McGovern v. Hospital Service Ass'n

• Decision Date: 26 October 2001
• Citation: 785 A.2d 1012
• Parties: Harold P. McGOVERN, et. al., Appellees v. HOSPITAL SERVICE ASSOCIATION OF NORTHEASTERN PENNSYLVANIA, d/b/a Blue Cross of Northeastern Pennsylvania; HMO of Northeastern Pennsylvania, Inc., d/b/a First Priority Health; and Thomas J. Ward, Appellants
• Court: Pennsylvania Superior Court

785 A.2d 1012

Harold P. McGOVERN, et. al., Appellees v. HOSPITAL SERVICE ASSOCIATION OF NORTHEASTERN PENNSYLVANIA, d/b/a Blue Cross of Northeastern Pennsylvania; HMO of Northeastern Pennsylvania, Inc., d/b/a First Priority Health; and Thomas J. Ward, Appellants

Superior Court of Pennsylvania.

October 26, 2001.

John P. Moses, Wilkes-Barre, for appellants.

George Croner, Philadelphia, for appellees.

Before: McEWEN, President Judge Emeritus, TODD, J., and HESTER, Senior Judge.

HESTER, Senior Judge.

¶ 1 Hospital Service Association of Northeastern Pennsylvania, d/b/a/ Blue Cross of Northeastern Pennsylvania ("Blue Cross"), HMO of Northeastern Pennsylvania, Inc., d/b/a First Priority Health ("First"), and Thomas Ward appeal from the order compelling them to produce all documents, including alleged privileged materials, relating to this action.¹ We are constrained to reverse and remand for proceedings consistent with this adjudication.

¶ 2 This case arises from a companion case captioned Howell Benefit Services, Inc. v. Hospital Service Association of Northeastern Pennsylvania, et al., No. 1398-C-1997, which was settled in March 1997. Approximately four months after that case was settled, Harold McGovern et al., Appellees herein, filed a complaint against Appellants alleging breach of contract and tortious interference with existing and prospective contractual relations. The cause of actions in both cases stem from Appellants' termination of a general agency agreement among them and Howell Benefit Services, Inc. ("Howell"). Howell provided health service representatives who assisted in the overall management of various group health insurance programs, and Appellees allege they are a sub-agent of Howell, which solicited applications for insurance on behalf of Appellants and who provided services to employer groups enrolled by Howell.

¶ 3 From the time the complaint was filed on July 7, 1997, until May 29, 1998, the issue of class certification was pending, and no discovery took place except as to that issue. During the next one and one-half years, putative class members determined whether they would pursue their case against Appellants individually or in groups. On January 18, 2000, Appellees filed an amended complaint. Preliminary objections were filed by Appellants, and argument was entertained on May 22, 2000. The trial court subsequently denied the preliminary objections.

¶ 4 On May 31, 2000, Appellees served Appellants with their first set of interrogatories and a documents request.² Approximately thirty-five days later, Appellants' counsel informed Appellees by letter that the discovery responses would be forthcoming "shortly." No requests for extensions of time were made or filed. Appellees responded by letter informing Appellants they waived their right to object to any discovery requests in the future since they did not file their responses within the thirty-day period prescribed by Pa.R.C.P. 4006 and 4009.12.

¶ 5 On July 13, 2000, approximately fourteen days after the thirty-day deadline, Appellants served Appellees with their discovery responses, which Appellees assert were "materially deficient and accompanied by a demand that [Appellee's counsel] execute a `Stipulation and Protective Order of Confidentiality' before any documents would actually be exchanged." Appellees' brief at 3. Appellants' responses were served with a cover letter that stated in pertinent part,

Some of the foregoing documents are confidential in nature[.] Therefore, production of the documents is subject to the enclosed Confidentiality Agreement. Kindly execute the agreement and return it to me as soon as possible. We will make the production available for your inspection at the offices of ... Please contact ... to arrange for a time to review the production.

Letter, Defendant's Response to Interrogatories and Requests for Production of Documents, 7/13/00, at 2. The documents that were to be made available included all documents produced and responses served in the Howell case, including deposition transcripts.

¶ 6 In their objections, Appellants asserted that some of the information sought was subject to the attorney-client privilege. Taking the position that any objections were waived, Appellees filed a motion to compel, asking the trial court to order full and complete discovery responses. Briefs were submitted, and a hearing was conducted on this issue on September 25, 2000. On November 20, 2000, the trial court ordered Appellants to answer all interrogatories and to submit all discovery documents requested by Appellees. This timely appeal followed.³

¶ 7 Preliminarily, we note the following. On January 3, 2001, after Appellants filed their notice of appeal, the trial court ordered them to file a statement of matters complained of pursuant to Pa.R.A.P.1925. Appellants complied, but the court failed to render an opinion as required by the rule. Pa.R.A.P.1925 provides (emphasis added):

Upon receipt of a notice of appeal, the judge who entered the order appealed from, if the reasons for the order do not already appear of record, shall forthwith file of record at least a brief statement, in the form of an opinion, of the reasons for the order, or for the rulings or other matters complained of ...

After a careful and thorough review of the record, we are unable to discern the reasons why the trial court rendered its order.

¶ 8 Appellants contend the trial court abused its discretion since its order compelling full discovery is an unwarranted sanction. We acknowledge at the outset that "the purpose of the discovery rules is to prevent surprise and unfairness and to allow a fair trial on the merits." Dominick v. Hanson, 753 A.2d 824, 826 (Pa.Super.2000). Further, sanctions pursuant to Pa.R.C.P. 4019 generally are imposed when a court order has been violated, although certainly the rule does allow for sanctions when there has been a discovery violation:

According to Pa.R.C.P. 4019, [entitled "Sanctions"], a trial court may "make an appropriate order" if a party "fails to make discovery or to obey an order of court respecting discovery." Pa.R.C.P. 4019(a)(1) (viii). The decision whether to sanction a party, and if so the severity of such sanction, is vested in the sound discretion of the trial court. See, e.g., Christian v. Pennsylvania Financial Responsibility Assigned Claims Plan, 454 Pa.Super. 512 [518-19], 686 A.2d 1, 4 (1996)

; Grunde v. Huff, 433 Pa.Super. 94, 101, 639 A.2d 1227, 1230 (1994). Absent a finding that the trial court abused its discretion, [the Superior] Court will not reverse an order sanctioning a party which the trial court found necessary and proper.

Croydon Plastics Co., Inc. v. Lower Bucks Cooling & Heating, 698 A.2d 625, 628 (Pa.Super.1997). We now examine the relevant procedural rules.

¶ 9 Amended on November 7, 1988, Pa. R.C.P. 4006(a)(2), answers to written interrogatories by a party, states in pertinent part, (emphases added): "The answering party shall serve a copy of the answers, and objections if any, within thirty days after the service of the interrogatories. The party submitting the interrogatories may move the court to dismiss an objection and direct that the interrogatory be answered." Pa.R.C.P. 4009.12(a) (1), answer to request upon a party for production of documents and things, states in pertinent part, (emphasis added): "(a) The party upon whom the [document] request is served shall within thirty days after the service of the request (1) serve an answer including objections to each numbered paragraph in the request[.]" We also note that Pa.R.C.P. 126 expressly states, (emphasis added): "The rules [of civil procedure] shall be liberally construed to secure the just, speedy and inexpensive determination of every action... The court at every stage ... may disregard any error or defect of procedure which does not affect the substantial rights of the parties."

¶ 10 The issue at bar is whether the failure to file objections within thirty days after being served interrogatories and requests for documents results in a waiver of all objections. After an exhaustive search of applicable case law, we have found one plurality decision of our Supreme Court dealing with a similar issue. Likewise, there are a number of published common pleas courts decisions that have addressed the underlying issue but have reached different conclusions.

¶ 11 The only Pennsylvania appellate case to shed light on the issue presented herein is Nissley v. Pennsylvania Railroad Co., 435 Pa. 503, 259 A.2d 451 (1969). In that case, a plurality of our Supreme Court found that a party who failed to answer an interrogatory until four months after service had waived any objection to that interrogatory. The applicable rule then stated, "Any party may file and serve upon any adverse party written interrogatories to be answered by the party served... who shall furnish such information as is available to the party... [A] party may file objections to an interrogatory within ten days of its receipt." Pa.R.C.P. 4005(a)(b) (emphases added) (4005(b) repealed and superceded by Rule 4006(a)).

¶ 12 Nissley involved an action by the administratrix of a deceased employee against the employer railroad. On October 1, 1965, the railroad served the administratrix an interrogatory asking for the name and address of each physician whom the administratrix consulted concerning the accident referred to in the complaint. Six weeks later, the administratrix agreed to answer this interrogatory by December 6, 1965. On December 21, 1965, the administratrix asked for more time. Finally, on February 2, 1966, five days prior to trial, the administratrix responded that no answer was required under Rule 4011(d), which stated,

No discovery or inspection shall be permitted which ... (d) would disclose the existence or location of reports, memoranda, statements, information or other things made or secured by any person or party in anticipation of

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