Corbetta v. Albertson's, Inc., 98SA128

• Decision Date: 19 January 1999
• Docket Number: No. 98SA128,98SA128
• Citation: 975 P.2d 718
• Parties: 1999 CJ C.A.R. 416 In re Patricia CORBETTA, Plaintiff-Respondent, v. ALBERTSON'S, INC., Defendant-Petitioner, and Fresh Express, Inc., Defendant.
• Court: Colorado Supreme Court

Page 718

975 P.2d 718

1999 CJ C.A.R. 416

In re Patricia CORBETTA, Plaintiff-Respondent, v. ALBERTSON'S, INC., Defendant-Petitioner and Fresh Express, Inc., Defendant.

No. 98SA128.

Supreme Court of Colorado En Banc.

Jan. 19, 1999.

Montgomery, Kolodny, Amatuzio, Dusbabek & Parker, L.L.P., Lorriane E. Parker, Cook & Fitch, Richard K. Rediger, Denver, for Defendant-Petitioner.

Sanderson & Associates, P.C., Jeffrey S. Gard, David S. Sanderson, Boulder, for Plaintiff-Respondent.

Justice RICE delivered the Opinion of the Court.

In this original proceeding under C.A.R. 21, the petitioner, Albertson's, Inc., seeks a writ prohibiting the trial court from enforcing an order compelling discovery of certain employee files, as well as five years of state and federal tax returns. Petitioner argues that the trial court erred in compelling production of its personnel records without first balancing the interests favoring discovery against the privacy interests of its employees. Further, petitioner alleges that the trial court erred in ordering production of its tax returns because section 13-21-102(6), 5 C.R.S. (1998) bars consideration of evidence of income or net worth when deciding whether to award exemplary damages. We issued a rule to show cause. We now make that rule absolute.

I.

The petitioner is the defendant in a civil action brought in the trial court by Patricia Corbetta (Corbetta). On June 20, 1996, Corbetta allegedly cracked several teeth on a pebble in a spinach salad she purchased in one of petitioner's grocery stores. On May 9, 1997, Corbetta filed a civil action against the petitioner alleging negligence, negligent supervision, premises liability, strict liability in tort, implied warranty of merchantability, and breach of contract. Corbetta did not seek exemplary damages in her initial complaint.

On July 18, 1997, Corbetta filed a request for production of documents pursuant to C.R.C.P. 34, seeking petitioner's state and federal corporate tax returns for the previous five years, as well as the entire employment files of the store manager and all deli/salad bar employees and managers employed at the subject grocery store in the week preceding Corbetta's purchase of the spinach salad.

The petitioner objected to the requests for production, claiming, inter alia, that production would constitute an invasion of privacy. In response, Corbetta filed a motion to compel, requesting "an order requiring [petitioner] to properly and completely respond to [Corbetta's] various discovery requests." Corbetta's motion did not specifically address her requests for production of petitioner's tax returns or personnel files, nor did it enumerate any reasons why Corbetta needed discovery of these items.

On November 14, 1997, the trial court issued an order granting Corbetta's motion, stating, "[t]he discovery requests appear appropriate and Defendant shall respond within 20 days."

The petitioner responded by filing a motion for reconsideration on December 3, 1997, arguing that (1) its tax records were not relevant to the assessment of Corbetta's compensatory damages claims; (2) production of its personnel files would invade the right of privacy or confidentiality of its employees who, notably, were not parties to the suit; and (3) the trial court's order was deficient because it failed to conduct the balancing inquiry which must be undertaken when the right to privacy is invoked.

Nine days later, Corbetta amended her complaint to include a claim for exemplary damages. ¹ In responding to the petitioner's motion for reconsideration, Corbetta alleged that the petitioner's tax records were relevant not only to her newly asserted punitive damages claim, but also to her negligence claims.

On March 5, 1998, the trial court declined to reconsider its order compelling discovery of petitioner's personnel files and tax records. While the trial court did not address the petitioner's privacy claim directly, it noted that the employment files were not the property of the employees but, rather, were merely files created and kept by the petitioner. Although it noted that there may be information within the personnel files that does relate to the employees' intimate selves, the trial court held that it could not speculate as to what information might be within said files. Notably, the trial court's order does not reflect any balancing of the competing interests for and against discovery of these files. ² In declining to reconsider its order compelling production of the petitioner's tax records, the trial court held that petitioner's objection was moot in light of Corbetta's newly asserted punitive damages claim. This petition for a writ of prohibition followed.

II.

Under the Colorado Rules of Civil Procedure, the scope of discovery is very broad. See Kerwin v. District Court, 649 P.2d 1086, 1088 (Colo.1982). For example, C.R.C.P. 26(b)(1) provides:

[p]arties may obtain discovery regarding any matter, not privileged, which is relevant to the subject matter involved in the pending action.... The information sought need not be admissible at the trial if the information sought appears reasonably calculated to lead to the discovery of admissible evidence.

In addition, when resolving discovery disputes, we construe the rules of civil procedure liberally to effectuate the full extent of their truth-seeking purpose. See Smith v. District Court, 797 P.2d 1244, 1248 (Colo.1990). In keeping with these tenets, motions to compel discovery are committed to the discretion of the trial court, and the court's determination must be upheld on appeal absent a clear abuse of discretion. See Williams v. District Court, 866 P.2d 908, 911 (Colo.1993); Gagnon v. District Court, 632 P.2d 567, 569 (Colo.1981).

III.

The petitioner argues that the trial court abused its discretion by failing to balance the competing interests served by granting or denying discovery of the personnel files. More specifically, the petitioner argues that the trial court was required to conduct the three-part balancing test set forth in Martinelli v. District Court, 199 Colo. 163, 173-76, 612 P.2d 1083, 1091-93 (1980), before granting plaintiff's motion to compel production of these files. We agree.

While the information sought in discovery need not be admissible at trial, C.R.C.P. 26(b)(1) provides that it must be "reasonably calculated to lead to the discovery of admissible evidence." However, relevancy is not the end of the inquiry. An additional test is necessary when a party opposes discovery on the ground that it would violate a right to privacy or a right to confidentiality. See Williams, 866 P.2d at 912-13; Martinelli, 199 Colo. at 173-76, 612 P.2d at 1091-93.

The right to privacy protects "the individual interest in avoiding disclosure of personal matters." Whalen v.Roe, 429 U.S. 589, 599, 97 S.Ct. 869, 51 L.Ed.2d 64 (1977); see also Martinelli, 199 Colo. at 173, 612 P.2d at 1091. The right to privacy, alternatively referred to as the "right to confidentiality," encompasses the "power to control what we shall reveal about our intimate selves, to whom, and for what purpose." Martinelli, 199 Colo. at 173-74, 612 P.2d at 1091.

When the right to privacy or confidentiality is invoked, as it has been here, to prevent discovery of personal materials or information, the trial court must conduct a three-part balancing inquiry. ³ This inquiry requires the trial court to consider: (1) whether the individual has a legitimate expectation of nondisclosure; (2) whether disclosure is nonetheless required to serve a compelling state interest; and (3) where a compelling state interest necessitates disclosure of otherwise protected information, how disclosure may occur in a manner which is least intrusive with respect to the right to confidentiality. See Martinelli, 199 Colo. at 174, 612 P.2d at 1091. Furthermore, it must be apparent from the order compelling discovery that the trial court conducted the foregoing test. Id. at 175, 612 P.2d at 1092.

Our review of the trial court's order compelling discovery reveals that it did not apply the foregoing principles. The trial court simply found that the information requested by Corbetta might be relevant and ordered the petitioner to produce the requested personnel files in their entirety. In our opinion, the trial court's failure to apply the Martinelli balancing test requires us to vacate its order compelling discovery of the personnel files. Therefore, we direct the trial court to conduct an in camera examination of the requested personnel files in order to facilitate its application of the Martinelli balancing test and to make specific findings regarding same.

IV.

The petitioner further argues that the trial court abused its discretion by ordering it to produce financial information in conjunction with Corbetta's punitive damages claim in violation of section 13-21-102(6). ⁴ We agree.

Exemplary damages in Colorado are available pursuant only to statute. See Amber Properties, Ltd. v. Howard Elec. & Mechanical Co., 775 P.2d 43, 46 (Colo.App.1988); Kaitz v. District Court, 650 P.2d 553, 556 (Colo.1982); Ark Valley Alfalfa Mills, Inc. v. Day, 128 Colo. 436, 440, 263 P.2d 815, 817 (1953). In 1986, the legislature added the following provision to the exemplary damages statute:

In any civil action in which exemplary damages may be awarded, evidence of the income or net worth of a party shall not be considered in determining the appropriateness or amount of such damages.

§ 13-21-102(6), 6A C.R.S. (1987) (emphasis added).

Our primary task in construing a statute is to ascertain and give effect to the intent of the legislature. See People v. Zapotocky, 869 P.2d 1234, 1238 (Colo.1994). In order to discern legislative intent, we look first to the language of the statute itself. See Farmers Ins. Exch. v. Bill Boom Inc., 961 P.2d 465, 470 (Colo.1998); Seaward Constr. Co. v. Bradley, 817 P.2d 971, 973 (Colo.1991). However, if the...