Haney v. Woodward & Lothrop, Inc.

• Decision Date: 13 April 1964
• Docket Number: No. 9117.,9117.
• Parties: Jack HANEY, and Michael Haney, who sues by his next friend, Jack Haney, Appellants, v. WOODWARD & LOTHROP, INC., and Peter F. Gordon, Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

330 F.2d 940 (1964)

Jack HANEY, and Michael Haney, who sues by his next friend, Jack Haney, Appellants, v. WOODWARD & LOTHROP, INC., and Peter F. Gordon, Appellees.

No. 9117.

United States Court of Appeals Fourth Circuit.

Argued January 10, 1964.

Decided April 13, 1964.

George A. Fath, Alexandria, Va., for appellants.

E. Waller Dudley, Alexandria, Va. (Boothe, Dudley, Koontz & Blankingship, Alexandria, Va., on brief) for appellees.

Before BOREMAN, BRYAN and BELL, Circuit Judges.

PER CURIAM:

Discovery proceedings and not the merits of this personal injury action pose the decisive question here: whether a judgment by default should have been directed against the defendant-appellees for their refusal to produce records as ordered by the District Judge. We think the refusal unwarranted. The trial court's failure to impose sanctions upon the defendants, we think too, deprived the plaintiff-appellant of substantial rights, requiring us to set aside the verdict against him.

The truck of defendant Woodward & Lothrop, driven by its employee, defendant Peter F. Gordon, struck six-year-old Michael Haney in front of his home in Fairfax County, Virginia. On the assertion of Gordon's negligence, actions for damages were brought by Jack Haney, Michael's father (plaintiff) for himself and his son. Negligence was denied but, as noted, we have no occasion to examine that issue. Recount of the discovery steps is necessary for an understanding of our conclusions.

After the action was begun on April 4, 1962, interrogatories propounded by the plaintiff were, with exceptions well taken, freely and fully answered by the defendants on April 30, 1962. They disclosed that the defendants were protected by an automobile liability policy of Liberty Mutual Insurance Company. It gave the name of Donald P. Raynor as the person who conducted the investigation for the insurer.

On December 12, 1962, approximately two months before the trial date, the plaintiff had a subpoena duces tecum issued for Robert H. Ford, manager of Liberty's area office, to come to Alexandria, Virginia — 6 miles away — on December 18, for a noticed discovery deposition. Service of the subpoena was not made until the late afternoon of December 17, but he did not appear. Defense counsel, who also represented Liberty and Ford, states that the deposition was postponed by agreement because Liberty and Ford desired first to be heard on a motion to quash the subpoena. Plaintiff's attorney contends that Ford and the defendants simply ignored the subpoena. The point is not pivotal now, but the witness should have attended or counsel, if agreed, should have gone before the notary and put their understanding of record. Parties are not at liberty, as the District Judge observed, to dispense with the command of a subpoena. Strictly, this power rests with the court only. Cf. Rules 30(b) and 45(b), Fed.R.Civ.P. In practice, the courts generally adopt the wishes of counsel, but the stipulations should be formal to avoid just such a misunderstanding as arose here.

The subpoena sought Liberty's investigation records. The witness, Liberty and the defendants promptly moved to quash the subpoena. The notice of deposition and the subpoena apparently were issued under the provisions of Rule 26 (a) and (b), Rule 34 and Rule 45(d), Fed.R.Civ.P. We need not distinguish between the defendants as parties and the insurer and Ford as third persons, for they acted as one and by the same attorney throughout the entire discovery steps. The District Court accorded the plaintiff his privilege, under Rule 26, to ascertain the existence, the possession and the location of the papers he desired. It found good cause shown for their production. One ground for the finding was the absence of any eye-witness for the plaintiff save that of the injured child. The motion to quash came on for hearing December 27, 1962. It was overruled by an order entered January 2, 1963.

Thereupon the defendants, as well as Liberty and witness Ford, moved the Court to clarify the order of January 2, 1963; pointing out that they disagreed with the view of the Court that counsel for the parties could not modify the return date of the subpoena; inquiring if the subpoenaed material would have to be exhibited to the plaintiff's attorney for his inspection; and stating that the defendants desired to prosecute an immediate appeal pursuant to 28 U.S.C. § 1292 (b).

After a hearing, the motion for clarification was denied by order of January 8, 1963. It detailed what was expected of Ford by the previous order — that he should appear for the deposition at eleven o'clock A.M. on January 11, 1963 in Alexandria and "produce and bring with him for examination by the plaintiff, at the time and place aforesaid, all Liberty Mutual Insurance Company documents, records, statements, etc., pertaining to the investigation of an accident on December 7, 1961, wherein Michael Haney was injured."

This witness attended the deposition with the case file and testified that he was in full charge of the local Liberty office. He tendered for inspection certain photographs and the statements taken from the truck driver and his assistant. However, on the advice of his, Liberty's and defendants' counsel, he declined to allow plaintiff's lawyer to inspect the file. The papers in the file were numbered and listed by description. The witness stated that he had no familiarity with the contents of the file, but he did not offer, nor did the insurer or the defendants, to bring the investigator who made or compiled the contents of the file. Among these papers was a "report of an investigator" consisting of six pages, initialed by Donald P. Raynor. This was on January 11, 1963.

The trial had been set to begin February 11, 1963. On February 4, 1963, the plaintiff filed a motion for a sanction under Rule 37 by way of a default judgment of liability against the defendants, with a contempt citation of Ford, for the disregard of the production order of January 8, 1963. This motion was returnable to the trial date. Earlier action, his attorney explained, was prevented by his inability to obtain sooner a transcript of the deposition proceedings.

On the trial date before the impaneling of the jury plaintiff pressed, and the Court heard, the motion for the sanction. Ford was called to the stand with the file in hand. The deposition proceedings were reviewed. The District Judge then directed the witness "to turn over his file to me right now and to point out by some means of identification those articles, those documents therein which he considers had nothing to do with the investigation of this case, and I will rule on those and I will decide what I am going to do with the rest of the file. I will let him just mark them". To this, on behalf of the defendants, the insurer and Ford, their counsel responded "* * * we respectfully decline to tender the file to the Court."

The Court was told on this occasion by the defendants that the head of the Claims Department was one Black, that he was not present in court and in answer to the inquiry of the District Judge if Black could be brought into court, he was told that the defendants were willing to see if Black might be obtained. Ford was then arraigned for contempt — for failure to deliver the file to the Court — found guilty and assessed with a fine of $100.00 which was suspended.

The Court had been informed that one Maxim, then in court, was in possession of the file of the insurer. With the permission of the insurer and the defendants he selected from the file such papers as he considered related exclusively to the investigation. It was solely his choice, neither the plaintiff's counsel nor the Court taking part in the separation. The papers thus picked out by him were submitted to plaintiff's counsel, but they did not include the six-page investigation report. Just what comprised the other papers not produced for inspection is not known. It was understood they were "documents which have some factual information in it pertaining to the investigation but in the same document is comingled other matters specifically referring to the opinion of the investigator or some of the officials as to values, and so forth".

After looking at the selected papers, plaintiff's counsel asked that the Court "examine the remaining documents for the relevancy and pertinency to the investigation of this case". This the Court would not do, stating to plaintiff's attorney that "in the absence of a showing to the contrary, and if you have any reason now or subsequently * * * substantial reasons that they have wilfully withheld documents that pertain to the investigation, the Court will rule accordingly and act accordingly". The Court added it had no reason to think that the selection had not been made in good faith.

By reference to the Ford deposition, plaintiff's counsel specified, among others, the six-page report of investigator Raynor as papers not presently produced. The Court, emphasizing that plaintiff's counsel had been dilatory in not bringing to its attention earlier the refusal of Ford, Liberty and the defendants, ruled that the trial should not be delayed and declined to require production of any of the specified papers. At that time plaintiff's counsel declared that he did not desire a postponement of the case, and the Court repeated its unwillingness to defer the trial, saying again that if plaintiff had any evidence of the withholding of material documents by the defendants, their production would be directed. This statement was accompanied by the assurance that after the trial the Court would rule "as to who I think was wrong and what costs, if any, are going to be imposed for * * * not complying with the Court's Order".

Thereupon plaintiff's counsel did ask for a continuance. It was denied; the motion for the sanction of judgment by default was reserved...