Proposed Findings of Fact Explained
Proposed findings of fact are a set of statements submitted by a party, setting forth in paragraph form factual determinations that discovery and trial evidence demonstrate. Proposed findings of fact are an integral part of every bankruptcy plan confirmation and objection, as they promote the focused consideration of disputes proceeding to trial . By drafting and submitting proposed findings of fact, counsel can focus the issues to be considered at trial to those that are critical to the party’s position. In contested cases that may not be resolved through alternative dispute resolution, clear and concise proposed findings of fact limit the issues at trial and the presentation of evidence, focus the case in preparation for decision making, and assist the court in rendering a reasoned decision promptly after trial.
Conclusions of Law: A Court’s Approach
Conclusions of law are usually written after the case has been tried, and the evidence entirely submitted. These conclusions of law embody the legal principles which the trier of fact must apply to the evidence in arriving at a verdict. The corresponding term for conclusions of law are findings of fact. Findings of fact are objective conclusions about facts from the evidence. These are distinguished from the conclusions of law, which are what the trier of fact applies the findings of fact made. Overall, this demonstrates that conclusions of law apply the objective facts to the subjective law in order to arrive at a legal conclusion that is a finding of law. When making a finding, the hearing officer should briefly address all of the evidence in order to show that there was an appropriate factual basis for his/her conclusion. This is also done through the opinions of witnesses while testifying. The hearing officer generally does not comment on the application of the law to the facts except to show how one fact may logically lead to a conclusion from the law. Conclusions of law are made once the hearing officer has reviewed and evaluated the evidence as a whole before any ultimate conclusions of law are made. Although you may not realize it, you have probably seen conclusions of law before; in verdict forms. It is the instructions given to the jury that the jury must follow based off of the law to make the verdict in the case.
Significance in Litigation Strategy
The significance of proposed findings and recommendations is often lost on less experienced lawyers. The strategic importance of master proposed findings of fact and conclusions of law should not be underestimated. Counsel typically submit proposed findings and conclusions in response to orders from the judge or magistrate to do so. Depending on the court, those orders may come after a summary judgment motion or other dispositive motion has been filed, or after bench trial has ended. Even if formal proposed findings and conclusions are neither requested nor required, this is a task to which I always assign considerable care and attention. I do so because a proposed findings and conclusions can serve as a tool to help guide the court to the outcome you wish to see.
For example, in an appeal of a bench trial, an appellate court might look to the proposed findings and conclusions to confirm what was found to have occurred at a given point in the trial record. One of my clients – a closely held business – faced an attack on its operations brought by a hostile former member. My client defended on statutory and contractual grounds, prevailing at trial. We were pleased with that result and moved on to other matters. The former member appealed, and the appeal involved several nuanced facts regarding various issues and defenses. The appeal challenged the facts presented at trial and the application of those facts to the law. Not surprisingly, we defended that appeal on both points.
On appeal, the appellate court found persuasive what the trial court and we had to say not only in the written trial brief, but also in our proposed findings and conclusions. As a result, the appellate court steadfastly refused to tamper with the trial court’s fact findings, and we prevailed again. This result came from more than just luck.
We typically prepare our proposed findings and conclusions after the trial. We discuss each proposed finding and conclusion and analyze the strengths and weaknesses of each. We apply our findings to the law, and reason through problems and anticipated objections and arguments from the other side. This is much more than a routine review of the record and law – our proposed findings and conclusions become a strategy document of sorts. It also presents an opportunity to educate the judge about the law, and how we applied it to the facts. And, it serves as a good template if, for any reason, it is necessary for the trial court to later explain its ruling, or to defend it on appeal.
Creating Winning Proposals
When crafting proposed findings of fact and conclusions of law, best practices include the following rules for drafting:
- Be clear. Not all disputed facts are material to an arbitrator’s final decision. The better disputant is one who quickly focuses on the issues that matter for a decision. And while one can infer a material fact from another fact, or from a statement, your inference may differ from the inference drawn by the arbitrator. Be direct. State your position clearly.
- Choose your words wisely. Better tools lead to better results. Verbs are stronger in an active voice where the subject of the verb is doing the action than in the passive where something is being done to the subject. Use "He made the decision to not fulfill his promise" rather than "The decision to not fulfill his promise was made," or "The letter was sent to him by the company" instead of, "The company sent him a letter." In so many words — Do not be passive. Be active.
- Be precise. Be specific. Short cuts in drafting avoid some words, but they may also lead to vagueness or ambiguity. "The client told the accountant to either get it right or else." That’s an example of where a litigant may be better off saying more to be sure the arbitrator understands the situation. Otherwise, missing context can lead to incorrect conclusions. In addition, while adjectives add color, remember that too much color can mean too much paint.
- Be persuasive without being obnoxious. A full set of succinct, factual findings of fact and conclusions of law is a better showcase for skill, focus, and respect than a flowery, well-discussed, or pleading document. Case in point is U.S. Silica Co. v. Adams, 2008 WL 2705088 (E.D. Ky. 2008) which contains the court’s rejection of a magistrate judge’s recommendation for damages because the magistrate’s findings of fact were "at times incomprehensible," and "as a whole . . . particularly difficult to follow." The court could not comprehend why an arbitrator would have found an award of $80,000 and 20% interest per year seemed "an unchallenged award of damages for emotional distress." Nor could the court find any legal basis for what could become 8 million dollars in damages.
The U.S. Silica court concluded:
[T]his Court cannot accept the magistrate’s findings of fact conclusions of law and recommendations
It is impossible in this case to consider any findings of fact as highly publicized and complex as this without considering the facts in their totality and with adequate explanation from the magistrate judge as to how he reached the final result. Instead, [the magistrate] abandoned his duty as the finder of fact and inappropriately substituted his own judgment for that of the jury on several key points. He had a responsibility to provide the parties with a record on which to draw conclusions to assist this Court in any subsequent review of his fact-finding and recommendations. That record is entirely absent.
5. Be mindful of procedure. Failing to conform to the procedural rules for proposed findings of fact and conclusions of law may mean a failure to uphold the burden to show any grounds for reversal, such as in CPLG v. BGS V, LLC, No. 13-CV-12839.
What Courts Consider and Why
Judges utilize proposed findings and conclusions to not only guide their decision-making, but also to assist in evaluating the sufficiency of the evidence. When deliberating a cause, a trial court judge will always critique the credibility of every witness, while simultaneously attempting to determine the ultimate truth. Fortunately, the legislature has provided a much broader sense of decision making authority to trial court judges than the strict binary "a says b" decisions that verdict forms and jury trials require. In Texas, a trial court judge decides the weight and credibility of the evidence, and ultimately exercises discretion in sustaining or overruling objections, excluding or admitting evidence, and deciding jury issues.
Trial courts are entrusted to find the facts based upon the preponderance of the evidence. The judge must also conclude that those facts necessitate the award or denial sought by the trial lawyers. Because trial judges are required to make controversial decisions on a jury’s right to the ultimate truth and weigh the credibility of witnesses and evidence, many judges have created their own guidelines—sometimes based upon their own experience—and frequently adopt the suggestions proffered by the trial lawyers. Judges do not have the unlimited discretion they are given within family law matters, where the standard of proof is a mere preponderance of the evidence necessary to justify the relief sought. Instead, the standard on appeal is legal sufficiency when findings of fact form the basis of the judgment, and factual sufficiency as to the weight of the evidence.
It is important to note the difference between sufficiency of the evidence and the weight of the evidence. Legal sufficiency requires that there is some evidence supporting findings of fact. This is the most mundane standard of review, and it is difficult to have a ruling overturned for lack of legal evidence. It is much more common to have a reversal for lack of factual sufficiency, which is where the evidence failed to support the trial court’s findings of fact .
When suggesting findings, trial lawyers must keep in mind what is sufficient if standing alone, and what might be insufficient alone, but sufficient when combined with the other findings suggested. For example, if two jurors had been in the midst of a disagreement while eye-witnessing a hotly contested fact, one juror’s account alone may not be sufficient for the jury to believe the witness; however, combined with the other juror’s testimony, the lone juror’s account may be sufficient. A good trial lawyer will already have considered this analysis before drafting what he or she will recommend to the trial court. Suggesting findings that pass the sufficiency test gives the judge an opportunity to properly prepare the appellate basis for appeal, should the need arise.
Consider, for example, Husband and Wife’s dispute relative to the title of a large tract of land. Husband claims that the property passed to him as a gift in a Commercial Transactions. Wife asserts that she was intended to be the grantee. Wife will likely have to prove exactly what happened during the execution of the Commercial Transactions and who was actually named as the owner of the property. Almost every fact she impleads at trial will have the potential to fall within the realm of sufficiency or insufficiency, if standing alone, but able to sustain another finding of sufficiency when combined with the others. Understanding which bits and pieces should stand alone or should be combined is critical to properly define the issues on appeal.
Without question, both parties will have a significant number of findings indicating that Wife was not the grantee or owner of the property. However, if Husband is willing to concede at trial or at least fail to object to most of Wife’s findings, he will be able to show on appeal that finding no. 1 (that wife was not the grantee or owner) is not legally sufficient to sustain the judgment and/or is not factually sufficient to show that the weight of evidence requires a judgment in his favor.
Common Hurdles and Workarounds
One thing is for sure, proposed findings of fact and conclusions of law ("PFOFCL") can be very challenging to draft. I have reviewed many PFOFCL which I believe are completely inadequate. They list the documents in the record, yet there are no specific references to the record. Here is a partial list of common problems I have noticed with PFOFCL and my recommendations for overcoming those challenges.
- Problem: Legal Argument Included in the Findings of Fact. Too many PFOFCL include legal argument in the findings of fact. The PFOFCL should contain materially uncontradicted facts which you believe will lead to a conclusion of law in your favor. If the judge evidences resistance to making factual findings or conclusions of law in your favor, it is likely you are requesting a ruling he or she refuses to make. Solution: Remove the legal argument from the findings of fact and limit the PFOFCL to factual statements which support your conclusions of law.
- Problem: Inclusion of Additional Evidence. Practitioners frequently forget that certain documents are automatically considered part of the record without any need for you to make them part of the record by requesting inclusion through a PFOFCL. Solution: Don’t include as separate exhibits in your PFOFCL documents your judge did not require you to provide as additional exhibits for inclusion in the record.
- Problem: Length of the Summary and Findings of Fact. Many practitioners write PFOFCL which are far too long. They waste time, cause confusion and frustrate the judge. The PFOFCL should be concise and limited to the critical points you want the judge to consider. Solution: write one or two pages of PFOFCL, maybe three or four if they are short sentences. If you cannot adequately communicate in that length, break each section down into parts and where possible stick to simple, straightforward, uncomplicated sentences.
- Problem: Excessive Citation of the Record. It is not nearly as helpful as you believe when the PFOFCL seems to be more of a narrative rehash of the entire record. There comes a point where adding one more citation merely adds clutter and gives no additional value or clarity to the judge. Those citations further clutter the record and make it hard to read. Solution: Limit the citations to those citations which clearly lead to the finding you are requesting.
Case Law and Practical Examples
The use of proposed findings of fact and conclusions of law is not limited to the Colorado Public Utilities Commission (CPUC). Here are a couple of examples from other state regulatory agencies.
A state district court in Los Angeles, California, rejected proposed findings of fact and conclusions of law in a case decided by the California Public Utilities Commission (CPUC) over the validity of decisions by an administrative law judge. Sierra Club v. California Public Utilities Commission, 2015 Cal. App. Unpub. Lexis 4338 (Cal. Ct. App. Aug. 25, 2015). The court found that they did not meet the "substantial evidence" requirement for judicial review. Most importantly, the court noted in general that the public utility code requires that "findings be based on ‘facts that the commission finds to be true.’" (Emphasis in original.) The CPUC’s "failure to include" such facts and their support "rendered the Proposed Findings of Fact and Conclusions of Law, and the underlying decisions, invalid and unenforceable." Id.
The CPUC’s new rules on proposed findings were non-existent right before the CPUC issued its restructured time rules. Since then, the CPUC has issued some revised guidance and a decision on proposed findings of fact and conclusions of law to be included in a decision. On April 11, 2013, a California Administrative Law Judge issued Decision 13-04-004 that amended the CPUC’s Rules of Practice and Procedure regarding requested changes to proposed decisions. The CPUC modified the subject rule , Rule 13.13 on Proposed Findings of Fact and Conclusions of Law, several times. The last change was made in 2016. 2016 Cal. PUC Lexis 660. Under Rule 13.13, proposed findings must include an analysis of each party’s claim, and a statement of the relevant facts, including, but not limited to, references to the record for the proposed findings, and citations to applicable statutory or regulatory provisions.
The New York Public Service Commission has found proposed findings of fact and conclusions of law useful. In a decision in a case regarding a Verizon’s services and competitive markets, the public service commission relied on findings filed by Verizon. In re Verizon New York Inc., Case No. 06-C-1148, et al., 2007 N.Y. PUC LEXIS 475 (Nov. 15, 2007). Not having a hearing is permissible when the "Commission is faced with an investigation that does not involve factual disputes, but rather the issue of whether a company’s actions comport with the plain meaning of the statute, recognizing its primary function is to interpret the law."
The Mississippi Public Service Commission allows filing proposed findings of fact and conclusions of law. Miss. Code Ann. § 77-2-21 (1999) and In re the Investigation of the Rate Structure of Bellsouth Telecommunications, Inc. d/b/a AT&T Mississippi for Increased General Business and Residential Rates, Order Adopting Proposed Recommended Order, Docket No. 2006-AD-516 (Feb 16, 2009) (acceptance of the Proposed Recommended Order filed by the Utility Act Staff).