Hammonds v. Osteopathic Hosp. Founders Ass'n

• Decision Date: 17 September 1996
• Docket Number: Nos. 84357,82183,s. 84357
• Citation: 1996 OK 100,934 P.2d 319
• Parties: James L. HAMMONDS, Executor of the Estate of Varl Hammonds, now deceased, and W.C. Sellers, the real party in interest, Appellants, v. OSTEOPATHIC HOSPITAL FOUNDERS ASSOCIATION, d/b/a Oklahoma Osteopathic Hospital, Kenneth H. Stover, Inc., Kenneth H. Stover, D.O., and Stephen Fletcher, D.O., Appellees. Mack M. BRALY, Appellant, v. The Honorable Robert J. SCOTT, Judge of the District Court; Osteopathic Hospital Founders Association, d/b/a Oklahoma Osteopathic Hospital; Kenneth H. Stover, D.O., Inc.; and Steven Fletcher, D.O., Appellees.
• Court: Oklahoma Supreme Court

Page 319

934 P.2d 319

1996 OK 100

James L. HAMMONDS, Executor of the Estate of Varl Hammonds,

now deceased, and W.C. Sellers, the real party in

interest, Appellants, v. OSTEOPATHIC HOSPITAL FOUNDERS ASSOCIATION, d/b/a Oklahoma

Osteopathic Hospital, Kenneth H. Stover, Inc.,

Kenneth H. Stover, D.O., and Stephen

Fletcher, D.O., Appellees.

Mack M. BRALY, Appellant, v. The Honorable Robert J. SCOTT, Judge of the District Court;

Osteopathic Hospital Founders Association, d/b/a Oklahoma

Osteopathic Hospital; Kenneth H. Stover, D.O., Inc.; and

Steven Fletcher, D.O., Appellees.

Nos. 84357, 82183.

Supreme Court of Oklahoma.

Sept. 17, 1996.

Rehearings Denied March 3, 1997.

Mack M. Braly, Tulsa, Jim Gassaway, Gassaway & Harris, Tulsa, George Braly, Braly & Braly, Ada, W.C. Sellers, W.C. Sellers, Jr., Sapulpa, for Appellants.

Joseph A. Sharp, John H.T. Sheridan, Karen M. Grundy, Best, Sharp, Holden, Sheridan, Best & Sullivan, Tulsa, Mike Barkley, Ann Makela Schneider, F. Will DeMier, Leslie C. Weeks, Barkley, Rodolf & McCarthy, Tulsa, for Appellees.

OPALA, Justice.

A single issue is dispositive of the two consolidated causes. Did the trial court abuse its discretion by imposing the 12 O.S.1991 § 2011 ¹ sanction against Braly and Sellers, counsel in the case, for prosecuting Hammonds' motion to impose sanctions upon the defendants? Our answer is in the affirmative.

I THE ANATOMY OF LITIGATION

While a patient at Oklahoma Osteopathic Hospital [Hospital], Varl Hammonds [Hammonds or patient] escaped his restraints on November 8, 1982 and fell from his third-floor room's window. Joyce Walters (his daughter) moved him the next day to another facility. Contemporaneously with the transfer, she secured from Hospital a copy of her father's medical charts.

A lawyer named D.B. originally represented Varl Hammonds. After he had completed an investigation of Hammonds' injury, the Hammonds' legal representation fell to S.W., who in 1984 brought a negligence action against Hospital, Stover and Fletcher ² [collectively "defendants"]. ³ It was while S.W. was preparing for trial in December 1990 that he first came to realize there were three different versions of Hammonds' medical charts. S.W. retained Messrs. Braly and Sellers to serve as his co-counsel. The latter lawyers moved on February 19, 1991 for sanctions against the defendants (by striking their answers). They alleged that the defendants (or their lawyers) improperly modified the produced medical records of the patient. ⁴ The motion was signed by Braly. ⁵ The defendants' responses sought sanctions (against Braly and Sellers).

Following a three-day hearing the trial judge denied Hammonds' motion and, on Sellers timely moved for a new trial. His motion was denied on September 14, 1994, and he appealed on September 22, 1994. ⁷ Pursuing a different course for corrective relief from the same sanction order, Braly timely brought an appeal on August 26, 1993. After an adverse decision, he sought certiorari, which was granted. The Sellers appeal and the Braly certiorari quest stand consolidated for disposition by a single opinion.

January 2, 1992, imposed a § 2011 ⁶ sanction against Braly and Sellers, as joint obligors. Once the monetary amount to be imposed as sanction had been set, the proceedings were memorialized and placed of record on July 30, 1993.

II THE STANDARD OF REVIEW

The correctness of a nisi prius imposition of sanctions is reviewed under an abuse-of-discretion standard. ⁸ If the trial court's decision stands supported by the record and reason, it will not be disturbed on review. ⁹ In assaying the reasonableness of Braly and Sellers' professional pre-filing inquiry into the integrity of the medical records in question, we are duty-bound to consider four factors: (1) the amount of time available to the signer for conducting relevant factual and legal investigations; (2) the necessity for reliance on a client for underlying factual information; (3) whether the case was referred to the signer by another member of the bar; and (4) the plausibility of the legal position advocated. ¹⁰

III

THE CRITERIA FOR IMPOSING THE § 2011

SANCTIONS

Under the terms of 12 O.S.1991 § 2011, sanctions may be visited upon a legal practitioner who signed the critical document on file. ¹¹ If the standards prescribed by § 2011 are offended, the violation is complete when the signed paper is filed. The text of § 2011 coincides with that of the 1983 version of Fed.R.Civ.Proc. Rule 11. ¹² Before deciding whether the requested sanction should be imposed, the trial judge must ascertain if, when first setting in motion the critical stage, the offending counsel could reasonably have argued in support of the legal theory that was being advanced. ¹³ In order to escape the condemnation sought, it is not necessary that counsel--against whom sanctions are requested--prevail upon the invoked theories. ¹⁴

The appropriateness of sanctions depends on the pre-filing conduct by counsel who signed the critical document. That conduct must be tested by a standard of objective reasonableness under the then-existing circumstances. ¹⁵ Sanctions are appropriate only for (a) frivolous filing ¹⁶ or for (b) filing made with an improper purpose in mind. ¹⁷

IV

TESTING WHETHER THE TRIAL COURT ABUSED ITS DISCRETION IN

SANCTIONING BRALY AND SELLERS

Hammonds' suit was first filed in 1984. Braly and Sellers were not joined as plaintiff's counsel until the latter part of 1990. When they came to the case, at least three different versions of Hammonds' medical charts had been discovered. ¹⁸ Copies of these versions were furnished them by S.W., the lawyer who had commenced the suit. It is unrefuted that (a) when Braly and Sellers were retained, S.W. assumed that he had all of Hospital's medical records for the Hammonds case ¹⁹ and (b) he had failed to request the defendants to provide him a "complete" copy of Hospital's charts. It is equally clear that a "complete" copy of Hammonds' medical charts stood attached to a sealed 1985 deposition by Stover (which S.W. had taken). The defendants do not refute that, after his release from the Hospital, Hammonds' medical records were modified. During the May 28-29, 1991 nisi prius hearing (on plaintiff's motion for sanctions) Hospital explained that all the Stover modifications of the critical medical records were entered within a reasonable time (six days) after Hammonds' discharge.

It was but a month before trial ²⁰ and at the end of the discovery process that Braly and Sellers were brought into the case as S.W.'s co-counsel. When Braly signed the motion for sanctions, he knew that there were three different versions of Hammonds' medical charts and that (in some form) all three had emanated from Hospital, either directly or through its counsel. Even if Braly and Sellers had been aware--which they concededly were not--that the version of Hammonds medical records which was given to them as a trial exhibit was identical to that which stood attached to Stover's 1985 deposition, they would not have had an adequate answer to the critical question of why and when the suspicious-appearing modifications were made. The deposition exhibit, which would have supplied nothing more than that Hospital's records had been altered, would not have satisfied the inquiry to be pressed. Their concerns about the critical records' integrity were no doubt fortified when, during Braly and Sellers' pre-filing inquiry, Dr. Morrell, an expert in medical documentation, told them that the records provided for the Hammonds case were unreliable. ²¹ Considering that Braly and Sellers were retained a short time before trial, it was far from unreasonable for them (a) to place reliance on the materials earlier secured by If the discovery probing by Hammonds' earlier counsel was indeed legally inadequate (because it did not resolve the discrepancies between the differing versions of Hammonds' medical records), an issue we need not reach today, the deficient handling by those professionals could not be foisted upon Braly and Sellers. The latter stand sanctionable, if at all, for no other misdeeds than their own.

their client and by co-counsel and (b) to challenge the patent alterations as the entering physician's self-serving afterthoughts.

Braly and Sellers entered the case shortly before trial. They were confronted with three differing versions of a critical record--Hospital's medical charts for Hammonds. They did secure the opinion of an expert that the records had been altered in an effort to add strength to the defendants' defensive posture in the case. The circumstances known and knowable when the plaintiff's motion for sanctions was filed, and the rational inferences that may be drawn from them, all serve to support the reasonableness of Braly and Sellers' decision to press Hammonds' motion. Their conduct amply meets the § 2011 standards for pre-filing investigation.

V

THE VITRIOLIC RHETORIC USED BY BRALY (AND SELLERS) IN THE

PLAINTIFF'S MOTION FOR SANCTIONS DOUBTLESS DIVERTED THE

TRIAL JUDGE'S FOCUS FROM THE CRITERIA THAT GOVERN THE

IMPOSITION OF § 2011

SANCTIONS--THE REASONABLENESS OF COUNSEL'S PRE-FILING INQUIRY

The trial court's order sanctioning Braly and Sellers is a product of its over focusing on the vitriolic rhetoric used in the plaintiff's motion for sanctions. ²² This undoubtedly led the court into erroneously concluding that a complete exoneration of the defense would establish the challenged litigation conduct by plaintiff's counsel to be ipso facto sanctionable. In short, the defendants' blamelessness came to be inextricably interconnected with Braly and Sellers' culpability. While we do not condone the harsh tone of either the motion's text or that of its supporting brief, we must not confuse the defendants' (and their lawyers') well-documented blamelessness with an automatic condemnation of Braly and Sellers. The latter were not required to prevail upon Hammonds' motion in order to escape ...