves, 720 F.2d 1416 (5th Cir.1983) and Johnson v. Wells, 566 F.2d 1016 (5th Cir.1978).

Therefore:

IT IS ORDERED that the motion of the defendants, Circle R. Convenience Stores, Inc., J.C. Roberts Oil Company, Inc., James C. Roberts, Jr. and Mrs. Sylvia Roberts, for summary judgment, insofar as it is based upon the plaintiffs not being purchasers of motor fuel, be and it is hereby DENIED.

IT IS FURTHER ORDERED that the motion of the defendants, Circle R. Convenience Stores, Inc., J.C. Roberts Oil Company, Inc., James C. Roberts, Jr. and Mrs. Sylvia Roberts for summary judgment, insofar as it is based upon the absence, of a contract whereby the defendants have authorized the plaintiffs to use a refiner’s trademark in connection with the sale of motor fuel, be and it is hereby DENIED.

IT IS FURTHER ORDERED that the motion of the defendants, Circle R. Convenience Stores, Inc., J.C. Roberts Oil Company, Inc., James C. Roberts, Jr. and Mrs. Sylvia Roberts, for failure to state a claim pursuant to Racketeering Influenced and Corrupt Organization Act for which relief can be granted be, and it is hereby GRANTED.

      . The defendants filed a motion to dismiss the claims filed under the Petroleum Marketing Practices Act, 15 U.S.C. §§ 2801-2806, for failure to state a claim upon which relief can be granted pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure.

      . A retailer is "any person who purchases motor fuel for sale to the general public for ultimate consumption.” 15 U.S.C. § 2801(7).

      . 15 U.S.C. § 2801(6) provides that a distributor is a person or an affiliate of such person who:
      (A) purchases motor fuel for sale, consignment, or distribution to another; or
      (B) receives motor fuel on consignment for consignment or distribution to his own motor fuel accounts or to accounts of his supplier, but shall not include a person who is an employee of, or merely serves as a common carrier providing transportation service for, such supplier.

      . The Court finds that it is unnecessary to discuss whether the plaintiffs are distributors as they do not contend that they are such.

      . See Complaint Exhibit # 2, Attachment E.

      . See definition of retailer at note 1, supra.

      . Louisiana Civil Code article 1915. See also 2 Litvinoff, Obligations § 39 (1975).

      . See the affidavits of Jim Baker and Miller Baker, John Schafer and Lloyd Truax and Barbara Truax.

      . See the affidavits of Edwin L. Perkins, Brenda A. LeBeau, Paul R. Patterson, Jim Flotte and Vonceile B. Patterson

      . See affidavits designated in notes 8 and 9, supra.

      . See La.C.C. art. 1945(3) [Re-enacted effective January 1, 1985 as La.C.C. art. 2046], Battig v. Hartford Acc. & Indem. Co., 482 F.Supp. 338 (W.D.La.1977), aff'd 608 F.2d 119 (5th Cir.1979).

      . See affidavit of Billy Cole filed with the Opposition to Motion to Dismiss on December 2, 1984, asserting that the plaintiffs had purchased . gasoline from the defendants.

      . See also Billy Cole v. Circle R. Convenience Stores, Inc., 602 F.Supp. at 1110, n. 4.

      . See affidavits designated in notes 8 and 9, supra.

      .See Complaint Exhibit #2, Attachment A, IIB.


author: HUNGATE, District Judge.

text:
    Robert A. FLINN, et al., Plaintiffs, v. John BLOCK, et al., Defendants.
    No. 84-665C(3).
    United States District Court, E.D. Missouri, E.D.
    Sept. 4, 1985.
    Susan M. Hais, Clayton, Mo., for plaintiffs.
    Wesley D. Wedemeyer, St. Louis, Mo., for defendants.
   MEMORANDUM

HUNGATE, District Judge.

This matter is before the Court on defendants’ motion for summary judgment. For the reasons stated below, defendants’ motion will be granted.

Plaintiffs borrowed money from the Farmers Home Administration (FMHA), secured by plaintiffs’ property in Lincoln County, Missouri. Plaintiffs did not continue making payments on the loans, and the FMHA accelerated the loans on July 5, 1979.

Plaintiffs are suing defendants, in their individual and representative capacities, for equitable relief and for damages. Plaintiffs’ state and federal claims are premised on defendants’ failure to notify plaintiffs of 7 U.S.C. § 1981a relief.

Defendants allege that they are immune from damage claims because their conduct did not violate “clearly established statutory or constitutional rights of which a reasonable person would have known.” See Harlow v. Fitzgerald, 457 U.S. 800, 102 S.Ct. 2727, 73 L.Ed.2d 396 (1982).

In Allison v. Block, 723 F.2d 631 (8th Cir.1983), the appellate court held that the FMHA is required to provide Consolidated Farm and Rural Development Act (CFRDA) borrowers with notice of 7 U.S.C. § 1981a relief, including deferral and other alternatives to acceleration. Prior to the Allison decision, the law concerning the FMHA’s duties pursuant to § 1981a was unclear. See Allison v. Block, 556 F.Supp. 400 (W.D.Mo.1982) and Neighbors v. Block, 564 F.Supp. 1075 (E.D.Ark.1983). Further, the government enacted notice provisions in 1983. See 7 C.F.R. §§ 1951.33 and 1951.--40(b)(2) (1983). However, the Allison court found that these regulations did not provide for adequate notice as required by 7 U.S.C. § 1981a. Allison, supra, 723 F.2d 631.

Defendants’ actions preceded the clarification of the FMHA’s duties under § 1981a since defendants accelerated plaintiffs’ loans in 1979. Because the law was not clearly established at that time, the Court will grant defendants’ motions for summary judgment based upon defendants’ qualified immunity. See Schieffer v. Block, 601 F.Supp. 90 (E.D.Mo.1984).

In Coleman v. Block, 580 F.Supp. 194 (D.N.D.1984), the court issued a permanent injunction preventing the FMHA from foreclosing on all CFRDA loans without providing eligible borrowers with notice of deferral options under § 1981a. The court certified a national class action of eligible borrowers. The FMHA is abiding by and has not appealed the Coleman order. Therefore, plaintiffs’ claims for injunctive and equitable relief are moot and do not provide any genuine issues of material fact. See Fed.R.Civ.P. 56.

Finally, pursuant to state law, plaintiffs seek to set aside a transfer of title and to recover damages for defendants’ alleged fraud and misrepresentations. Having granted summary judgment on all federal claims, the Court will decline to hear the remaining pendent state claims. See United Mine Workers of America v. Gibbs, 383 U.S. 715, 86 S.Ct. 1130, 16 L.Ed.2d 218 (1966).


author: BLATT, District Judge.

text:
    Margaret KLUGH, Katherine Klugh Maultsby, Mary Klugh Garner, John Bradley Klugh, William W. Bradley, III, Frederick H. Bradley, Patrick H. Bradley, Edna Bradley Troxell, Hugh W. Bradley, Mabel Bradley Payne, Mary Bradley Pressly, Thomas R. Bradley, William T. Bradley, Margaret Bradley Poole, David W. Bradley, John T. Bradley, Jr., Frances K. Bradley, Mark E. Bradley, Jr., Elizabeth Bradley McGarity, Robert F. Bradley, III, Thomas J. Bradley, Frances Wright Bradley, III, William R. Bradley, II, Rufus A. Johnson, III, Mary Bradley Brown, Margaret Bradley Shuford, Arthur L. Bradley, James B. Bradley, Curtis L. Bradley, David J. Wardlaw, Martha Wardlaw Buie, Foster Bradley Wardlaw, Jr., Ivey Jean Wardlaw Pressly, Robert S. Wardlaw, William W. Wardlaw, Mildred E. Wardlaw, John U. Wardlaw, Mary Wardlaw Deason, Annie Wardlaw Wright, Frances M. Wardlaw, John K. Bradley, Mary Bradley Miller, Martha Bradley Moody, Frances Trenholm Bradley, Jane H. Bradley, Martha B. Mayo, Robert F. Bradley, Jr., Eustace U. Bradley, Mary Bradley Cox, and Frances Thompson Sheppard, Plaintiffs, v. UNITED STATES of America; Certain Lands Located in Abbeville, Greenwood and McCormick Counties, South Carolina, Being a Portion of the Estate of W.K. Bradley, Deceased; and the United States Department of Agriculture, Defendants.
    Civ. A. No. 73-95.
    United States District Court, D. South Carolina, Greenwood Division.
    Sept. 6, 1985.

      Frank H. Clabaugh, Hilton Head Island, S.C., for plaintiffs.
    Silvia Sepulveda-Hambor, Dept, of Justice, Washington, D.C., for defendants.
   ORDER

BLATT, District Judge.

This matter is before the court upon cross motions for summary judgment. This court, after reviewing the entire record, including the briefs of counsel and applicable law, grants plaintiffs’ motion for summary judgment to the extent indicated in this order.

The central issue in this case is whether the lineal descendants of W.K. Bradley, as devisees under Bradley’s will, have a property interest in certain parcels of land, currently titled to the United States, that Bradley owned at his death. The lineal descendants who brought this action contend that they retain interests in the properties due to flaws in the procedure that the United States utilized in obtaining the land pursuant to the Weeks Act, 16 U.S.C.A. §§ 515, 517, 517a (West 1974). The plaintiffs argue that these irregularities, which occurred in three (3) judicial proceedings between 1936 and 1939, render the judgments that awarded title in these properties to the United States, void or voidable, as to the plaintiff’s interests. The defects of which the plaintiffs complain include:

(1) failure to join as parties, or to appoint a guardian ad litem to represent, unborn Bradley heirs;
(2) failure to appoint a guardian ad li-tem to represent unknown Bradley heirs who were served by publication; and
(3)failure of the guardians ad litem who were appointed to represented known minor and incompetent Bradley heirs to adequately protect their wards’ interests.

In this suit against the United States, the plaintiffs seek return of title to the affected properties and an accounting for interim use.

I.

W.K. Bradley died on December 30,1881. Under his will, dated December 8, 1881, Bradley devised his real property, including the parcels at issue in this case, to his wife and children “to be theirs and for their use and benefit for life, and after their death to go to their children and on down as far as the law will allow.”

Between 1935 and 1937, the United States, acting through its Secretary of Agriculture, entered into several land option contracts with a number of adult Bradley heirs. While differing in form, each contract provided that the named vendors agreed to convey to the United States certain specified acreage if, within twelve (12) months of their entering into the option contract, the vendors were notified that the National Forest Reservation Commission had approved the purchase. The contracts further provided for the institution of condemnation proceedings if the vendors were unable to provide title satisfactory to the Attorney General of the United States. Acreage specified in four of these option contracts is also at issue in the case at bar.

Pursuant to the Weeks Act, between 1936 and 1939, the United States condemned 7,913.5 acres of land in three separate judicial proceedings for a national forest. As foreshadowed in the previously mentioned contracts, the United States included the optioned lands in these condemnations. In the condemnation proceedings, the unborn Bradley heirs were not joined as parties, nor did the court appoint a guardian ad litem to protect their interests. The unknown Bradley heirs were joined and served by publication, but the court did not appoint a guardian ad litem to represent their interests. The minor and incompetent Bradley heirs were joined and served by publication, and the court appointed guardians ad litem to protect their interests. The known adult Bradley heirs were joined and did not object to the condemnations.

As previously noted, these condemnation proceedings culminated in judgments that awarded the United States title to the properties described therein. In 1973, the plaintiffs filed this action seeking to have the court set aside those condemnation judgments to the extent that the plaintiffs’ interests in the properties were affected.

Of primary importance in this case was the interpretation of W.K. Bradley’s will. Bradley devised his real property and mills to his wife and children “to be theirs and for their use and benefit for life, and after their death to go to their children and on down as far as the law will allow.” The will indisputably devised a life estate to Bradley’s wife and five children, but the disposition the testator intended by the phrase, “and after their death to go to their children and on down as far as the law will allow,” raised serious and complex legal questions.

This court previously ruled that Bradley intended to devise life estates to successive lineal generations as a class, with the fee vesting in as many members of the next lineal class as was legally permissible under the rule against perpetuities. The court determined that the fee simple title vested twenty-one (21) years and nine (9) months after W.K. Bradley’s death in his then living great grandchildren. With this interpretation of the will, the court traced through a submitted genealogical chart of the W.K. Bradley family and concluded that the statutorily required consent for the sale of the entire vested remainder interest had been obtained, since the re-maindermen were properly served adults who allowed the condemnations to proceed to judgment without objection. For these reasons, the court earlier granted the defendants’ motion for summary judgment in 1977. Klugh, et al. v. United States, No. 73-95 (D.S.C. February 2, 1977).

The Fourth Circuit Court of Appeals disagreed with this court’s conclusion that the testator intended to make a class gift. Klugh, et al. v. United States, 588 F.2d 45 (4th Cir.1978). Instead, the appeals court intepreted the testator’s intent, as manifested in the will, to create successive life estates individually in his lineal heirs for as long as the rule against perpetuities might allow. This interpretation placed the vesting of the fee twenty-one (21) years and nine (9) months after the death of the survivor of the children and grandchildren who were living at the testator’s death. The appeals court determined that under the facts of the case at bar, “the fee to the testator’s lands will not vest until January 21, 1988, and possibly as much as nine months later.” Id. at 51. Accordingly, the judgment of this court was reversed, and the case was remanded for further proceedings in accordance with the appeals court opinion. The action, on remand, is currently before this court on cross-motions for summary judgment.

II.

The parties agree that the United States acquired the subject properties pursuant to the Weeks Act, 16 U.S.C.A. § 516 (West 1974). That statute provides, in part, that:

[t]he Secretary of Agriculture is authorized to purchase, in the name of the United States, such lands as have been approved for purchase by the National Forest Reservation Commission at the price or prices fixed by said commission. No deed or other instrument of conveyance shall be accepted or approved by the Secretary of Agriculture under this section until the legislature of the State in which the land lies shall have consented to the acquisition of such land by the United States for the purpose of preserving the navigability of navigable streams.

Id Similarly, both sides concur that the Legislature of South Carolina conditionally consented to the acquisitions through the enactment of S.C.Code Ann. § 3-1-410 (Law.Co-op.1977). That statute provides, in part, that:

[t]he consent of the State is hereby given to the acquisition by the United States, by purchase, gift or condemnation according to law, of such forest lands or such other property as it may acquire by purchase, deed or otherwise in this State as, in the opinion of the Federal Government, may be needed for the establishment of a national forest service in that region; provided, that unless the consent of the owner of such land is had and obtained, nothing herein contained shall be construed as giving the right to condemn any building, dwelling house or cultivated or pasture land.

Id. In sum, the United States was authorized to purchase property that encompassed a building, dwelling house, or cultivated or pasture land only if the owner of such property consented to the sale. The parties have stipulated, for purposes of these cross motions for summary judgment, that at least one acre of condemned Bradley land encompassed a building, dwelling house or cultivated or pasture land at the time of the federal acquisitions, that at least one of the plaintiffs qualifies as an heir of W.K. Bradley and was not represented by a guardian ad litem in any of the condemnation cases, and that at least one of such unrepresented plaintiffs will be alive on October 21, 1988.

III.

The plaintiffs argue that under the will of W.K. Bradley, they are owners of life estates and, additionally, have a contingent remainder interest in the properties that the government condemned. As owners of such interests, the plaintiffs contend that the United States was required to obtain their consent as a prerequisite to a proper transfer of title to the Bradley lands. It is alleged that the statutorily mandated consent was not obtained from the plaintiffs since they are either (1) the unborn Bradley heirs who were neither joined as parties in the condemnation proceeding nor represented by a guardian ad litem; (2) the unknown Bradley heirs who were served by publication, but who were not represented by a guardian ad litem, in the condemnation proceeding; or (3) the known minor and incompetent Bradley heirs whose appointed guardians ad litem failed to adequately protect their interests in the condemnation proceeding. As a result of these irregularities in obtaining owner consent, the plaintiffs assert that the condemnation judgments are void, or voidable, and that Rules 60(b)(4), and 60(b)(6), Fed.R.Civ. Pro. (West 1982), bestow jurisdiction on this court to set aside those condemnation judgments.

The United States does not contest that, under the Bradley will, and absent condemnation, the plaintiffs would be owners of life estates and would own a contingent remainder interest in the subject lands; neither does the government contest that, as such owners, the plaintiffs’ consent was a prerequisite to purchase these properties. Instead, the United States claims that the statuate of limitations bars this action. Further, the government contends that the plaintiffs failed to properly plead the guardian ad litem aspects of the consent issue, and, thus, are foreclosed from submitting that theory to the court on a motion for summary judgment. Even if the guardian ad litem aspects of consent were pled, the government submits that the lack of consent is, at best, mere error to be corrected on direct appeal and not an irregularity that would render the judgments void; at worst, the United States urges, such is a voidable error that was cured either through publication notice or -when the government deposited just compensation into the respective county treasuries at the time the condemnation judgments were entered.

IV.

Until a party’s interest vests, the statute of limitations does not begin to run against him as to an action he may wish to institute challenging another’s title to the property. Walter J. Klein Co. v. Kneece, 239 S.C. 478, 123 S.E.2d 870 (1962); Wooten v. Standard Life & Casualty Ins. Co., 239 S.C. 243, 122 S.E.2d 637 (1961); Tuten v. Alameda Farms, 184 S.C. 195, 192 S.E. 153 (1937). Since title to the properties at issue in this suit will not vest until October of 1988, Klugh, et al. v. United States, 588 F.2d 45, 51 (4th Cir.1978), the government’s statute of limitations argument is no defense as to the plaintiff’s action seeking title to the property. Insofar as the plaintiffs seek an accounting, however, the government’s statute of limitations may bar some plaintiffs and their predecessors in individual cases, but this will have to be developed in later factual proceedings.

V.

Sufficiency of the pleadings is a question of federal law. Bryan v. Ker- shaw, 366 F.2d 497 (5th Cir.1966). Under the federal system of notice pleading, the complaint is designed to put the defendant on notice of the incident out of which the cause of action arose. Roberts v. Acres, 495 F.2d 57 (7th Cir.1974). This type of pleading requires a party to submit a “short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.Pro. 8(a)(2) (West 1960). A party, by contrast, is not required to plead either evidentiary matters or the factual particulars of any claims. Maclin v. Paulson, 627 F.2d 83 (7th Cir.1980). Claims that have not been pleaded, however, may not be the basis of recovery. Atlas Chemical Industries, Inc. v. Moraine Products, 509 F.2d 1 (6th Cir.1974).

In this case, the plaintiffs fulfilled the requirement of notice pleading. In paragraph nine (9) of the amended complaint, plaintiffs alleged, “[t]hat the consent of the Plaintiffs to the acquisitions of the said lands by the United States of America was not given as required by law.” This allegation, coupled with an earlier assertion that consent was required for title to properly pass to the United States, put the defendants on notice of a claim that would entitle the pleader to relief. Plainly, the government was on notice that lack of proper consent was in issue. The plaintiffs were not required by notice pleading to shoulder the additional burden of pleading the factual guardian ad litem aspects of the consent claim; thus, the plaintiffs are entitled to submit that factual theory to the court as a basis of recovery on their motion for summary judgment.

VI.

Pursuant to Rule 60(b), Fed.R.Civ. Pro. 60(b) (West 1982), a federal district court has jurisdiction to set aside certain judgments. The portions of the rule relevant to this litigation provide:

On motion and upon such terms as are just, the court may relieve a party or his legal representative from a final judgment, order, or proceedings for the following reasons: ... (4) the judgment is void; ... (6) or any other reason justifying relief from the operation of the judg-ment_ A motion under this subdivision (b) does not affect the finality of a judgment or suspend its operation.

Id. (b)(4), (b)(6). As to the interests of the present Bradley heirs who were unborn, and not represented in the condemnation proceedings by a guardian ad litem when the condemnation sales were completed, this court has concluded that, under Rule 60(b)(4), the condemnation judgments should be set aside as being void. Pursuant to Rule 60(b)(6), this court similarly has concluded that, for equitable considerations, the condemnation judgments should be set aside as to the interests of the present Bradley heirs who were unknown at the time of the condemnation judgments, and who were not represented by a guardian ad litem, and the known minor and incompetent Bradley heirs who received inadequate guardian ad litem representation in that litigation.

A.

Under Rule 60(b)(4), “the only question for the court is whether the judgment is void; if it is, relief from it should be granted.” Marquette Corp. v. Priester, 234 F.Supp. 799, 802 (D.S.C.1964) (quoting Austin v. Smith, 312 F.2d 337, 343 (D.C.Cir.1962)).

A judgment is void if the court that rendered it lacked jurisdiction of the subject matter, or of the parties, or acted in a manner inconsistent with due process. Margoles v. Johns, 660 F.2d 291 (7th Cir.1981) cert. denied, 455 U.S. 909, 102 S.Ct. 1256, 71 L.Ed.2d 447 (1982); In re Four Seasons Securities Laws Litigation, 502 F.2d 834 (10th Cir.1974), cert. denied, 419 U.S. 1034, 95 S.Ct. 516, 42 L.Ed.2d 309 (1975). Mere error does not render the judgment void unless the error is of constitutional dimension. Simer v. Rios, 661 F.2d 655 (7th Cir.1981), cert. denied, sub nom Simer v. United States, 456 U.S. 917, 102 S.Ct. 1773, 72 L.Ed.2d 177 (1982).

In the condemnation judgments challenged at bar, the present plaintiffs who are Bradley heirs, and who were not in being when the judgments were entered, were neither joined as parties nor represented by guardians ad litem. To determine the rights of persons not even made parties to the litigation, and who were, additionally, not in being when such determination was made, is conduct clearly repugnant to the concept of due process. As to the interests of these plaintiffs, the condemnation judgments are adjudged to be void.

In contrast, when a party has been properly served, he is brought within the court’s jurisdiction and subsequent irregularities in the appointment of a guardian ad litem do not render the judgment void. Robertson v. Blair, 56 S.C. 96, 34 S.E. 11 (1899); Barfield v. Barnes, 108 S.C. 1, 93 S.E. 425 (1917); Greer v. Greenville County, 245 S.C. 442, 141 S.E.2d 91 (1965). In this case, the United States served by publication all known and unknown Bradley heirs, including minors and incompetents. This was sufficient to bring those heirs within the jurisdiction of the court and render any irregularity in the appointment of a guardian ad litem voidable error. Since Rule 60(b)(4) is exclusively for relief from void judgments, the known and unknown Bradley heirs are foreclosed from relief under this particular subsection of the rule because they were served.

B.

A court may set aside a judgment pursuant to Rule 60(b)(6) when compelled by unusual or exceptional circumstances. U.S. v. $3,216.59 in U.S. Currency, 41 F.R.D. 433 (D.S.C.1967); Marquette Corp. v. Priester, 234 F.Supp. 799 (D.S.C.1964). Relief may be awarded when the challenged judgment resulted from an excusable default of the party against whom it was directed when the circumstances go beyond the earlier clauses of the rule. See 11 C. Wright & A. Miller, Federal Practice and Procedure, § 2864 (1973). If the proper circumstances are presented, Rule 60(b)(6) should be given liberal construction “to the end that justice is accomplished”. Marquette Corp. at 803.

As this court has noted, when a party has been properly served, as have the remainder of these plaintiffs, irregularities in the appointment of a guardian ad litem do not render the judgment void. If a judgment was rendered without regard to a legal disability, however, then that judgment may be set aside for equitable reasons. Ex Parte Kibler, 53 S.C. 461, 31 S.E.2d 274 (1898); Ex Parte Roundtree, 51 S.C. 405, 29 S.E. 66 (1898). This is logical since “[s]uch a person is incapable of putting his competency in issue in the prior suit.” Anderson v. Anderson, 327 S.E.2d 355, 356 (South Carolina Court of Appeals 1985).

This case presents such an equitable ground for setting aside the challenged condemnation judgments. While the unknown Bradley heirs were served, they did not receive guardian ad litem representation. The court’s failure to appoint a guardian ad litem allowed the condemnation judgments to be rendered without regard to the status of the unknown Bradley heirs. Since the unknown Bradley heirs could not participate in those proceedings, they could not raise this issue as error on appeal. Cf Stewart Securities Corp. v. Guaranty Trust Co., 71 F.R.D. 32 (D.C.Okla.1978) court’s power to vacate a judgment in the interest of justice under Rule 60(b)(6) is not intended to relieve a party from the consequences of a free, calculated and deliberate choice: cf. also Loucke v. U.S., 21 F.R.D. 305 (D.C.N.Y.1957); Whiteleather v. U.S., 264 F.2d 861 (6th Cir.1959). These facts present the type of exceptional circumstances that justify relief from judgment pursuant to Rule 60(b)(6); therefore, this court sets aside the condemnation judgments as they affect the interests of the present Bradley heirs who were unknown when said judgments were entered.

The known minor and incompetent Bradley heirs similarly present this court with exceptional circumstances justifying relief pursuant to Rule 60(b)(6). These plaintiffs were served and guardians ad litem were appointed to represent their interests. These guardians, however, only submitted their wards’ rights and interests to the protection of the court. A guardian ad litem who merely files a formal answer submitting the wards’ rights to the protection of the court fails to perform his duty. Cagle v. Schaefer, 115 S.C. 35, 104 S.E. 321 (1930). Such inadequate reprsen-tation does not render the judgment void, but it is an error “for which a judgment may be set aside.” Simpson v. Doggett, 159 S.C. 294, 156 S.E. 771 (1930). By reason of their minority and incompetence, these Bradley heirs and their successors in interest could not raise this as an error on direct appeal. Under these circumstances, relief from the condemnation judgments pursuant to Rule 60(b)(6) is granted as to the interests of the minor and incompetent Bradley heirs who were parties to condemnation proceedings but were improperly represented.

VII.

For the aforesaid reasons, the court grants the plaintiffs’ motion for summary judgment on the issue of liability to the extent indicated herein. Such relief is interlocutory in character because genuine issues remain as to the type of accounting required, the amount of damages, to whom such damages will be paid, in whom title will eventually vest on October 21, 1988, and the exact manner in which relief shall be afforded those who shall become fee simple title holders.

This court being of the opinion that this order involves a controlling question of law as to which there is substantial ground for difference of opinion, and that an immediate appeal from this order may materially advance the ultimate termination of this litigation, permission is, therefore, granted by this court to any of the parties hereto, if they be so advised, to petition the Court of Appeals for the Fourth Circuit to allow an appeal from this order in accordance with 28 U.S.C. § 1292(b), and Rule 5 of the Federal Rules of Appellate Procedure. Therefore, it is

ORDERED, that further proceedings in this case be stayed, pending a determination by the parties, within the time required by law, as to whether they shall seek an interlocutory appeal of this order, and whether, if sought, such appeal is granted by the Fourth Circuit Court of Appeals.

AND IT IS SO ORDERED.

      . Initially, this court notes the absence of argument in the plaintiff s briefs that an irregularity occurred which would justify setting aside the judgments as to the interests of the adult Bradley heirs who consented at the time of the condemnations. In oral argument, however, the plaintiffs contended that the government did not obtain the proper consent of the Bradley heirs who were adults at the time of the condemnations. The plaintiffs reasoned that the adult Bradley heirs were foreclosed from giving valid consent because W.K. Bradley’s will provided for the disinheritance of any family member who disposed of the property in "any way.” The plaintiffs’ contention is meritless. Such a forfeiture provision would not render an heir incapable of consenting to a condemnation and, thus, disposing of the property; it would, at best, expose such a consenting heir to a subsequent penalty of disinheritance. This being the sole irregularity claimed concerning the consenting adult Bradley heirs, these plaintiffs have asserted no jurisdictional basis for relief. This court can not set aside the condemnation judg-merits as to their interests since no legal ground for such relief has been presented. See Western Union Tel. Co. v. Dismang, 106 F.2d 362 (10th Cir.1939). Furthermore, no party has ever raised in this proceeding the question of whether, even with consent, any adult or properly represented minor, incompetent, unknown heir, or unborn heir, could, through legal proceedings, transfer any contingent remainder which they possessed, since under certain circumstances, such contingent remainder interest may not be devised, transmitted, or assigned. Lemmon v. Wilson, 204 S.C. 50, 28 S.E.2d 792, 804 (1944). Because this issue affects only those in whom title finally vests on October 21, 1988, its resolution need not be determined at this time.

      . In this order, the court can pass with finality on liability as to an accounting. Insofar as the plaintiffs demand that title be returned to them, the court’s opinion does not have the same degree of finality since title does not vest until 1988. See Klugh, et al. v. United States, 588 F.2d 45, 51 (4th Cir.1978).

      . The United States disputes that the land specified in one of the option contracts was part of W.K. Bradley’s estate at the time of the condemnations. It is currently unnecessary to pass on this issue.

      . The answers of the guardians in the condemnation proceedings were almost identical, “submit[ting] their [wards] rights and interests in the matters in question to the protection of the court."

      .Whether title passes per stirpes or per capita remains for future determination.

      . This section of the code has undergone significant amendment. 16 U.S.C.A. § 516 (West Supp.1985). The parties have not contended that the revised statute is pertinent to the disposition of this case. The statute as it appeared at the time of the condemnation will govern this litigation.

      . Initially, the United States denied the plaintiffs’ allegation that the condemnations were subject to the state consent statute. See Amended Answer paragraph 3 (Jan. 20, 1983). The government has apparently abandoned that position. The court reaches this conclusion for two reasons. First, the United States chose not to contest the statute's applicability in its summary judgment brief. Second, the government seemingly endorsed the statute’s applicability when it labelled a quoted segment of S.C.Code Ann. § 3-1-410 as "[t]he relevant portion of the South Carolina consent statute.”

      . The government also contends that the doctrines of res judicata and collateral estoppel bar consideration of the plaintiffs’ consent claims. A void judgment, however, is subject to both direct and collateral attack. Lubben v. Selective Service System Local Bd. No. 27, 453 F.2d 645 (1st Cir.1972); Graciette v. Star Guidance, Inc., 66 F.R.D. 424 (D.N.Y.1975). This court is aware of the general rule that a voidable judgment is subject only to direct, not collateral attack. A.D. Juilliard & Co. v. Johnson, 166 F.Supp. 577 (D.N.Y.1958), aff’d, 259 F.2d 837 (2d Cir.1958), cert. denied, 359 U.S. 942, 99 S.Ct. 723, 3 L.Ed.2d 676 (1959). The rationale for this rule is to establish a requirement that the affected party raise such voidable error on direct appeal so that such error can be corrected. This rule, however, is based on the premise that a competent party exists to raise the error. In this action, some of the plaintiffs who were served by publication allege voidable error concerning nonexistent or inadequate guardians ad litem representation as the basis for setting aside the condemnation judgments. Collateral attack should be allowed here since the voidable errors themselves evidence the absence of the underlying premise of res judicata and collateral estop-pel; the plaintiffs, by reason of their disabilities, were incapable of raising the voidable errors on direct appeal. See Anderson v. Anderson, 327 S.E.2d 355, 356 (S.C.App.1985).

      . Any person living on October 21, 1988, when ' title vests, who was alive and not under a disability at the time of the condemnation proceedings, who was served and whose consent was obtained, may be barred from an interest in the properties due to the government’s compliance under those circumstances with the Weeks Act and S.C.Code Ann. § 3-1-410; But see Footnote # 1, Lemmon v. Wilson.

      . The defendants did not exercise their right to move for a more definite statement. Instead, they answered, "9. Deny.”

      . The government is not being treated as harshly as it may, at first blush, appear; liberal discovery is available for a party to uncover the - specific factual underpinnings of a claim that an adversary has pleaded. See Roberts, supra.

      . Unborn heirs should not be confused with unknown heirs. Unknown heirs are those who were in being at the time of the action. If unborn heirs are construed as a subset of unknown heirs, however, they would be entitled to relief under Rule 60(b)(6) with the other unknown heirs.

      .In the case at bar, relief is sought and granted under two different subsections of Rule 60(b). The well established concept of mutual exclusivity, see generally 11 C. Wright & A. Miller, Federal Practice and Procedure § 2864 (1973) (and cases cited therein) is not violated, however, because the court awards certain classes of plaintiffs individual relief from the challenged judgments and such relief, in each instance, is based upon a different subsection of Rule 60(b).

      . The United States contended in oral argument that the express language of Rule 60(b) forecloses relief to any heir who was unborn at the time of the condemnations because no unborn heir was "a party or his legal representative” to the original condemnation proceedings. This court recognizes that there is, as a general rule, merit to this argument, Screven v. U.S., 207 F.2d 740 (5th Cir.1953); however, under the circumstances of this case, the unborn heirs were sufficiently connected and identified with the original condemnation actions to attack those judgments. Dunlop v. Pan American Airways, Inc., 672 F.2d 1044 (2d Cir.1982). This case is especially suited for Rule 60(b) relief since, in addition to the then unborn Bradley heirs, the parties to the original condemnation judgments—(the United States, the then adult Bradley heirs, and the then minor, incompetent and unknown Bradley heirs)—are parties to this action. See Karnegis v. Schooler, 57 F.Supp. 178 (N.D.Tex.1944) (third parties not entitled to Rule 60 relief unless original parties who secured the decree are parties to new suit). In its supplemental brief filed after oral argument, the United States conceded that the unborn Bradley heirs were sufficiently connected and identified with the original condemnation proceedings to attack those judgments in this action.

      .The United States correctly contends that a party must act promptly to set aside an offending judgment in order to present proper circumstances justifying Rule 60(b)(6) relief; if a party’s delay in attacking a judgment becomes unreasonable under the circumstances of a particular case, the defense of laches would defeat a claim for Rule 60(b)(6) relief. Undue delay, however, is not a defense here because a fog of complex real property issues concealed from these laymen plaintiffs whether they possessed any interest about which they might complain. The conflicting judicial opinions concerning these preliminary issues, including in whom and when title vested under the will, highlight the complexity that handicapped the plaintiffs from demanding Rule 60(b)(6) relief any sooner than they did; this court and at least one judge on the appeals panel had an opinion at odds with the majority panel’s determination.

      . This ruling may result in a conflict of interest among the plaintiffs. For every unknown and/or improperly represented Bradley heir who is held entitled to an interest in the subject properties, the percentage of interest held by each unborn Bradley heir is reduced.

      . See Footnote 3, supra.

      . As between these parties, the money the United States paid into county treasuries when the condemnation judgments were rendered can only act as an offset to what an individual plaintiff may be awarded in an accounting if that same plaintiff received money from the county treasury funds.

      . Pursuant to Rule 60(b), judgments may be reopened, modified, corrected, set aside and vacated. Finucane v. Bindczyck, 184 F.2d 225 (D.C.Cir.1950), rev'd on other grounds, 342 U.S. 76, 72 S.Ct. 130, 96 L.Ed. 100 (1951). While some courts have restricted Rule 60(b) relief to the setting aside of an offending judgment, this court believes the better view allows affirmative relief to be granted in a proper case. See U.S. v. Jacobs, 298 F.2d 469 (4th Cir.1961); see also Aro Corp. v. Allied Witan Co., 531 F.2d 1368 (6th Cir.1976); Conerly v. Flower, 410 F.2d 941 (8th Cir.1969); Hartford-Empire Co. v. Shawkee Manufacturing Co., 163 F.2d 474 (3d Cir.1947). Under the circumstances herein, where twelve years have passed since suit was instituted, if this court now refused to grant affirmative relief, in addition to setting aside the offending judgments, the statute of limitations might consequently bar many of the plaintiffs from an accounting in any newly instituted suit. For this reason, as well as in the interest of judicial economy, this court reserves the right to grant such affirmative relief as the plaintiffs may be entitled to receive upon completion of further discovery herein.