Rodriguez v. Hidden River Ranch, LLC

1

LINDSEY (EVANS) RODRIGUEZ, Plaintiff, v. HIDDEN RIVER RANCH, LLC and CALVIN EVANS III, Appellants

CORY EVANS, individually, and on behalf of HIDDEN RIVER RANCH, LLC, Respondent.

No. 84985-9-I

Court of Appeals of Washington, Division 1

May 28, 2024

UNPUBLISHED OPINION

COBURN, J.

Cal Evans Jr.'s father left him a horse ranch, but because Cal Jr.^[1]was found to have financially exploited his father, the application of the antilapse statute caused the property to pass to Cal Jr.'s four adult children as tenants in common. Two of his children, including Cory Evans later quitclaimed their interest in the property to Hidden River Ranch LLC (HRR). Cal Jr. identifies himself as the owner and sole member of HRR. When Cory's sister Lindsey sued to force the sale of the property, Cory intervened and filed a third-party action against Cal Jr. and HRR. Cory asserts an ownership interest in HRR and the subject property.

During the ensuing litigation Cal Jr.^[2] frustrated Cory's attempts at discovery in the third-party action, causing the trial court to extend discovery deadlines and issue multiple sanctions such as attorney fees and orders to compel. Eventually the trial court determined that Cal Jr.'s discovery violations were willful and that lesser sanctions had failed to bring about compliance. The court struck Cal Jr.'s pleadings and a different judge later entered a default judgement in Cory's favor.

In this appeal Cal Jr. argues that the courts did not properly find all of the Burnet^[3]factors on the record before imposing the harshest sanctions. We agree and reverse the order striking the pleadings and the order granting a default judgment. Reversal means this case may proceed toward trial with the opportunity for appropriate pretrial motions and discovery.

BACKGROUND

Facts

This is the third time a family dispute over the subject horse ranch in Sultan, Washington has reached this court. The background facts are set forth in the prior appeal and will be repeated where needed to provide context. See Hidden River Ranch LLC v. Rodriguez, No. 82228-4-I (Wash.Ct.App. Nov. 14 2022) (unpublished) https://www.courts.wa.gov/opinions/pdf/822284.pdf review denied, 528 P.3d 357 (2023); In re Est. of Evans, 181 Wn.App. 436, 326 P.3d 755 (2014).

Calvin H. Evans Senior (Cal Sr.) owned the horse ranch before his death. Following Cal Sr.'s death in 2011, the probate court found that his son, Calvin Evans Jr. (Cal Jr.) had financially exploited his father and deemed Cal Jr. to have predeceased his father under RCW 11.84.030. Hidden River Ranch, No. 82228-4-I, slip op. at 2. The ranch passed to Cal Jr.'s four children: Lindsey Rodriguez, Calvin Evans III (Cal III), Cory Evans and Jesse Evans. Id. They owned the ranch as equal tenants in common. Id.

In 2017, Cory and Jesse entered into an agreement with their father to quitclaim their interest in the property to Cal Jr.'s limited liability company, Hidden River Ranch, LLC (HRR). Id. "[I]n exchange, Cal Jr. agreed 'to execute a will in which Cory and Jesse are each named as beneficiaries and each to receive one half of any interest' that Cal Jr. would have in the property." Id.

Procedure

In 2019, Lindsey^[4] brought a suit against HRR and Cal III seeking to force a partition by sale of the entire property. Id. at 3. Lindsey's complaint maintained that partition in kind was not feasible or practical without great prejudice to the owners. Id. HRR filed a reply opposing all partition remedies and, in the alternative asking that any sale be subject to a life estate in the property that it asked the court to grant Cal Jr.^[5] Id. at 3-4. Cory then intervened in Lindsey's action by filing a third-party complaint against HRR and Cal Jr. Id. at 3. Cory seeks a judicial dissolution of HRR and the imposition of a constructive trust. Id. Cory otherwise supported Lindsey's request for partition by sale. Id. After the court granted Lindsey's motion for sale in January 2021 and denied HRR's request for a life estate to Cal Jr., this court granted HRR's motion for discretionary review. Id. at 6. While that appeal was pending, robust litigation of Cory's third-party complaint continued.

In February 2021 Cal Jr. filed a motion for summary judgment against Cory's third-party claim, asserting absence of any genuine issue of material fact. The trial court denied the motion. In its minutes, the trial court found evidence that "some sort of an agreement existed" which could potentially "furnish Cory with causes of action" based on an expectation.

In July 2021 Cory filed a motion for default judgment claiming Cal Jr. resisted multiple discovery requests. Cory asserted that Cal Jr. "refused to cooperate in deposition scheduling . . . [and w]hen finally deposed, Calvin Jr.'s evasive and misleading testimony was tantamount to non-answer under the rules." Cory further alleged Cal Jr. had used evasive tactics to avoid answering interrogatories, document requests, and subpoenas. This included defense counsel advising Cal Jr. to not answer a broad array of questions in violation of CR 30(h)(3). In response to the motion, Cal Jr. argued inter alia that the pending discretionary review of the partition claim stayed the trial court's proceedings on the partition sale action and that proceeding with Cory's default motion thus "may be a violation" of this court's stay order. Cory's motion for default was denied.^[6]

In August 2021 Cory filed a motion to compel production, requesting a special master and award of sanctions. At the August 17 hearing on the motion to compel, Cory's counsel asserted that multiple deadlines for electronic discovery production had been ignored, and that Cal Jr. had also been "[i]gnoring interrogatories, feigning forgetfulness to the majority of deposition questions, twice threatening to no-show deposition, including the day before deposition. . ." The trial judge orally found that:

[A] fair process of discovery hasn't taken place here.

In reviewing the documents provided, I'm very concerned about the fact that there was a deposition in which the answers were essentially stonewalled. The answers were essentially "I don't know."

. . .

But the rules of evidence are designed to be liberally construed to allow for the free flow of information so long as that information can be shown to be relevant, and all the information requested here, as I can see, is relevant.

The court orally ordered that copies of all requested documents be put on discs and provided to Cory's counsel within 14 days. The court also ordered that, "if there is another deposition," Cal Jr.^[7] will sit for it and answer the questions. The court required Cal Jr. to answer the interrogatories in 14 days. The court denied Cory's request to appoint a special master, but granted him attorney fees for having to bring the motion. The court signed an order on September 3 consistent with its oral ruling, but reserved on the amount of attorney fees because it had not received an affidavit as to fees. That same day, Cory filed an amended motion and affidavit for attorney fee award.

On September 9, Cal Jr. filed an objection to the motion for attorney fees. On September 30, Cal Jr. filed an emergency motion asking this court to stay discovery and trial in the third-party complaint while his appeal in the first-party partition action was pending review.

On October 1, Cory filed a motion to strike Cal Jr.'s pleadings and to enter a fee order. Cory asserted that Cal Jr. failed to comply with the court's September 3 discovery order. The same day, Cal Jr. filed with this court another emergency motion for a stay of trial and discovery.^[8] On October 7, a commissioner of this court denied Cal Jr.'s motion to stay discovery and the scheduled trial, reasoning that a stay of Cory's action was not necessary to preserve this court's review of Lindsey's first-party partition claim.

On October 8, the court heard oral argument on Cory's motion to strike the pleadings. Cory asked the trial court to "hold Calvin Jr. in default not only of the September 3rd order but of multiple discovery orders, and to find that no lesser sanctions have sufficed or would suffice, in writing, to compel Calvin Jr.'s compliance [sic] to find that Cory has been substantially prejudiced in his preparation for trial and that Calvin Jr.'s actions have been willful and deliberate." The trial court declined to strike the pleadings. Instead, the court ordered Cal Jr. to provide all discovery by October 12 in the form and format required by the civil rules and to appear for deposition at a time and place determined by Cory's counsel. The court then stated, "[i]f he fails to do that, the Court will strike his pleadings and enter a default." The court also signed an order on judgment awarding attorney fees from its August 17 and September 3 orders, as well as ordered Cal. Jr. to pay an additional $1,000 in attorney fees. The court entered its written order reflecting its October 8 rulings on October 15. After the hearing, Cal Jr. filed an emergency motion with this court to modify the October 7 commissioner ruling. A panel of judges of this court denied that motion.

On October 13 Cory moved to strike Cal Jr.'s pleadings, asserting that Cal Jr. had failed to comply with the court's October 8 order. Specifically, Cory claimed Cal Jr.'s counsel did not respond to a request for a link to the October 12 production upload and to a proposed October 15 deposition date. Cory deposed Cal Jr. on October 25.

At the following November 4 hearing on the motion to strike the pleadings, Cory's counsel asserted that during the October 25 deposition, Cal Jr. identified documents that were missing and title reports that had never been produced that were in his possession. The...