Bass-Davis v. Davis

• Decision Date: 11 May 2006
• Docket Number: No. 41015.,41015.
• Citation: 134 P.3d 103
• Parties: Kimberly BASS-DAVIS, Appellant, v. Kathi DAVIS and Christopher E. Davis, Respondents.
• Court: Nevada Supreme Court

Page 103

134 P.3d 103

Kimberly BASS-DAVIS, Appellant, v. Kathi DAVIS and Christopher E. Davis, Respondents.

No. 41015.

Supreme Court of Nevada.

May 11, 2006.

Kirk-Hughes & Associates and Judith H. Braecklein and Geraldine Kirk-Hughes, Las Vegas, for Appellant.

Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, and Gloria J. Sturman, Las Vegas, for Respondents.

Before the Court En Banc.

OPINION

GIBBONS, J.

In this appeal, we primarily consider whether evidence that is lost after being forwarded from franchisees to their franchisor is subject to a permissive inference that the evidence would have been unfavorable if produced.

On August 11, 2005, a panel of this court issued an opinion in this case. The panel concluded that the lost evidence was not "willfully suppressed" but that, based upon the facts of this case, appellant Kimberly Bass-Davis was nonetheless entitled to an inference that the lost evidence would have been unfavorable to respondents, franchisees Kathi and Christopher Davis. The panel also endorsed a jury instruction to be given when evidence that should have been preserved for trial is lost or destroyed but no evidence of willful suppression exists. The panel subsequently denied respondents' petition for rehearing, and the respondents then filed a petition for en banc reconsideration. Pending our consideration of the petition, we withdrew the panel's opinion on December 13, 2005. Having considered the petition, answer, and reply, we conclude that en banc reconsideration is warranted because this case involves a substantial precedential issue.¹ We therefore grant the petition and issue this opinion in place of the panel's withdrawn opinion.

In considering the issue of lost evidence, we necessarily revisit our 1997 decision in Reingold v. Wet'n Wild Nevada, Inc.² In that case, we determined that the district court should have given a jury instruction allowing an adverse inference for lost evidence, as relevant evidence was spoliated when Wet'n Wild followed its policy of routinely destroying records each season. We further concluded that Wet'n Wild's evidence destruction was "willful" as defined by NRS 47.250(3), thus creating a rebuttable presumption that the evidence "`would be adverse if produced."'³

Given that Reingold seemingly embraced both an inference created by evidence not produced and a rebuttable presumption for evidence willfully suppressed, we take this opportunity to clarify that decision and conclude that a permissible inference that missing evidence would be adverse applies when evidence is negligently lost or destroyed. The NRS 47.250(3) presumption, on the other hand, applies only in cases involving willful suppression of evidence, in which the party destroying evidence intends to harm another party, i.e., to obtain a competitive advantage in the matter. In this case, involving negligent loss of evidence, the district court abused its discretion by refusing to issue an adverse inference instruction or to consider other appropriate sanctions. We therefore reverse the judgment and order of the district court and remand for a new trial consistent with this opinion.

FACTS

On January 11, 1999, appellant Kimberly Bass-Davis slipped and fell on a wet floor inside a 7-Eleven convenience store. Bass-Davis claims that she slipped because a 7-Eleven employee had mopped the floor but failed to post warning signs. After the fall, she sought medical attention and was diagnosed with numerous injuries, ultimately requiring surgery. Bass-Davis incurred medical bills in excess of $201,000.

Within one week of Bass-Davis' fall, Bass-Davis' sister contacted the franchise operators, Kathi and Christopher Davis (the franchisees) and requested copies of the store's incident report, documenting Bass-Davis' fall, and the surveillance videotape from inside the store. The franchisees referred Bass-Davis' sister to a Southland employee, whom she contacted, repeating her request to no avail. Bass-Davis later filed a complaint against the franchisees and, during discovery, she learned that the franchisees could not locate the surveillance videotape. Franchisee Christopher Davis testified that, although he had no personal knowledge of the videotape, the store manager should have mailed this item to Southland, according to corporate policy. Southland explained that it had received the tape and had ultimately forwarded it to its insurer, where it was lost.

Bass-Davis' theory of the case during trial was that the franchisees were liable for her injuries because their employees had failed to post signs to warn that the floor was wet from mopping. That theory was supported by the testimony of Bass-Davis and Aldora Lewis, a witness who was at the store when Bass-Davis fell. The franchisees' defense was that warning signs were posted when Bass-Davis fell. Although the franchisees were not in the store when Bass-Davis fell, they testified that it was the normal practice for employees to post warning signs when they mopped the floors. Since Bass-Davis' case was based on a failure to warn, the lost videotape was arguably relevant. The videotape showed the front door and a portion of the center aisle, and it was the store's policy to set up a wet floor warning sign near the front door. Thus, even if the videotape would not have shown the location where Bass-Davis fell, it would have shown whether or not a warning sign was placed near the front door.

During the trial, Bass-Davis proffered several jury instructions concerning evidence spoliation, including proposed Instruction C:

Where relevant evidence which would properly be part of this litigation is within the control of the defendants whose interest it would naturally be to produce it, and they fail to do so without a satisfactory explanation, the jury may draw an inference that such evidence would have been unfavorable to the defendants.

The district court refused to give this instruction, and the jury ultimately returned a verdict for the franchisees.

After the district court entered a judgment on the jury's verdict, Bass-Davis filed a new trial motion, contending, among other things, that the district court had abused its discretion in refusing to give the spoliation instruction and had erred in allowing collateral source evidence at trial. Specifically, during Bass-Davis' cross-examination, the franchisees' counsel had asked her whether she "received a paycheck" during the four-month leave of absence she took from her employment following surgery. Bass-Davis admitted that she had. Bass-Davis' counsel objected because the question called for collateral source evidence, since Bass-Davis was seeking damages for lost wages. The district court overruled the objection. After considering Bass-Davis' new trial motion, the district court denied it.

On appeal, Bass-Davis argues that the district court abused its discretion by (1) failing to instruct the jury on loss of evidence and (2) failing to grant her motion for a new trial based on the introduction of collateral source evidence at trial.

DISCUSSION

Loss of evidence jury instruction

Bass-Davis argues that the jury should have been instructed that potentially relevant lost evidence creates a permissible inference that the evidence was harmful to the party responsible for its production. We agree.

The district court has broad discretion to settle jury instructions, and its decision to give or decline a proposed jury instruction is reviewed for an abuse of that discretion.⁴ Notwithstanding this significant latitude, it is well established that "`a party is entitled to have the jury instructed on all of h[er] case theories that are supported by the evidence.'"⁵ Additionally, other courts have held that a trial court's decision on whether to impose sanctions—including an adverse inference instruction—for the destruction or spoliation of evidence, is committed to the trial court's discretion.⁶ Thus, if the district court, in rendering its discretionary ruling on whether to give an adverse inference instruction, "has examined the relevant facts, applied a proper standard of law, and, utilizing a demonstratively rational process, reached a conclusion that a reasonable judge could reach," affirmance is appropriate.⁷

When evidence is willfully suppressed, NRS 47.250(3) creates a rebuttable presumption that the evidence would be adverse if produced. Other courts have determined that willful or intentional spoliation of evidence requires the intent to harm another party through the destruction and not simply the intent to destroy evidence.⁸ We agree. Thus, before a rebuttable presumption that willfully suppressed evidence was adverse to the destroying party applies, the party seeking the presumption's benefit has the burden of demonstrating that the evidence was destroyed with intent to harm.⁹ When such evidence is produced, the presumption that the evidence was adverse applies, and the burden of proof shifts to the party who destroyed the evidence. To rebut the presumption, the destroying party must then prove, by a preponderance of the evidence, that the destroyed evidence was not unfavorable.¹⁰ If not rebutted, the fact-finder then presumes that the evidence was adverse to the destroying party.

Unlike a rebuttable presumption, an inference has been defined as "[a] logical and reasonable conclusion of a fact not presented by direct evidence but which, by process of logic and reason, a trier of fact may conclude exists from the established facts."¹¹ Although an inference may give rise to a rebuttable presumption in appropriate cases, an inference simply allows the trier of fact to determine, based on other evidence, that a fact exists. An inference is permissible, not required, and it does not shift the burden of proof.

As the rebuttable presumption in NRS 47.250(3) applies only when evidence is willfully suppressed, it should not be applied when evidence is negligently lost or destroyed, without the...