124 F.R.D. 103 (D.Md. 1989), C. A. S 87-2855, Smith v. Cessna Aircraft Co.

Docket NºCiv. A. S 87-2855.
Citation124 F.R.D. 103
Opinion JudgeSMALKIN, District Judge.
Party NameRonald E. SMITH, Plaintiff, v. CESSNA AIRCRAFT COMPANY, Defendant. James H. GARNER, Plaintiff, v. CESSNA AIRCRAFT COMPANY, Dwight Law, t/a Law Aviation, and C. William Pancake, Defendants.
AttorneyThomas J. Harlan, Jr. and James M. McCauley, Norfolk, Va., Robert T. Hall, Warner F. Young, III, and Hall, Markle, Sickels & Fudala, P.C., Fairfax, Va., and Brian C. Parker and Gebhardt & Smith, Baltimore, Md., for plaintiff Ronald E. Smith. Peter A. Greenburg, Morton A. Faller, and Meyer, Faller...
Case DateFebruary 14, 1989
CourtUnited States District Courts, 4th Circuit, District of Maryland

Page 103

124 F.R.D. 103 (D.Md. 1989)

Ronald E. SMITH, Plaintiff,

v.

CESSNA AIRCRAFT COMPANY, Defendant.

James H. GARNER, Plaintiff,

v.

CESSNA AIRCRAFT COMPANY, Dwight Law, t/a Law Aviation, and C. William Pancake, Defendants.

Civ. A. No. S 87-2855.

United States District Court, D. Maryland.

February 14, 1989

Plaintiff sued airplane manufacturer, inspector and repairer for injuries incurred when plane crashed. During discovery, plaintiff deliberately gave false answers to interrogatories and deposition questions regarding his past income. Defendants brought motion to dismiss complaint as a result of plaintiff's perjury. The District Court, Smalkin, J., held that plaintiff's damage claims for lost income would be dismissed with prejudice.

So ordered.

Thomas J. Harlan, Jr. and James M. McCauley, Norfolk, Va., Robert T. Hall, Warner F. Young, III, and Hall, Markle, Sickels & Fudala, P.C., Fairfax, Va., and Brian C. Parker and Gebhardt & Smith, Baltimore, Md., for plaintiff Ronald E. Smith.

Peter A. Greenburg, Morton A. Faller, and Meyer, Faller, Weisman and Greenburg, and John J. Tigert, VI and Kathryn A. Ledig, Washington, D.C., for plaintiff James H. Garner.

Mark A. Dombroff, Jonathan M. Stern, and Katten, Muchin, Zavis & Dombroff, Washington, D.C., for defendant Cessna Aircraft Co.

Page 104

Charles E. Iliff, Jr. and Semmes, Bowen & Semmes, Baltimore, Md., for defendants Dwight Law, trading as Law Aviation, and C. William Pancake.

MEMORANDUM

SMALKIN, District Judge.

Now pending before this Court is the motion of defendant Cessna Aircraft Company to dismiss with prejudice the amended complaint of plaintiff James H. Garner. Also pending is the motion to dismiss filed by defendants Dwight Law and C. William Pancake, which incorporates by reference Cessna's motion, and sets forth additional case law in support of the motion. Plaintiff Garner has opposed the motions; Cessna has replied. The motions assert that dismissal of Mr. Garner's complaint is warranted on the basis of both the clean hands doctrine and Fed.R.Civ.P. 41(b), as a result of Mr. Garner's admitted fraud and perjury during discovery.

For the reasons set forth below, the motions to dismiss will be granted in part and denied in part. Mr. Garner's claims for damages for lost income will be dismissed. His claims for other compensatory damages and for punitive damages, however, are not dismissed.

Facts

Mr. Garner filed this lawsuit as a result of the March 3, 1985 crash of his single engine aircraft, which was manufactured (in 1956) by Cessna, inspected by Pancake, and repaired by Law. Mr. Garner, who was piloting the plane, 1 broke both his legs in the crash. The complaint sets forth causes of action for negligence and breach of warranty, seeking compensatory damages for personal injury and property damage from all three defendants, as well as punitive damages from Cessna. As part of his desired damages, Mr. Garner seeks compensatory damages for income which he lost in his contracting business as a consequence of the crash.

In the course of discovery, Cessna propounded interrogatories to Mr. Garner. Interrogatory Number 15 asked:

If you claim that you have been or will be rendered fully or partially incapable of engaging in your employment or profession, or that your earnings therefrom have been or will be impaired as a result of the accident:

....

(d) State your net business or professional income from salary, wages, and tips as reflected by your federal income tax returns (including amendments) for 1981, 1982, 1983, 1984, 1985, 1986, and, when available, 1987.

(Cessna's Motion, Exhibit B, at 10-11 (emphasis in original)). In his answer, Mr. Garner listed his income as follows:

Year Income
1982 $29,500.00
1983 35,000.00
1984 41,102.35
1985 25,835.20
1986 44,441.68
( Id. at 12-13). At the end of his answers, Mr. Garner signed his name below the statement, " I declare under penalty of perjury that the foregoing is true and correct." ( Id. at 22). Similarly, Cessna's request for production of documents asked Mr. Garner to produce " [a]ll of the pilot's federal, state, and local tax returns for the years 1983, 1984, 1985, 1986, and, when completed 1987." (Cessna's Motion, Exhibit A, Request No. 16, at 5 (emphasis in original)). In response, Mr. Garner declared, " The tax returns sought will be produced." Mr. Garner then produced documents purporting to be his tax returns for 1986 and 1987, and part of his tax documents for 1985. The Form 1040's for 1986 and 1987 bore Mr. Garner's signature under the statement, " Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete." (Cessna's Motion, Exhibit C). Page 105 Mr. Garner's sworn assertions regarding his income tax data for the years in question were false. After Mr. Garner failed to produce the rest of the requested tax returns, Cessna's counsel asked for the documents. Mr. Garner's attorney then notified Cessna's counsel that, rather than produce the documents, Mr. Garner would execute an authorization which would allow Cessna to get the tax returns directly from the Internal Revenue Service. When Mr. Garner's attorney asked his client to execute the authorization, however, he learned for the first time that his client had in fact failed to file any tax returns for the years 1983 through 1987. Mr. Garner then filed a supplemental answer to Interrogatory Number 15(d):

The amounts stated with respect to the years 1983 through 1986 in the plaintiff Garner's original answers to this interrogatory are probably in error. The purported portions of income tax returns furnished by the plaintiff to the defendants through counsel, as being portions of plaintiff's income tax returns are, in fact, not portions of any income tax returns filed by the plaintiff with the Internal Revenue Service. Income tax returns for the plaintiff for the years 1983 through 1987 are being prepared with the assistance of John J. Canto, a certified public accountant identified below, and copies thereof will be furnished to the defendants as soon as the same can be completed.

(Cessna's Motion, Exhibit D, at 2). Cessna finally received the tax returns on September 30, 1988, after Mr. Garner filed them with the help of Mr. Canto. ( See Cessna's Motion, Exhibit E). As a result of these developments, Cessna sought to redepose Mr. Garner on November 11, 1988.2 There, Mr. Garner admitted that at his earlier deposition he had " hedged the answer" when asked if he had filed his tax returns. (Cessna's Motion, Exhibit F, at 282). He acknowledged, " The answer I gave implied that I had filed my income tax returns." ( Id. at 283). He further admitted that he knew he was violating the law by failing to file returns. ( Id. at 312). Turning to the issue of the answers to interrogatories, Cessna's attorneys asked Mr. Garner, " So you wanted the lawyers to believe that your answer to Interrogatory Number 15-D was coming from federal income tax returns, didn't you?" Mr. Garner conceded, " I assumed that that is what you would think, yes." ( Id. at 324). Cessna's attorneys pressed the point:

Q. So your affirmation at the end that this is true under penalty of perjury...

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27 practice notes
  • 364 B.R. 220 (Bkrtcy.E.D.Va. 2007), 05-77916, In re Hathaway
    • United States
    • Federal Cases United States Bankruptcy Courts Fourth Circuit
    • March 6, 2007
    ...safeguard the judicial process, not to protect the parties." McGovern, 2004 WL 1764088 at *10 (citing Smith v. Cessna Aircraft Co., 124 F.R.D. 103, 106 (D.Md.1989)). The actions must be such that they impair the court's ability to effectuate a proper finding in a case, "where plai......
  • 413 S.E.2d 630 (Va. 1992), 910073, Owens-Corning Fiberglas Corp. v. Watson
    • United States
    • Virginia Supreme Court of Virginia
    • January 10, 1992
    ...thus, the Konzen memorandum which reveals this fraud is not protected by the attorney-client privilege. See Smith v. Cessna Aircraft Co., 124 F.R.D. 103 (D.Md.1989) (litigant committed fraud upon court by knowingly filing false answers to interrogatories). Exclusion of the Konzen memorandum......
  • 934 A.2d 450 (Md.App. 2007), 2609, Mona v. Mona Elec. Group, Inc.
    • United States
    • Maryland Court of Special Appeals of Maryland
    • September 13, 2007
    ...directed the parties to brief the "clean hands" issue and, in particular, to discuss the case of Smith v. Cessna Aircraft, 124 F.R.D. 103 (D.Md.1989). After the parties submitted their memoranda, a second hearing was held. At the outset, the court framed the issue before it as fol......
  • Beyond Chafee: A Process‐Based Theory of Unclean Hands
    • United States
    • American Business Law Journal Nbr. 47-3, September 2010
    • September 1, 2010
    ...Hosp. v. Patriot Med. Techs., Inc., No. IP 01-1404-C K/H, 2004WL 392938, atn7 (S.D. Ind. Feb 11, 2004); Smith v.Cessna Aircraft Co., 124 F.R.D. 103, 105–07 (D. Md. 1989); Buchanan Home & Auto Supply Co. v. Firestone Tire & RubberCo., 544 F.Supp. 242, 244–45 (D.S.C. 1981); Urecal Cor......
  • Request a trial to view additional results
24 cases
  • 364 B.R. 220 (Bkrtcy.E.D.Va. 2007), 05-77916, In re Hathaway
    • United States
    • Federal Cases United States Bankruptcy Courts Fourth Circuit
    • March 6, 2007
    ...safeguard the judicial process, not to protect the parties." McGovern, 2004 WL 1764088 at *10 (citing Smith v. Cessna Aircraft Co., 124 F.R.D. 103, 106 (D.Md.1989)). The actions must be such that they impair the court's ability to effectuate a proper finding in a case, "where plai......
  • 413 S.E.2d 630 (Va. 1992), 910073, Owens-Corning Fiberglas Corp. v. Watson
    • United States
    • Virginia Supreme Court of Virginia
    • January 10, 1992
    ...thus, the Konzen memorandum which reveals this fraud is not protected by the attorney-client privilege. See Smith v. Cessna Aircraft Co., 124 F.R.D. 103 (D.Md.1989) (litigant committed fraud upon court by knowingly filing false answers to interrogatories). Exclusion of the Konzen memorandum......
  • 934 A.2d 450 (Md.App. 2007), 2609, Mona v. Mona Elec. Group, Inc.
    • United States
    • Maryland Court of Special Appeals of Maryland
    • September 13, 2007
    ...directed the parties to brief the "clean hands" issue and, in particular, to discuss the case of Smith v. Cessna Aircraft, 124 F.R.D. 103 (D.Md.1989). After the parties submitted their memoranda, a second hearing was held. At the outset, the court framed the issue before it as fol......
  • 380 B.R. 154 (Bkrtcy.E.D.Va. 2007), 07-51040, In re Loy
    • United States
    • Federal Cases United States Bankruptcy Courts Fourth Circuit
    • December 18, 2007
    ...not necessarily one of the parties, such that the fraud will undermine the judicial process. Id.; see also Smith v. Cessna Aircraft Co., 124 F.R.D. 103, 106 (D.Md.1989) (citing Mas v. Coca-Cola Co., 163 F.2d 505, 507 (4th Cir.1947)). Thus, Loy is charged with the burden of showing that a cl......
  • Request a trial to view additional results
3 books & journal articles
  • Beyond Chafee: A Process‐Based Theory of Unclean Hands
    • United States
    • American Business Law Journal Nbr. 47-3, September 2010
    • September 1, 2010
    ...Hosp. v. Patriot Med. Techs., Inc., No. IP 01-1404-C K/H, 2004WL 392938, atn7 (S.D. Ind. Feb 11, 2004); Smith v.Cessna Aircraft Co., 124 F.R.D. 103, 105–07 (D. Md. 1989); Buchanan Home & Auto Supply Co. v. Firestone Tire & RubberCo., 544 F.Supp. 242, 244–45 (D.S.C. 1981); Urecal Cor......
  • Treating Equity Like Law: A Post‐Merger Justification of Unclean Hands
    • United States
    • American Business Law Journal Nbr. 45-3, September 2008
    • September 1, 2008
    ...Buchanan Home and Auto Supply Co. v. Firestone Tire and Rubber Co., 544 F. Supp.242, 245 (D.S.C. 1981); Smith v.Cessna Aircraft Co.,124 F.R.D. 103, 105-07 (D. Md. 1989); seealso McGovern v. Deutsche Post GlobalMail, Ltd., No. Civ.JFM-04-0060, 2004 WL 1764088,atn10 n.6 (D. Md. Aug. 4, 2004) ......
  • A complainant-oriented approach to unconscionability and contract law.
    • United States
    • University of Pennsylvania Law Review Vol. 164 Nbr. 5, April - April 2016
    • April 1, 2016
    ...should not be entered without consideration of those effects."). (130) These are roughly the facts of Smith v. Cessna Aircraft Co., 124 F.R.D. 103 (D. Md. 1989). (131) See, e.g., Universal Builders, Inc. v. Moon Motor Lodge, Inc., 244 A.2d to, 14 (Pa. 1968) ("[A]lthough it has bee......