St. Mary v. Superior Court , 223 Cal. App. 4th 762 ( 2014 )

Filed 1/31/14
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SIXTH APPELLATE DISTRICT
LISA ST. MARY, No. H038918
(Monterey County
Petitioner, Super. Ct. No. M111895)
v.
THE SUPERIOR COURT OF
CALIFORNIA FOR THE COUNTY OF
MONTEREY
Respondent,
THOMAS SCHELLENBERG and
KATHERINE MILLS,
Real Parties in Interest.
Petitioner Lisa St. Mary (St. Mary) brought an action below for damages, alleging
fraud and other claims arising out of an investment of $475,000. She sued, among others,
Thomas Schellenberg and his wife, Katherine Mills. (Schellenberg and Mills are
sometimes referred to herein collectively as real parties in interest, or real parties.)
Schellenberg and Mills each propounded requests for admissions (RFAs) directed to St.
Mary, which consisted collectively of 119 individual RFAs. After making two written
requests for a two-week extension to respond, and after Schellenberg denied the
extension request one day after the due date for the responses, counsel for St. Mary
served responses to the RFAs. They were served four days late, on July 16, 2012. Four
days later, real parties, without any attempt to meet and confer, filed a motion (Motion)
with the respondent superior court requesting that the 119 RFAs in their entirety be
deemed admitted, pursuant to Code of Civil Procedure section 2033.280, subdivision
(b).1 The court granted the Motion as to the Schellenberg RFAs, deemed 41 of the 105
RFAs admitted, and awarded sanctions in favor of real parties. The court’s order omitted
any reference to the Motion to deem admitted the 14 RFAs propounded by Mills upon St.
Mary.
St. Mary seeks a writ of mandate directing the superior court to vacate its order
deeming the 41 Schellenberg RFAs admitted. She contends in her petition that real
parties’ Motion was defective in that it did not constitute a motion to compel further
responses to RFAs under section 2033.290. She argues further that real parties
improperly included new matter for the first time in their reply papers—namely,
argument directed to St. Mary’s responses to specific Schellenberg RFAs that real parties
claimed were deficient—and that the court granted the Motion based upon the
presentation of such new arguments. St. Mary asserts that the impact of the court’s order
is extremely significant because, among other things, six of the RFAs deemed admitted
are specifically directed to a potential statute of limitations defense asserted by real
parties.
In response, real parties raise several procedural objections to the petition,
including its timeliness.2 In addition, real parties assert, among other things, that St.
Mary has failed to demonstrate “ ‘clear error’ ” entitling her to relief; the statutes under
which real parties’ Motion was brought (§ 2033.280) and the additional statute governing
motions to compel further responses to RFAs (§ 2033.290) are clear; and the untimely
1
All further statutory references are to the Code of Civil Procedure unless
otherwise specified.
2
To the extent warranted, these procedural objections are addressed, post.
2
responses to RFAs served by St. Mary were not substantially compliant with the Code of
Civil Procedure.
We conclude that respondent court erred in granting real parties’ Motion by
deeming admitted 41 of the Schellenberg RFAs. Accordingly, we will grant the petition
and order a writ of mandamus to issue commanding respondent to vacate its order and
issue a new and different order denying real parties’ Motion pursuant to section
2033.280, subdivision (b) as to the RFAs propounded upon St. Mary.
PROCEDURAL BACKGROUND3
I. The Complaint
St. Mary filed her complaint on April 25, 2011, alleging claims sounding in fraud
against Schellenberg, Mills, and David Nilsen4 (collectively, Defendants), arising out of
the investment of her life savings of $475,000. According to the pleading’s caption, St.
Mary asserts claims for breach of fiduciary duty, fraudulent concealment, conflict of
interest, affirmative misrepresentation, fraudulent concealment in connection with the sale
of an interest in real property, embezzlement, and a request for an accounting.
It is alleged by St. Mary5 that after having heard a radio advertisement in December
2005 promoting investment opportunities in Cedar Funding, Inc., she called the telephone
3
In addition to the procedural matters relating to the discovery order being
challenged in these proceedings, both St. Mary and real parties have included discussions
of various other procedural aspects of the underlying case, including other discovery
matters. These ancillary procedural matters are not germane to our disposition of the
petition.
4
Nilsen is alleged to have been the former CEO of Cedar Funding, Inc., and a
licensed real estate broker whose license was suspended. There is evidence in the record
that, as of August 2012, he was incarcerated in a federal penitentiary.
5
The statements made in this paragraph and the succeeding paragraph are based
upon the allegations made by St. Mary in her complaint. For simplicity and to avoid
repetition, we have generally omitted the phrase “St. Mary alleges in her complaint” in
describing the background of her claims, which claims we assume for purposes of this
proceeding are denied by real parties. In our consideration of the petition, we have also
(Cont.)
3
number indicated in the radio advertisement and was referred to Schellenberg, who was
identified as “ ‘Director, New Business’ for Cedar Funding, and [as] a ‘Real Estate & Loan
Consultant.’ ” Schellenberg provided written materials to St. Mary and later recommended
that she make a loan to his wholly owned separate venture, Neo Ventures, Inc., to facilitate
ongoing substantial renovations of residential property located at 214 4th Street in Pacific
Grove (subject property). He represented that in exchange for her $475,000 investment,
she “would receive an undivided 92.054 % majority interest in an already existing
Promissory Note and an already recorded Deed of Trust” recorded against and secured by
the subject property. Schellenberg represented to St. Mary that this deed of trust would
ultimately be in first priority, that the subject property would be worth $1,375,000, and that
her investment would be protected.
St. Mary alleges further in her complaint that “Defendants [intended] to defraud
[her] by inducing her to advance $475,000.00 for [their] personal, secret and prohibited use
and enjoyment . . . Instead of action for the benefit of protection of [St. Mary] in a
transaction lending her investment out to a third person on a safe and fully secured loan
with the represented adequate equity as security, Defendants always intended to convert
the proceeds of the loan to their own personal use and benefit and did so.” St. Mary
alleges that she provided the funds to Defendants in January 2006 in reasonable and
justifiable reliance upon their representations. By March 2007, “Defendants had
fraudulently but secretly extracted $1,887,000.00” using the subject property as the basis
for the financial transactions. (Original emphasis omitted.)6 St. Mary never received any
security as promised, and her entire investment was lost after the bankruptcy of Cedar
noted the lengthy recitation of alleged underlying facts presented by real parties (almost
entirely without citation to the record).
6
St. Mary alleges that the subject property “was appraised at $775,000.00 at the
top of the market in 2005.”
4
Funding, Inc. and the foreclosure of the subject property effectuated by a lienholder bank.
She became aware of “the vast fraudulent operations of Defendants” in May 2008.
II. The RFAs and Responses
On June 7, 2012,7 Schellenberg served by mail upon St. Mary a set of 105 RFAs,
seeking that she admit or deny certain specified matters.8 On the same date, Mills served
by mail upon St. Mary a set of 14 RFAs, seeking that she admit or deny specified matters.
St. Mary was therefore required to serve her responses to the Schellenberger RFAs and the
Mills RFAs on or before July 12, 2012. (§§ 2033.250; 1013, subd. (a).)
On July 16—four days late—St. Mary served her responses to the Schellenberg and
Mills RFAs by facsimile and mail. Prior to this tardy service of the responses, and on or
before the July 12 deadline for service of the responses, counsel for St. Mary, David
Hollingsworth—based upon the volume of the discovery and his involvement in preparing
for a federal jury trial—requested that real parties grant him a two-week extension to
complete the responses.9 Real parties did not respond to the extension request until after
the responses were due. On July 13, Schellenberg faxed a letter to Hollingsworth granting
a nine-day extension, subject to the condition that St. Mary immediately file a dismissal
with prejudice of the action as to Mills.
7
All dates hereafter stated are 2012 unless otherwise specified.
8
Service of the 105 Schellenberg RFAs was accompanied by the requisite
declaration for additional discovery pursuant to section 2033.050.
9
Hollingsworth’s paralegal sent an e-mail to Schellenberg on July 10, requesting a
two-week extension; the paralegal received no response to this request. After learning
that there had been no response to the July 10 extension request, Hollingsworth drafted
and faxed a letter on July 12, reiterating the request for a two-week extension. Later the
same day, Hollingsworth attempted to reach Schellenberg by telephone and left a
voicemail message repeating the request for an extension.
5
III. Real Parties’ Motion to Have RFAs Deemed Admitted
On July 20—four days after receipt by facsimile of the responses to the RFAs—real
parties filed a Motion to have the Schellenberg and Mills RFAs propounded upon St. Mary
deemed admitted.10 Real parties acknowledged that St. Mary had (belatedly) served
responses to the two sets of RFAs, and they attached those responses to the respective
declarations of Schellenberg and Mills filed in support of the Motion. Real parties
contended that St. Mary’s “responses [were] defective, legally deficient, and a nullity.”
They repeated this conclusory statement serially in the memorandum filed in support of the
Motion. The Motion contained no reference to any particular response by St. Mary to any
of the 119 RFAs to explain real parties’ claim that the responses were defective or legally
deficient. Indeed, other than being served four days late, there was no basis for real
parties’ claim that St. Mary’s responses to the 14 Mills RFAs were deficient; each
response consisted of a one-word admission or denial.
On August 3, St. Mary’s counsel and Schellenberg appeared at a case management
conference. There was substantial discussion between Hollingsworth, Schellenberg, and
the court concerning the Motion, outstanding interrogatory responses due from St. Mary to
real parties (concerning St. Mary’s denials of any of the RFAs), and Hollingsworth’s
unavailability for a portion of August due to a federal jury trial. The court suggested that it
might be appropriate for the parties to arrive at a compromise under which St. Mary would
agree to serve responses to the interrogatories by a date certain, in exchange for which real
parties would vacate the hearing on the Motion. At the conclusion of the conference,
Schellenberg stipulated that if he had received St. Mary’s responses to interrogatories “in
[his] hands” by the end of business on August 9, he would drop the Motion.
10
Real parties’ Motion also sought to have deemed admitted certain RFAs
propounded by Schellenberg and Mills upon Nilsen to which responses were not
received. The court granted real parties’ motion as to Nilsen. This aspect of real parties’
Motion is not at issue here.
6
Hollingsworth, on behalf of St. Mary, filed opposition to the Motion on August 3.
That opposition emphasized (1) the collective volume of the RFAs; (2) Hollingsworth’s
unsuccessful attempts to obtain a two-week extension to respond; (3) real parties’ belated
reply to the extension request made after the responses were due in which they conditioned
the grant of an extension upon the “extortionate demand” that Mills be dismissed with
prejudice; and (4) the fact that St. Mary’s responses to both sets of RFAs were received by
real parties before they filed the Motion, and she had thus substantially complied with
section 2033.220, notwithstanding that the responses were four days late. Hollingsworth
also noted that he had cured a technical issue with the responses to the RFAs—his failure
to sign them as counsel—once he was made aware of the issue by a statement made in the
Motion.
Real parties filed a reply in support of their Motion on August 10.11
At the hearing on the Motion on August 17, Schellenberg personally appeared and
Hollingsworth appeared by telephone. After the court determined that the parties
disagreed as to whether Hollingsworth had complied by serving the interrogatory
responses on August 9, in compliance with the conditional stipulation under which real
parties agreed to drop the Motion, the court heard the merits of the Motion.12 It found that
some of the responses complied with the Code of Civil Procedure, but some did not. The
court concluded that the Motion as to the responses to the Schellenberg RFAs should be
granted, and that any responses that were not unqualified denials would be deemed
admitted. It entered an order the same day granting real parties’ Motion, deeming admitted
11
The substance of real parties’ reply is discussed, post.
12
There is evidence in the record suggesting that the court should have required
Schellenberg to honor his agreement to vacate the hearing on the Motion because St.
Mary complied with the terms of the stipulation; she served her interrogatory responses
on August 9 and they were received by real parties (at least by fax) on August 9.
Although this issue is raised by St. Mary, because we conclude that the trial court erred,
we do not address this claim.
7
41 of the Schellenberg RFAs; it concluded that as to those RFA responses, St. Mary had
failed to serve responses in substantial compliance with section 2033.220.13
St. Mary filed a motion for reconsideration of the court’s order granting the Motion.
On October 5, the court denied the motion for reconsideration.
IV. Petition for Writ of Mandate
St. Mary filed her petition for writ of mandate with this court on October 22.14 On
November 9, we issued an order staying all trial court proceedings and a Palma15 notice
indicating that we were considering issuing a peremptory writ of mandate in the first
13
Real parties contend “[t]he trial court found St. Mary failed to substantially
comply with § 2033.280 in 82 out of 119 FRAS [sic].” This is incorrect. The court
deemed admitted the following 41 Schellenberg RFAs based upon their alleged
noncompliance with section 2033.220: 20, 27, 29, 31, 36, 38, 48, 51-59, 61, 64-76, 82,
84, 85, 87-92, 96, and 102. The court amended its order on September 5, to include an
award of $245 in sanctions in favor of real parties. Neither the order nor the amended
order specifically addressed the Motion as it concerned the Mills RFAs propounded upon
St. Mary.
14
Real parties in their opposition contend that the petition is untimely and is
defective because it is not verified by St. Mary personally. Neither position has merit.
Appellate courts generally require that nonstatutory writ petitions be filed within 60 days
of service of the challenged order, i.e., the same 60-day period applicable to appeals.
(Cal West Nurseries v. Superior Court (2005) 129 Cal. App. 4th 1170, 1173-1174; see
generally Eisenberg et al., Cal. Practice Guide: Civil Appeals and Writs (The Rutter
Group 2012) ¶¶ 15:144 to 15:146, pp. 15-74 to 15-75 (rev. #1 2012).) The challenged
order here was served on August 23, and the petition was filed within 60 days thereafter
on October 22. The petition was verified by St. Mary’s counsel. Given that the
underlying facts concerning the issues in the petition—i.e., the procedural history of real
parties’ RFAs, St. Mary’s responses, real parties’ Motion to deem the RFAs admitted and
St. Mary’s opposition and real parties’ reply, and the hearing and the court’s ruling on the
Motion—are all ones within the personal knowledge of St. Mary’s counsel, the failure of
St. Mary to verify the petition is not improper. (§ 446, subd. (a); see Eisenberg, supra, ¶¶
15:185, p. 15-93; Perlman v. Municipal Court (1979) 99 Cal. App. 3d 568, 574 [“ ‘if the
facts are within the knowledge of the attorney . . . , [he] may verify the pleading without
regard to the existence of . . . conditions’ ” of the party’s unavailability].)
8
instance. Real Parties filed their opposition on December 27, and St. Mary filed her reply
on January 29, 2013.
DISCUSSION
I. Standard of Review
Discovery orders are generally reviewed for abuse of discretion. (Costco
Wholesale Corp. v. Superior Court (2009) 47 Cal. 4th 725, 733.) This abuse of discretion
standard is applicable to a variety of discovery rulings. (See, e.g., Edwards v. Superior
Court (1976) 16 Cal. 3d 905, 913 [order compelling psychiatric examination of litigant];
Life Technologies Corp. v. Superior Court (2011) 197 Cal. App. 4th 640, 655 [order
compelling further responses to interrogatories]; Sinaiko Healthcare Consulting, Inc. v.
Pacific Healthcare Consultants (2007) 148 Cal. App. 4th 390, 401 (Sinaiko Healthcare)
[discovery sanctions order]; Obregon v. Superior Court (1998) 67 Cal. App. 4th 424, 431
[determination of adequacy of meet and confer efforts regarding discovery dispute].)
Our high court has indicated that this abuse of discretion standard is founded on
principles of deference to the trial court, such as “whether or not the trial court exceeded
the bounds of reason, all of the circumstances before it being considered” (In re Marriage
of Connolly (1979) 23 Cal. 3d 590, 598); and that that appellate courts should disturb
discretionary trial court rulings only upon a showing of “ ‘ “a clear case of abuse” ’ ” and
“ ‘ “a miscarriage of justice” ’ ” (Blank v. Kirwan (1985) 39 Cal. 3d 311, 331.) But these
broad principles should not be read as permitting an appellate court to reverse a trial court
based upon abuse of discretion only if “its action was utterly irrational.” (City of
Sacramento v. Drew (1989) 207 Cal. App. 3d 1287, 1297.) As our high court later
explained, “the court’s discretion is not unlimited . . . and it must be exercised within the
confines of the applicable legal principles.” (Sargon Enterprises, Inc. v. University of
15
Palma v. U.S. Industrial Fasteners, Inc. (1984) 36 Cal. 3d 171, 180. (See also
Lewis v. Superior Court (1999) 19 Cal. 4th 1232, 1240-1241.)
9
Southern California (2012) 55 Cal. 4th 747, 773.) The court explained further: “ ‘The
discretion of a trial judge is not a whimsical, uncontrolled power, but a legal discretion,
which is subject to the limitations of legal principles governing the subject of its action,
and to reversal on appeal where no reasonable basis for the action is shown.’ [Citations.]
‘The scope of discretion always resides in the particular law being applied, i.e., in the
“legal principles governing the subject of [the] action. . . .” Action that transgresses the
confines of the applicable principles of law is outside the scope of discretion and we call
such action an “abuse” of discretion. [Citation.] . . . [¶] The legal principles that govern
the subject of discretionary action vary greatly with context. [Citation.] They are derived
from the common law or statutes under which discretion is conferred.’ [Citation.] To
determine if a court abused its discretion, we must thus consider ‘the legal principles and
policies that should have guided the court’s actions.’ [Citation.]” (Ibid.) Thus, “[a]ction
that transgresses the confines of the applicable principles of law is outside the scope of
discretion and we call such action an ‘abuse’ of discretion. [Citation.]” (City of
Sacramento v. Drew, supra, 207 Cal.App.3d at p. 1297.)
Accordingly, “[w]here . . . the relevant facts [concerning the discovery order] are
undisputed, we review a trial court’s exercise of discretion as a question of law.
[Citation.]” (Toshiba America Electronic Components, Inc. v. Superior Court (2004) 124
Cal. App. 4th 762, 768 (Toshiba America).) And to the extent we must construe relevant
discovery statutes in resolving the issues in this proceeding, we do so de novo and
without regard to the trial court’s reasoning. (Sinaiko Healthcare, supra, 148
Cal.App.4th at p. 401.)
Writ review of discovery rulings is generally disfavored. (O’Grady v. Superior
Court (2006) 139 Cal. App. 4th 1423, 1429 (O’Grady).) Review of discovery rulings by
extraordinary writ proceedings “is generally limited to ‘situations where (1) the issues
presented are of first impression and of general importance to the trial courts and to the
profession [citation], (2) the order denying discovery prevents a party from having a fair
10
opportunity to litigate his or her case [citation], or (3) the ruling compelling discovery
would violate a privilege [citations].’ [Citation.]” (OXY Resources California LLC v.
Superior Court (2004) 115 Cal. App. 4th 874, 886 (OXY Resources), quoting Johnson v.
Superior Court (2000) 80 Cal. App. 4th 1050, 1061; see also Toshiba America, supra, 124
Cal.App.4th at p. 767.) Furthermore, “[b]ecause requests for admissions are more closely
akin to summary adjudication procedures than to orthodox discovery, being designed not
so much to ‘discover’ the facts and to expedite trial preparation as to render it
unnecessary to try an otherwise triable issue of fact or law [citations], we do not apply the
rule that a reviewing court should rarely interfere with pretrial discovery orders,
particularly where such orders operate to grant discovery. [Citation.]” (Hansen v.
Superior Court (1983) 149 Cal. App. 3d 823, 827-828.)
II. Requests for Admissions and Related Discovery Motions
A party may request that another litigant “admit the genuineness of specified
documents, or the truth of specified matters of fact, opinion relating to fact, or application
of law to fact. A request for admission may relate to a matter that is in controversy
between the parties.” (§ 2033.010.) Unless the responding party moves promptly for a
protective order under section 2033.080, he or she, within 30 days of service of the RFAs
(§ 2033.250), shall respond in writing under oath and separately to each RFA
(§ 2033.210, subd. (a)) and “shall answer the substance of the requested admission, or set
forth an objection to the particular request” (id., subd, (b)). Each response to the RFAs
must be “complete and straightforward.” (§ 2033.220, subd. (a).) The responding party
shall admit as much of the request that is true, “either as expressed in the request itself or
as reasonably and clearly qualified by the responding party” (id., subd. (b)(1)); “[d]eny so
much of the matter involved in the request as is untrue” (id., subd. (b)(2)); or “[s]pecify
11
so much of the matter involved in the request as to the truth of which the responding
party lacks sufficient information or knowledge” (id., subd. (b)(3)).16
RFAs are different from other civil discovery tools such as depositions,
interrogatories, and requests for documents. “Most of the other discovery procedures are
aimed primarily at assisting counsel to prepare for trial. Requests for admissions, on the
other hand, are primarily aimed at setting at rest a triable issue so that it will not have to
be tried. Thus, such requests, in a most definite manner, are aimed at expediting the
trial.” (Cembrook v. Superior Court (1961) 56 Cal. 2d 423, 429 (Cembrook); see also
Studll v. Sparrow (2001) 92 Cal. App. 4th 860, 864 (Studll) [instead of “seeking to
uncover information, [RFAs] seek to eliminate the need for proof”].) As has been
explained in one treatise: “The request for admission differs fundamentally from the
other five discovery tools (depositions, interrogatories, inspection demands, medical
examinations, and expert witness exchanges). These devices principally seek to obtain
proof for use at trial. In marked contrast, admission requests seek to eliminate the need
for proof: ‘[T]he purpose of the admissions procedure . . . is to limit the triable issues
and spare the parties the burden and expense of litigating undisputed issues.’ Sometimes,
the admissions obtained will even leave the party making them vulnerable to summary
judgment.” (Hogan and Weber, 1 Cal. Civil Discovery (2d ed. 2005) § 9.1, p. 9-2, fns.
16
“(a) Each answer in a response to requests for admission shall be as complete
and straightforward as the information reasonably available to the responding party
permits. [¶] (b) Each answer shall: [¶] (1) Admit so much of the matter involved in the
request as is true, either as expressed in the request itself or as reasonably and clearly
qualified by the responding party. [¶] (2) Deny so much of the matter involved in the
request as is untrue. [¶] (3) Specify so much of the matter involved in the request as to
the truth of which the responding party lacks sufficient information or knowledge. [¶]
(c) If a responding party gives lack of information or knowledge as a reason for a failure
to admit all or part of a request for admission, that party shall state in the answer that a
reasonable inquiry concerning the matter in the particular request has been made, and that
the information known or readily obtainable is insufficient to enable that party to admit
the matter.” (§ 2033.220.)
12
omitted, quoting Shepard & Morgan v. Lee & Daniel, Inc. (1982) 31 Cal. 3d 256, 261.)
Matters that are admitted or deemed admitted through RFA discovery devices are
conclusively established in the litigation and are not subject to being contested through
contradictory evidence. (Murillo v. Superior Court (2006) 143 Cal. App. 4th 730, 736
(Murillo).)
Prior to 1987 and the enactment of the Civil Discovery Act, a party propounding
RFAs was required to include a warning that noncompliance would result in the RFAs
being deemed admitted; in the event timely responses were not served and the
propounding party then served a statutory notice that the RFAs had been deemed
admitted, the nonresponding party would then have 30 days to make a motion for relief
from default under section 473 to avoid the RFAs becoming binding admissions. (Wilcox
v. Birtwhistle (1999) 21 Cal. 4th 973, 979 (Wilcox).) “This practice, however, was
problematic because it: (1) was too ‘draconian’ and ‘imposed a sanction for nonresponse
or tardy response that [was] out of all proportion to the abuse of discovery’; and
(2) created no incentive for a party willing to make the admissions to serve an actual
response. [Citations.]” (Id. at pp. 979-980.)17
Under the RFA procedure postdating the Civil Discovery Act, a propounding party
must take affirmative steps—by bringing a formal “deemed admitted” motion—to have
RFAs to which timely responses are not received deemed admitted. In the event
responses to RFAs are not timely served, responding party waives any objections thereto
(§ 2033.280, subd. (a)), and “[t]he requesting party may move for an order that the
17
See also Hogan and Weber, 1 Cal. Civil Discovery, supra, § 9.15, p. 9-40:
“Thus, for the price of a postage stamp and some legal stationery, a litigant could spin the
‘deemed admission’ wheel. If the requesting party was lucky, there would be no
response, or it would be untimely or unverified. That party would then spin the wheel
again by serving a ‘notice of deemed admission.’ At the very least, the delinquent party
would be at the mercy of some trial judge’s notion of what constitutes ‘mistake, surprise
or excusable neglect.’ ”
13
genuineness of any documents and the truth of any matters specified in the requests be
deemed admitted, as well as for a monetary sanction” (id., subd. (b)). Unless the court
determines that the responding party “has served, before the hearing on the motion, a
proposed response to the requests for admission that is in substantial compliance with
Section 2033.220,” it must order the RFAs deemed admitted. (Id., subd. (c).) “[A]
deemed admitted order establishes, by judicial fiat, that a nonresponding party has
responded to the requests by admitting the truth of all matters contained therein.”
(Wilcox, supra, 21 Cal.4th at p. 979.) The court must also impose monetary sanctions
upon the party and/or the attorney for the failure to serve a timely response to the RFAs.
(§ 2033.280, subd. (c).) But a responding party’s service, prior to the hearing on the
“deemed admitted” motion, of substantially compliant responses, will defeat a
propounding party’s attempt under section 2033.280 to have the RFAs deemed admitted.
(Tobin v. Oris (1992) 3 Cal. App. 4th 814, 827 (Tobin).) As one court put it: “If the party
manages to serve its responses before the hearing, the court has no discretion but to deny
the motion. But woe betide the party who fails to serve responses before the hearing. In
that instance the court has no discretion but to grant the admission motion, usually with
fatal consequences for the defaulting party. One might call it ‘two strikes and you’re out’
as applied to civil procedure.” (Demyer v. Costa Mesa Mobile Home Estates (1995)
36 Cal. App. 4th 393, 395-396, fns. omitted (Demyer).)18
If the propounding party believes that the responses to RFAs are deficient in some
respect or that any objections thereto are not well taken, he or she may make a motion to
compel further responses under section 2033.290. (See Wimberly v. Derby Cycle Corp.
(1997) 56 Cal. App. 4th 618, 636; Tobin, supra, 3 Cal.App.4th at p. 829, fn. 25.) Section
2033.290 provides that such a motion to compel further responses may be made within
18
Both Tobin, supra, 3 Cal. App. 4th 814, and Demyer, supra, 36 Cal. App. 4th 393,
were disapproved on other grounds in Wilcox, supra, 21 Cal.4th at p. 983, fn. 12.
14
45 days of service of the responses (§ 2033.290, subd. (c)) if the propounding party
asserts that the particular answer or answers are “evasive or incomplete” or the objection
or objections are “without merit or too general” (id., subd. (a)). The court is required to
impose sanctions upon the unsuccessful party or attorney for the party in connection with
a motion to compel further responses, unless it finds that the “one subject to sanction
acted with substantial justification or that other circumstances make the imposition of the
sanction unjust.” (Id., subd. (d).) And if the responding party disobeys an order
compelling further responses made under section 2033.290, the court is empowered to
“order that the matters involved in the requests be deemed admitted” and/or impose
monetary sanctions. (Id., subd. (e).)19
III. Order Deeming RFAs Admitted Was an Abuse of Discretion
A. Nature of Deemed Admitted Motion
We first address the nature of the Motion brought by real parties, because
resolution of this issue is directly germane to the propriety of the challenged order. As
discussed ante, there are three types of motions that a party propounding RFAs may
initiate: (1) motions to deem RFAs admitted based upon the responding party’s failure to
serve any responses at all in a timely fashion (§ 2033.280, subd. (b)); (2) motions to
compel further responses to RFAs where the responses are claimed to be inadequate or
the objections improper (§ 2033.290, subd. (a)); and (3) motions to deem responses
admitted and/or for sanctions based upon the responding party’s disobedience of an order
19
In addition to the deemed admitted motion under section 2033.280, subdivision
(a), and the motion to compel further responses procedure delineated in section 2033.290,
subd. (a), the Code of Civil Procedure also specifies that a responding party may seek
leave of court to withdraw or modify an admission on the basis of mistake, inadvertence,
or excusable neglect. (§ 2033.300; see New Albertsons, Inc. v. Superior Court (2008)
168 Cal. App. 4th 1403, 1418-1421 (New Albertsons, Inc.).) That motion procedure is not
germane to this proceeding.
15
compelling further responses (id., subd. (e)). It is clear for a number of reasons that the
Motion was of the first-described type pursuant to section 2033.280, subdivision (b).
First, the Motion did not include a statement that real parties were seeking to
compel further responses because they were inadequate or deficient. Second, real parties
made no reference in their Motion to any of the specific, tardy RFA responses of St.
Mary that were allegedly substantively inadequate. Nor did they describe in the Motion
with any specificity the basis for their generalized and repeated claim that the responses
were “defective, legally deficient, and a nullity.” Third, neither the notice nor
memorandum in support of the Motion contained a reference to section 2033.290, the
statute governing motions to compel further RFA responses. Fourth, the Motion included
no declaration indicating any meet and confer attempts made by real parties in an effort
to avoid bringing the Motion. Clearly, such a declaration would have been required for a
motion to compel further responses. (§ 2033.290, subd. (b); see also § 2023.020 [court
shall impose sanction for failure to meet and confer as required under Civil Discovery
Act].) Indeed, real parties stated in the Motion that there is no meet and confer obligation
at all—a true statement for a deemed admitted motion brought under section 2033.280
(Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group
2013) ¶ 8:1371, p. 8G-25), but an incorrect one for motions to compel further responses
(§ 2033.290, subd. (b)). Fifth, the Motion was not accompanied by the requisite separate
statement, under which the moving party, as to each allegedly inadequate RFA response,
must state individually the RFA, the RFA response, and the factual and legal reasons why
the response is inadequate. (Cal. Rules of Court, rule 3.1345; see Mills v. U.S. Bank
(2008) 166 Cal. App. 4th 871, 893 [failure to include separate statement required by Rules
of Court provided justification of court’s denial of discovery motion].)
Thus, it is clear that real parties’ Motion was one to deem the RFAs admitted
based upon the responding party’s failure to serve timely any responses at all under
section 2033.280, subdivision (b). Real parties acknowledged below and in their
16
opposition to the petition here that the Motion was to deem RFAs admitted (section
2033.280, subdivision (b)), and was not a motion to compel further responses (section
2033.290, subdivision (a)). But as we will explain, post, real parties in their reply
memorandum filed below and the court at the hearing on the Motion effectively and
improperly transmuted the Motion from a deemed admitted motion into a motion to
compel further responses.
B. The Court Erred In Deeming the 41 RFAs Admitted
As noted, in the event timely RFA responses are not served, the court is required
to grant the propounding party’s deemed admitted motion “unless it finds that the party to
whom the requests for admission have been directed has served, before the hearing on the
motion, a proposed response to the requests for admission that is in substantial
compliance with Section 2033.220.” (§ 2033.280, subd. (c).) Thus, a responding party’s
service of a tardy proposed RFA response that is substantially Code-compliant will defeat
a deemed admitted motion. (Weil & Brown, Cal. Practice Guide: Civil Procedure
Before Trial, supra, ¶¶ 8:1374 to 8:1374.2, p. 8G-26.) Here, St. Mary served her
proposed response to the RFAs not only before the hearing on the Motion, but even
before the Motion was even filed. Thus, the key question is whether her proposed RFA
response substantially complied with the requirements of section 2033.220.
The Civil Discovery Act does not include a definition of “substantial compliance”
in the context of service of a proposed RFA response that complies with section
2033.220. And very few cases have addressed the circumstances under which a
proposed, untimely RFA response will be deemed to be qualitatively not in substantial
compliance with the Code. (See, e.g., Allen-Pacific, Ltd. v. Superior Court (1997) 57
Cal. App. 4th 1546, 1551 [unverified RFA response is not in substantial compliance with
the law], disapproved on other grounds in Wilcox, supra, 21 Cal.4th at p. 983; Appleton v.
Superior Court (1988) 206 Cal. App. 3d 632, 636 [RFA response that is unverified
17
“tantamount to no response[] at all”].) We therefore turn to case law generally
addressing substantial statutory compliance.
“ ‘Substantial compliance, as the phrase is used in the decisions, means actual
compliance in respect to the substance essential to every reasonable objective of the
statute.’ (Stasher v. Harger-Haldeman (1962) 58 Cal. 2d 23, 29 (Stasher).) Where there
is compliance as to all matters of substance technical deviations are not to be given the
stature of noncompliance. [Citation.] Substance prevails over form.” (Southern Pac.
Transportation Co. v. State Bd. of Equalization (1985) 175 Cal. App. 3d 438, 442; see also
Western States Petroleum Assn. v. Board of Equalization (2013) 57 Cal. 4th 401, 426.)
Our high court has more recently explained with respect to the above-quoted passage
from Stasher: “This formulation is unobjectionable so long as it is understood to mean
that each objective or purpose of a statute must be achieved in order to satisfy the
substantial compliance standard, but this language cannot properly be understood to
require ‘actual compliance’ with every specific statutory requirement.” (Costa v.
Superior Court (2006) 37 Cal. 4th 986, 1017, fn. 24 (Costa).) An appellate court in a
more recent case succinctly observed: “Substantial compliance with a statute is
dependent on the meaning and purpose of the statute.” (Freeman v. Vista de Santa
Barbara Associates, LP (2012) 207 Cal. App. 4th 791, 793 (Freeman).)
We turn to examine whether St. Mary’s proposed response to the Schellenberg
RFAs substantially complied with section 2033.220. Initially, we take issue with
respondent court’s approach. The court examined the individual RFA responses,
determined that some 41 of them were not Code-compliant, and found—explicitly in its
announced reasoning at the hearing, and implicitly in the subsequent order—that the
remaining 64 RFA responses did, in fact, comply with section 2033.220. It therefore
deemed admitted the RFAs corresponding with the 41 responses it determined to have
been noncompliant, implicitly denying the deemed admitted Motion as to the responses
to the remaining 64 RFAs.
18
We find no authority for this piecemeal approach to adjudicating a tardy, proposed
RFA response filed by a responding party prior to the hearing on a deemed admitted
motion. Subdivision (c) of section 2033.280 requires the court to evaluate whether the
“proposed response to the requests for admission” substantially complies with section
2033.220. (Italics added.) This suggests that the court evaluate qualitatively the
proposed response to RFAs in toto to determine whether it substantially complies with
the Code. It does not permit the court to segregate each individual RFA response for the
purpose of finding that portions of the document are Code-compliant (and will therefore
be accepted), while concluding that other portions are noncompliant (and will thus be
rejected). Furthermore, the fact that there is an effective statutory vehicle by which a
propounding party may seek a court order compelling a responding party to cure
individual RFA responses deemed not to be in compliance with section 2033.220—
namely, a motion to compel further responses under section 2033.290—offers additional
support for our view that the court’s seriatim approach to St. Mary’s proposed response
to the RFAs was improper. We therefore conclude that the court’s misapplication of
section 2033.280 in granting the deemed admitted Motion in part and denying it in part
constituted an abuse of discretion. (See City of Sacramento v. Drew, supra, 207
Cal.App.3d at p. 1297 [“[a]ction that transgresses the confines of the applicable
principles of law is outside the scope of discretion and we call such action an ‘abuse’ of
discretion.”].)
Were we to disregard the court’s failure to evaluate St. Mary’s proposed response
to RFAs in its entirety to determine its compliance with section 2033.220, we would
nonetheless conclude that the court erred. First, the proposed response to the RFAs was
verified as required by section 2033.210, subdivision (a). (Cf. Allen-Pacific, Ltd. v.
Superior Court, supra, 57 Cal.App.4th at p. 1551 [unverified response to RFAs did not
substantially comply with law].) Further, St. Mary’s response was unquestionably Code-
19
compliant, at least as it concerned the responses to 64 of the individual RFAs: they
consisted of one-word “Admit” or “Deny” responses.20
Moreover, the court’s conclusion that the responses to the remaining 41 RFAs did
not substantially comply with section 2033.220—based upon reasoning stated at the
hearing that each response was “not unequivocal and [was] incomplete” because each
contained additional language besides an admission or denial—was incorrect. This
finding was apparently based upon the faulty premise that it is universally improper for a
responding party to include any explanation in denying or admitting an individual RFA.
Although “[a] denial of all or any portion of the request must be unequivocal
[citation] . . . reasonable qualifications are not improper.” (Weil & Brown, Cal. Practice
Guide: Civil Procedure Before Trial, supra, ¶ 8:1332.1, p. 8G-16; see also Hogan and
Weber, 1 Cal. Civil Discovery, supra, § 9.11, pp. 9-25 to 9-26.) Thus, for instance, the
RFA response, “ ‘As framed, denied,’ ” was held to constitute a legally sufficient denial.
(Smith v. Circle P Ranch Co. (1978) 87 Cal. App. 3d 267, 275; see also Holguin v.
Superior Court (1972) 22 Cal. App. 3d 812, 820 & fn. 9 [RFA responses proper despite
“rather weaseling qualification attached to most of them that they are made on advice of
counsel”].)
An examination of a small sample of the RFA responses the court found deficient
illustrates the point. St. Mary’s response to RFA number 20 (“Admit you attended a
meeting with David Nilsen on or about January 13, 2006”) was “Admit. Thomas
Schellenberg was also present.” This response admitted the statement and was not
improper. St. Mary’s response to RFA number 27 (“Admit that you intended on
purchasing a fractional interest in a real estate secured note and deed of trust from Cedar
Funding, Inc.”) was “Admit, first position only.” This was also a proper admission to the
20
The court at the hearing acknowledged that the individual responses consisting
of one-word denials to the RFAs were Code-compliant.
20
statement, and the fact that it included a short statement further explaining the nature of
St. Mary’s intent beyond what was included in the RFA did not render the response
improper. St. Mary’s response to RFA number 88 (“Admit that you knew during the
month of March 2008, that there were problems at Cedar Funding, Inc.”) was: “Deny.
There seemed to be rational explanations for tardiness.” This response was also
apparently a straightforward denial that included an explanation as to the reason the
statement was denied.
St. Mary responded to RFA number 91 (“Admit you received a letter from David
Nilsen, owner of Cedar Funding, Inc.[,] on or about April 9, 2008, telling you that there
were problems at Cedar Funding, Inc.”) with the following: “Deny. That letter dated
April 10, 2008, was by no means a statement of ‘problems at Cedar Funding, Inc.’ but
attribution of all delays to ‘the worldwide financial markets are in turmoil due to the
effects of the U.S. sub-prime mortgage markets[,]’ and ‘investment banks like Bear
Stearns.’ In fact, on 4/17/08 at 5:26 P.M., Mr. Schellenberg answered my inquiry of one
hour earlier by personally attributing all problems to a declining, problematic economy
and urging me to discount ‘rumor and fear, innuendo and imagination.’ All problems
fully known and understood by Mr. Schellenberg and Mr. Nilsen were continued to be
concealed. [Sic.]” In this response, St. Mary attempted to deny that the specified letter
had the content as described in the RFA. Without us determining conclusively whether it
was in full compliance with section 2033.220, it constituted a denial that was in
substantial compliance with the statute.21
21
As we read St. Mary’s response to this RFA, we understand that she does not
deny receiving the referenced letter, but otherwise denies that the letter contained the
substance as described in the RFA. If our understanding is correct, a more adroit
response to the RFA would have been, in substance, “Admit receipt of the letter on or
about April 9, 2008, but otherwise deny.” (Since Schellenberg concurrently served upon
St. Mary a set of interrogatories asking her to explain any of her responses to RFAs that
were not unqualified admissions, she could have explained the reason for her partial
(Cont.)
21
Our review of the totality of St. Mary’s proposed response to the Schellenberg
RFAs—an approach not taken by the trial court—leads to the conclusion that the
response was in substantial compliance with section 2033.220. (See Freeman, supra, 207
Cal. App. 4th 791, 793 [“Substantial compliance with a statute is dependent on the
meaning and purpose of the statute.”]) The proposed response was verified by the party;
contained responses to a majority (64) of the individual RFAs that were unquestionably
Code-compliant; contained, as to at least most of the balance of the individual RFAs (41)
meaningful, substantive responses; and was served well before the hearing (and, in fact,
even before the deemed admitted Motion was filed). Although St. Mary’s proposed
response may not have actually complied with all statutory requirements, such actual
compliance is not required where the proposed response is facially a good-faith effort to
respond to RFAs in a manner that is substantially Code-compliant. (See Costa, supra, 37
Cal.4th at p. 1017, fn. 24.) The Motion therefore should have been denied.22
Section 2033.290 authorizes a party propounding RFAs to seek further responses
in the event he or she concludes that the individual responses received are legally
denial of RFA number 91 in her interrogatory response.) If Schellenberg believes that St.
Mary’s response to this RFA, as phrased, is legally insufficient, the appropriate method
of challenging it would be for him to seek an order compelling a further response under
section 2033.290, which motion would be preceded by his attempting to resolve the
dispute informally under subdivision (b).
22
Our conclusion that the proposed response was substantially Code-compliant
and therefore the Motion should have been denied does not suggest that there are no
defects whatsoever with respect to any of the 41 responses to RFAs the court found
deficient and ordered to be deemed admitted. Indeed, St. Mary responded to several of
the individual RFAs with “[u]ncertain.” We surmise that these responses are a denial
based upon lack of information and belief; but if that is the case, they do not comply in
full with the requirements of subdivision (d) of section 2033.220. Our disposition of this
proceeding does not preclude Schellenberg, on remand, from making a motion under
section 2033.290, after appropriate meet and confer efforts are exhausted, to compel St.
Mary to provide further responses to any of the RFAs he contends are not compliant with
the Code of Civil Procedure.
22
insufficient. Real parties’ argument in their reply below that St. Mary’s proposed
response included responses to certain specific RFAs that were deficient effectively
transmuted their deemed admitted Motion into a motion to compel further responses
under section 2033.290. The detriment to St. Mary from this shift was exacerbated by
several factors: (1) real parties did not cite section 2033.290 in their Motion papers, and
they assured the court at a conference held the day St. Mary filed her opposition that the
Motion was a deemed admitted Motion and was not a motion to compel; (2) the court
indicated at the same conference that it viewed the Motion as not addressing the content
of the individual responses, and that any challenge to specific RFA responses would be
the proper subject of a later motion to compel further responses;23 and (3) the fact that
real parties did not argue any particular deficiencies with respect to any individual RFA
response until their reply papers were filed one week before the hearing, thereby
precluding St. Mary from addressing such claims in her opposition. (See Balboa Ins. Co.
v. Aguirre (1983) 149 Cal. App. 3d 1002, 1010 [“points raised in a reply brief for the first
time will not be considered unless good cause is shown for the failure to present them
before”]; cf. Plenger v. Alza Corp. (1992) 11 Cal. App. 4th 349, 362, fn. 8 [court’s
consideration of new matter presented in summary judgment reply not an abuse of
discretion if opponent has notice and court gives him or her an opportunity to respond to
it].)
Further compounding the problem, the court adopted real parties’ position that the
proposed response contained a number of responses to RFAs that were legally
23
The court indicated at the conference: “This does not create a motion regarding
the content of the admissions, what they said. Everything about [Schellenberg’s]
declaration and [the] notice [of Motion] is based on [real parties’] not receiving [the
response] on time, and for that reason, having these [RFAs] deemed admitted.”
23
insufficient.24 The court deemed admitted 41 specific RFA responses that it concluded
were not Code-compliant, rather than considering whether the proposed response to the
Schellenberg RFAs as a whole substantially complied with section 2033.220—thereby
effectively converting real parties’ deemed admitted Motion under section 2033.280 into
a motion to compel further responses under section 2033.290. The court is authorized by
statute to deem particular requests admitted if the responding party fails to comply with
an order compelling further responses to RFAs. (§ 2033.290, subd. (e).) Here, the court,
at real parties’ urging, bypassed four steps of the statutorily required process by deeming
admitted the responses to 41 RFAs in St. Mary’s proposed response: There was no prior
(1) motion to compel further responses (§ 2033.290. subd (a)); (2) order compelling
further responses; (3) noncompliance with an order compelling further responses; or (4)
motion to deem specific RFAs admitted based upon noncompliance with a prior order
compelling further RFA responses (id., subd (d)).
In concluding that the court abused its discretion by misapplying section 2033.280
and effectively granting a motion under section 2033.290 that was never made, we cannot
ignore the potentially drastic consequences to a civil litigant of having RFAs deemed
admitted, given the fact that an RFA that is admitted is “conclusive in the action as to the
party making it.” (Murillo, supra, 143 Cal.App.4th at p. 736.) We do not read the
statutes governing RFAs in a vacuum. The purpose of the RFA procedure is to expedite
trials and to eliminate the need for proof when matters are not legitimately contested.
(Cembrook, supra, 56 Cal.2d at p. 429; Studll, supra, 92 Cal.App.4th at p. 864.) The
RFA device is not intended to provide a windfall to litigants. Nor is the RFA procedure a
“gotcha” device in which an overly aggressive propounding party—who rejects facially
24
In their reply papers, real parties made specific argument concerning claimed
deficiencies with respect to 37 of the 41 RFA responses that the court ultimately found to
be not in compliance with section 2033.220.
24
reasonable requests for a short discovery extension and thereafter files the wrong
discovery motion after service of a slightly tardy proposed RFA response that is
substantially Code-compliant—may obtain a substantive victory in the case by having
material issues deemed admitted. RFAs are not to be deemed admitted unless the party to
whom RFAs are propounded fails to respond prehearing to RFAs in a manner that is
substantially Code-compliant (§ 2033.280, subd. (c)), or he or she is recalcitrant and
violates a court order compelling further responses that are deficient (§ 2033.290, subd.
(e)). Furthermore, the order deeming admitted the 41 RFAs, to the extent that it may
substantially impact St. Mary’s ability to prove her case, undermines public policy that
promotes controversies being resolved through trials on the merits. (See New
Albertson’s, Inc., supra, 168 Cal.App.4th at pp. 1420-1421 [court’s discretion under
§ 2033.300 to grant party leave to withdraw or amend RFA responses based upon
“mistake, inadvertence, or excusable neglect” must be exercised consistently with “the
spirit of the law and in a manner that serves the interest of justice”; policy favoring trial
on the merits dictates that any doubts be resolved in favor of party seeking relief].)
For these reasons, we conclude that the respondent court erred in granting the
Motion by deeming admitted 41 of the Schellenberg RFAs.
C. Conclusion
Although writ review of discovery rulings is generally disfavored (O’Grady,
supra, 139 Cal.App.4th at p. 1429), the petition here challenges a trial court order that has
the potential of curtailing or preventing St. Mary from proving her case, irrespective of
the actual merits of her claims. In this instance, mandamus is appropriate, because the
court’s order potentially “ ‘prevent[s] a party from having a fair opportunity to litigate
[her] . . . case [citation] . . .’ ” (OXY Resources, supra, 115 Cal.App.4th at p. 886.)
The proposed response to the Schellenberg RFAs, served four days late, was
substantially Code-compliant. Because the order deeming admitted 41 RFAs propounded
by Schellenberg was based upon an erroneous legal conclusion, it constituted an abuse of
25
discretion. (Toshiba America, supra, 124 Cal.App.4th at p. 768.) Furthermore, because
St. Mary served her proposed responses to both sets of RFAs before the Motion was
filed, the order, insofar as it awarded sanctions to real parties, was also improper. (Weil
& Brown, Cal. Practice Guide: Civil Procedure Before Trial, supra, ¶ 8:1377.2, p. 8G-
28.) Accordingly, we will grant St. Mary’s petition for writ of mandamus.
DISPOSITION
Respondent superior court erred in its order deeming admitted 41 RFAs
propounded by Schellenberg on St. Mary and by awarding sanctions in favor of real
parties in interest. Accordingly, let a peremptory writ of mandate issue commanding
respondent superior court to vacate its order insofar as it concerns St. Mary, and to enter a
new order denying the Motion to deem admitted RFAs propounded by Schellenberg and
Mills upon petitioner St. Mary, and denying real parties’ motion for sanctions. Upon
finality of this opinion, the temporary stay issued by this court is vacated. Statutory costs
are awarded to petitioner.
26
Márquez, J.
WE CONCUR:
Premo, Acting, P.J.
Elia, J.
St. Mary v. The Superior Court of California, Monterey County
No. H038918
Trial Court: Monterey County Superior Court
Superior Court No.: M111895
Trial Judge: The Honorable
Kay T. Kingsley
Attorneys for Petitioner Law Office of David M. Hollingsworth
Lisa St. Mary:
David M. Hollingsworth
Real Parties in Interest In pro. per.
Thomas Schellenberg and Katherine Mills:
St. Mary v. Superior Court; Schellenberg et al.
H038918