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A trial court’s order for two people to pay expenses related to a discovery dispute wasn’t warranted because the defendants’ underlying motion to compel wasn’t completely successful, the Court of Appeals of Indiana has ruled in reversing a lower court’s decision.
David and Susan Yount bought property in Brown County and later sued the realtors in the transaction, accusing them of fraud, deception and breach of contract. They claimed the realtors made misrepresentations about dock access, water access, the property boundary and a surveyor location report.
The realtors sent the Younts 39 requests for admission and 17 requests for production. The Younts answered eight of the requests for admission and objected to the other 31.
Counsel for the parties resolved some of the contested items, but not all.
The realtors moved to compel answers to 18 of the requests for admission and responses to three of the requests for production.
Requests for admission included asking the Younts to admit or deny that the person who sold them the property “told” the realtors certain information. The Younts objected to the requests on the basis that they called for “speculation” about the statements, knowledge and reliance of others, and therefore they couldn’t “truthfully admit or deny the matter.”
They also objected to other requests for admission on the basis that they weren’t qualified to opine on the meaning and applicability of a state statute.
Requests for production included asking the Younts to produce invoices, payment records, and time and billing records for their attorney fees. They objected on the basis that the requests were premature.
The Brown Circuit Court granted the realtors’ motion to compel in large part, ordering the Younts to respond to all but three requests.
The Younts complied and responded to the requests.
The realtors then moved for sanctions under Trial Rule 37(A)(4), arguing the Younts’ objections to the discovery requests had not been “substantially justified.”
The trial court ordered the Younts to pay the realtors $900 for the 6.2 hours counsel spent on the discovery dispute at a rate of $175 per hour.
On appeal, the Court of Appeals agreed in part with both parties but ultimately ruled that because the realtors weren’t completely successful in their motion to compel, reversal of the trial court’s sanction order was warranted.
The Younts argued they were substantially justified in objecting to both the factual and legal theory requests.
Addressing the factual requests, the appellate court ruled the Younts’ responses were “entirely appropriate.” That’s because, as they argued, they weren’t required to answer requests because they couldn’t know what the seller told the realtors.
“Defendants could have used alternative discovery tools, such as depositions (Trial Rules 30 and 31) or interrogatories (Trial Rule 33), to discover what Plaintiffs knew or didn’t know about the statements, knowledge, and actions of other people,” the opinion says.
But objections to the legal theory requests weren’t substantially justified, the Court of Appeals ruled, because Trial Rule 36 “permits a request for admission regarding an opinion, a contention, or a legal conclusion, if the request is related to the facts of the case,” citing Gen. Motors Corp., Chevrolet Motor Div. v. Aetna Cas. & Sur. Co., 573 N.E.2d 885, 888 (Ind. 1991).
The Younts also argued their objections to the requests for attorney fee documents were proper, but the Court of Appeals disagreed.
“Because Plaintiffs expressly sought an award of attorney’s fees in their complaint, the documents sought in these requests are unquestionably relevant to the subject matter of this case,” the opinion says.
Still, the Court of Appeals ruled the trial court’s sanction order wasn’t appropriate, considering the realtors prevailed on 11 of the discovery requests and the Younts prevailed on 10.
“That is close enough to a wash that an award of expenses to Defendants is unwarranted,” the opinion says.
Judge Nancy Vaidik wrote the opinion. Judges Paul Mathias and Rudolph Pyle concurred.
The case is David Yount and Susan Yount v. Carpenter Co. Inc. d/b/a Carpenter Realtors, Janet Stitt, and Patsy L. Coffey, 23A-PL-116.
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