Corto v. National Scenery Studios, Inc.

• Decision Date: 22 September 1997
• Docket Number: No. 92-CV-558,92-CV-559 and 94-CV-212.,92-CV-558
• Parties: Diana CORTO, Appellant, v. NATIONAL SCENERY STUDIOS, INC., et al., Appellees.
• Court: D.C. Court of Appeals

705 A.2d 615

Diana CORTO, Appellant, v. NATIONAL SCENERY STUDIOS, INC., et al., Appellees.

Nos. 92-CV-558, 92-CV-559 and 94-CV-212.

District of Columbia Court of Appeals.

Argued October 8, 1996.

Decided September 22, 1997.

Frederic W. Schwartz, Jr., Washington, DC, for appellant.

Neil D. Goldman, Alexandria, VA, with whom John Baker McClanahan, Jr., Richmond, VA, was on the brief, for appellee, National Scenery Studios, Inc.

David H. Coburn, Washington, DC, for appellees Theater Now, Inc. and Ralph Roseman.

Frances C. DeLaurentis, with whom James F. Hibey, Washington, DC, was on the brief, for appellee/garnishee, The John F. Kennedy Center for the Performing Arts.

Before FERREN, STEADMAN and RUIZ, JJ.

RUIZ, Associate Judge:

This case arises from an unsuccessful run of West Side Story, produced by Diana Corto, which appeared in the John F. Kennedy Center for the Performing Arts ("Kennedy Center") in 1985. Diana Corto appeals from the judgment of the Superior Court awarding more than $300,000 to National Scenery Studios, Inc. ("National"), Theater Now, Inc. and Ralph Roseman (collectively "Theater Now"), and the Kennedy Center.¹ Corto appeals on a number of grounds. We affirm.²

I.

The Kennedy Center entered into a contract in July 1985 with West Productions Limited Partnership ("West Productions") and the "producer or presenter of the musical West Side Story" for the production of the musical at the Kennedy Center. West Productions is one of the trade names used by Corto; the contract was signed by Corto.³ The contract provided that "all expenses incurred by the Kennedy Center directly or indirectly as a result of, or partially as a result of West Productions' use of the Kennedy Center," other than those expressly specified as the responsibility of the Kennedy Center, "shall be paid by West Productions."⁴ The contract provided for compensation in the form of a share of box office receipts.

Corto contracted with Theater Now, a corporation that provides general management services to stage productions, to be her management company. Theater Now, represented by Ralph Roseman, its general manager, negotiated a contract with National on behalf of West Productions, to build a deck for the sets of West Side Story. Corto signed the contract on behalf of West Productions. Under the contract National was to be paid $18,500 upon completion of the deck. National performed under the contract and was tendered a check in that amount by Theater Now. National twice presented the check for payment; it was returned both times due to insufficient funds.

II.

A chronology of the intricate procedural history of this case is necessary to understand the issues on appeal. The litigation began on September 20, 1985, when National sued Corto individually (trading as West Productions and West Side Story) and as a partner of West Productions; Theater Now; and Ralph Roseman, for the $18,500 due for the deck. Theater Now and Ralph Roseman settled with National⁵ and cross-claimed against Corto to recover, pursuant to their management contract, attorney's fees and costs connected to the litigation. Corto cross-claimed that she had not authorized the contract with National and that Theater Now and Ralph Roseman should indemnify her for her damages, including any amount she may have to pay to National.

To ensure recovery, National had sought to attach cash, credits and property belonging to Corto and her various trade names in the amount of $18,500. National posted a bond for twice that amount with the Superior Court. D.C.Code § 16-501(e) (1996). A writ of attachment was issued by the Superior Court and served on the Kennedy Center as garnishee. The writ provided that any property or credits belonging to Corto which were in the possession of the Kennedy Center were seized by the writ of attachment and that the Kennedy Center was to retain control over all the property used in the production of West Side Story. Corto counterclaimed against National for abuse of process, claiming that in pursuit of the unpaid debt of $18,500, National had caused the attachment of property in excess of that amount. As a result of National's writ, the Kennedy Center inventoried and stored Corto's property related to the production of West Side Story for a number of years and engaged counsel to represent it in connection with the present proceedings. Although Corto had the right to challenge National's writ of attachment in the Superior Court, D.C.Code § 16-506, she did not do so at that time.

In October 1985, a month after National sued her, Corto, individually and under her various trade names, filed a bankruptcy petition with the United States Bankruptcy Court for the Southern District of New York seeking relief under Chapter 11 of the Bankruptcy Code. 11 U.S.C. § 301 (1994). This filing stayed National's lawsuit against Corto. 11 U.S.C. § 362 (1994). This first bankruptcy petition was dismissed almost two years later. Upon dismissal of the bankruptcy petition, Corto retained counsel and filed an answer to the suit pending in Superior Court.

The case was first scheduled to come to trial before Judge Rufus King on March 16, 1990. On March 1, 1990, Corto filed a motion for a continuance, which was granted. Trial was rescheduled to begin on June 11, 1990; however, Corto filed a second motion for continuance, and trial was continued until August 13, 1990, with the court's warning that it would not grant any further requests for continuance. Nevertheless, on August 2, 1990, Corto filed her third motion for a continuance seeking to postpone the August trial date. Although the trial judge found that the motion did not cite any grounds which would persuade the court to further delay the trial date, the case was continued, due to the court's own schedule, to begin on January 7, 1991. After this rescheduling, Corto moved for the recusal of Judge King alleging bias. The recusal motion was denied. Due to amendments to the Superior Court's Rules of Procedure, however, the case was once again rescheduled to begin on June 10, 1991, this time before Judge Colleen Kollar-Kotelly. This was the fifth trial date scheduled for the case. Corto then filed a "Petition For a Stay of Proceedings in the Trial Court" which was considered by the court as another motion for a continuance. This motion was denied.

On June 10, 1991, all parties except Corto appeared for trial. On that same morning, Corto faxed to the trial judge a copy of an unsigned Chapter 13 Voluntary Petition in Bankruptcy (Corto's second bankruptcy petition) filed in the United States Bankruptcy Court for the Western District of New York. As a result of the automatic stay provisions of 11 U.S.C. § 362, the trial was not held. This second bankruptcy petition was dismissed on Corto's motion on July 22, 1991, and the sixth trial date was then set for August 26, 1991. Corto sought to have Judge Kollar-Kotelly recused for bias and to once again postpone the trial date. These motions were denied. All parties were once again ready for trial on August 26, 1991, except for Corto. Corto filed another bankruptcy petition (her third) in the Western District of New York, which, again, stayed the proceedings in the trial court.

On October 4, 1991, the United States Bankruptcy Court for the Western District of New York dismissed Corto's third bankruptcy petition, finding that Corto had failed to prosecute her Chapter 13 plan by willfully failing to comply with orders issued by the bankruptcy court. Trial in the Superior Court was then, for the seventh time, rescheduled to begin on January 13, 1992. Corto informed the court on January 10 that she had not received notice of the January 13 trial date and that she would be unable to appear on that date due to claimed conflicts. Although she was then informed that the trial was still scheduled to proceed on January 13, 1992, Corto did not appear for trial.

On January 13, 1992, the trial court was notified by fax that Corto's mother and son had on that same day filed an involuntary petition for bankruptcy against Corto in the United States Bankruptcy Court for the Western District of New York. When notified of the petition, the court left messages for Corto on her answering machine to call immediately. The phone calls were not returned. After considering the involuntary petition filed by Corto's mother and son, and the bankruptcy court's October 4, 1991, order dismissing Corto's third bankruptcy petition, the trial court determined that the automatic stay provision of the Bankruptcy Code was "inapplicable" to the current proceedings because the involuntary bankruptcy filing contravened the bankruptcy court's order prohibiting Corto from becoming a debtor under Title 11 of the United States Code for a period of 180 days.⁶ In making its decision, the trial court also considered Corto's failure to request a continuance for the last trial date, her failure to respond to the court's messages left on her answering machine, her purposeful and repeated delays to avoid trial and her faxing of bankruptcy petitions on the same day of trial on two prior occasions. Corto's sister, Ms. Margaret Pesta, also telephoned the court on the same date to inform the court that Corto was ill. The court however, deemed Corto's sister's phone call as not credible and insufficient to warrant a continuance. The case proceeded to trial without Corto.

National requested that the bankruptcy court dismiss the involuntary petition filed by Corto's mother and son. Two months after trial, in an order dated March 25, 1992, the bankruptcy court noted that the three bankruptcy petitions filed by Corto, had "been filed for the sole purpose of preventing trial from going forward in the case of National." Although the bankruptcy court did not, at that time,⁷ dismiss the involuntary petition because Corto's mother had been unavailable to appear at a hearing for medical reasons, the court ordered that "any...