BANKRUPTCY BULLETIN
Editors-in-Chief
Karl Johnson, Taft Stettinius & Hollister LLP
Alexander J. Beeby, Larkin, Hoffman, Daly, & Lindgren Ltd.
Contributing Editor: Karl Johnson, Taft Stettinius & Hollister LLP
In Roman Catholic Archdiocese of San Juan, Puerto Rico v. Yali Acevedo Feliciano, 589 U.S. __ (Feb. 24, 2020), the Supreme Court held, among other things, that an order remanding an action from federal court to the Puerto Rico Court of First Instance nunc pro tunc (“now for then,” or effective as of a prior date) did not restore jurisdiction to the non-federal tribunal prior to the date of the order because the order did not “reflect[ ] the reality” of what had already occurred.
In 2016, employees of certain Puerto Rican Catholic schools filed complaints alleging the Catholic schools’ pension trust failed to fulfill its obligations to them. The plaintiffs named various Catholic organizations as defendants, including the Archdiocese of San Juan. Although the Puerto Rico Court of First Instance and Court of Appeals denied injunctive relief for the payment of benefits, the Puerto Rico Supreme Court held that the participating employers could be ordered to pay the pension obligations even if the trust lacked funds. Then, litigation continued regarding which defendants had legal personalities that could be liable.
The Pension Plan filed a bankruptcy petition and removed the case to federal court, but the bankruptcy case was quickly dismissed. Even though the pension litigation had not been remanded yet, the Court of First Instance issued three payment and seizure orders during the weeks immediately following the dismissal. Nearly five months after the bankruptcy case was dismissed, the federal District Court remanded the pension litigation back to the Court of First Instance and entered the order nunc pro tunc to the date of dismissal.
The Supreme Court of the United States unanimously held that the Court of First Instance lacked jurisdiction to issue the payment and seizure orders because the case had been removed and was therefore coram non judice, “not before a judge.” The Court rejected the argument that the nunc pro tunc relief retroactively provided jurisdiction for the payment and seizure orders because “nunc pro tunc orders are not some Orwellian vehicle for revisionist history—creating ‘facts’ that never occurred in fact.” Instead, nunc pro tunc relief “presupposes a decree allowed, or ordered, but not entered, through inadvertence of the court.”