Hahm v. Hills

Decision Date10 October 1984
Docket NumberA-8107-04433
Citation70 Or.App. 275,689 P.2d 995
PartiesMin Boo HAHM and Miryung Hahm, Walter F. Brown and Barbara Brown, Edward Buhn and Virginia Buhn and Edith Hawley, Edwin Y. Chen and Jessie Y. Chen, Lloyd Danielson and Janice Danielson, John M. DeGroat and Michel DeGroat, Eileen Grigsby, Eugene M. Hahn, James P. Holson, as custodian for Eric R. Holson, a minor, James P. Holson, as trustee for the James P. Holson Trust, H. Ross McDowell and Dorothy L. McDowell, Michael J. O'Gara and Janelle O'Gara, Mark P. Ronayne and Linda Ronayne, Allen G. Stechmesser, Robert W. Sudlow and Allen G. Stechmesser, as joint venturers, Allen G. Stechmesser and Robert W. Sudlow, as trustees for the Far West Marketing Profit Sharing Trust Fund, Joseph Stronko, Constance M. Vance, Darrell Williams and Daphne Williams, Patrick Ross Crosby, Respondents, v. John HILLS, Appellant, and Robert Landman, Defendant. ; CA A26507.
CourtOregon Court of Appeals

Jeffrey M. Batchelor, Portland, argued the cause for appellant John Hills. With him on the briefs were Wayne Hilliard, Milo P. Petranovich, and Spears, Lubersky, Campbell, Bledsoe, Anderson & Young, Portland.

Gary M. Berne, Portland, argued the cause for respondents Min Boo Hahm and Miryung Hahm, Walter F. Brown and Barbara Brown, Edward Buhn, Virginia Buhn and Edith Hawley, Edwin Y. Chen, Jessie Y. Chen, Lloyd Danielson, Janice Danielson, John M. DeGroat, Michel DeGroat, Eileen Grigsby, Eugene M. Hahn, James P. Holson, as custodian for Eric R. Holson, a minor, James P. Holson, as trustee for the James P. Holson Trust, H. Ross McDowell, Dorothy L. McDowell, Michael J. O'Gara, Janelle O'Gara, Mark P. Ronayne, Linda Ronayne, Allen G. Stechmesser, Robert W. Sudlow, Allen G. Stechmesser as joint venturers, Allen G. Stechmesser, and Robert W. Sudlow, as trustees for the Far West Marketing Profit Sharing Trust Fund, Joseph Stronko, Constance M. Vance, Darrell Williams, Daphne Williams, and Patrick Ross Crosby. With him on the briefs was Stoll & Stoll, P.C., Portland.

Before GILLETTE, P.J., and VAN HOOMISSEN and YOUNG, JJ.

VAN HOOMISSEN, Judge.

This is a securities case in which plaintiffs alleged that defendant Hills and others violated state and federal securities laws. They sought $569,000 in damages plus more than $200,000 in attorney fees, expenses and costs. Defendant Hills appeals from a judgment for plaintiffs. The dispositive issue is whether the trial court abused its discretion in striking defendant's appearance, in declaring him in default and in entering judgment for plaintiffs. We conclude that it did.

Plaintiffs' complaint alleges that they had invested in securities relating to the purchase of various real properties, that unregistered securities were sold to them in violation of state and federal securities laws, and that defendant, an attorney, participated in those sales by preparing legal documents and by making representations to them regarding the tax consequences of the investments. On March 30, 1982, plaintiffs' attorney formally noticed defendant's deposition for April 6. Because of illness, defendant did not appear for that deposition. However, he did appear for his deposition on April 14. Plaintiffs' attorney did not complete the deposition on April 14, and two months later the parties' attorneys agreed to continue it on July 7. Defendant's attorney informed him of the new date and he agreed to appear. Plaintiffs' attorney subsequently canceled the July 7 date because he wanted to complete other discovery before continuing with defendant's deposition. On July 19, plaintiff's attorney formally noticed the continuation of defendant's deposition for August 4. Defendant's attorney attempted to inform him of the August 4 date. He made several telephone calls to defendant's office and he sent him letters informing him of the August 4 date. Defendant did not acknowledge his attorney's telephone calls or letters and he failed to appear on August 4.

On August 12, plaintiffs' attorney moved the trial court for a sanction against defendant. See ORCP 46. 1 He recommended that defendant be required to pay $20 for the court reporter who appeared at the deposition and $80 for plaintiffs' attorney fees. He further recommended that defendant be required to appear at plaintiff's attorney's office for deposition, that he be required to pay attorney fees for the additional time required to prepare for the next deposition, and that defendant be held in contempt of court should he again fail to appear. Instead of allowing plaintiff's motion in whole or in part, the trial court concluded that "the perfect sanction is to strike [his] appearance and hold him in default," which is what the court eventually did.

On August 16, defendant's attorney moved for reconsideration. In his affidavit, the attorney stated that he had met defendant on August 14, that defendant had told him that he was unaware of the August 4 deposition, that he would appear for his deposition if it were rescheduled and that he would call his attorney on August 16 to arrange for that rescheduling. On August 24, the trial court entered a default order, and on September 3, the court denied defendant's motion for reconsideration. On October 22, judgment was entered for plaintiffs. Defendant's attorney then moved to relieve defendant from the judgment. See ORCP 71 B. Appearing personally, defendant told the trial court that he had had personal problems connected with his then-pending divorce, that on July 16, he and a builder with whom he had been associated "basically closed up shop," and that he first learned of the August 4 deposition when he returned to his office in mid-August. The trial court refused to set the judgment aside.

Defendant contends that the trial court erred in, sua sponte, striking his appearance and declaring him in default. He argues that ORCP 46 requires a showing that he wilfully or inexcusably violated a discovery order in order for the trial court properly to strike his appearance and order a default and he argues that there is no such showing here.

Before the adoption of ORCP 46, a motion to strike pleadings for failure to appear for a deposition was governed by ORS 45.190. That statute required a showing of wilfulness. Grant's Mechanical, Inc. v. Olson, 284 Or. 75, 584 P.2d 1387 (1978); Peterson v. Day, 283 Or. 353, 584 P.2d 253 (1978); Williams and Williams, 47 Or.App. 1159, 615 P.2d 1178 (1980).

ORCP 46 is derived from FRCP 37. 2 See Comment to ORCP 46. Federal cases construing FRCP 37 are probative in interpreting ORCP 46. See Garrison v. Cook, 280 Or. 205, 570 P.2d 646 (1977); Karsun v. Kelley, 258 Or. 155, 482 P.2d 533 (1971); Santiam Fish & Game Ass'n v. Tax Com., 229 Or. 506, 368 P.2d 401 (1962). Under FRCP 37, pleadings may be stricken when noncompliance with a discovery order has been wilful or in bad faith, or where noncompliance is occasioned by the fault of the sanctioned party. Societe Internationale v. Rogers, 357 U.S. 197, 78 S.Ct. 1087, 2 L.Ed.2d 1255 (1958). In National Hockey League v. Metropolitan Hockey Club, 427 U.S. 639, 96 S.Ct. 2778, 49 L.Ed.2d 747, reh. denied 429 U.S. 874, 97 S.Ct. 197, 50 L.Ed.2d 158 (1976), the Supreme Court framed the standard for review under the federal rule:

"The question, of course, is not whether this court, or whether the Court of Appeals would, as an original matter have dismissed the action; it is whether the district court abused its discretion in so doing." 427 U.S. at 642, 96 S.Ct. at 2780.

Under the federal rule, the most severe sanctions are imposed only when they are necessary to preserve the integrity of the judicial system or in some other extreme circumstance. See, e.g., Litton Systems, Inc., v. American Tel. & Tel. Co., 700 F.2d 785, 828 (2d Cir.1983); Chira v. Lockheed Aircraft Corp., 634 F.2d 664, 666 (2d Cir.1980); Cine Forty-Second Street Theater v. Allied Artists Picture Corporation, 602 F.2d 1062 (2d Cir.1979).

On August 12, the trial court was aware only that, because of illness, defendant, an attorney, had failed to appear at the April 6 deposition, that, without explanation, he had failed to appear at the August 4 deposition, and that his attorney had several times attempted to notify him about the August 4 deposition. Imposition of the ultimate sanction was based on that record and on the trial court's conclusion that, as an attorney, defendant "knows his obligations to [his attorney] and to the Court, and [his] failure to keep in touch with [his attorney] indicates to [the court] that sanctions are appropriate." 3 Without deciding whether the record here would have permitted the trial court to do so, we note...

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  • Chong Ok Chang v. Eun Hee Chun
    • United States
    • Oregon Court of Appeals
    • 1 Julio 2020
    ..., 123 Or. App. 388, 391, 859 P.2d 1185 (1993), rev'd on other grounds , 319 Or. 429, 877 P.2d 1196 (1994) (citing Hahm v. Hills , 70 Or. App. 275, 279-80, 689 P.2d 995 (1984) ). We review the grant of a motion to dismiss for failure to state a claim under ORCP 21 A(8) for legal error. Rivas......
  • Pamplin v. Victoria
    • United States
    • Oregon Court of Appeals
    • 24 Enero 1996
    ...sanction of dismissal. Dismissal is the most drastic of sanctions, to be reserved for the most severe violations. Hahm v. Hills, 70 Or.App. 275, 281, 689 P.2d 995 (1984). As the Supreme Court said in Pamplin, the trial court must set forth "the analytical process by which [it] concluded tha......
  • Weber v. Mahler
    • United States
    • Oregon Court of Appeals
    • 29 Septiembre 1999
    ...terms of the letter opinion, the court abused its discretion in dismissing plaintiff's action with prejudice. See Hahm v. Hills, 70 Or.App. 275, 280, 689 P.2d 995 (1984). Plaintiff also assigns error to the trial court's decision to award defendants attorney fees.3 The trial court awarded d......
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    • 25 Octubre 1995
    ...858 P.2d 1313 (1993). The court's failure to comply with the applicable rules is such an abuse of discretion. See Hahm v. Hills, 70 Or.App. 275, 280-81, 689 P.2d 995 (1984). ORCP 46B(2)(c) provides that a trial court may impose various sanctions if a "fails to obey an order to provide or pe......
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