Medina v. Foundation Reserve Insurance

870 P.2d 125, 117 N.M. 163
CourtNew Mexico Supreme Court
DecidedFebruary 16, 1994
Docket20911
StatusPublished
Cited by31 cases

This text of 870 P.2d 125 (Medina v. Foundation Reserve Insurance) is published on Counsel Stack Legal Research, covering New Mexico Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Medina v. Foundation Reserve Insurance, 870 P.2d 125, 117 N.M. 163 (N.M. 1994).

Opinion

OPINION

FROST, Justice.

This appeal requires us to determine whether the district court properly dismissed a complaint pursuant to SCRA 1986, 1-037 (Repl.Pamp.1992) for failure to comply with rules of discovery. Plaintiff-Appellant Ricardo Medina sued Defendant-Appellee Foundation Reserve Insurance Company, Inc. (Foundation) for bad faith in refusing to honor an insurance claim. The district court found that Medina willfully provided false discovery responses and disobeyed a discovery order, and it therefore dismissed Medina’s action with leave to reinstate upon payment of sanctions and costs. We affirm.

In 1985, Medina allegedly suffered aggravation of pre-existing injuries when he was involved in a hit-and-run automobile accident. Medina filed a claim for his injuries under his uninsured motorist insurance policy with Foundation. In 1989, Medina received an arbitration judgment for $100,000 against Foundation for damages sustained in the automobile accident. Before the completion of arbitration, Medina filed the present bad faith action against Foundation. In the present action, Foundation attempted to discover relevant information about Medina’s background, including his employment and disability history, to demonstrate that Medina had been dishonest in the arbitration proceedings. 1

In its motion to dismiss and on appeal, Foundation alleges that Medina deliberately violated court discovery orders and gave numerous false, evasive, incomplete, and misleading responses to discovery requests. Foundation contends that Medina’s egregious misconduct constitutes a flagrant pattern of deception that justifies the sanction of dismissal. In support of its motion to dismiss, Foundation submitted to the district court a Summary of Evidence. This voluminous document compiles evidence explaining Foundation’s discovery request; Medina’s response to the request; how that response was false, deceptive, and misleading; and the relevance of the discoverable information to the proceeding.

On appeal, Medina asserts that his responses were not false. He also contends that dismissal was an inappropriate sanction under the requirements of Sandoval v. Martinez, 109 N.M. 5, 780 P.2d 1152 (Ct.App.), cert. denied, (July 27, 1989), because his incomplete discovery responses did not in fact deceive Foundation and they were not critical to Foundation’s preparation for trial.

The district court conducted an extensive and thorough review of this matter before dismissing Medina’s complaint with leave to reinstate on the condition that Medina pay Foundation for attorney’s fees and costs “incurred in ferreting out Plaintiffs lies, and evasive and vague responses in discovery.” After reviewing the parties’ briefs and evidence, it found many specific instances of discovery violations by Medina, as well as a general, willful failure by Medina to meet his discovery obligations. The district court found:

1.Plaintiff willfully failed to meet his discovery obligations.
2. Plaintiff willfully provided false discovery responses.
3. Plaintiff willfully failed to fully obey the Court’s Discovery Order of January 28, 1992 regarding worker’s compensation benefits.
4. Plaintiff failed to fully obey the Court’s Order of April 23, 1992 regarding authorizations.
5. Plaintiff failed to fully obey the Court’s Order of May 5, 1992 reflecting the oral orders of the Court at the April 29, 1992 hearing regarding divorce and custody issues and his employment in 1982.
6. Plaintiff failed to meet Court imposed pre-trial deadlines.
7. Plaintiffs discovery responses deceived Defendant in that they concealed the existence of discoverable information.
(a) Plaintiff has a college education and has completed his first year in law school. He is evasive, not complete and his “I guess so” answers are willful and misleading. [No part (b) in original].
8. Plaintiffs responses were false in stating or implying that he had not been arrested[;] ... there were no additional documents concerning vocational evaluations or vocational rehabilitation^] ... he had not been employed as an insurance salesman in 1982[;] ... there were no custody or divorce proceedings other than in California[; and] ... the total amount of worker’s compensation benefits that he received was limited to approximately $55,-000.
14. Plaintiffs responses are relevant to a crucial defense in this matter, i.e., that Plaintiff acted dishonestly and in bad faith in the underlying arbitration, which defense, if proven, would constitute a complete defense to Plaintiffs claims under UJI 13-1710 [SCRA 1986, 13-1710 (uniform jury instruction on policyholder’s dishonesty as affirmative defense to bad faith claim) ].
19. Plaintiffs deception and falsehoods exhibit a pattern of willful evasion in his discovery obligations.
20. Defendants have incurred expenses in ferreting out Mr. Medina’s evasive and false answers to discovery.

A district court may impose the sanction of dismissal for violation of discovery orders under SCRA 1-037(B) 2 when the failure to comply is due to the willfulness, bad faith, or fault of the disobedient party. United Nuclear Corp. v. General Atomic Co., 96 N.M. 155, 202, 629 P.2d 231, 278 (1980), appeal dismissed and cert. denied, 451 U.S. 901, 101 S.Ct. 1966, 68 L.Ed.2d 289 (1981). A willful violation of SCRA 1-037 occurs when there is a conscious or intentional failure to comply with the rule’s requirements. Id. A finding of willfulness may be based upon either a willful, intentional, and bad faith attempt to conceal evidence or gross indifference to discovery obligations. Lopez v. Wal-Mart Stores, Inc., 108 N.M. 259, 261, 771 P.2d 192, 194 (Ct.App.1989) (citing United Nuclear, 96 N.M. at 238, 629 P.2d at 314).

The choice of sanctions under SCRA 1-037 lies within the sound discretion of the trial court, and it will be reversed only for an abuse of discretion. Smith v. FDC Corp., 109 N.M. 514, 523, 787 P.2d 433, 442 (1990). While the severest of sanctions should be reserved for extreme circumstances, the district court does not abuse its discretion by imposing the sanction of dismissal when a party demonstrates flagrant bad faith and callous disregard for its responsibilities. United Nuclear, 96 N.M. at 239, 629 P.2d at 315. The district court is not required to impose lesser sanctions before it imposes the sanction of dismissal. Id.

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Bluebook (online)
870 P.2d 125, 117 N.M. 163, Counsel Stack Legal Research, https://law.counselstack.com/opinion/medina-v-foundation-reserve-insurance-nm-1994.