Fire Ins. Exchange v. Zenith Radio Corp., 17319

• Decision Date: 31 December 1987
• Docket Number: No. 17319,17319
• Court: Nevada Supreme Court
• Parties: FIRE INSURANCE EXCHANGE, Appellant, v. ZENITH RADIO CORPORATION, a Delaware corporation, Charleston TV & Appliance, a Nevada corporation, Respondents.

Page 911

747 P.2d 911

103 Nev. 648

FIRE INSURANCE EXCHANGE, Appellant, v. ZENITH RADIO CORPORATION, a Delaware corporation, Charleston TV & Appliance, a Nevada corporation, Respondents.

No. 17319.

Supreme Court of Nevada.

Dec. 31, 1987.

Simmons, Madson & Snyder, Las Vegas, for appellant.

Johnson & Rosenberger, Las Vegas, for respondents.

OPINION

YOUNG, Justice:

The subject of this appeal is the sanction imposed by the district court under NRCP 37(b). We find no abuse of discretion, and therefore, affirm the judgment of the district court.

Appellant, Fire Insurance Exchange, insured the home of Carmen and Fulvia Di Lorenzo, which was destroyed by fire on July 30, 1980. The home was unoccupied at the time of the fire; therefore, there were no eye witnesses to the ignition and spread of the fire.

Richard Whitaker, appellant's property claims representative, conducted a preliminary investigation of the residence on the date of the fire. In the course of his investigation, Whitaker looked for evidence supporting subrogation liability. Based upon his investigation, Whitaker concluded the fire originated in the area of a television set, H.B.O. Converter, and lamp. Thereafter, Whitaker told his supervisor of the potential subrogation claim against the manufacturers of these products, and Fire Insurance Exchange retained Daniel J. Bowker, a fire cause and origin expert, to investigate the cause of the fire.

Bowker accompanied Whitaker to the destroyed residence on August 4, 1980. Based upon his observations, Bowker advised Whitaker that the fire had originated in the area of the television set and H.B.O. Converter. Bowker later testified in his deposition that the fire originated inside the television set. Although Bowker was not trained in electrical engineering, or television set design and manufacturing, he took no steps to preserve the television set because he felt the remains were insufficient to conduct tests that might determine whether an electrical fault was the cause of the fire.

The residence remained in its damaged condition until approximately September 1, 1980, when contractors were engaged by Fire Insurance Exchange to remove the debris--including the television set--from the home.

On December 9, 1982, over two years after the fire and the disposal of the television set, Fire Insurance Exchange filed its complaint against Zenith Radio Corporation, the manufacturer of the television set, and Charleston TV & Appliance Company, the retailer. Respondents answered on April 22, 1983, and thereafter, discovery ensued.

On June 14, 1983, respondents served interrogatories on Fire Insurance Exchange. Interrogatory No. 45 requested the following information:

State the present location of the television set described in Plaintiff's Complaint and the name of the person or entity giving the address and telephone number of each person or entity having possession and control of the television set or its component parts.

No answer was provided until October 1983, when Fire Insurance Exchange evasively answered the interrogatory as "unknown."

A request for the production of the television set was filed by respondents on July 25, 1983. On May 7, 1984, the district court ordered Fire Insurance Exchange to produce the television set.

Thereafter, respondents served supplemental interrogatories on June 8, 1984, inquiring:

What became of the television set at issue here?

(a) If you are not sure, who do you believe would have such knowledge?

(b) Was the television set at issue here destroyed? If so, why was it destroyed, who destroyed it and explain any other details surrounding its destruction.

Fire Insurance Exchange failed to answer the supplemental interrogatories until November 1984, when it stated:

Dan Bowker--Bowker Fire Cause Consultants would be able to explain what happened to the television set in question.

On September 12, 1985, respondents moved for sanctions pursuant to NRCP 37; or, in the alternative, exclusion of the testimony of appellant's expert witness and motion for summary judgment. Appellant replied, and the motions were subsequently argued on October 9, 1985, before Judge Pavlikowski. The district court ordered that the testimony of appellant's expert be excluded, and as appellant admitted to having insufficient evidence to prove its case in absence of the expert testimony, the district court granted summary judgment in favor of respondents.

Fire Insurance Exchange appeals from the judgment of the district court.

NRCP 37(a) authorizes the district court to issue orders compelling discovery when a party fails to respond to a request for inspection submitted under NRCP 34. NRCP 34(a) states: "Any party may serve on any other party a request ... to inspect and copy, test, or sample any tangible things which constitute or contain matters within the scope of Rule 26(b) and which are in the possession, custody or control of the party upon whom the request is served...." (Emphasis added.) Fire Insurance Exchange argues: the television set was out of its control prior to the issuance...