Lawson v. Brown's Home Day Care Center

Decision Date08 July 2004
Docket NumberNo. 03-112.,03-112.
PartiesKatherine LAWSON and Bradley Lawson v. BROWN'S HOME DAY CARE CENTER, INC. and Lucille Nelson and Robert Nelson, Jr. (Duncan F. Kilmartin, Appellant).
CourtVermont Supreme Court

Present: AMESTOY, C.J., DOOLEY, JOHNSON and SKOGLUND, JJ., and FREDERIC W. ALLEN, C.J. (Ret.), Specially Assigned.

ENTRY ORDER

¶ 1. Duncan Kilmartin appeals from the trial court's order, on remand, upholding its imposition of $2000 in sanctions. The court found that Kilmartin acted in bad faith in filing unsealed materials from a confidential mediation session with the court. Kilmartin argues that the court's order should be reversed because: (1) he was deprived of his due process right to advance notice that his conduct was proscribed; (2) due process required proof of his misconduct beyond a reasonable doubt; (3) the trial court erred in finding that he acted in bad faith; and (4) the court lacked jurisdiction to sanction him after August 10, 1998 when the underlying case was dismissed.

¶ 2. As discussed below, we find these arguments without merit. The trial court was ordered on remand to determine Kilmartin's motivation in disclosing confidential materials. See Lawson v. Brown's Day Care Ctr., Inc., 172 Vt. 574, 574, 776 A.2d 390, 391 (2001) (mem.) ("We reverse and remand for a determination on the issue of Kilmartin's motivation in making the disclosure."). We explained that if the court found that Kilmartin had revealed the mediation materials in bad faith, "then a sanction would be an appropriate exercise of the court's inherent powers." Id. at 578, 776 A.2d at 395. The court's finding that Kilmartin acted in bad faith is supported by the record, and the court did not abuse its discretion in imposing sanctions. See Chambers v. NASCO, Inc., 501 U.S. 32, 55, 111 S.Ct. 2123, 115 L.Ed.2d 27 (1991) (court's exercise of its inherent powers reviewed for abuse of discretion). We therefore affirm.

¶ 3. The facts underlying this appeal are largely set forth in our entry order reversing and remanding this case to the trial court. See Lawson, 172 Vt. at 574-76,776 A.2d at 390-93. Briefly restated, Kilmartin was counsel for defendants in an underlying civil action. Significant animosity developed between Kilmartin and plaintiffs' counsel, Gareth Caldbeck, which manifested itself in numerous filings with the trial court. Despite being ordered to refrain from personally attacking one another, their behavior continued. See id. at 574, 776 A.2d at 391. On June 18, 1998, Kilmartin filed an "emergency" motion to disqualify Caldbeck, accusing him of obstruction of justice, subornation of perjury, and presentation of false evidence. See id. The motion was denied.

¶ 4. On June 22, 1998, the parties began court-ordered mediation, agreeing that all proceedings would remain confidential. Shortly thereafter, Kilmartin filed unsealed documents with the court accusing Caldbeck of unethical and illegal conduct. These filings included a copy of a proposed settlement agreement, and they disclosed discussions that had occurred during mediation. Caldbeck similarly filed material from the mediation session with the court. The court ordered the temporary seal of certain pages of these documents to protect the confidentiality of the parties' mediation and settlement discussions.

¶ 5. On August 10, 1998, the underlying case was dismissed with prejudice based on the parties' stipulation. On August 21, the court issued a show cause order, asking Kilmartin and Caldbeck to demonstrate why sanctions should not be imposed for their violation of the confidentiality of the mediation session. After a hearing, the court imposed sanctions against both attorneys pursuant to its inherent powers.

¶ 6. Kilmartin appealed, arguing that he had been denied procedural due process, and that his professional responsibilities required him to make the disclosure that was the subject of sanctions.1 See id. at 574, 776 A.2d at 390. We reversed and remanded, holding that the trial court lacked the authority to sanction Kilmartin through its inherent powers absent a finding of bad faith or other exceptional circumstances. Id. at 576, 776 A.2d at 393. We thus remanded for a determination of Kilmartin's motivation in making the disclosure. As we explained, Kilmartin was entitled to "some explanation why the reasons [he offered] for the disclosure were not only wrong, but so wrong that they were advanced in bad faith." Id. We recognized that the court's imposition of sanctions raised due process concerns, but we concluded that these concerns would be addressed by a finding of bad faith. Id. at 577-78, 776 A.2d at 394 (explaining that "attorneys in this state are on notice that negotiating in bad faith during settlement negotiations can result in sanctions.").

¶ 7. On remand, and after a hearing, the trial court issued a lengthy order upholding its imposition of sanctions after finding that Kilmartin acted in bad faith. In reaching its conclusion, the court considered Kilmartin's justification for his behavior, i.e., "to disclose unethical conduct and/or potentially criminal conduct and to disqualify the opposing lawyer," in light of all the facts and circumstances. The court found Kilmartin's explanation inconsistent with his conduct, and, based on numerous findings, it concluded that Kilmartin had acted in bad faith in filing confidential materials with the court.

¶ 8. To place Kilmartin's behavior in context, the court first recounted in detail the "unnecessary, unprofessional, and distracting" behavior exhibited by counsel in the underlying proceedings. The court turned next to the specific acts that formed the basis of its sanction order: Kilmartin's repeated filing of documents protected by the confidentiality of the mediation process. As the court explained, on July 2, 1998, Kilmartin filed a complicated motion seeking permission to appeal the court's denial of his emergency motion to disqualify Caldbeck, or alternatively, to suspend and disqualify Caldbeck. In his motion, Kilmartin accused Caldbeck of misconduct in preparation of the settlement agreement, and he repeated his earlier charge that Caldbeck had prepared false affidavits. Kilmartin described specific discussions that took place during the June 22 mediation session, and attached a draft settlement agreement as an exhibit. Kilmartin did not request that any portion of the motion be sealed, and it became a matter of public record upon filing, even though the settlement process was ongoing. Kilmartin filed two additional motions that included discussions of events that had occurred during mediation, as well as an affidavit from a mediation participant.

¶ 9. The court compared this behavior with the justification proffered by Kilmartin, and found that, although his claimed purposes appeared facially valid, they did not justify his actions. The court explained that if Kilmartin's purpose was to disclose unethical conduct, the filing of confidential material from the mediation session with the trial court three times between July 2 and July 10 in the context of the filing of civil motions was not the way to do it. Similarly, the court found that if Kilmartin's purpose was to disclose potentially criminal conduct, the filing of the confidential material in motions with the trial court was ineffectual. If his intent was to disqualify Caldbeck, the court found no reason why this required him to place confidential mediation information into the public record when reasonable alternatives existed. Moreover, the court found that this asserted purpose did not justify the filing of confidential material not only once, but repeatedly, including after the court had ordered that it would temporarily seal such material. Thus, because Kilmartin's stated objectives were inconsistent with his conduct, the court found that this raised serious questions about his motivation.

¶ 10. The court placed significant importance on the context in which the filings had occurred. As the court found, at the time of Kilmartin's actions: there was a high degree of animosity between the parties; Kilmartin had engaged in a pattern of "baiting" Caldbeck; Kilmartin had been sanctioned twice for discovery violations that involved wilful, knowing refusals to provide information to Caldbeck; Kilmartin had already tried twice unsuccessfully to disqualify Caldbeck, and his behavior occurred in the context of a third attempt; Kilmartin acted swiftly to seek Caldbeck's disqualification without the support of defendants' other attorneys at a time when the case was already substantially settled; the disqualification of Caldbeck would have deprived plaintiffs of the one attorney familiar with their case at a time when they were near settlement, and it would have foiled Caldbeck's attempt to settle the claim in a timely manner; and most importantly, none of Kilmartin's stated purposes were advanced by the public filing of confidential material from the mediation process.

¶ 11. Based on its findings, the court found the presence of five elements that, collectively, compelled a finding of bad faith. These included: (1) the conduct was in violation of a duty to the court; (2) the conduct was not the result of an inadvertent mistake but consisted of conscious acts; (3) the proffered justification, though valid on its face, was not supported by the actual conduct; (4) the conduct was prompted by an improper purpose; and (5) it involved ill will. After analyzing Kilmartin's behavior with respect to each of these factors, the court upheld its imposition of sanctions. ¶ 12. Kilmartin filed several post-judgment motions. In one of these motions, Kilmartin asserted, for the first time, that he was entitled to have proof of his misconduct established beyond a reasonable doubt because the court's sanction was punitive. The court rejected this argument. It explained that at the...

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8 cases
  • In re Duckman
    • United States
    • Vermont Supreme Court
    • March 10, 2006
    ...faith, but also provide notice and an opportunity for a hearing. Lawson v. Brown's Home Day Care Center, Inc., 2004 VT 61, ¶ 14, 177 Vt. 528, 861 A.2d 1048 (mem.). If the sanction imposed is punitive in nature, additional due process protections may apply. Id. process than a criminal defend......
  • Ji v. Heide
    • United States
    • Vermont Supreme Court
    • September 13, 2013
    ...and an opportunity to be heard concerning the proposed sanction. Lawson v. Brown's Home Day Care Ctr., Inc., 2004 VT 61, ¶ 14, 177 Vt. 528, 861 A.2d 1048 (mem.) (stating that, when a court relies on its inherent authority to impose sanctions, “the party being sanctioned must be provided wit......
  • Stopford v. Milton Town Sch. Dist.
    • United States
    • Vermont Supreme Court
    • November 16, 2018
    ...compensate defendants for the costs of responding to the motion. See Lawson v. Brown's Home Day Care Ctr., Inc., 2004 VT 61, ¶ 14, 177 Vt. 528, 861 A.2d 1048 (mem.) (holding that court may sanction attorneys for misconduct through its inherent powers but finding of bad faith must precede an......
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    • Vermont Supreme Court
    • July 29, 2016
    ...if any reasonable and credible evidence in the record supports them. Lawson v. Brown's Home Day Care Ctr., Inc., 2004 VT 61, ¶ 18, 177 Vt. 528, 861 A.2d 1048 (mem.) ("We will not disturb the trial court's factual findings unless they are clearly erroneous, meaning there is no credible evide......
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