Mercury Ins. Co. v. Naghash

• Decision Date: 28 November 2016
• Docket Number: D070690
• Court: California Court of Appeals Court of Appeals
• Parties: MERCURY INSURANCE COMPANY, Plaintiff and Respondent, v. ROGER E. NAGHASH, Defendant and Appellant.

MERCURY INSURANCE COMPANY, Plaintiff and Respondent, v. ROGER E. NAGHASH, Defendant and Appellant.

D070690

COURT OF APPEAL, FOURTH APPELLATE DISTRICT DIVISION ONE STATE OF CALIFORNIA

November 28, 2016

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(Super. Ct. No. 30-2012-00599953)

APPEAL from a judgment of the Superior Court of Orange County, Craig Griffin, Judge. Affirmed.

Roger E. Naghash, in pro. per., for Defendant and Appellant.

Law Office of Cleidin Z. Atanous and Cleidin Z. Atanous, for Plaintiff and Respondent.

Roger E. Naghash appeals a judgment entered after the superior court granted the motions of Mercury Insurance Company (Mercury) for terminating sanctions dismissing his arbitration against Mercury based on (1) Naghash's refusal to comply with the court's orders compelling document production and (2) Naghash's refusal to comply with the court's orders compelling him to participate in the selection of an arbitrator. On appeal, Naghash contends the superior court erred in issuing the underlying order compelling further responses to inspection demands because: (i) the Code of Civil Procedure¹ does not allow for production when no action is pending and therefore conflicts with Insurance Code provisions authorizing discovery in underinsured motorist disputes; (ii) the court did not properly balance third-party privacy interests against interests compelling disclosure; (iii) Mercury did not provide prior consumer notice required by sections 1985.3 and 1985.6; (iv) the motion to compel was untimely because Mercury had previously requested the same documents without moving to compel; and (v) the order compelled production of attorney-client privileged documents. We are unpersuaded by Naghash's contentions regarding the court's discovery order.

We conclude the superior court did not abuse its discretion in issuing the order compelling document production because: (i) the categories of documents sought related to the amount of Naghash's disputed damages and were within the scope of discovery encompassed by Insurance Code section 11580.2, subdivision (f), and the Insurance Code did not conflict with the Code of Civil Procedure; (ii) the court properly balanced third-party privacy concerns as evidenced by the discovery order, which provided for redaction of individually identifiable information; (iii) the consumer notice provisions did not apply to the inspection demands; (iv) the motion was not untimely because substantial evidencesupported the court's determination that the inspection demands at issue differed from prior demands; and (v) the order explicitly allowed Naghash to redact attorney-client communications and therefore did not compel him to produce privileged documents. We further conclude the superior court did not abuse its discretion in ordering a terminating sanction based on Naghash's refusal to comply with its discovery orders, because Naghash demonstrated willful noncompliance with multiple prior orders and his repeated noncompliance and failure to pay prior sanctions established that imposition of lesser sanctions would be ineffective.

Because we affirm the judgment based on the court's order issuing a terminating sanction for Naghash's refusal to comply with discovery orders, we decline to consider whether imposition of a terminating sanction would be proper on the additional ground of his failure to comply with the court's orders relating to arbitration. Finally, Naghash contends the judgment should be overturned because the court's bias prevented him from receiving a fair hearing. We find no evidence of bias in the record or in the examples Naghash identified. We affirm the judgment of the superior court.

FACTUAL AND PROCEDURAL BACKGROUND

A. Factual Background

In October 2010, Mercury issued a vehicle insurance policy to Naghash's wife, which policy listed Naghash as a covered driver. The insurance policy containedprovisions for uninsured and underinsured motorist coverage.² Later that same month, while driving a covered vehicle, Naghash was involved in an accident with two other vehicles. Juan Flores Galeana (Galeana) was driving one of the vehicles and Linda A. Hail (Hail) was driving the other. Naghash filed a claim with Mercury for underinsured motorist benefits following the accident and, in May 2012, asked Mercury to initiate arbitration after Naghash was unable to reach agreement with Mercury regarding the amount of his damages. In June 2012, Naghash wrote to Mercury, rejecting its suggested arbitrators and proposing arbitration "through JAMS." Naghash also sent Mercury a revised claim, seeking $116,090 in damages, including $10,000 for pain and suffering; $50,490 for lost income; $20,000 for loss of consortium; $35,000 for emotional distress; and $600 for miscellaneous expenses. In the same month, Mercury first propounded discovery on Naghash.

B. Procedural Background

On September 21, 2012, Mercury petitioned the superior court to assign it a case number so that it could compel Naghash to respond to the discovery propounded in June 2012 relating to his underinsured motorist claim (Mercury Case). Shortly thereafter, in a separate proceeding, Naghash filed a complaint against Galeana, Mercury and Hailalleging negligence, bad faith and negligent and intentional infliction of emotional distress (Galeana Case).

1. The Galeana Case³

In November 2012, Mercury filed a motion to compel arbitration in the Galeana Case. The court granted the motion in January 2013. At a review hearing in August 2013, on finding that no arbitrator had been selected, the court, pursuant to the terms of the insurance policy, ordered each party to select its own arbitrator and those arbitrators were to select a third arbitrator to conduct the arbitration.

In January 2014, Galeana filed a motion to compel Naghash to submit to a deposition. Naghash opposed the motion, arguing the deposition was duplicative of his prior deposition taken by Mercury, and characterizing the deposition as occurring in the same case and involving the same parties and same issues. The court granted the motion, based on Naghash's admission in his declaration that the prior deposition was taken in a different case, and on his failure to cite any authority supporting his position. The court imposed monetary sanctions on Naghash. In February 2014, the court held a second review hearing to address the status of the arbitration and Mercury informed the court of its plans to file a motion to compel Naghash to take further action to proceed with the arbitration.

In March 2014, Naghash filed motions to compel Galeana to provide various discovery responses. Galeana opposed the motions, arguing (among other things) that his counsel had attempted to contact Naghash to request an extension several times prior to the response deadline, but Naghash never responded; Galeana had belatedly served verified responses; and Naghash should not be awarded sanctions because self-represented attorneys cannot recover attorney fee sanctions. Galeana's counsel also sought relief from waiver of Galeana's objections to the inspection demands or, in the alternative, a protective order to protect certain attorney-client privileged documents. The court heard oral argument and denied Galeana's motion for protective order (without prejudice), but granted Galeana relief from waiver; took Naghash's motions to compel discovery responses off calendar as moot; and awarded Naghash the costs of filing the four motions as sanctions. However, the court did not award Naghash his attorney fees because he was a self-represented litigant.

In April 2014, Galeana filed a motion to compel Naghash to answer deposition questions and produce documents, and also sought sanctions. Galeana contended Naghash had appeared for his deposition, but testified that he didn't know the answer to numerous questions ranging from his address to the nature of the accident, in every instance testifying that he would need to review his prior deposition transcript to answer the question, and Naghash further failed to produce any documents. In July 2014, the court granted Galeana's motion to compel, finding Naghash's conduct during the court-ordered deposition indicated "a contemptuous attitude toward the legal discovery process in general, and the court's February 5 order in particular," assessed sanctions againstNaghash and warned him that any further failure to comply with his discovery obligations "may result in the imposition of an evidence sanction, an issue sanction, or a terminating sanction, in addition to monetary sanctions."

2. The Mercury Case

In October 2012, Mercury filed a petition to obtain a case number and a motion to compel Naghash to provide verified answers to the June 2012 discovery, and sought sanctions. The court (the Honorable Charles Margines) denied the motion without prejudice, concluding it lacked jurisdiction over Naghash because Mercury did not personally serve Naghash with the petition to obtain a case number. Mercury personally served the petition on Naghash in February 2013.

In March 2013, Mercury filed a second motion to compel responses to the June 2012 discovery. Naghash opposed the motion on the ground the court lacked jurisdiction because no arbitration was pending. The court granted Mercury's motion in April 2013, finding the court had exclusive jurisdiction over the discovery dispute pursuant to Insurance Code section 11580.2, subdivision (f), and ordered Naghash to pay sanctions. In July 2013, in response to a notice of related cases, Judge Margines deemed the cases related and reassigned the Mercury Case to the Honorable Craig Griffin, who was presiding over the Galeana Case.

In ...