Opinion
A133684
08-07-2013
LEONARD KEY et al., Plaintiffs and Appellants, v. MASON-McDUFFIE REAL ESTATE INC. et al., Defendants and Respondents.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(Alameda County
Super. Ct. No.
RG05208993)
Plaintiffs Leonard and Sandra Key (collectively plaintiffs) appeal from an order dismissing their action against defendants Mason-McDuffie Real Estate, Inc., and Mona Koussa (collectively defendants) for failure to prosecute (Code Civ. Proc., §§ 583.410, 583.420, subd. (a)(2)). Plaintiffs argue the trial court abused its discretion by dismissing the action.
Unless otherwise noted, all further statutory references are to the Code of Civil Procedure.
We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
We provide only the factual and procedural details that are germane to plaintiffs' claim that the court erred by dismissing their action for failure to prosecute.
In 2003, plaintiffs entered a "written real estate purchase and sale agreement" (agreement) with RH Bedford Developers, Inc., and Richard H. Bedford (collectively Bedford) to purchase a home to be built by Bedford in Castro Valley. Koussa — then a real estate broker at Mason-McDuffie Real Estate, Inc. — represented plaintiffs and Bedford in the transaction. Bedford did not complete the home by the scheduled date and allegedly threatened to sell the property to a third party unless plaintiffs agreed to various conditions.
In April 2005, plaintiffs sued Bedford and defendants. Among other things, the complaint alleged Bedford and defendants breached the agreement and that defendants breached their fiduciary duty to plaintiffs and defrauded them. Bedford moved to compel arbitration. In June 2005, the court denied Bedford's petition to compel arbitration but stayed the action on its own motion to allow plaintiffs and Bedford to mediate pursuant to the agreement's dispute resolution requirement. In March 2006, plaintiffs reached a tentative settlement with all parties except defendants and few months later, in July 2006, plaintiffs closed escrow and took possession of the house. In November 2006, the court lifted the stay.
In April 2007, plaintiffs filed the operative third amended complaint alleging seven claims against defendants. Among other things, the complaint alleged defendants breached their fiduciary duty to plaintiffs and breached the agreement by: (1) "acting solely in the interests of [Bedford][;]" (2) failing "to disclose the missing and inadequate square footage after the foundation was built[;]" and (3) failing to inform them that Bedford's intention was to "induce [them] to spend their own money to construct the home and then sell the home to a third party after the home was completed." Plaintiffs also alleged defendants defrauded them and negligently failed to disclose information about the property.
In early 2007, defendants propounded discovery. They served requests for production and later subpoenaed information from third parties, including a title company. Plaintiffs and defendants litigated discovery disputes throughout 2008.
Plaintiffs filed a first amended complaint in November 2005 and a second amended complaint in January 2007. Defendants cross-complained against plaintiffs. In early 2008, the court consolidated the action with Corina Lockerbie, et al. v. R.H. Bedford Developers, et al., Alameda County Superior Court case No. RG06284960 for discovery and case management.
Trial Setting and Discovery Abuses
The court set an initial trial date of July 20, 2009. In May 2009, defendants served plaintiffs with a third set of requests for production of documents seeking documents relating to work performed on the house, communications between plaintiffs and Bedford, and documents supporting plaintiffs' damages claims. Plaintiffs' responses were untimely and unverified and did not provide substantive information. For several months, counsel for defendants tried — repeatedly and unsuccessfully — to obtain responsive information from plaintiffs.
In late June 2009, defendants moved to continue trial, claiming there were "a number of unresolved discovery issues due in large part to plaintiffs' numerous cancellations and failures to appear for their depositions, as well as their failure to respond to meet and confer letters" or assist defense counsel in determining what discovery was exchanged "while prior counsel for Defendants was in the case." Defendants explained they had noticed plaintiffs' depositions five times and each time plaintiffs "cancelled on short notice" and failed to provide information to resolve defense counsel's "questions regarding the status of document production and written discovery." The court vacated the trial date and set an August 5, 2009 trial date. Later, the court continued trial a second time, to March 5, 2010.
Defendants retained new counsel in October 2008.
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In January 2010, plaintiffs served further responses to defendants' written discovery, but the responses were unverified, failed to provide all responsive information, and "still contained a variety of improper objections." At a January 2010 mandatory settlement conference, the court vacated the March 2010 trial date, finding "that discovery [was] incomplete[.]" In late March 2010, defendants moved to compel responses to form interrogatories propounded in 2009 and moved to compel plaintiffs to appear for their depositions. Defendants claimed plaintiffs' responses to the form interrogatories were deficient; they also argued they had noticed or scheduled plaintiffs' depositions seven times and each time, plaintiffs "cancelled on short notice or outright failed to appear." The court granted the motions, ordered plaintiffs to provide supplemental responses and to appear for their depositions, and sanctioned plaintiffs.
Plaintiffs finally appeared for their depositions in August 2010. They did not, however, bring documents supporting their damages claims, such as Sandra Key's medical records, nor did they bring documents reflecting work done on the property. After their depositions, plaintiffs produced 750 photographs of the property in various stages of construction.
Defendants' First Motion to Dismiss
In October 2010, the court set a March 4, 2011 trial date. In January 2011, defendants moved to dismiss, claiming plaintiffs had "misused the discovery process and failed to timely bring their action to trial." Plaintiffs opposed the motion. They argued they had "not unduly delayed" the action and claimed "the discovery issues [did] not warrant dismissal." Plaintiffs described the difficulty scheduling their depositions and claimed "[a]ny delay or failure to respond to discovery" was caused by their "acute depression, which they suffered after being swindled out of their life savings . . . by Defendants."
The court denied the motion. The court declined to the dismiss the action under section 583.310, the mandatory dismissal statute, finding the case was "4 years and 4 months old" — not five years old — after removing "the time that the 'stay' was in place from the overall age of this case. . . ." The court also declined to exercise its discretion to dismiss the case under 583.410, the discretionary dismissal statute. It, however, noted that in the four years and three months since the court lifted the stay, "Plaintiffs have been sanctioned for failure to provide discovery and . . . have failed, yet again, to provide timely responses to outstanding discovery requests. . . . [W]hen Plaintiffs eventually responded to discovery, their responses were, conditional and lacking in completeness or candor." The court explained that though it was "inclined to dismiss this case as an exercise of discretion because of the delay caused by Plaintiffs and their conduct in frustrating discovery, . . . the Court shall not do so, at this time. The Court is sympathetic to Plaintiff's claims of distress. Nevertheless, the Court's policy of resolving disputed issues 'on the merits' is just about at its reasonable limit."
Defendants' Renewed Motion to Dismiss
On March 11, 2011 — and a month after discovery closed — plaintiffs produced 1,076 pages of additional documents responsive to defendants' 2007 and 2009 document requests. The new documents included plaintiffs' notes detailing their communications with defendants and other documents prepared by plaintiffs describing work done to the property. Shortly after plaintiffs produced the documents, defendants moved to continue the trial date. They explained plaintiffs had failed to depose defendants before discovery closed and "[a]s a result, expert depositions have had to be postponed and will not be completed before" trial. The court continued trial to April 15, 2011.
In late March 2011, defendants filed a renewed motion to dismiss. They urged the court to dismiss the case under sections 583.410 and 583.420 because plaintiffs had "abused the rules of discovery and persistently failed to diligently pursue their case." Defendants claimed plaintiffs deprived them of their right to present a "fair defense" by withholding "vast amounts of material evidence for four years[.]" They also argued they would be forced to retake depositions and supplement their expert disclosures based on the newly disclosed information. In addition, defendants claimed plaintiffs refused to make their expert appraiser available in a timely fashion and had refused to produce their expert witnesses for deposition.
In opposition, plaintiffs argued the March 2011 document production was "not dilatory, the documents were produced as soon as they were discovered" and the documents were duplicative of other previously produced documents. Plaintiffs claimed defendants were not prejudiced by the "late production" because the documents did not "contain evidence of different facts and or new claims not already disclosed[.]" In addition, plaintiffs blamed their inability to "fully cooperate" in the litigation on their depression and Leonard Key's knee injury. According to plaintiffs, Sandra Key had suffered a "mental breakdown . . . and fell into an acute depression" during the pendency of the litigation and had "only recently begun to recover." Additionally, Leonard Key "suffered a knee injury," which was operated on in early January 2010 and "fell into an acute depression" for several months in 2005 and again in 2009 and 2010.
Plaintiffs claimed dismissing the case would be "devastating" to them because they "have been wary of trusting professionals given the conduct of defendants. Mrs. Key sought treatment for her depression and anxiety on February 1, 2011. Thereafter, [she] also began to experience spiritual renewal. Her constant migraine headaches . . . abated and she has been able to sleep through the night. [¶] This allowed her to more readily cooperate and search for documents and recall where documents were kept. When she located the documents, [plaintiffs'] counsel advised that she needed to produce the documents immediately and she allowed the production." Plaintiffs' opposition contained a spreadsheet indexing the March 2011 production.
In reply, defendants argued the documents produced in March 2011 were relevant, were responsive to their 2007 and 2009 discovery requests, and contained "vast amounts of material information either entirely unknown to Defendants before now or that help to explicate previous information." Defendants also argued plaintiffs had misused the discovery process and "delayed the litigation process" numerous times.
Following a hearing, the court granted the motion to dismiss. It concluded the trial date had been continued several times "at least in part as a result of Plaintiffs' failure to comply with discovery[,]" specifically because plaintiffs failed to appear for their properly-noticed depositions and failed to provide complete responses to defendants' discovery requests. The court also noted plaintiffs produced over 1,000 pages of documents after the close of discovery and "some four years after Defendants first requested relevant documents" despite having had the documents in their possession. The court determined the late production of these documents prejudiced defendants because the documents contained new information that defendants could have utilized "in identifying and deposing witnesses, conducting further investigations, and crafting defense strategies." As the court explained, "[t]o process and utilize the additional material and information contained in the withheld documents . . . Defendants would essentially have to start over in deposing Plaintiffs" which was impossible "before expiration of the five-year statute for bringing the case to trial."
The court exercised its discretion pursuant to sections 583.410 and 583.420, subdivision (a)(2)(A) and dismissed the case because plaintiffs had "repeatedly abused the discovery process, lacked diligence, and failed to timely bring their action to trial, all resulting in prejudice to Defendants."
DISCUSSION
The court has inherent power to dismiss a case "for delay in prosecution." (6 Witkin, Cal. Procedure (5th ed. 2008) Proceedings Without Trial, § 438, p. 890.) Section 583.410, subdivision (a) provides: "The court may in its discretion dismiss an action for delay in prosecution . . . if to do so appears to the court appropriate under the circumstances of the case." Under section 583.420(a)(2)(A), however, a court may not dismiss an action for delay in prosecution unless one of certain conditions has occurred, including failing to bring the action "to trial within . . . [t]hree years after the action is commenced against the defendant" or within two years under California Rules of Court, rule 3.1340. (See Roman v. Usary Tire & Service Center (1994) 29 Cal.App.4th 1422, 1430-1431; Witkin, supra, § 441, p. 893.)
The moving party must show discretionary dismissal is warranted based on the following six factors set forth in California Rules of Court, rule 3.1342(e), including: (1) "The court's file in the case and the declarations and supporting data submitted by the parties . . . ;" (2) "The diligence of the parties in pursuing discovery or other pretrial proceedings, including any extraordinary relief sought by either party;" (3) "The nature and complexity of the case;" (4) "The nature of any extensions of time or other delay attributable to either party;" (5) "Whether the interests of justice are best served by dismissal or trial of the case; and (6) "Any other fact or circumstance relevant to a fair determination of the issue." (Cal. Rules of Court, rule 3.1342(e); see Van Keulen v. Cathay Pacific Airways, Ltd. (2008) 162 Cal.App.4th 122, 130-131 (Van Keulen).)The "burden [then] shifts to the plaintiff to show excusable delay." (San Ramon Valley Unified School Dist. v. Wheatley-Jacobsen, Inc. (1985) 175 Cal.App.3d 1050, 1057; Wagner v. Rios (1992) 4 Cal.App.4th 608, 611-612.)
"'A reviewing court may not reverse a trial court's order granting dismissal for dilatory prosecution unless the plaintiff meets the burden of establishing manifest abuse of discretion resulting in a miscarriage of justice. [Citations.] An appellate court may not substitute its own discretion for that of the trial court and must uphold the dismissal order if the trial court has not abused its discretion.' [Citation.]" (Van Keulen, supra, 162 Cal.App.4th at p. 131.)
Plaintiffs contend the court "erred in granting dismissal" because the documents they produced in March 2011 were "not material to the disputed issues." They also claim the court should have excused their delay in responding to discovery because they "suffered from depression caused by" defendants. Alternatively, plaintiffs contend the trial court should have imposed a lesser sanction to minimize any prejudice to defendants, such as "precluding the additional documents" from being used at trial.
Plaintiffs have not demonstrated the court abused its discretion by dismissing the action pursuant to sections 583.410 and 583.420. The case was filed in 2005, over six years before the court dismissed it, and over four years after the court lifted the stay. Ample evidence supports the court's conclusion that plaintiffs "repeatedly abused the discovery process, lacked diligence, and failed to timely bring their action to trial, all resulting in prejudice to Defendants." The record demonstrates the court continued trial several times because plaintiffs repeatedly failed to appear for their properly-noticed depositions and because plaintiffs failed to provide complete responses to defendants' discovery requests. In addition, plaintiffs produced over 1,000 pages of documents after the close of discovery and "some four years after Defendants first requested relevant documents" despite having had the documents in their possession. Finally, the record also supports the court's finding of prejudice to the defendants from the delay and the untimely March 2011 document production.
We are sympathetic about the physical and emotional difficulties plaintiffs experienced as a result of their dispute with Bedford and defendants, but we cannot — as plaintiffs urge — conclude the court abused its discretion by declining to excuse plaintiffs' delays and discovery abuses on this ground. A trial court has broad discretion in determining the reasonableness of an excuse for delay. Even "[d]elay attributable to sickness or death of . . . the parties is not necessarily excusable. Each case must be decided on its own peculiar features and facts." (White v. Mortgage Finance Corp. (1983) 142 Cal.App.3d 770, 775.) Plaintiffs have not demonstrated an abuse of discretion in this regard, particularly where they relied on the hearsay assertions of their attorney rather than offering a declaration or submitting medical records supporting their claimed health problems. (See Longshore v. Pine (1986) 176 Cal.App.3d 731, 737 [specificity required to justify delay].)
Plaintiffs devote much of their opening and reply briefs urging us to take a contrary view of the evidence, but we cannot. We must defer to the court's factual determinations when the evidence is in conflict even if we might have reached a contrary result. (Shamblin v. Brattain (1988) 44 Cal.3d 474, 478-479.) We conclude the court did not abuse its discretion by dismissing the case for failure to prosecute under sections 583.410 and 583.420. The court considered all of the relevant factors and properly determined plaintiffs' delay in prosecuting the action was not reasonable or excusable. (Landry v. Berryessa Union School Dist. (1995) 39 Cal.App.4th 691, 698.)
DISPOSITION
The judgment is affirmed. Defendants are entitled to costs on appeal.
____________________________
Jones, P.J.
We concur: ____________________________
Simons, J.
____________________________
Bruiniers, J.