Final Chapter In The Case Of The Missing Double Eagle Coins

     by:  Peter J. Gallagher (@pjsgallagher) (LinkedIn)

Double eagle (pd)
One of the more interesting cases I have written about is Langbord v. U.S. Dept. of Treasury, which I described in a June 2015 post as follows:

It's not every day that you find a case that starts with Depression-era monetary policy, ends with a relatively obscure federal statute, and in between tells the tale of the alleged theft of a coin considered to be "the most valuable ounce of gold in the world." Did I mention that the case also involves both Presidents Roosevelt, King Farouk of Egypt and the Sept. 11, 2001, terrorist attacks? A case recently decided by the U.S. Court of Appeals for the Third Circuit, Langbord v. U.S. Dept. of Treasury, has all of this and more.

Langbord involved the 1933 Double Eagle gold coin. It is a $20 gold piece that was designed by famed artist Augustus Saint-Gaudens after he was commissioned by President Theodore Roosevelt to help beautify American coinage. Almost a half million Double Eagles were minted, but none were ever officially released into circulation. Shortly after they were minted, newly-elected President Franklin D. Roosevelt, seeking to stem a run on the banks, issued Executive Order 6102, which made it illegal to "hoard" large amounts of gold. Accordingly, the U.S. Mint was ordered to stop issuing gold coins and to melt down any gold coins in its possession, including the Double Eagle. As part of this process, two Double Eagles were sent to the Smithsonian Institution for posterity, but the rest were supposed to have been melted down.

As you might have guessed, not all of the remaining coins were melted down. According to the government, approximately 20 of them ended up in the hands of a coin dealer who worked with a corrupt cashier at the US Mint to smuggle them out before they could be melted down. Over the years, it was alleged, he sold several of these coins. But, after his death, his family found 10 of them in his safety deposit box and offered to return them to the government. They requested the same terms as the government had agreed to several years earlier with a different individual who came into possession of another one of the coins. The government originally seized that coin after luring the dealer into a sting conducted at the Waldorf Astoria in New York City, but later, after the dealer sued, agreed to sell the coin at auction and split the proceeds with him. At auction, it sold for almost $7.6 million, more than twice the world record for any coin sold at auction at the time. Plaintiffs in Langbord were looking for the same arrangement for their coins. The government agreed in principle but asked to authenticate the coins first. Plaintiffs agreed and sent the coins to the government for authentication. However, after authenticating them, the government refused to return them, arguing that they were stolen and were rightfully the property of the U.S. government. 

Continue reading “Final Chapter In The Case Of The Missing Double Eagle Coins”

In New Jersey, You Can Now Disapprove A Real Estate Contract By Email Or Fax (But Not Telegram)

     by:  Peter J. Gallagher (@pjsgallagher) (LinkedIn)

Telepgraph (pd)Anyone who has bought or sold real estate in New Jersey is familiar with "attorney review." When you buy or sell a house, you sign a contract that is almost always prepared by a broker. The contract must contain a standard provision stating that the buyer and seller have the right to have an attorney review the contract. This "attorney review" period lasts three days. The contract becomes legally binding if, at the end of that three-day period, neither the buyer's nor the seller's attorney disapproves of the contract. If either side disapproves, their attorney must notify the other side's broker by certified mail, telegram, or personal service. In Conley v. Guerrero, a case that seems to be a case study in the concept of raising form over substance, the New Jersey Supreme Court updated this requirement to allow the notice of disapproval to also be sent by fax or email. (Those of you still using telegrams may be out of luck, however, because this no longer appears to be an appropriate method of service for the notice of disapproval.) 

In Conley, plaintiffs signed a form contract to purchase a condominium unit from sellers. It contained the standard "attorney review" provision. After signing the contract, but during the attorney review period, sellers received competing offers to purchase the property and eventually entered into a new contract to sell it to a new buyer for a higher price. Sellers' attorney sent a disapproval of plaintiffs' contract to both plaintiffs' counsel and the broker (who was a duel agent represented both plaintiffs and seller) during the attorney-review period. He sent the notice via email, which plaintiffs' counsel and the agent acknowledged receiving within the attorney review period. Nonetheless, plaintiffs claimed that the sellers were bound by the contract and had to sell to his clients because the disapproval was not sent in the proscribed manner — by certified mail, telegram, or hand delivery.

Plaintiffs sued, seeking specific performance. Both sides moved for summary judgment. The Chancery Division granted defendants' motion and dismissed the complaint. The Chancery Division held that, while seller did not comply with the method-of-delivery requirements set forth in the contract, this breach was only "minor" because plaintiffs' counsel acknowledged receiving the notice within the attorney review period. Therefore, the Chancery Division held that the "underlying justification for the attorney review clause" — to protect parties against being bound by broker-prepared contracts without the opportunity to review them with their attorneys — was accomplished.

Continue reading “In New Jersey, You Can Now Disapprove A Real Estate Contract By Email Or Fax (But Not Telegram)”

“Here’s the mail it never fails . . . :” Judge Posner Criticizes “Rhetorical Envelopes” In Which Judicial Opinions Are “Delivered To The Reader”

by:  Peter J. Gallagher (@pjsgallagher) (LinkedIn)

Judge (pd)[Apologies for the Blue's Clues reference in the title to this post.]

In his concurring opinion in a recent Seventh Circuit decision — United States v. Dessart — Judge Posner agreed with the majority's conclusions, but wrote separately to express his "reservations about some of the verbal formulas in the majority opinion." He did not "criticize the majority for reciting them" because, as he noted, they are "common, orthodox, even canonical." But he did criticize the "verbal formulas" themselves as being "inessential and in some respects erroneous" and thus, he urged, "ripe for rexamination."

What were the "verbal formulas" that Judge Posner was so keen to criticize? Just some of the legal standards that we see recited in opinions every day. For example, the commonly-used "abuse of discretion" standard, of which Judge Posner appears not to be a big fan. In his concurring opinion, Judge Posner noted that the majority defined this standard as including "among other missteps, 'material errors of law.'" This apparently did not jibe with Judge Posner's understanding of discretion and its abuse, as he explained:

Of course, material errors of law are potentially very serious, but what has that to do with discretion or its abuse? Common as the term "abuse of discretion" is in opinions dealing with appeals from district court decisions, I find it opaque. If the appellate court is persuaded that the trial court erred in a way that makes the trial court's decision unacceptable, it reverses. What has discretion to do with it? And "abuse" seems altogether too strong a term to describe what may be no more than a disagreement between equally competent judges – the trial judge and the appellate judges – that the appellate judges happen to be empowered to resolve as they see fit.

Similarly, he challenged the majority's similarly well-settled statement that an appellate court, when reviewing a trial court's decision to issue a search warrant, must afford that decision "great deference." (Among the issues in the Dessart case was whether a search warrant was supported by probable cause.) Judge Posner acknowledged that the standard comes from a Supreme Court decisions holding that "[a] magistrate's determination of probable cause should be paid great deference by reviewing courts," but questioned it nonetheless. First, he questioned why "great" deference should be afforded to such decisions since "warrants [are] usually issued by the most junior judicial officers – and often police or prosecutors can shop among magistrates for one who is certain or almost certain to respond affirmatively to a request to issue a warrant." Second, Judge Posner noted that "[n]othing in the [Fourth] amendment requires warrants – ever," therefore it was not fair, in Judge Posner's opinion, to conclude, as is often concluded, that the Constitution expresses a preference for searches conducted pursuant to warrants or to afford great deference to a trial court's decision to issue one.

Continue reading ““Here’s the mail it never fails . . . :” Judge Posner Criticizes “Rhetorical Envelopes” In Which Judicial Opinions Are “Delivered To The Reader””

When Was The Last Time You Sent A Letter Via Telegram?

Telegram (PD)
I have never sent a telegram and would not know how to send one even if I wanted to. But, if you are so inclined, there is a somewhat quirky provision of New Jersey real estate law that would allow you to dust off your telegram machine and send one. This provision was the subject of a recent Appellate Division decision, Conley v. Guerrero, that attracted significant attention from the real estate community and may end up before the New Jersey Supreme Court. 

Anyone who has bought or sold real estate in New Jersey is familiar with "attorney review." When you buy or sell a house, you sign a contract that is almost always prepared by a broker. The contract must contain a standard provision stating that the buyer and seller have the right to have an attorney review the contract. This "attorney review" period lasts three days. The contract becomes legally binding if, at the end of that three-day period, neither the buyer's nor the seller's attorney disapproves of the contract. If either side disapproves, their attorney must notify the other side's broker by "certified mail, telegram or by delivering it personally." The attorney must also notify the other attorney (or the party itself if they are not represented), but the law does not specify the manner in which this notice must be delivered. (Stay tuned for more on this later!)

In Conley, plaintiffs signed a form contract to purchase a condominium unit from sellers. It contained the standard "attorney review" provision. After signing the contract, but during the attorney review period, sellers received competing offers to purchase the property and eventually entered into a new contract to sell it to a new buyer for a higher price. Sellers' attorney therefore sent a disapproval of plaintiffs' contract to both plaintiffs' counsel and the broker (who was a duel agent represented both plaintiffs and seller). He sent the notice of disapproval via email, which plaintiffs' counsel and the agent acknowledged receiving within the attorney review period. Nonetheless, plaintiffs argued that the notice was ineffective because it was not sent in the proscribed manner — by certified mail, telegram, or hand delivery.

Continue reading “When Was The Last Time You Sent A Letter Via Telegram?”

Update: Third Circuit Grants Government’s Request For En Banc Review In Double Eagle Dispute

Double eagle(2)

I have written before about Roy Langbord v. U.S. Dept. of Treasury, a lawsuit over ten old, rare, and valuable "Double Eagle" coins.  Very long story, short — plaintiffs gave the coins to the government for authentication, the Government claimed they were stolen and refused to return them, plaintiffs sued to get them back. A divided panel ruled in favor of plaintiffs and ordered the coins returned. The Government sought en banc review of this decision and, on July 28, 2015, this request was granted. As a result, the panel's decision has been vacated and this already fascinating case continues to roll on. Stay tuned.

Update: Government Seeks En Banc Review in “Double Eagle” Coin Case

by:  Peter J. Gallagher (@pjsgallagher)

A few weeks ago, I shared an article I published in the New Jersey Law Journal about a dispute over some rare coins that were allegedly stolen from the U.S. Mint more than 80 years ago: The Case Of The Missing Double Eagle Coins. The saga now continues.

As you may recall, the case of Langbord v. United States involved ten Double Eagle coins that were minted in 1933 but never put into circulation. It was believed that all of the Double Eagles had been melted down except for two that were sent to the Smithsonian. Over the years, however, several of these coins began to appear on the market. The government alleged that all of these Double Eagles were illegally removed from the U.S. Mint in Philadelphia by a cashier, George McCann, in concert with a coin dealer, Israel Switt.

The Government was able to recover most of the purloined Double Eagles in the 1940's and 1950's without much fanfare. Several others slipped through the cracks, however, including one that was illegally removed from the Mint, but legally shipped to King Farouk in Egypt (the Government mistakenly granted an export license). When this  coin resurfaced in the mid-1990's, the Government seized it from a dealer trying to sell it. Given the confusion about its ownership created by the issuance of the export license, however, the Government agreed to auction it and split the proceeds with the owner. In 2011, it sold for a record $7.5 million at auction.

Shortly after the auction, Mr. Switt's daughter and grandsons, the Langbords, contacted the Government about 10 additional Double Eagles that they claimed to have found in Mr. Switt's safe-deposit box. They sent them to the Government for authentication and suggested that they be auctioned as well, with the Government splitting the proceeds with the Langbords like it had done with King Farouk's Double Eagle. The Government authenticated the Double Eagles, but refused to return them , claiming they were stolen property.

The Langbords sued to get the coins back. A jury ruled in the Government's favor, but a divided panel of the U.S. Court of Appeals for the Third Circuit reversed and ordered that the Double Eagles be returned to the Langbords. The Third Circuit held that the government failed to follow the Civil Asset Forfeiture Reform Act ("CAFRA") and therefore could not keep the coins.

On July 1, 2015, the Government sought en banc review of this decision. The petition is, as expected, a sober, straight-forward recitation of the ways the Government believes the panel got CAFRA wrong, but it does contain at least one barb: "The family of a thief now stands to benefit in the millions of dollars on the basis of property that belongs to the people of the United States . . . . " 

Stay tuned to see if the Government's petition is granted and, if it is, what happens before the full U.S. Court of Appeals for the Third Circuit.

Planning Board Can’t Deny Variance Based on Anticipated Inability of Applicant to Satisfy Site Plan Criteria

by:  Katharine A. Muscalino

The Bay Head Planning Board initially approved a bulk variance application submitted by a property owner who had inherited an irregular lot with just ten feet of frontage, where fifty feet was required.  Finding that denying a bulk variance for the frontage requirement would result in an undue hardship, and that the Applicant had adequately addressed concerns about emergency access to the Property resulting from the lot frontage variance, the Board approved the application with a 5-4 vote.  Per the approval, the Applicant was required to submit a drainage plan for the Borough Engineer’s approval at the time of site plan application.

Upon an objector’s prerogative writ suit, the parties discovered that a board member had voted on the bulk variance without attending all of the meetings or reviewing all of the transcripts.  The bulk variance application was remanded for a new vote, following a review of the transcripts by all of the board members.  The Board then voted to deny the bulk variance, with a 4-5 vote.  In its resolution, the Board explained that it denied application because the applicant had failed to provide “affirmative testimony… by any competent engineer… on how the applicant would address the well known drainage issues which plagued the proposed lot and more assuredly concerned the adjoining property owners.”

 

Continue reading “Planning Board Can’t Deny Variance Based on Anticipated Inability of Applicant to Satisfy Site Plan Criteria”