Traxler v. Ford Motor Co., Docket Nos. 200704

• Decision Date: 13 January 1998
• Docket Number: 200856,Docket Nos. 200704
• Citation: 576 N.W.2d 398,227 Mich.App. 276
• Parties: Sarah A. TRAXLER, Minor, by her next friend Steven Traxler, Deanna Traxler and Scott Traxler, Plaintiffs-Appellees, v. FORD MOTOR COMPANY and Ford Motor Company of Canada, Defendants-Appellants, and Spalding and Evenflo Companies and Evenflo Juvenile Furniture Company, Defendants.
• Court: Court of Appeal of Michigan — District of US

Page 398

576 N.W.2d 398

227 Mich.App. 276

Sarah A. TRAXLER, Minor, by her next friend Steven Traxler Deanna Traxler and Scott Traxler, Plaintiffs-Appellees, v. FORD MOTOR COMPANY and Ford Motor Company of Canada Defendants-Appellants and Spalding and Evenflo Companies and Evenflo Juvenile Furniture Company, Defendants.

Docket Nos. 200704, 200856.

Court of Appeals of Michigan.

Submitted Sept. 9, 1997, at Grand Rapids.

Decided Jan. 13, 1998, at 9:05 a.m.

Released for Publication March 26, 1998.

Rhoades, McKee, Boer, Goodrich & Titta by Bruce W. Neckers, Paul A. McCarthy, and Molly M. McNamara, Grand Rapids, for plaintiffs-appellees.

Dawson & Clark, P.C., Detroit by Kathleen A. Clark and John R. Prew, Dickinson, Wright, Moon, Van Dusen & Freeman, Grand Rapids by Richard A. Glaser, John M. Thomas, and Michael J. O'Reilly, Dearborn, for defendants-appellants.

Before GRIFFIN, P.J., and WAHLS and GRIBBS, JJ.

WAHLS, Judge.

Defendants Ford Motor Company and Ford Motor Company of Canada (hereinafter Ford) appeal by leave granted from an order of default. We affirm in part, reverse in part, and remand.

This case stems from an automobile accident in 1990. At the time of the accident, two-month-old Sarah Traxler was strapped into a child safety seat in the back of her parents' 1986 Ford Tempo. Her mother was driving, and her father was seated next to her in the back seat. As the Traxlers were waiting to make a left turn, they were rear-ended by another vehicle traveling at approximately fifty miles an hour. The force of the collision caused the driver's seat of the Traxler's car to move rearward into the back seat, striking Sarah in the head. Sarah was left with severe and permanent injuries. Apparently, no one else was injured in the crash.

Plaintiffs filed suit against the driver of the other vehicle, the maker of the child safety seat, and Ford. This appeal involves only Ford. ¹ Plaintiffs' theory regarding Ford's liability revolved around the design of the driver's seat in the Ford Tempo. Their discovery requests thus focused on Ford's design process, on Ford's knowledge regarding the tendency of its seats to give way in rear-end collisions, and on other lawsuits filed against Ford alleging front-seat design defects. Discovery took place over more than two years and was marked by Ford's numerous objections and by plaintiffs' repeated motions to compel. Most of plaintiffs' motions to compel were withdrawn before the trial court could hear them, apparently because the parties agreed to work out their differences between themselves. Eventually, however, the trial court heard and granted one of plaintiffs' motions to compel. In granting the motion, the trial court warned Ford that its failure to comply with the discovery order would result in a default. In response to the trial court's order, Ford provided plaintiffs with sixty-two boxes of documents. After reviewing this new information, plaintiffs asked the trial court to order a default against Ford. They argued that the documents produced as a result of the trial court's order should have been produced far earlier and that the delay had prejudiced them to the point that default was the only appropriate remedy. The trial court agreed and entered an order of default against Ford. In its written opinion, the trial court lambasted Ford for its conduct during discovery:

What plaintiffs' counsel discovered when they read those documents was disgusting; no other word would be accurate. For over two years, Ford had concealed very significant documents and information, and, worse, had blatantly lied about those documents and about the information in them; any word other than "lied" would understate what Ford did.... After carefully reviewing plaintiffs' discovery requests and some of Ford's responses (hundreds of pages), studying several rounds of briefs, and listening to counsels' very helpful oral argument, this Court had to agree that an outrageous fraud has been perpetrated by Ford ... and that the sanction of a default ... is the appropriate response.

Ford raises several issues on appeal. It argues that the trial court (1) did not have the power to impose a default, (2) erred in finding that Ford committed fraud, and (3) erred in denying Ford's request for an evidentiary hearing. In addition, Ford argues that the trial court failed to consider alternative sanctions, failed to consider how Ford's errors were made and who made them, and made findings of fact that were not supported by the record. We begin by addressing the extent of a trial court's power to sanction discovery abuses.

The scope of a trial court's powers is a question of law. We review questions of law de novo. Smith v. Henry Ford Hosp., 219 Mich.App. 555, 557, 557 N.W.2d 154 (1996). The Michigan Court Rules specifically authorize a default judgment as a sanction for certain discovery abuses. Such abuses include a failure to comply with a discovery order, MCR 2.313(B)(2)(c), failure to serve answers to interrogatories, MCR 2.313(D)(1)(b), and, under certain circumstances, failure to supplement responses to discovery requests, MCR 2.302(E)(2). Ford argues that, even assuming the trial court's factual findings were correct, none of these rules apply in this case. We disagree.

First, it is clear that the trial court did not find a violation of a discovery order, and thus, MCR 2.313(B)(2)(c) does not apply directly. Second, there is no allegation that Ford failed to serve answers to plaintiffs' various interrogatories, and thus MCR 2.313(D)(1)(b) does not appear to apply. ² However, assuming the trial court's factual findings were correct, we believe that MCR 2.302(E) does apply. ³ That subrule states, in part:

(1) Duty to Supplement....

(a) A party is under a duty seasonably to amend a prior response if the party obtains information on the basis of which the party knows that

(i) the response was incorrect when made; or

(ii) the response, though correct when made, is no longer true and the circumstances are such that a failure to amend the response is in substance a knowing concealment.

* * * * * *

(2) Failure to Supplement.

If the court finds, by way of motion or otherwise, that a party has not seasonably supplemented responses as required by this subrule the court may enter an order as is just, including an order providing the sanctions stated in MCR 2.313(B), and, in particular, MCR 2.313(B)(2)(b). [MCR 2.302(E).]

Here, the trial court concluded that Ford "lied" and was guilty of "an outrageous fraud." Any response that can be characterized as fraudulent or as a lie was obviously incorrect when made. Thus, to the extent that the trial court found that Ford's responses constituted lies or fraud, Ford had a duty to seasonably supplement those responses. On the basis of the trial court's findings, Ford clearly failed to fulfill this duty. Therefore, the trial court had the power to order a default pursuant to MCR 2.302(E)(2).

Ford next argues that the evidence in the record does not support the trial court's conclusion that Ford lied or committed fraud. We disagree. We review a trial court's findings of fact for clear error. Triple E Produce Corp. v. Mastronardi Produce, Ltd., 209 Mich.App. 165, 171, 530 N.W.2d 772 (1995). A finding of fact is clearly erroneous when, although there is evidence to support it, the reviewing court is left with a definite and firm conviction that a mistake has been made. Id. In this case, we are not left with a definite and firm conviction that a mistake has been made. On the contrary, the record makes it clear that Ford failed to disclose relevant, non-privileged information in its responses to plaintiffs' early discovery requests. While Ford objected to plaintiffs' discovery requests, we do not believe that those objections were sufficient to excuse Ford's conduct.

The parties and the trial court address numerous examples of Ford's conduct during discovery. Here, we simply address two interrogatories that are illustrative. We begin with an interrogatory and a response that highlight Ford's position during the early stages of discovery:

35. How many 4-door Ford Tempos were sold in 1986 by Ford dealers in the United States and Canada?

35. Ford objects to this Interrogatory on the ground that it is overly broad, vague, irrelevant, oppressive and not calculated to lead to the discovery of admissible evidence. Without waiving its objections and in the spirit of discovery, Ford states 176,976 Four-Door Tempo vehicles were sold in the United States and Canada.

This exchange is significant for two reasons. First, it illustrates the fact that Ford objected to interrogatories even where its objections were groundless on their face; how can an interrogatory that asks for a simple numerical answer be overly broad or vague? What is the purpose of objecting on the ground that a request is oppressive when the objection is followed by the answer to the request? How could Ford argue that information regarding the number of products sold is irrelevant or not calculated to lead to the discovery of admissible evidence in a products liability suit? Clearly, Ford's objections were boilerplate, and plaintiffs were justified in ignoring them when they were followed by an answer that was responsive to their request. Ford's response also highlights the fact that, "in the spirit of discovery," Ford provided apparently complete answers to at least some of plaintiffs' requests despite its objections. The significance of these observations becomes clear when we review one of the more important interrogatories. The parties and the trial court offer contrasting interpretations of the following interrogatory and answer:

10. State whether the same left front driver's seat and right front passenger seat tracks and seat backs, as identified previously in this set of interrogatories as having been installed on the subject vehicle, were ever installed on any other Ford Motor...