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Harris v. Soley
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MAINE SUPREME JUDICIAL COURT Reporter of Decisions
Decision: 2000 ME 150
Docket: Cum-99-543
Argued: April 5, 2000
Decided: July 28, 2000
Panel:WATHEN, C.J., and CLIFFORD, RUDMAN, SAUFLEY, ALEXANDER, and CALKINS, JJ.
ANDREA HARRIS et al.
v.
JOSEPH SOLEY et al.
SAUFLEY, J.
[¶1] Joseph Soley, Monopoly, Inc., Jobar, Inc., Seamen's Club, Inc.,
Christopher Stafiej, and Preston Wilkin{1} appeal from a judgment entered
against them by the Superior Court (Cumberland County, Mills, J.) on a
complaint filed by former tenants. The defendants appeal both from the
default judgment on liability, entered by the court as a sanction for discovery
violations, and from the judgment entered on the jury's verdict on damages.
We affirm the judgments.
I. BACKGROUND
A. Factual Background
[¶2] Near Labor Day of 1997, Andrea Harris, Kimberly Nightingale,
Karen Simard, and Michelle Dussault{2} moved into a large apartment that was
located in the Old Port area of Portland and owned by Joseph Soley. Soley
had promised the tenants that the apartment, which had previously been
condemned by the City of Portland, would be repaired by the time they
moved in. When they arrived, the condemnation notice was still on the
door. Upon entering the apartment, they found it in an uninhabitable
condition. They spoke to Soley's property manager who indicated that if the
tenants were willing to clean the apartment themselves, she would credit
them with $750 of their $1000 monthly rent for the month of September.
They rented a steam cleaner, bought various cleaning supplies, and cleaned
the apartment themselves. Soley's property manager also suggested that
they buy a new refrigerator and deduct it from the rent because the one in
the apartment did not work.
[¶3] Despite their efforts to clean the apartment, the tenants
continued to have problems with infestations of mice and cockroaches, as
well as a persistent odor of cat urine. A dead cat was eventually found
beneath the floorboards. The apartment had no heat during the month of
October. One tenant slept with blankets over her head, not only because of
the cold, but also to keep bugs away from her. These problems persisted
into November, and the tenants submitted to Soley a list of complaints
including a broken skylight, a broken toilet, a broken garbage disposal, a
leaking roof, and cockroach infestation. As winter arrived, snow would fall
into the living room through the broken skylight. When Soley did not make
the needed repairs, the tenants stopped paying rent. During this period,
Soley telephoned them on several occasions regarding the rent and spoke to
the tenants in a rude and abrasive manner. In February, the property
manager told the tenants that Soley had begun eviction proceedings against
them.
[¶4] The tenants eventually found another place to live and had begun
moving out by April 1, 1998.{3} While the tenants were in the process of
moving out, but were away from the apartment, Soley's agents broke into the
apartment and took many of the tenants' remaining belongings. Upon
confrontation with the returning tenants and police officers who had been
called to the scene, Soley's agents indicated that Soley had directed their
actions. Eventually, the officers and one of the tenants went to an apartment
nearby and recovered some, but not all, of the missing property.
[¶5] The tenants then sought out Soley to request that he return their
remaining possessions. They located him at his restaurant, the Seamen's
Club. According to one of the tenants, he replied that he would return their
property only after they paid him $3000.{4} He then ordered them to leave
and threatened to call the police and have them forcibly removed. Soley
told the tenants that he knew where they were moving and where their
families lived, a statement that the tenants took as a threat.
B. Procedural Background
[¶6] On June 18, 1998, the tenants brought suit against the
defendants in a complaint that included claims for conversion, intentional
infliction of emotional distress, punitive damages, breach of contract,
wrongful eviction, and wrongful retention of a security deposit. The court
set a discovery deadline of February 1, 1999. As discovery proceeded, Soley
repeatedly failed to comply with appropriate discovery requests, failed to
make the apartment available for inspection, and, later, failed to make
witnesses available for deposition. Eventually, the tenants filed a motion to
compel discovery. The parties reached agreement on certain aspects of
discovery and the court entered an order compelling the delivery of
documentary discovery by December 20. When the defendants did not
comply with that order, the court sanctioned the defendants by entering
judgment against them on all counts, leaving only the matter of damages for
trial. When Soley again failed to comply with damage-related discovery
requests, the court precluded him from offering certain evidence in the trial
on damages.
[¶7] At the two-day jury trial on the issue of the tenants' damages, the
trial judge read the complaint to the jury and explained that they were to
accept those facts as true and would only be required to address the
question of damages.{5} After hearing the evidence, the jury awarded each of
the tenants $15,000 for intentional infliction of emotional distress, $110 for
breach of contract, and damages varying from $250 to $1060 on their
claims for conversion. They also awarded a total of $1 million in punitive
damages against Joseph Soley, Monopoly, Inc., Seamen's Club, Baker's
Table, Inc., and Jobar, Inc., and $4000 against Christopher Stafiej. The
court entered its judgment in accordance with the jury's determinations of
damages, along with additional damages determined by the court and those
agreed to by the parties on the claims for wrongful eviction, wrongful
retention of a security deposit, and breach of implied warranty of fitness for
human habitation.{6} This appeal followed.
II. DISCUSSION
A. Entry of Judgment as a Discovery Sanction
[¶8] Soley first challenges the court's imposition of a judgment
against all defendants on all claims of liability as a sanction, pursuant to
M.R. Civ. P. 37(b)(2)(C),{7} for discovery related conduct. Soley argues that
the court abused its discretion by imposing the ultimate sanction without
providing the defendants another chance to comply with the discovery
order, and without issuing a warning that the court was contemplating the
entry of judgment as a sanction.{8}
[¶9] We review the imposition of sanctions for discovery violations for
an abuse of discretion, but will more closely scrutinize sanctions such as
dismissal or default. See Saucier v. State Tax Assessor, 1998 ME 61, ¶ 6,
708 A.2d 281, 283. Nevertheless, "[a]lthough we recognize the
constitutional implications of dismissal and give greater scrutiny to the
decision to dismiss than we would give to a lesser sanction, we will not
lightly overrule the trial court's decision." Orlandella v. O'Brien, 637 A.2d
105, 106 (Me. 1994) (citing Fallon v. Casco-Northern Corp., 462 A.2d 53, 56
(Me. 1983); Reeves v. Travelers Ins. Cos., 421 A.2d 47, 50 (Me. 1980)); see
also Pelletier v. Pathiraja, 519 A.2d 187, 190 (Me. 1986).{9}
[¶10] A court that is called upon to determine an appropriate
sanction for a discovery violation must understand the facts at issue, the
factors and the law material to its decision, and must weigh the factors
accordingly. The factors to be weighed when the court considers imposing
sanctions for discovery violations include, but are not limited to, "the
purpose of the specific rule at issue, the party's conduct throughout the
proceedings, the party's bona fides in its failure to comply, prejudice to
other parties, and the need for the orderly administration of justice."{10}
Baker's Table, Inc. v. City of Portland, 2000 ME 7, ¶ 17, 743 A.2d 237, 243.
The court must also consider the purposes to be served by imposing
sanctions, including penalizing the noncompliant party, remedying the
effects of the noncompliance, and deterring similar conduct by the
offending party, as well as by others. See Pelletier, 519 A.2d at 190; Reeves,
421 A.2d at 50.
[¶11] When the court has determined the facts without error and has
understood the factors and law material to the decision at hand, we defer to
the trial court and will find an abuse of discretion only where the court
makes a "serious mistake" in weighing the applicable factors. See West
Point-Pepperell, Inc. v. State Tax Assessor, 1997 ME 58, ¶ 7, 691 A.2d
1211, 1213.
[¶12] In the matter before us, the court had before it evidence that
Soley failed at every turn to comply with Rule 26, failed to cooperate in good
faith in providing access to the apartment, failed to make witnesses
reasonably available for deposition, and ultimately failed to comply with the
court's order compelling compliance with the rules. By the date first
scheduled for hearing on the tenants' motion for discovery sanctions-over
seven months after the service of the complaint and first request for
documents, two days short of the close of discovery, and more than a month
after the date by which compliance had been ordered by the court-Soley
had produced not a single document, the apartment had not been made
available for inspection, and only one deposition had been taken.{11}
[¶13] As a result of the delay occasioned by Soley's conduct, discovery
had barely begun on the day that the court had set for the close of discovery.
The tenants and their attorneys were required to spend unnecessary time
and money setting up and canceling depositions, writing letters, scheduling
conferences with the court, and attending hearings. The tenants were
effectively prevented from preparing their case and on the eve of trial had
received almost no meaningful discovery. It is difficult to imagine a more
unprincipled approach to the discovery process.
[¶14] Soley argues, nonetheless, that the defendants should not have
been exposed to the ultimate sanction for two reasons: first, Soley argues
that the court was unaware of whether his attorney had kept him informed
on discovery issues, and second, Soley insists that the defendants only
engaged in a clear violation of one court order.{12} Both arguments lack
merit.
[¶15] Regarding Soley's first argument, "it is well settled that the
knowledge of trial counsel is imputed to plaintiff." Orlandella, 637 A.2d at
106 n.1. The conduct of discovery constitutes no exception to that rule.
Soley's complete failure to comply with his discovery obligations, regardless
of his relationship with his attorney, requires that the defendants be held
fully accountable.
[¶16] Soley's second argument, that default judgment was an
inappropriate sanction given the fact that the defendants only failed to
comply with one court order, demonstrates a critical misapprehension of
the rules of discovery. Our discovery rules are designed to "eliminate the
sporting theory of justice," Reeves, 421 A.2d at 50, and are based on
concepts of voluntary cooperation.{13} A party to a lawsuit has a duty to
comply with the rules regarding discovery throughout the litigation.
[¶17] Recourse to the authority of the court for orders compelling
compliance with the rules must be the exception rather than the rule.
Ordinarily, the court's intervention in discovery matters should be necessary
only where there is a legitimate dispute regarding the responsibility of one
party to provide certain discovery. When one party forces another to obtain
a court order merely to enforce an obligation that is not legitimately in
dispute, that party wastes the court's resources, causes unnecessary expense
to the opposing party, and delays the ultimate resolution of the suit. Hence,
a party's failure to cooperate in discovery prior to the entry of a court order
compelling compliance constitutes "conduct throughout the proceeding"
that may be considered by a court in determining an appropriate sanction
for purposes of M.R. Civ. P. 37(b). Baker's Table, Inc., 2000 ME 7, ¶ 17,
743 A.2d at 243.
[¶18] There can be no question on the record of this case that Soley
failed to comply with the rules of discovery, caused additional expense and
delay by his conduct, and failed to comply with the court order requiring his
compliance. The court acted well within the bounds of its discretion when
it entered judgment in favor of the tenants on all claims as a discovery
sanction.
B. In Limine Ruling Excluding Evidence of Joseph Soley's Debts
[¶19] After default on liability was imposed as a sanction for Soley's
failure to provide discovery, the court issued another discovery order in
March 1999 compelling defendants to provide requested financial
information. Notwithstanding what was, at that point, the obvious risk of
failing to provide discovery, Soley failed once again to provide any
meaningful information.{14} Finding that there had been absolutely no effort
on Solely's part to verify or even investigate the figures provided to the
tenants, the court concluded that there was no reliable information provided
by Soley regarding his financial liabilities and therefore that it would be
improper to allow him to testify regarding liabilities at trial.
[¶20] As with the court's first sanction for discovery violations, we
review the order for an abuse of discretion, looking to the same factors and
principles as set out above, and we conclude that the court acted well within
the range of its discretion in fashioning the sanction for Soley's continued
failure to comply with the court's orders regarding production of his
financial documents.
C. Admission of Evidence of Previous Violations of the City's Code
[¶21] Soley next argues that the court erred by admitting evidence of
Soley's prior building code violations in the City of Portland on the issue of
punitive damages. Soley contends that the evidence was irrelevant to the
determination of punitive damages stemming from either the claim for
conversion or the claim for the intentional infliction of emotional distress.
[¶22] Any analysis of relevance regarding the determination of
punitive damages in this case necessarily begins with a review of the facts
conclusively established upon the adjudication by default of liability on the
conversion and emotional distress claims.{15} In the count alleging
intentional infliction of emotional distress, the tenants reallege the general
facts recited in their complaint, including, inter alia, Soley's repeated
broken promises to fix the numerous problems with the tenants' apartment,
his refusal to fix the apartment following an inspection by the Portland Code
Enforcement Officer in September, and the continuing condemnation of the
premises as unfit for human occupation.
[¶23] Thus, the tortious conduct proved by the tenants was not
limited to the break-in, as Soley argues, but encompassed the ongoing
conduct of the defendants, including repeated refusals to fix problems
amounting to code violations. It is well established that prior misconduct by
a defendant that is similar to the misconduct giving rise to liability is
relevant to the determination of punitive damages. See BMW of N. Am., Inc.
v. Gore, 517 U.S. 559, 576-77 (1996) (citing TXO Prod. Corp. v. Alliance
Resources Corp., 509 U.S. 443, 462 n.28 (1993); Gryger v. Burke, 334 U.S.
728, 732 (1948)). This approach reflects one of the primary purposes of
punitive damages in allowing that "a recidivist may be punished more
severely than a first offender [because] repeated misconduct is more
reprehensible than an individual instance of malfeasance." BMW, 517 U.S. at
577.{16}
[¶24] The court did not err in admitting, on a carefully limited basis,
evidence of prior conduct relating to repeated failures to fix serious
habitability problems.
III. DAMAGES
A. Emotional Distress Damages
[¶25] The jury awarded each of the tenants $15,000 as damages for
emotional distress. The defendants argue that the evidence does not
support an award to each of the tenants in identical amounts. In addition,
Soley relies on the fact that the awards are identical to support a claim that
the awards are the result of passion and prejudice.
[¶26] The determination of damages is the "'sole province of the
factfinder,' [and] we will not disturb the jury's decision unless there is 'no
basis in the evidence for the award,'" Tang of the Sea, Inc. v. Bayley's Quality
Seafoods, Inc., 1998 ME 264, ¶ 8, 721 A.2d 648, 650 (quoting VanVoorhees
v. Dodge, 679 A.2d 1077, 1081 (Me. 1996) (emphasis in original), or unless
"the jury acted under some bias, prejudice, or improper influence,"
Lawrence v. Saunders, 539 A.2d 1102, 1103 (Me. 1988) (citations omitted),
quoted in Town of Stonington v. Galilean Gospel Temple, 1999 ME 2, ¶ 17,
722 A.2d 1269, 1273.
[¶27] Contrary to Soley's argument, the jury was not required to find
that each of the tenants suffered identical emotional distress in order to
award the same amount of damages to each; rather, the jury need only have
found that the emotional distress suffered by each, regardless of the nature
of that distress, warranted comparable monetary compensation. The
evidence introduced at trial, including evidence of Soley's conduct and the
tenants' testimony regarding their emotional responses, could support a
determination that the tenants suffered comparable emotional distress.
[¶28] We also reject the defendants' argument that the awards must
necessarily be the product of passion and prejudice because they are
identical. The mere fact that different tenants receive identical awards does
not establish the existence of bias or prejudice. See, e.g., Lambert v.
Ackerley, 180 F.3d 997, 1011 (9th Cir. 1999); Kuhl v. Atchison, Topeka &
Santa Fe Ry. Co., 827 P.2d 1, 9 (Kan. 1992) ("There is no per se rule which
discredits identical awards, and there is no provision in the current law for
comparison of one plaintiff's recovery with another's to serve as the basis for
overturning a jury's verdict."). The court did not err in declining to set
aside the jury's award of emotional distress damages.
B. Punitive Damage Award
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