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Sandstrom & Sons, Inc. v. State of Alaska (12/24/92), 843 P 2d 645
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Notice: This is subject to formal correction before
publication in the Pacific Reporter. Readers are
requested to bring typographical or other formal errors
to the attention of the Clerk of the Appellate Courts,
303 K Street, Anchorage, Alaska 99501, in order that
corrections may be made prior to permanent publication.
THE SUPREME COURT OF THE STATE OF ALASKA
SANDSTROM & SONS, INC., )
an Alaska corporation, ) Supreme Court No. S-4608
)
Appellant, ) Trial Court No.
) 3AN-89-08120 Civil
v. )
) O P I N I O N
STATE OF ALASKA, )
)
Appellee. ) [No. 3909 - December 24, 1992]
______________________________)
Appeal from the Superior Court of the
State of Alaska, Third Judicial District,
Anchorage,
J. Justin Ripley,
Judge.
Appearances: James T. Stanley and Susan
D. Mack, James T. Stanley Corporation, P.C.,
Anchorage, for Appellant. James F. Klasen,
Assistant Attorney General, Anchorage,
Charles E. Cole, Attorney General, Juneau,
for Appellee.
Before: Rabinowitz, Chief Justice,
Burke, Matthews, Compton, and Moore,
Justices.
BURKE, Justice.
I. INTRODUCTION
Sandstrom & Sons, Inc. sued the State of Alaska for
breach of contract. During the course of the litigation,
Sandstrom failed to comply with a superior court order requiring
Sandstrom to produce discoverable materials. It also failed to
oppose in a timely fashion the State's motion for summary
judgment. As a sanction, the superior court dismissed
Sandstrom's suit with prejudice. Sandstrom appeals. We remand.
II. FACTS
Sandstrom sued the State over a road construction
contract dispute on September 27, 1989. The superior court
placed the case on the "fast track"pursuant to Civil Rule 16.1.
Civil Rule 16.1(k) required Sandstrom to produce certain
documents not later than 75 days after service of the summons and
complaint.1 It is undisputed that Sandstrom failed to comply
with this rule.
On August 17, 1990, the superior court moved the case
to the inactive calendar, warning Sandstrom that it would be
dismissed "unless prior to the 61st day [after August 17] a valid
motion to Set Trial and Certificate are filed." On October 16,
Sandstrom filed its Motion to Set Trial and Certificate. In the
motion, Sandstrom claimed, incorrectly, that it was in the
process of complying with Civil Rule 16.1(k).
On December 12, the State submitted eleven inter
rogatories and a request for production of documents to
Sandstrom.2 Although the answers and production were due on
January 11, 1991,3 Sandstrom never responded to the
interrogatories and failed to produce all the requested
documents.4
On February 6, the State filed a motion to compel
Sandstrom to comply. Sandstrom never responded to the State's
motion to compel.
On February 19, the State filed a motion for summary
judgment. On February 20, Sandstrom moved to allow Sandstrom's
attorney, Craig Schmidt, to withdraw from representing Sandstrom.
On March 4, the superior court granted Sandstrom's motion
allowing Schmidt to withdraw, but ordered Sandstrom to
immediately retain another attorney: "New counsel for the
corporate plaintiff shall enter [an] appearance immediately." At
the same time, the superior court granted the State's motion to
compel, ordering Sandstrom to comply with the State's discovery
requests by March 25. The court also ordered Sandstrom to "file
and personally serve an opposition to the state's motion for
summary judgment" by March 25. The court expressly warned
Sandstrom that it would dismiss Sandstrom's complaint if
Sandstrom did not oppose the State's motion for summary judgment:
"Failure of the plaintiff to oppose the state's motion for
summary judgment within 20 days from the date of this order shall
result in the dismissal of the plaintiff's complaint."
Despite the superior court's order to immediately
retain another attorney, Sandstrom did not begin looking for
another attorney until March 11, and did not retain another
attorney until March 26, one day after the court's deadline for
Sandstrom to respond to the State's discovery requests and to
oppose the State's motion for summary judgment. Even after
retaining another attorney, Sandstrom did not respond to the
State's discovery requests, and did not oppose the State's motion
for summary judgment. Instead, on March 29 Sandstrom requested a
sixty day extension of time to oppose the State's motion for
summary judgment "with the appropriate extensions for discovery."
In response to Sandstrom's motion for extensions of time, the
State asked the superior court to dismiss Sandstrom's action as a
Civil Rule 37(b) sanction for Sandstrom's failure to comply with
the court's discovery order.
The superior court did not explicitly address
Sandstrom's March 29 motion. Instead, on April 24 the superior
court dismissed Sandstrom's complaint as a sanction for
Sandstrom's noncompliance with the court's March 4 order.
Specifically the superior court stated:
The court finds that the plaintiff has
failed to comply with the court's order of
March 4, regarding discovery owed to the
state, plaintiff has failed to timely oppose
[the state's] summary judgment motion as per
the March 4, 1991 order, and that the
plaintiff has offered no adequate
justification for that failure and further
that the plaintiff's repetitious conduct in
failing to provide discovery shows a
willfulness to violate the court's orders and
the civil rules, [sic] therefore the court
hereby dismisses the plaintiff's complaint
with prejudice as a sanction for failing to
comply with the court's order of March 4,
1991.
The superior court denied Sandstrom's motion for reconsideration.
Sandstrom appeals.
III. DISCUSSION
Civil Rule 37(b)(2)(C) authorizes the superior court to
dismiss an action if a party fails to comply with a discovery
order.5 However, since the law disfavors litigation ending
sanctions, the superior court has the discretion to impose such
sanctions only in "extreme circumstances." Otis Elevator Co. v.
Garber, 820 P.2d 1072, 1074 (Alaska 1991). We have held that "a
party should not be barred from his or her day in court where an
alternative remedy would suffice to make the adverse party
whole." Power Constructors v. Acres American, 811 P.2d 1052,
1055 (Alaska 1991). Thus, "the record [must] clearly indicate a
reasonable exploration of possible and meaningful alternatives to
dismissal."Id.
Additionally, for Civil Rule 37(b) sanctions to be
appropriate, a party's failure to comply with a court order must
be willful. Rohweder v. Fleetwood Homes of Oregon, 767 P.2d 187,
190 (Alaska 1989). "Willfulness is defined as "a conscious
intent to impede discovery." Hawes Firearms Co. v. Edwards, 634
P.2d 377, 378 n.2 (Alaska 1981).
In the case at bar, Sandstrom failed to comply with the
superior court's order compelling it to respond to the State's
discovery requests and the State's motion for summary judgment.
By failing to comply with the discovery order, Sandstrom violated
Civil Rule 37(b).
Sandstrom argues that the superior court's dismissal
with prejudice denied it procedural due process because the
superior court did not hold a specific dismissal hearing.
However, almost two months before the dismissal, in its March 4
discovery order, the superior court explicitly forewarned
Sandstrom that it would face dismissal with prejudice if it
failed to comply with the order. This order afforded Sandstrom
notice and an adequate opportunity to be heard on the dismissal
issue. The superior court therefore afforded Sandstrom
procedural due process. Graham v. State, 633 P.2d 211, 216
(Alaska 1981) (procedural due process requires the State to
afford a person an opportunity for a hearing before the State
deprives that person of a protected property interest).6
The only explanation that Sandstrom offered in its
brief and at oral argument to justify its misconduct is that it
was without counsel from March 4, 1991 until March 26, 1991.
This does not explain Sandstrom's failure to comply with the
superior court's order after March 26. Moreover, it does not
adequately explain Sandstrom's failure to comply with the
superior court's order between March 4 and March 26.7
While Sandstrom's conduct deserves sanction, we remand
the case because the superior court failed to explore any
sanctions other than dismissal. In Power Constructors, we held
that before dismissing a case with prejudice the superior court
must examine less drastic sanctions:
We do not require the court to make
explicit findings concerning alternative
sanctions, nor do we require it to examine
every single alternate remedy to dismissal.
We require only that the record clearly
indicate a reasonable exploration of possible
and meaningful alternatives to dismissal.
811 P.2d at 1055 (citations omitted). In Power Constructors, we
found evidence of such a "reasonable exploration" since the
superior court rejected the plaintiff's offer to pay for the cost
of deposing out of state witnesses and its offer to pay a fine to
avoid dismissal. Id.
In the present case, the record contains no evidence
that the superior court considered alternative sanctions. The
State suggests that "the trial court considered and rejected non-
litigation ending sanctions in the court's rejection of
Sandstrom's motion for extension of time and in its rejection of
Sandstrom's motion for reconsideration of the court's order to
dismiss." Our examination of the record does not support this
contention. Thus, we must remand the case for a "reasonable
exploration"of alternative sanctions.8 We express no view at
this time as to whether the imposition of a litigation ending
sanction of dismissal with prejudice is warranted.
REMANDED for further proceedings as required by this
opinion.
_______________________________
1. Civil Rule 16.1(k) required in part that Sandstrom
furnish the State with all documents regarding the interpretation
of their contract and all documents evidencing damages by
December 19, 1989.
2. Many of the items requested by the State were due a
year earlier pursuant to Civil Rule 16.1(k).
3. Civil Rules 33(a) and 34(b) provide that a party has 30
days to respond to interrogatory and production of document
requests.
4. On January 22, 1991, Sandstrom responded to the State's
request for production by indicating that the documents requested
were available for copying. However, when the State reviewed
the documents it discovered that "numerous categories of
documents were completely missing including employee and
equipment time cards, accounting ledgers, payroll records and all
other documents verifying the claimed damages."
5. We review a trial court's choice of Rule 37 sanctions
for abuse of discretion. Alaska Trams v. Alaska Elec. Light &
Power, 743 P.2d 350, 354 (Alaska 1987).
6. In addition, in response to Sandstrom's motion for
extensions of time, the State specifically requested the superior
court to dismiss Sandstrom's action as a Civil Rule 37(b)
sanction for Sandstrom's failure to comply with the court's
discovery order. Sandstrom had the opportunity to oppose the
State's request in its reply brief. This opportunity
independently afforded Sandstrom procedural due process.
7. Sandstrom's delay in finding a new attorney was not
reasonable. According to Sandstrom, sometime between December
18, 1990 and January 22, 1991, its original attorney, Craig
Schmidt, "ceased practicing law." Therefore, Sandstrom should
have started searching for a new attorney on January 22, at the
latest. However, according to Sandstrom it did not start looking
for a new attorney until March 11. This occurred twenty days
after Sandstrom filed its motion to recuse Schmidt and seven days
after the superior court granted that motion.
8. We note that Power Constructors addressed dismissal
under Civil Rule 41(e), whereas the present case concerns
dismissal under Civil Rule 37(b)(2)(C). The Power Constructors
requirement that the court examine alternative sanctions applies
with equal force to Rule 37(b) since the results of the two Rules
are the same: A party is barred from his or her day in court.
Such an "extreme sanction"should always require an examination
of alternative sanctions.
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