Katie Nesbit v. Antonio Arellano, Emilio Trevino.

• Court: Court of Appeals of Minnesota
• Decided: March 30, 2015
• Docket: A14-1330
• Status: Unpublished

Opinion

This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2014).

STATE OF MINNESOTA IN COURT OF APPEALS A14-1330

Katie Nesbit, Respondent,

vs.

Antonio Arellano, Appellant,

Emilio Trevino, Defendant.

Filed March 30, 2015 Affirmed Bjorkman, Judge

Dakota County District Court File No. 19HA-CV-12-4341

Katherine A. Brown Holmen, Dudley and Smith, P.A., St. Paul, Minnesota (for respondent)

Louise A. Behrendt, Stich, Angell, Kreidler, Dodge & Unke, P.A., Minneapolis, Minnesota; and

Troy A. Bachmann, Beth K. Bussian, Eden Prairie, Minnesota (for appellant)

Considered and decided by Bjorkman, Presiding Judge; Hudson, Judge; and

Reyes, Judge. UNPUBLISHED OPINION

BJORKMAN, Judge

Appellant challenges the default judgment entered as a sanction for his repeated

discovery violations, arguing that (1) the district court erred by entering a default

judgment on all issues because his conduct did not impair respondent’s ability to prove

damages and (2) the record does not support the $100,000 damages award. We affirm.

FACTS

On January 7, 2010, respondent Katie Nesbit was injured in a hit-and-run car

accident. In 2012, she sued appellant Antonio Arellano, alleging that he negligently

drove the other vehicle and caused her injuries. Arellano answered the complaint,

admitting that he was driving in the lane next to Nesbit, but denying that he was negligent

and caused her injuries. A jury trial was scheduled for mid-2013.

Nesbit served Arellano with notice of taking his deposition on February 27, 2013.

Arellano did not appear and offered no explanation for his absence. About a month later,

Arellano’s lawyer informed Nesbit that Arellano sold the vehicle to Emilio Trevino

before the accident and had no first-hand knowledge of the accident. Nesbit filed an

amended complaint alleging that either Arellano or Trevino was driving the vehicle

involved in the accident.

Nesbit renoticed Arellano’s deposition for May 21. Arellano failed to appear,

without explanation. Counsel for the parties agreed to reschedule the trial to February

2014. Nesbit noticed Arellano’s deposition for August 1; Arellano again failed to appear

without explanation.

2 Nesbit moved the district court to compel Arellano’s appearance at a deposition

and to impose sanctions. By order dated September 9, the district court directed Arellano

to appear for and provide testimony at a deposition, and ordered him to pay Nesbit’s

reasonable attorney fees incurred in bringing the motion. The district court stated that, if

Arellano did not attend the deposition, Nesbit could renew her request for sanctions, up to

and including striking his pleadings and entering judgment by default.

Nesbit scheduled the deposition for September 24. Arellano did not appear and, as

before, gave no explanation. Nesbit once again moved to compel Arellano’s appearance

and requested various sanctions. The district court conducted a hearing on January 22,

2014. Arellano appeared at the hearing with his lawyer, who assured the court that

Arellano would appear for a deposition if given yet another opportunity. The district

court once again declined to impose sanctions but postponed the trial for two months, and

warned Arellano that he would be found in default if he failed to appear at the next

scheduled deposition.

Nesbit rescheduled the deposition for February 17. Arellano did not appear.

Nesbit filed an affidavit of default. Arellano’s lawyer responded by letter, arguing that

“the appropriate sanction, under these circumstances, is a default judgment with respect

to liability only.” On February 27, the district court entered a default judgment against

Arellano in the amount of $100,000.1

1 The February 27 judgment was a partial judgment because Nesbit’s claim against Trevino remained unresolved. She subsequently dismissed her claim against Trevino.

3 Arellano moved the district court to reopen or vacate the judgment “as to damages

only,” arguing that Nesbit did not prove her damages and that her receipt of collateral-

source payments should be addressed. The district court temporarily vacated the default

judgment “with respect to the amount of the damages award,” ordering Nesbit to submit

supporting documentation and to “candidly address any collateral offsets she has received

that have reduced her losses.”

Nesbit submitted four affidavits. In the first, Nesbit’s lawyer avers that she has

practiced personal-injury law for more than 20 years and believes, based on that

experience, that “a net judgment in the amount of $100,000 is a fair and reasonable

amount in this case given the facts and Ms. Nesbit’s injuries and damages.” In the

second affidavit, Nesbit details her past and ongoing medical care and past wage loss,

acknowledging receipt of payments totaling $20,941.38 from her no-fault insurer. She

also describes the pain she has experienced following the accident and how her injuries

interfere with her life and work. The third affidavit has eight attachments documenting

the medical expenses Nesbit incurred. In the fourth affidavit, Nesbit’s chiropractor

describes the care he provided to Nesbit from shortly after the accident through late April

2014. He notes that Nesbit’s condition is “fairly stable,” but that she “is always however,

experiencing some kind of pain,” and he opines that the degenerative joint changes

caused by her injury are permanent and “will most surely progress with time.” He also

includes five attachments documenting Nesbit’s medical care and expenses.

Based on Nesbit’s submissions, the district court found that she suffered a

substantial permanent injury as a result of the motor-vehicle accident, that her condition

4 continues to require monthly chiropractic care and may worsen, and that an award of

$100,000 is warranted. The district court reinstated the default judgment against

Arellano. Arellano appeals.

DECISION

I. The district court did not abuse its discretion by entering default judgment against Arellano based on his egregious discovery violations.

A district court may impose sanctions if a party fails to obey a discovery order.

Minn. R. Civ. P. 37.02(b). Authorized sanctions range from awarding attorney fees and

costs caused by the discovery violation up to dismissing all or part of an action “or

rendering a judgment by default against the disobedient party.” Id. We review a district

court’s imposition of sanctions for abuse of discretion. State by Humphrey v. Ri-Mel,

Inc., 417 N.W.2d 102, 108 (Minn. App. 1987), review denied (Minn. Feb. 17, 1988).

Because “the primary objective of the law [is] to dispose of cases on the merits,”

the extreme sanctions of dismissal and entry of a default judgment are only appropriate

under “exceptional circumstances.” Firoved v. Gen. Motors Corp., 277 Minn. 278, 283,

152 N.W.2d 364, 368 (1967). Chief among such circumstances are those in which a

party’s discovery violations impair the other party’s ability to defend against or prove a

claim. See Frontier Ins. Co. v. Frontline Processing Corp., 788 N.W.2d 917, 924-26

(Minn. App. 2010), review denied (Minn. Dec. 14, 2010); see also Chicago Greatwestern

Office Condo. Ass’n v. Brooks, 427 N.W.2d 728, 730-31 (Minn. App. 1988) (stating that

prejudice to the moving party is “a prime consideration”). Moreover, district courts must

have broad discretion to manage cases and enforce calendar rules to prevent “unnecessary

5 and inexcusable” delays. Firoved, 277 Minn. at 284, 152 N.W.2d at 369. A party that

“willfully and without justification or excuse” fails to comply with discovery orders

effectively “forfeits the right to a trial on the merits.” Ri-Mel, 417 N.W.2d at 108-09

(citing Breza v. Schmitz, 311 Minn. 236, 237, 248 N.W.2d 921, 922 (1976)).

The extent of the sanction to be imposed depends on numerous factors:

(1) whether the district court set a certain date by which compliance was required,

(2) whether the district court warned of potential sanctions for noncompliance,

(3) whether the noncompliance with discovery was “an isolated event or part of a

pattern,” (4) whether the noncompliance was “willful or without justification,” and

(5) whether the moving party has demonstrated prejudice. Frontier Ins., 788 N.W.2d at

923.

All five of these factors are implicated here. It is undisputed that the district court

told Arellano what he needed to do and when—attend a deposition as scheduled by

Nesbit—and personally warned him of the consequences of noncompliance. And

Arellano concedes that his repeated failure to appear for deposition and his violation of

two court orders prejudiced Nesbit by depriving her of evidence necessary to address

liability and warrants entry of a default judgment. But he contends that the default should

only extend to the issue of liability because his non-appearances did not impair Nesbit’s

ability to prove damages. We are not persuaded for two reasons.

First, the unique and undisputed record before us demonstrates that Arellano’s

numerous discovery violations were egregious. Arellano received clear notice of each

scheduled deposition. The district court twice issued orders warning Arellano that he

6 could be sanctioned for failing to appear for deposition, and personally advised him in

January 2014 that if he did not attend the next scheduled deposition default judgment

would be entered against him. Despite these clear notices and the district court’s

warnings, Arellano failed to appear for five scheduled depositions over the course of a

year. And Arellano’s conduct undisputedly prejudiced Nesbit by causing her

inconvenience and delay and depriving her of critical evidence. After retracting his

admission that he was driving the vehicle involved in the accident six months into the

case, Arellano repeatedly flouted Nesbit’s attempts to clarify this key liability issue in the

only way possible—by taking his deposition. Arellano’s actions left the case at a stand-

still for an entire year and caused trial to be rescheduled twice. Arellano’s pattern of

wholly unjustified noncompliance with discovery is precisely the type of conduct that

amounts to forfeiture of a right to trial. See Ri-Mel, 417 N.W.2d at 109-10 (affirming

entry of default judgment when appellants repeatedly failed to cooperate with deposition

or appear for court as ordered, despite being warned that default sanction would result).

Frontier Ins., 788 N.W.2d at 923-25 (affirming dismissal of appellant’s claims against all

defendants based on failure to provide meaningful discovery responses).

Second, we are not persuaded that the district court’s decision to employ the

harsh—but permitted—sanction of default judgment constitutes abuse of discretion.

Arellano cites no authority for the proposition that the district court could have entered a

partial default judgment on the issue of liability. By definition, a default judgment is not

divisible; it is a judgment that fully and finally decides the case. See Minn. R. Civ.

P. 54.01 (defining judgment as “the final determination of the rights of the parties in an

7 action”). Arellano essentially argues that a more appropriate sanction would have been

an order refusing to allow him to defend on liability. Such a sanction would have been

well within the district court’s discretion. See Minn. R. Civ. P. 37.02(b)(2)-(3)

(permitting discovery sanctions of refusing to allow disobedient party to support

designated defenses or striking pleadings). But it also was within the district court’s

discretion to determine that such a sanction inadequately addresses Arellano’s conduct.

The district court’s more severe sanction takes into account not only the prejudice to

Nesbit but the numerous warnings Arellano received and his prolonged and unexcused

recalcitrance. On this singular record, we conclude the district court did not abuse its

broad discretion by entering a default judgment as a sanction.

II. The record supports the district court’s award of damages.

“A party entitled to judgment by default shall move the court for judgment in that

party’s favor, setting forth by affidavit the facts which entitle that party to relief. Either

the party or the party’s lawyer may make the affidavit, which may include reliable

hearsay.” Minn. Gen. R. Pract. 117.02. The moving party’s submissions must provide

sufficient evidence to support the damages award. See Wiethoff v. Williams, 413 N.W.2d

533, 537 (Minn. App. 1987) (citing Hill v. Tischer, 385 N.W.2d 329, 332 (Minn. App.

1986)) (stating that it “may be appropriate” to vacate a default judgment “where there is

not sufficient evidence to support an award of damages”).

The district court found that Nesbit incurred medical expenses and lost wages of

more than $23,000 and continues to suffer from permanent injuries that may worsen over

time. Based on those findings, the district court awarded damages of $100,000. Arellano

8 argues that the record does not support that award for two reasons. We address each in

turn.

First, Arellano contends that Nesbit’s future damages are speculative. He

compares Nesbit’s evidence to the “off the cuff” estimate of damages we reversed in Hill

and the award “taken directly” from the complaint, without any medical evidence, that

we reversed in Wiethoff. See Wiethoff, 413 N.W.2d at 537; Hill, 385 N.W.2d at 332

(quotation omitted). We disagree with this comparison. Nesbit presented her own

affidavit establishing that she continues to experience pain on a regular basis and avoids

activities that aggravate the pain, such as bending, lifting, and sitting or standing for long

periods of time. Despite those restrictions, she continues to require daily pain medication

and monthly chiropractic treatment. Her chiropractor’s affidavit indicates that Nesbit

sustained a permanent injury and that her degenerative joint changes “will most surely

progress with time.” We have previously stated that a plaintiff may prove damages for

future pain or disability by presenting evidence that she is not fully recovered at the time

of trial. Renswick v. Wenzel, 819 N.W.2d 198, 204-05 (Minn. App. 2012), review denied

(Minn. Oct. 16, 2012).

Second, Arellano argues that the district court erred by not reducing the judgment

by the amount Nesbit received from collateral sources, as required by Minn. Stat.

§ 548.251 (2014). We are not persuaded. While the district court did not expressly

address the collateral-source issue in its final order, we do not presume that this silence

indicates error. White v. Minn. Dep’t of Natural Res., 567 N.W.2d 724, 734 (Minn. App.

1997), review denied (Minn. Oct. 31, 1997). Arellano bears the burden of demonstrating

9 both error and prejudice. See id.; Bloom v. Hydrotherm, Inc., 499 N.W.2d 842, 845

(Minn. App. 1993), review denied (Minn. June 28, 1993). He has not done so.

In his motion to reopen or partially vacate the default judgment, Arellano asked

the district court to make the required collateral-source offset. The court reopened the

record and directed Nesbit to provide information about collateral-source payments.

Nesbit did so. And she contemporaneously presented evidence in the form of her

lawyer’s affidavit that “a net judgment in the amount of $100,000 is a fair and reasonable

amount.” (Emphasis added.) On this record, we conclude that the $100,000 award

represents the net damages remaining after the collateral-source offset. The district

court’s failure to make express findings with respect to collateral sources is harmless.

In sum, the district court did not abuse its broad discretion by entering a $100,000

default judgment against Arellano as a sanction for his extraordinary recalcitrance and

based on the affidavits Nesbit supplied.

Affirmed.