SINAIKO HEALTHCARE CONSULTING, INC.

v. PACIFIC HEALTHCARE CONSULTANTS

Filed 3/8/07

CERTIFIED FOR PARTIAL PUBLICATION*

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FIVE

STORY CONTINUED FROM PART I

C. Authority To Award A Monetary Sanction

Klugman contends that the trial court lacked the authority to award a monetary sanction in the September 2 Order because the April 26 Order was invalid, and because Sinaiko failed to comply with certain procedural requirements in its motion for terminating sanctions. We reject these contentions.

1. Defendants untimely interrogatory responses did not divest the trial court of the authority to compel responses in the April 26 Order.[1]

Klugmans primary contention is that, because defendants served their responses to Sinaikos interrogatories before Sinaiko filed its motion to compel responses under section 2030.290, subdivision (b), the trial court lacked the authority to grant Sinaikos motion. Klugman argues that Sinaikos sole remedy in those circumstances was to move to compel further responses to the interrogatories under section 2030.300, subdivision (a). We disagree for three independent reasons.

First, section 2030.290 provides that [i]f a party to whom interrogatories are directed fails to serve a timely response, the following rules apply[.] Defendants unquestionably fail[ed] to serve a timely response to Sinaikos form interrogatories; accordingly, the rules set forth in section 2030.290 apply. Those rules provide that the responding party waives . . . any objection to the interrogatories, including one based on privilege ( 2030.290, subd. (a)), and that the propounding party may move for an order compelling response to the interrogatories. ( 2030.290, subd. (b).) Once defendants fail[ed] to serve a timely response, the trial court had authority to grant Sinaikos motion to compel responses.

The trial court was entitled to rule on Sinaikos motion to compel responses based on the information before it. Sinaiko had informed the trial court prior to the April 26 hearing, On March 31, 2005, defendants served untimely and deficient responses to the First Set of Form Interrogatories, in that they failed to respond substantively to Form Interrogatory Nos. 50.1 through 50.6. (Italics added.) The trial court thus knew that defendants had served interrogatory responses, but also had a reasonable basis to conclude that defendants had not, in effect, responded to form interrogatories 50.1 through 50.6. Defendants had the opportunity to put their interrogatory responses before the trial court and to make whatever arguments they deemed appropriate to oppose the motion. They did not. The trial court was not required to speculate about what defendants interrogatory responses might have contained. For this reason, the trial court had authority to grant Sinaikos motion and did not abuse its discretion in doing so.

Second, Klugmans argument that defendants untimely statements in response to form interrogatories 50.1 through 50.6 divested the trial court of its power to grant Sinaikos motion is premised on the assumption that defendants statements were, in fact, responses to the interrogatories. That is not the case. Klugman has characterized the statements as neither answers nor objections, but as statements of defendants inability to respond. That characterization demonstrates that the responses were not merely insufficient, but legally invalid. (See Laguna Auto Body v. Farmers Ins. Exchange, supra, 231 Cal.App.3d at p. 487 [responding party violated order to compel answers by providing responses that were legally invalid, because they were unverified].)

Section 2030.210, subdivision (a) requires a responding party to respond separately to each interrogatory. Unlike section 2031.210, subdivision (a)(2), which permits a party to respond to an inspection demand with [a] representation that the party lacks the ability to comply with the demand, section 2030.210, subdivision (a), requires a party responding to interrogatories to provide either an answer containing the information sought ( 2030.210, subd. (a)(1)), an exercise of the partys option to produce writings from which the answer can be ascertained ( 2030.210, subd. (a)(2)), or [a]n objection to the particular interrogatory ( 2030.210, subd. (a)(3)). Accordingly, a responding party generally may not respond to interrogatories just by asserting its inability to respond. (See  2030.220 [responding party who does not have personal knowledge sufficient to respond fully to interrogatory may so state, but must make a reasonable and good faith effort to obtain the information by inquiry to other natural persons or organizations, unless the information is equally available to the propounding party].) Defendants thus did not respond to the interrogatories by stating that they were [unable] to respond. A response to some interrogatories does not divest a trial court of authority under section 2030.290 to compel answers to those interrogatories as to which there was no appropriate response. Because defendants did not provide legally valid responses to interrogatories 50.1 through 50.6, the trial court had the authority to compel such responses under section 2030.290.

Third, section 2030.290 does not preclude the trial court from granting a motion to compel responses under subdivision (b), even if the responding party serves untimely interrogatory responses after the propounding party has served the motion. We have found, and the parties have cited, no case considering this precise issue. We therefore turn to the language of the relevant statutes. As in any case involving statutory interpretation, our fundamental task here is to determine the Legislatures intent so as to effectuate the laws purpose. [Citation.] We begin by examining the statutes words, giving them a plain and commonsense meaning. [Citation.] We do not, however, consider the statutory language in isolation. [Citation.] Rather, we look to the entire substance of the statute . . . in order to determine the scope and purpose of the provision . . . .  [Citation.] (West Pico Furniture Co. v. Pacific Finance Loans (1970) 2 Cal.3d 594, 608 [86 Cal.Rptr. 793, 469 P.2d 665].) That is, we construe the words in question in context, keeping in mind the nature and obvious purpose of the statute . . . . [Citation.] (Ibid.) We must harmonize the various parts of a statutory enactment . . . by considering the particular clause or section in the context of the statutory framework as a whole. (Moyer v. Workmens Comp. Appeals Bd. (1973) 10 Cal.3d 222 [110 Cal.Rptr. 144, 514 P.2d 1224] . . . .) (People v. Murphy (2001) 25 Cal.4th 136, 142; accord, Scottsdale Ins. Co. v. Superior Court (1997) 59 Cal.App.4th 263, 273 [construing former 2031].)

As noted above, section 2030.290 provides that [i]f a party to whom interrogatories are directed fails to serve a timely response, the following rules apply[.] Those rules include that partys waiver of all objections under subdivision (a), and the propounding partys right to move to compel responses under subdivision (b). Nothing in the text of section 2030.290 suggests that section 2030.290 ceases to apply merely because a party serves a tardy response. Rather, the text implies the contrary. For example, the court may relieve a party who provides untimely responses from its waiver of objections under section 2030.290, subdivision (a), if that party demonstrates that three conditions are satisfied: (1) the party has subsequently served a response (italics added); (2) the response is in substantial compliance with the statutory provisions governing the form and content of interrogatory responses; and (3) the failure to respond in a timely fashion was the result of mistake, inadvertence, or excusable neglect. ( 2030.290, subd. (a).) Section 2030.290 suggests that merely providing untimely responses does not divest the trial court of its authority under that section.

This construction is supported by the manner in which section 2030.290 operates in conjunction with section 2030.300. If a party fails to serve a timely response to interrogatories, then under section 2030.290, subdivision (a), it waives all objections and the burden shifts to that party to demonstrate that it is entitled to relief from the waiver. In contrast, if the party does serve a timely response even if that response is deficient in some respect then the responding party has the procedural protections afforded by section 2030.300. Under that section, the burden is on the propounding party to demonstrate that the response is inadequate or improper, and that the propounding party made a good faith attempt to meet and confer. In addition, the propounding party has only 45 days to seek relief. Together, these two sections encourage parties to make reasonable discovery requests, to respond to discovery in a timely fashion, and to resolve their own disputes.

To accept Klugmans interpretation would remove an important incentive for parties to respond to discovery in a timely fashion. Under Klugmans theory, a party to whom interrogatories were directed could wait until the hearing on a section 2030.290 motion was imminent,[2]then serve a set of evasive and incomplete responses, and thereby unilaterally deprive the trial court of authority to hear the motion. Even though the responding party had waived all objections to the discovery, the burden would shift to the propounding party, first to meet and confer, and then to demonstrate the impropriety of the responding partys responses. The statutory language does not suggest such a result.

Under section 2030.290, therefore, once a party has failed to serve timely interrogatory responses, the trial court has the authority to hear a propounding partys motion to compel responses under section 2030.290, subdivision (b), regardless of whether a party serves an untimely response. If a party fails to serve a timely response to interrogatories, then by operation of law, all objections that it could assert to those interrogatories are waived. ( 2030.290, subd. (a).) Unless that party obtains relief from its waiver, the propounding party is entitled to move under subdivision (b) for an order compelling the response to which the propounding party is entitled: that is, a response without objection, and that substantially complies with the provisions governing the form ( 2030.210) and completeness ( 2030.220) of interrogatory responses.

The question we address is the extent of the trial courts authority under section 2030.290, subdivision (b), not whether relief should be granted in a particular case. If a party provides an untimely interrogatory response that does not contain objections and that sets forth legally valid responses to each interrogatory, the untimely response might completely or substantially resolve the issues raised by a motion to compel responses under section 2030.290. Even in such cases, however, the trial court retains the authorityto hear the motion. (See Cal. Rules of Court, rule 3.1030(a) [The court may award sanctions under the Discovery Act in favor of a party who files a motion to compel discovery, even though . . . the requested discovery was provided to the moving party after the motion was filed].) Whether a particular response does resolve satisfactorily the issues raised by a motion is a matter best determined by the trial court in the exercise of its discretion, based on the circumstances of the case. In many cases involving untimely responses, the propounding party will take the motion off calendar or narrow its scope to the issue of sanctions. If the propounding party proceeds with the motion, however, the trial court has the discretion to rule on the motion. The trial court might compel responses without objection if it finds no legally valid responses have been provided to one or more interrogatories; it might deny the motion to compel responses as essentially unnecessary, in whole or in part, and just impose sanctions; it might treat the motion as one under section 2030.300 and either determine that further answers are required,[3]or order the propounding party to meet and confer ( 2030.300, subd. (b)) and file a separate statement (Cal. Rules of Court, rule 3.1020(a)(2), (c)); or it might take the motion off calendar, thereby requiring the propounding party to file a motion under section 2030.300.

Deyo v. Kilbourne (1978) 84 Cal.App.3d 771 (Deyo), relied upon by Klugman, is inapposite. In that case, which was decided under the Civil Discovery Act of 1957, plaintiff Deyo, a lawyer, sued and served interrogatories on a former client, Kilbourne, who represented himself. Because Kilbourne was seriously ill and in-and-out of the hospital for several months, Kilbourne did not respond to Deyos interrogatories. Deyo moved to strike Kilbournes answer based on Kilbournes failure to respond. The trial court refused to strike Kilbournes answer, but directed Mr. Kilbourne to file answers by December 15, 1976. (Id. at p. 778.) Kilbourne filed answers on December 15, but his responses were clearly not fully responsive to the questions propounded. (Ibid., italics added.) Deyo moved again to strike Kilbournes answer. This time, the trial court struck Kilbournes answer and entered judgment in favor of Deyo. Kilbourne appealed. (Id. at pp. 778-779.) The court of appeal reversed, holding that the trial court could not sanction Kilbourne for violating the order to file answers by December 15, 1976 because Kilbourne had, in fact, filed answers by December 15, 1976. (Id. at 797-798.)

As its facts and procedural posture indicate, Deyo, supra, 84 Cal.App.3d 771, is not determinative as to whether the trial court in this case had authority to issue the April 26 Order. Deyo addressed a different issue. The trial court in Deyo clearly had authority to issue its order compelling Kilbournes responses to Deyos interrogatories, and Kilbourne did not challenge that authority on appeal. Rather, the issue in Deyo was whether the trial court exceeded its authority by imposing sanctions against Kilbourne for violating that order when, in fact, Kilbourne had complied. (Id. at p. 779 [defining issue as, What sanctions are proper when a party fails to fully answer interrogatories?].) As the Deyo court articulated its holding, In November, 1976, the Court denied respondents request for sanctions but directed appellant to file answers by December 15, 1976. Appellant complied with that order and, therefore, no sanctions under Section 2034(b) of the Code of Civil Procedure were permissible. (Id. at pp. 797-798.) Deyo thus stands for the unremarkable proposition that a party cannot be sanctioned for violating a discovery order that it did not, in fact, violate. That proposition has no bearing onwhether the trial court in this case had the authority in the April 26 Order to compel responses. The trial court did not, in its April 26 Order, issue the monetary sanction under review here. The trial court had authority to determine whether defendants complied with their statutory obligations.

Deyo, supra, 84 Cal.App.3d 771, also does notpreclude the monetary sanction for violating the April 26 Order imposed by the trial court in the September 2 Order. Unlike the defendant in Deyo, the defendants in this case did not do anything to comply with the trial courts order compelling responses to form interrogatories 50.1 through 50.6, even after the trial court overruled their demurrers, and failed to produce all of the documents the trial court ordered them to produce. (See infra, Part D.) Moreover, while Kilbournes untimely interrogatory answers were not fully responsive (id. at p. 778), there is no indication in Deyo that Kilbournes responses were legally invalid, as defendants statements of inability to respond to the interrogatories in this case. For these reasons, the trial courts September 2 Order awarding a monetary sanction against Klugman was not inconsistent with Deyo. ( 2023.010, subd. (g); see Laguna Auto Body v. Farmers Ins. Exchange, supra, 231 Cal.App.3d at p. 487 [affirming sanctions for violating order to compel responses under former section 2030, subd. (k) where belated interrogatory answers were legally invalid and trial court could reasonably infer [the responding parties] were merely obstructing and delaying discovery].)

We conclude that the trial court had the authority to grant Sinaikos motion to compel interrogatory responses under section 2030.290, subdivision (b). The violation of that order could therefore properly serve as the basis for a monetary sanction pursuant to sections 2030.290, subdivision (c) and 2023.030.

2. The award of a monetary sanction in the September 2 Order was not unauthorized.

Klugman contends that the trial court lacked authority to award a monetary sanction in its September 2 Order because Sinaiko failed to bring its motion for terminating sanctions within 45 days of defendants interrogatory responses. The 45-day limit, however, applies only to motions to compel further responses to interrogatories under 2030.300. ( 2030.300, subd. (c).) Section 2030.290 contains no such limitation in either subdivision (b), permitting motions to compel answers, or subdivision (c), permitting sanctions for failure to obey a court order compelling answers. (See Weil & Brown, supra, 8:1138, p. 8F-59.) Nor does section 2023.040 contain a 45-day limit. Unlike section 2030.300, section 2023.040 requires only that a motion seeking sanctions for misuse of discovery be supported by a memorandum of points and authorities, and accompanied by a declaration setting forth the facts supporting the amount of any monetary sanction sought. When the Legislature uses materially different language in statutory provisions addressing the same subject or related subjects, the normal inference is that the Legislature intended a difference in meaning. (People v. Trevino (2001) 26 Cal.4th 237, 242.)

Klugman also argues that Sinaiko was required to meet and confer prior to making the motion for terminating sanctions. Although the meet-and-confer requirement is an express prerequisite to moving to compel further responses to interrogatories ( 2030.300, subd. (b)) and inspection demands ( 2031.310, subd. (b)(2)), no such requirement appears in the statutes permitting sanctions based on a partys violation of a court order compelling responses ( 2030.290, subd. (c); 2031.300, subd. (c)) or for misuse of discovery ( 2023.040).[4] (See Leach v. Superior Court (1980) 111 Cal.App.3d 902, 906 [meet-and-confer requirement of former Cal. Rules of Court, rule 222.1 (now embodied in 2030.300, subd. (b)) did not apply when propounding party sought order compelling responses to interrogatories and sanctions for responding partys failure to respond within the statutorily permitted time].)

That Sinaiko was not required to meet and confer before seeking sanctions does not, as Klugman claims, make Sinaiko the sole arbiter of what would . . . be deemed compliant with the April 26, 2005 Order. As described above, defendants could have sought relief in the trial court from their waivers; such relief necessarily would have entailed a finding that defendants responses substantially complied with defendants discovery obligations. ( 2030.290, subd. (a)(1); 2031.300, subd. (a)(1).) In the alternative, if defendants believed that Sinaiko had asserted positions with respect to the April 26 Order that subjected defendants to unwarranted annoyance or undue burden and expense, defendants could have moved for a protective order determining that defendants had complied with the April 26 Order. Such a motion would have been subject to the meet-and-confer process. ( 2030.090, subd. (a); 2031.060, subd. (a)). In any event, it was ultimately the trial court not Sinaiko which determined that defendants violated the April 26 Order.

Finally, Klugman makes the related arguments that the April 26 Order was ambiguous because it purported to order Defendants to serve [interrogatory] responses which they had already served, and exceeded the scope of the trial courts authority under sections 2030.290, subdivision (b) and 2031.300, subdivision (b), because an order compelling a response cannot extend to govern the ultimate substance of any such response[.] The trial courts order, however, was not ambiguous. The trial court ordered defendants to respond without objection and produce all documents within 20 days. This means exactly what it says: that defendants were to respond without objection, in conformance with the statutory provisions governing the form and content of responses, and to produce all documents within 20 days. The trial court could not ascertain whether defendants had complied with the April 26 Order except with reference to the ultimate substance of defendants responses. Here, Sinaiko reported to the trial court that, although defendants had provided some interrogatory responses, there was, in effect, no proper response to interrogatories 50.1 through 50.6. Moreover, as discussed, the trial court had the discretion to assess the adequacy of defendants untimely responses upon a motion to compel responses under section 2030.290. The trial court thus did not exceed its authority either by issuing the April 26 Order or by imposing sanctions for violating that order.

[The following section D is not for publication]

D. The Trial Court Did Not Abuse Its Discretion In Concluding That Defendants Violated the April 26 Order

Klugman argues that, even if the April 26 Order was valid, the trial court erred when it determined that defendants violated that order. We conclude that the trial court was within its discretion to find that defendants violated the April 26 Order.

Klugman contends that defendants responses to form interrogatories 50.1 through 50.6 did not violate the April 26 Order because the responses did not contain objections, but instead contained a statement of defendants inability to respond. As stated in Part C, supra,such statements were not legally valid responses to the interrogatories. In addition, the trial court could reasonably conclude that the interrogatory responses were in bad faith and intended merely [to] obstruct[] and delay[] discovery. (Laguna Auto Body v. Farmers Ins. Exchange, supra, 231 Cal.App.3d at p. 487.) Sinaikos complaint states only one claim for breach of contract, and Sinaiko clearly describes the contract on which that claim is based in paragraph 17: In or about August, 2002, the parties orally agreed that defendants, and each of them, would provide advisory and financial services to SINAIKOs clients for which SINAIKO would compensate defendants. Defendants agreed that they would provide SINAIKO with the underlying materials supporting the opinion letters prepared upon SINAIKOs request, due to the fact that said materials were at all times the property of SINAIKO. Paragraph 19 of the complaint states, Beginning in or about August, 2002, and continuing to the present, defendants, and each of them, breached the above-referenced oral agreement[.] Defendants statements of inability to respond because they could not determine which contract, oral or written, if any, [was] at issue, were thus frivolous. Further still, Klugman and defendants have not attempted to justify their continued failure to respond to the interrogatories after the trial court overruled their demurrers on April 27, one day after the trial court issued the April 26 Order. The trial court did not abuse its discretion in concluding that defendants violated the April 26 Order with respect to the interrogatories.

With respect to the document requests, there is no question that defendants did not produce all documents within 20 days, as they were ordered to do. Defendants withheld documents that they claimed had been produced by a third party, and documents that defendants claimed belonged to third persons, as to which those third persons maintained privileges. We do not need to address defendants excuses for their failure to produce these documents because any and all objections that defendants might have asserted including objections based on privilege, undue expense, undue burden and duplication of effort were waived by defendants failure to serve a timely response to Sinaikos inspection demand.[5] ( 2031.300, subd. (a).) The trial court ordered defendants to produce all documents responsive to Sinaikos document requests; defendants did not do so; defendants therefore violated the April 26 Order.

Furthermore, even if defendants might have asserted colorable objections had they timely responded, defendants failed to make an evidentiary record to establish the validity of those objections for purposes of this appeal. Defendants failed to identify any of the documents they withheld with any degree of specificity; failed to establish any alleged contractual, fiduciary or other relationship between defendants and any third party obligating defendants to withhold any documents; and failed to establish the alleged confidential or proprietary nature of any documents. As stated above, [i]t is [Klugmans] burden to affirmatively demonstrate error[.] (Laguna Auto Body v. Farmers Ins. Exchange, supra, 231 Cal.App.3d at p. 487.)

Finally, we note that Klugman makes no specific argument, other than his arguments on the merits, that the trial court abused its discretion in finding that defendants acted without substantial justification in violating the trial courts order. ( 2023.030, subd. (a).) Klugman thus forfeited the issue. In any event, the record contains substantial evidence that defendants did not comply with the requirements of the Civil Discovery Act. Accordingly, we find no abuse of discretion.

[The remainder of the opinion is to be published]

DISPOSITION

The trial courts September 2, 2005 order awarding a monetary sanction of $8,786.36 against Steven M. Klugman is affirmed. No costs are awarded.

MOSK, J.

We concur:

ARMSTRONG, Acting P. J.

KRIEGLER, J.

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* Pursuant to California Rules of Court, rules 8.1100 and 8.1110, this opinion is certified for publication with the exception of Discussion, Part D.

[1]Sinaiko requested sanctions related to the interrogatory responses; the trial court found that defendants violated the April 26 Order by failing to respond to form interrogatories 50.1 through 50.6; and the trial court appears to have awarded sanctions based on that finding, without apportioning the sanction award between the interrogatories and the document requests. The propriety of the sanction thus turns, at least in part, on whether the trial court exceeded its authority in the April 26 Order by compelling responses to the interrogatories.

[2]Though Klugman emphasizes that defendants served their untimely interrogatory responses before Sinaiko filed its motions, nothing in section 2030.290 suggests that there is any significance as to when after the due date the untimely responses are served. Under Klugmans theory, an untimely interrogatory response served the day before the hearing on a motion to compel responses would as effectively render[] the relief sought in the motion[] moot as, in this case, a belated response served the day before the motion was filed.

[3]Normally, to compel further responses, the trial court would need to find that the propounding party made an effort at informal resolution sufficient to satisfy the meet and confer requirement of section 2030.300, subdivision (b). Although the court rule requiring a separate statement on a motion to compel further responses (Cal. Rules of Court, rule 3.1020) would permit the trial court to continue or deny a motion to compel when no separate statement is provided, it does not limit a trial courts discretion to compel further answers notwithstanding the absence of a separate statement.

[4]In his reply brief, Klugman recasts the meet-and-confer argument to contend that the amount of sanctions awarded was unreasonable because, had Sinaiko engaged in the required meet and confer process, defendants could have addressed their violations of the April 26 Order. We will not speculate regarding what defendants could have done. Defendants should have complied with the trial courts order, and they failed to do so. (See infra, Part D.)

[5]Contrary to Klugmans assertion, this does not mean that defendants waive[d] objections of third parties with privilege claims. Defendants merely waived their own right to assert those privileges in this litigation. The third parties themselves would have standing to intervene to assert their own privileges, if any such privileges exist. (Mylan Laboratories Inc. v. Soon-Shiong (1999) 76 Cal.App.4th 71, 80.)