Meadows v. Wal-Mart Stores, Inc.

• Decision Date: 13 March 2001
• Docket Number: No. 94,316.,94,316.
• Citation: 2001 OK 25,21 P.3d 48
• Parties: Mark Keith MEADOWS, Plaintiff/Appellant, v. WAL-MART STORES, INC., a Delaware Corporation; Kenith J. Gill, Individually and as Assistant Manager for Wal-Mart Stores, Inc.; Robert A. Lagrone, Individually and as Security Guard for Wal-Mart Stores, Inc.; Elite Security Service, an Oklahoma Corporation; John Doe, individually and as an employee of Wal-Mart Stores, Inc., Defendants/Appellees.
• Court: Oklahoma Supreme Court

21 P.3d 48

2001 OK 25

Mark Keith MEADOWS, Plaintiff/Appellant, v. WAL-MART STORES, INC., a Delaware Corporation; Kenith J. Gill, Individually and as Assistant Manager for Wal-Mart Stores, Inc.; Robert A. Lagrone, Individually and as Security Guard for Wal-Mart Stores, Inc.; Elite Security Service, an Oklahoma Corporation; John Doe, individually and as an employee of Wal-Mart Stores, Inc., Defendants/Appellees.

No. 94,316.

Supreme Court of Oklahoma.

March 13, 2001.

Barry W. Johnson, Barry W. Johnson, P.C. & Frederick W. Southern, Jr., Oklahoma City, for Plaintiff/Appellant.

Michael W. Brewer, Hiltgen and Brewer, Oklahoma City, for Defendants/Appellees. BOUDREAU, Justice.

¶ 1 The controversy arose out of an incident in which Meadows attempted to return some merchandise to a Wal-Mart store with a friend. When store officials refused to allow Meadows to return the merchandise, he became angry. The situation soon escalated with store managers and security using force against Meadows, who was then ultimately arrested for trespass by the Midwest City Police Department. Meadows was released several hours later and the charges were eventually dropped.

¶ 2 Meadows subsequently filed a lawsuit against Wal-Mart Stores, Inc., two Wal-Mart employees, Wal-Mart's security company and a security guard (collectively Wal-mart or Wal-Mart Defendants) for defamation, assault and battery and malicious prosecution. During the course of the pretrial discovery, Meadows requested that the Wal-Mart Defendants admit the truth of several matters. Wal-Mart denied each of the requests tendered by Meadows. Meadows presented his claims to a jury in September 1999. Meadows prevailed on the defamation and assault and battery claims, while Wal-Mart prevailed on the malicious prosecution claim.

¶ 3 In a post-trial motion, Meadows sought attorney fees pursuant to (1) 12 O.S.1991, § 3236 & 12 O.S. Supp.1996, § 3237(D), contending the Wal-Mart Defendants improperly refused to admit the matters that were the subject of his discovery requests and (2) 12 O.S.1991, § 103, contending that Wal-Mart asserted positions and defenses not well grounded in fact. The Wal-Mart Defendants countered that they had reasonable grounds to believe they might prevail on the matters that were the subject of Meadows' requests for admissions and he was not entitled to a fee under § 3237(D)(3). They also denied that any of their defenses were not well grounded in fact, contrary to 23 O.S.1991, § 103. The trial court denied Meadows' motion for attorney fees.

¶ 4 Meadows appealed the fee denial. He filed a motion to retain asking the Supreme Court to determine that because he prevailed at trial, § 3237(D) imposed a mandatory duty upon the trial court to award him his reasonable expenses, including reasonable attorney fees occasioned by the improper denials. This Court retained this appeal to consider the third exception to the mandatory sanction requirement of § 3237(D) — Did the Wal-Mart Defendants have reasonable grounds to believe they might prevail on the matters contained in the requests for admission?

I. STANDARD OF REVIEW

¶ 5 Section 3237 vests the trial court with discretion to impose sanctions for failure to comply with discovery. Skinner v. John Deere Ins., Co., 2000 OK 18, ¶ 24, 998 P.2d 1219, 1224. This Court can review the trial court's decision regarding § 3237 sanctions to determine if that discretion was abused. Id. "The party objecting to the trial court's decision regarding the imposition of sanctions has the burden of showing that the trial court abused its discretion." Id. A finding of abuse requires that the trial court made a clearly erroneous conclusion and judgment, against reason and evidence. CNA Ins. Co. v. Krueger, Inc., 1997 OK 142, 949 P.2d 676; Green Bay Packaging, Inc. v. Preferred Packaging, Inc., et al., 1996 OK 121, 932 P.2d 1091, 1097; Oklahoma Turnpike Auth. v. Asher, 1993 OK 136, 863 P.2d 1205, 1207; First National Bank and Trust Co. of Vinita v. Kissee, 1993 OK 96, 859 P.2d 502, 513; Broadwater v. Courtney, 1991 OK 39, 809 P.2d 1310, 1312.

II. REQUESTS FOR ADMISSION

¶ 6 Title 12 O.S.1991 § 3236 addresses requests for admissions, a discovery mechanism whereby parties, in appropriate instances, may obtain (a) an admission from an opposing party, (b) a specific denial, or (c) a detailed statement of the reasons why the answering party cannot truthfully admit or deny the question posed.¹ Unlike other forms of discovery, requests to admit involve primarily the elimination of undisputed matters, rather than the ascertainment of facts or the preservation of testimony for trial. The function of the § 3236 procedure is to promote admissions by action of the parties, and without the need for judicial intervention. Champlin v. Oklahoma Furniture Mfg. Co., 324 F.2d 74, 76 (10 Cir.1963); Wigler v. Electronic Data Sys. Corp., 108 F.R.D. 204, 206 (D.C.Md.1985); Hurt v. Coyne Cylinder Co., 124 F.R.D. 614, 614-15 (W.D.Tenn. 1989); Unit Petroleum Co. v. Nuex Corp., 1991 OK 21, 807 P.2d 251 (may use federal interpretation as guide when state law is based on federal counterpart); Warner v. Hillcrest Medical Ctr., 1995 OK CIV APP 123, 914 P.2d 1060, 1064 (may use federal interpretation as guide when state law is based on federal counterpart).

¶ 7 The vital force behind the admissions procedure is its sanction. A litigant who improperly refuses to admit a matter may be required to pay the costs incurred by the other party, including attorney fees, in proving the substance of the admission sought.² The sanction is designed to compensate the requesting party for the unnecessary expense of proving the matter and to deter misconduct. Payne v. DeWitt, 1999 OK 93, 995 P.2d 1088, 1092 n. 7. While other discovery infractions carry an array of sanctions that penalize the noncomplying party, payment of expenses and attorney fees is the sole sanction for improper failure to admit.³

¶ 8 A trial judge must issue an order granting attorney fees and expenses, compensating a litigant for making the proof when an opposing party improperly refuses to admit a matter, unless an exception applies. Section 3237(D) provides four exceptions which protect a party from having to pay expenses and attorney fees for failure to admit, even though the admission sought may later be proven at trial. The statute allows a party to establish (a) the request was objectionable; (b) the admission was of no substantial importance; (c) the denying party has reason to believe he might prevail on the matter; (d) there is other good reason.

III. ANALYSIS

A. DEFAMATION CLAIM

¶ 9 Meadows submitted requests for admission, in part, asking Kenith Gill, a Wal-Mart assistant manager, to admit the following:

Admission # 1: Admit that you accused Plaintiff of having stolen the merchandise he was attempting to exchange, and that your statements were made in the presence and hearing of several store customers.⁴

Admission # 3: Admit that you told the police upon their arrival that the merchandise Plaintiff was attempting to exchange was stolen. If you do not so admit, then state with specificity your reasons for not so admitting.

Admission # 6: Admit that you called Plaintiff a "nigger". If your answer is that you did not, state who did. If you do not so admit, then state with specificity your reasons for not so admitting.

Gill unequivocally denied each request.

¶ 10 Meadows served essentially the same admissions upon Robert LaGrone, a security guard, but instead of the first admission, LaGrone was asked the following:

Admission # 2: Admit that you told the police upon their arrival that Plaintiff was trespassing. If you do not so admit, then state with specificity your reasons for not so admitting.

LaGrone also denied each request.

¶ 11 Meadows argues that the Wal-Mart Defendants improperly failed to admit the matters contained in these requests. Meadows contends that Wal-Mart simply lied under oath in hopes that a jury might later find in its favor. Most significantly, Meadows argues the fact he prevailed at trial on the defamation claim demonstrates that the Wal-Mart Defendants' refusal to admit was improper.

¶ 12 The Wal-Mart Defendants argue § 3237(D) sanctions should not have been imposed because they had reasonable grounds to believe they might prevail on the matter. They note accurately that "the true test under [this section] is not whether a party prevailed at trial but whether he acted reasonably in believing that he might prevail." Advisory Committee Note to 1970 amendments of Rule 37(c), 48 F.R.D. 538, 541. They contend certain testimony in the trial transcript provides reasonable grounds to support their denials.

¶ 13 Our review of the record on appeal indicates that the trial court did not abuse its discretion when it concluded the Wal-Mart Defendants acted reasonably in believing that they might prevail on the matters which were the subject of the requests. First, Gill and LaGrone both testified consistently with one another, both denying Meadows was called a thief in the presence of customers, store personnel or the police. In addition, Meadows' own witness, Cotis Wilson, said he heard Gill call Meadows a thief, but upon cross-examination Mr. Wilson admitted he was unsure of the particular words used to accuse Meadows. Wal-Mart correctly asserts it had a right to stand behind the testimony of its employees on this issue and allow the jury to weigh the conflicting testimony.

¶ 14 Meadows presented two witnesses in addition to himself who testified that Wal-Mart personnel directed a racial expletive at him during the course of this altercation. However, in addition to both Gill and LaGrone denying use of the word, Meadows' own witness, Cotis Wilson, testified that he did not hear any racially derogatory terms used during the encounter. Also, Hazel Comas, another one of Meadows' witnesses, testified in great detail about Wal-Mart personnel's physical treatment of Meadows...