97-187 La.App. 5 Cir. 3/11/98, Brunet v. Magnolia Quarterboats, Inc.
| Citation | 711 So.2d 308 |
| Parties | 97-187 La.App. 5 Cir |
| Decision Date | 11 March 1998 |
| Court | Court of Appeal of Louisiana (US) |
Overton T. Harrington, Jr., Gretna, Joseph L. Gimbrone, San Diego, CA, for Appellant Polaris Insurance Company, Ltd.
Richard A. Weigand, T.A., Weigand, Levenson & Costa, New Orleans, for Appellee Charles Brunet.
Carl J. Hebert, T.A., Evans & Company, New Orleans, for Magnolia Holdings, Inc., Maintenance Dredging, Inc.
Before GAUDIN, CANNELLA and DALEY, JJ.
[97-187 La.App. 5 Cir. 2] CANNELLA, Judge.
Defendant, Polaris Insurance Company, Ltd. (Polaris), appeals from several trial court orders 1 fining it for contempt of court failure to comply with [97-187 La.App. 5 Cir. 3] discovery and failure to post a bond as an unauthorized insurer. We reverse in part and affirm in part.
On May 12, 1995, plaintiff filed a suit under the Jones Act 2, general maritime law and for maintenance and cure, for injuries he sustained to his back in an accident onboard the Q/B MAG II on October 21, 1994. 3 He initially filed suit against defendants, Magnolia Quarterboats, Inc. (Magnolia) and Maintenance Dredging, Inc. (Maintenance).
Maintenance filed a third-party suit against Polaris on September 20, 1995, asserting that Polaris provided insurance coverage for the claim and owed it a defense and indemnity. Polaris was alleged to be incorporated and/or registered in the British Virgin Islands (BVI), with their main office in San Juan, Costa Rica. On October 2, 1995, plaintiff added as defendants, Magnolia Holdings, Inc., as the owner of the vessel, and Polaris, as its' insurer. In its' answer, Polaris denied that it provided insurance coverage to Magnolia Holdings, Inc. or Maintenance or Magnolia (the three companies are hereinafter referred to as M/H). 4
In August of 1996, plaintiff and M/H filed a series of motions against Polaris for discovery, for sanctions for failing to comply with discovery and for the posting of a bond as an unauthorized insurer, pursuant to La. R.S. 22:1255. The latter was based on discovery that Polaris' name had been struck from the rolls of insurers in the BVI and that it was not authorized to do business in Louisiana or any other state. The trial judge issued orders for discovery relative [97-187 La.App. 5 Cir. 4] to motions filed by either plaintiff or M/H or by those parties jointly. The discovery was aimed at obtaining the correct insurance policies and the language in the policies on which Polaris was basing its denial of coverage for this accident. Movers tried to obtain certified copies of the policies, applications and a quote letter provided to M/H by Polaris. They also attempted to obtain documents related to Polaris' status as an unauthorized insurer. However, Polaris' responses were unsatisfactory to the movers.
In August and September of 1996, plaintiff and M/H filed motions to compel discovery and motions for sanctions and to strike Polaris' answers for failure to comply with discovery orders. A hearing was set for October 4, 1996. Trial had been set for October 8, 1996.
On August 5, 1996 and in September of 1996, the trial judge issued orders relating to discovery requests by plaintiff and M/H, individually filed in April and September of 1996.
On October 2 and 3, 1996, plaintiff and M/H filed additional motions to strike Polaris' answers, two motions to strike the pleadings based on R.S. 22:1255, a motion to file a supplemental memo on the issues raised in plaintiff's motion to compel, and another motion to compel and for sanctions by M/H for failure to comply with the discovery order. On October 4, 1996, plaintiff filed a motion to file a supplemental memorandum regarding the bond issue. These matters were set for hearing on October 4, 1996, the date previously set for hearing on the earlier filed motions.
On October 4, 1996 the hearing was held. On October 9, 1996, the trial judge rendered a judgment. The judgment granted plaintiff's and M/H's motions to compel discovery of the quote letter, applications, correct policies and any [97-187 La.App. 5 Cir. 5] documents on which Polaris based its denial of coverage. She "held in abeyance" a ruling on the motions to strike the pleadings urged on the basis of La. R.S. 22:1255. Trial on the merits was reset for October 29, 1996.
On October 15, 1996 and October 17, 1996, plaintiff and M/H filed motions for sanctions and for adverse presumptions against Polaris for their alleged failure to respond properly to the orders of October 9, 1996. They also filed a joint motion to file a supplemental memorandum and for a reconsideration of the Motion To Strike Pleadings Filed By Polaris. R.S. 22:1255. An expedited hearing was set for October 25, 1996.
On October 21, 1996, plaintiff and M/H filed a motion to order a representative of Polaris to appear at the hearing set for October 25, 1996 and to provide documents related to their status as an alleged unauthorized insurer. That motion was granted on the same day (four days before the hearing.) On the next day, Polaris responded with an opposition to the motions to strike and for the adverse presumptions. 5
On October 24, 1996, plaintiff and M/H filed a motion to file a joint supplemental memorandum in support of the motion to strike the pleadings based on R.S. 22:1255.
On October 25, 1996, the hearing convened. However, Polaris' representative failed to appear or produce any documents relative to the issue of it's status as an unauthorized insurer. Counsel for Polaris participated in the hearing by telephone. In open court and in the judgment dated October 28,1996, the trial judge granted the motions, applied the adverse presumptions and [97-187 La.App. 5 Cir. 6] assessed a $1,500 fine against Polaris for its failure to appear as ordered with the documents requested.
The judgment applied the adverse presumptions, as follows, stating:
The trial judge next granted the Joint Motion to File Supplemental Memorandum and For Reconsideration Of Motion To Strike Pleadings Filed By Polaris Insurance Company, Ltd. for Polaris' failure to comply with La. R.S. 22:1255 and ordered Polaris to post a bond in the amount of $550,000 by noon on Monday, October 28, 1996. The judgment states that, if the bond is not posted timely, the pleadings filed by Polaris "shall be struck from the record and the Clerk of Court shall enter a Preliminary Default against Polaris Insurance Company, Ltd."
The trial judge further found Polaris to be in contempt of court for failing to appear and produce documents at the hearing, as it was ordered to do in the judgment of October 21, 1996 and by virtue of the subpoena duces tecum issued October 21, 1996. For this violation, the trial judge ordered Polaris to pay a fine [97-187 La.App. 5 Cir. 7] of $1,500 to plaintiff and M/H. She further ordered Polaris to pay the fine and produce the subpoenaed documents at the office of plaintiff's counsel by Monday, October 28, 1996 at 12:00 noon, CST. Thus, Polaris was required to pay the $1,500 fine, to post bond and again to produce the documents by noon of October 28, 1996. Polaris did not ask for an extension, a stay order or any other relief.
On October 29, 1996, pursuant to a written motion filed in open court by plaintiff and M/H, the trial judge entered a preliminary default against Polaris on the issue of coverage for Polaris' failure to post the bond (in accordance with the provisions of the October 28, 1996 judgment). Polaris paid the $1,500 fine to the trial court.
Also, on October 29, 1996, a hearing was held on the following various outstanding motions. However, there is no motion to set a hearing on this date, or order setting a hearing on this date in the record. Both of Polaris' attorneys were present because this was the date set for trial. The trial was apparently continued again, this time, without date.
Following this hearing, the trial judge rendered a decision in open court, ordering Polaris to perform certain acts by November 4, 1996. However, the written judgment was not signed until November 4, 1996. The judgment:
1. Struck all of Polaris' pleadings in the case, pursuant to the Joint Motion To Strike, for its failure to comply with La. R.S. 22:1255 and for failing to post the bond as ordered..
2. Awarded $2,500 as sanctions against Polaris, pursuant to a joint oral motion based on Polaris' failure to pay the fine of $1,500 and failure to produce the documents, as ordered in the October 28, 1996 judgment.
3. Further states that
[97-187 La.App. 5 Cir. 8] "... if Polaris continues in contempt in any respect by continuing to fail to pay all fines now due or by continuing to fail to produce the documents Ordered by 5:00 p.m., CST, Thursday, October 31, 1996, they are additionally fined $3,500; if Polaris continues in contempt in any respect of this Court's orders by 9:00 a.m. CST on Monday, November 4, 1996, Polaris shall be fined an additional $5,000."
4. Ordered all of the contempt fines to be paid into the court registry for the...
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