Tuesday, 23 August 2016

Discovery Process Inspection Request

Part of the lawsuit process is obtaining information to support your claims, undermine the other side’s claims or evaluate the strengths and weaknesses on each side. As part of formal discovery each side may request to inspect documents and things from the other side. This can be paper files, electronic records, inspection and copying of computer systems, other physical evidence such as personal property, and even land.

Similar to interrogatories (written questions seeking information) inspection requests are typically prepared by the asking side’s attorney and responded to by the other side’s attorney. As with the questions, the answers are sworn to under penalty of perjury. So trouble may ensue for evasion.

The responses may come back with objections. The party may agree to comply with the request. The responding party may not be able to comply with the request because the documents never existed or were destroyed in come conveniently timed fire. Even though you may be disappointed not to get the information, it is important to run down what is available, what is not available, and why it is not available. Of course the destruction of evidence, especially under questionable circumstances, may damage or destroy credibility or a case.

As with interrogatories, if the asking party is not satisfied with the responses they received they may ask the court for help with getting the information or getting the responding party to comply with their obligations. This starts with an informal effort at working it out called the meet and confer process. This unfolds much like a negotiation where the attorneys go back and forth about requirements for the requests, the merits of the objections, and the standards for responding to requests. Some things may be clarified or worked out. For the remaining, the requesting party can ask the court for help. This is in the form of a discovery motion.

Discovery motions can be time consuming to prepare and to respond to. In ruling on the motion the court commonly imposes a financial consequence on the losing party and/or their attorneys for being wrong. This is called monetary sanctions. They are based on the expense to prepare the motion. How much is awarded very much depends on the judge, what was involved, how close the call was, and the apparent good faith of those involved.

So between the time and money involved in preparing or responding to a discovery motion and the exposure for the other side’s expenses, discovery disputes can become expensive.

However the stakes are also high as the information can make or break a case.

Monday, 11 July 2016

Discovery Informal And One Formal Discovery Device

Soon after the lawsuit papers are served the parties can engage in discovery. This phase of the litigation process lasts until basically thirty days before trial. The point of it is to develop and obtain evidence to support your claims and see what the others side has to support their claims. This is important so that you can win your case and evaluate your chances at success. And you need to evaluate the chances of success for the other side. This information can lead to a resolution of the case.

Before even filing a case, however, it is important to do informal investigation of the case. Your own files and records may have important documents to support your case and evaluate what issues the other side may try to raise. Go through your files. Pull together the contracts, agreements, and other supporting documents. Get the email and other communications together. The correspondence trail may be full of admission, for both sides. There may be smoking guns anywhere. This information must be gathered and preserved.

Witnesses can be identified and located. Investigators can obtain statements to preserve testimony and avoid later surprises. Maybe people on the other side will speak more freely before the court process begins.

Once the case begins the discovery process is more formal. There are various tools used to pursue formal discovery. These consist of written questions, requests for documents or to inspect places or things, requests for admissions that the other side admit or deny various propositions, live questioning of witnesses under oath with a formal record (depositions), and securing documents or testimony of or from third party witnesses. Closer to trial there is a process for exchanging information on experts who may testify to support each side.

Let’s look at the first on the list: interrogatories.

These are typically written by the lawyer for the asking party and answered by the lawyer on the other side. However the party answering the questions has to swear to the truth of the answers. So whatever information you get out of them can be used against them in court as an admission. It can also be used against them to attack their credibility if they change their story.

As you might imagine the side answering the questions will try to object to questions and provide as little information as possible, at least with respect to things they would prefer not to discuss. For the self-serving subjects, expect longer answers.

Once the questions are answered the asking party can press for better answers or try to overcome objections. This is first done informally through a meet-and-confer process. Basically it is a negotiation between the attorneys regarding what the rules and obligations are and how the standards were not met or the questions were hopelessly confusing or otherwise defective. The meet and confer process can lead to better and more information. It can narrow the issues where some common understanding is met. And for those areas where the parties cannot work it out the parties can tell it to the judge for a decision. There can be a financial penalty for being wrong. Typically the losing side has to pay the expenses of the winning side for the motion to bring the matter to the court’s attention. This could be anywhere from hundreds to thousands of dollars, depending on what is involved. And the court can review the request for attorney’s fees and reduce it if they feel it is excessive. If there is a close question and/or abundant good faith a court may not impose sanctions. Much depends on the judge hearing the discovery dispute. Typically some sanctions are imposed.

And, of course, pursuing a discovery motion can take a lot of time because of what must be prepared to properly present it to the court.

But without information you may not be able to prove your case. So this can be a mission critical process.

Monday, 6 June 2016

Discovery in Civil Litigation

Discovery is a process used in a court case. It is very important because, without it, you may not be able to develop the admissible evidence you need to prove your case. It is also important because you can use the discovery process find out about the other side’s case.

The opportunity to do discovery lasts from (usually) soon after the lawsuit is filed until about a month or so before trial. There are many qualifications regarding dates here because there are exceptions, special circumstances and different procedures are subject to different time frames.

In California civil procedure there are a variety of tools that can be used for getting information through discovery. These include writ questions (interrogatories), requests for documents for other things including inspection of premises, requests that specify matters admitted (requests for admissions), and questioning witnesses under oath (depositions). Documents and/or testimony can be obtained from third parties through subpoenas. Some cases require expert testimony. In the closing days of the case parties can demand information regarding experts to be used by the other side, and those experts can be questioned.

Discovery is a two-way street. Just as you can demand information from the other side, looking for a smoking gun to your case, the other side has the right to demand information from you.

Since the discovery phase the case lasts for most of the life the case prior to trial, discovery can become expensive and time-consuming. However, it is very important because it can make or break your case. Also information developed through discovery can help resolve the case without resort to the time and expense of going to trial. Or if the case does not resolve you will have the formation you need to prove your case, and you will know what to expect from the other side.

Forewarned is forearmed.

Thursday, 12 May 2016

Freezing Assets

If you have a breach of contract claim you may be eligible for an order freezing the other side’s assets until the case is over.  This does not come up in every contract case.  Some cases simply are not eligible for it.  For example, it needs to be a commercial claim.  So a credit card company will not be taking this action against a consumer.  (They used to be able to do this.)  Also the claim needs to be large enough to qualify – both as a matter of what the law provides for and also from a cost/benefit standpoint.  While it can be very important to tie up assets at an early stage of a case so you have a better chance at collecting, seeking this kind of order is a lot of work.  And you can understand why.  A judge is going to want to be pretty confident that you are going to win before making this kind of an order.  So you need a strong case. And it needs to be clearly presented so a judge can rule in your favor.

The more formal term for this process is “attachment”.  There are specific forms which must be correctly completed to apply for this kind of an order.  In addition to the mandated forms the party seeking an attachment must present legal authorities supporting the request as well as admissible evidence in support of the claim.  This will include declarations from eye witnesses as well as properly authenticated business records. 

An attachment can be requested on little or no notice.  This is called an ex parte application.  If there is an emergency, such as a sale of a business or evidence of assets being dissipated, then you might be able to get an order on a day’s notice or even in secret.  This is a very drastic request so you need a compelling situation to justify it.  If your showing falls short you may still be eligible for a temporary protective order to maintain the status quo until the application can be heard on regular notice.  That will be closer to a month.  Technically it is sixteen court days plus time for service.    

Another requirement for an attachment is that if it is allowed, you must post a bond in order to get papers issued to actually do something with the attachment.  Typically the bond is $10,000.  The premium for that will be a few hundred dollars per year.  It is important to know that a bond is not quite like an insurance policy.  If you lose the case then the other side can make a claim for damages for what will be seen as a wrongful attachment.  If the bonding company pays then they will want to be repaid.  So bonding companies will need some financial information and may run a credit report on you.  To avoid a lot of work for nothing I usually have my clients apply for the bond first to be sure they qualify.  Unfortunately I have seen people turned down. While that was unfortunate it was better to learn that early rather than after going to all the work.

Once an attachment is allowed you may tie up assets.  What exact form that will take will depend on what the asset is.  This does not mean that you get the money while the case is pending.  Instead the idea is that money, assets or other property are taken by the sheriff or otherwise subject to a lien such that they will not disappear while the case is pending.

An attachment is a powerful remedy.  It can make a dramatic difference in a case and improve your chances for collecting.  So instead of being frozen out by a breaching counter-party, see if you can freeze some assets instead.

Wednesday, 30 March 2016

What Responses Can the Defendant Make To the Lawsuit?

After the defendant has been sued and served, they have some time to respond to the case.  Commonly that time is about thirty days. If they do not respond then you can seek a default, locking them out of court and follow up with a default judgment. 
If the defendant wants to be heard and fight the case, they have several options.

A defendant can answer the complaint. Typically this takes the form of a denial of the allegations. In addition the defendant can raise various new matters. These are called affirmative defenses.  It is sort of like saying, “the plaintiff is wrong; even if he is not wrong, I still do not owe him because of this other thing.”  And those other things can take many shapes and forms, depending on what the case is about.

A defendant may challenge the legal sufficiency of the complaint. This is an attack on the complaint itself. Commonly the notion is, “even if everything you say is true, you do not have a claim against me.”  In a more lawyerly way of phrasing, the plaintiff fails to state facts sufficient to constitute a cause of action.  So, for example, the court papers may show on their face that the case is too old.  Or maybe it is some new theory of liability which is not well established. Or maybe the plaintiff’s court papers are gibberish.  It happens.

A defendant might file an attack on jurisdiction. So, without getting into the right or wrong of anything, the defendant wants to fight about where to fight. This can make a big difference with respect to convenience, home town advantage, what law to apply, etc.  

A defendant might respond by attacking the serve. Was the defendant served or served properly?  This is an unusual move to make. Sometimes it is appropriate. But a defective serve can often be corrected by re-serving the papers. This will be far cheaper than filing the motion to attack the serve. So this kind of battle can be expensive and little advantage is obtained through it.

If you need to sue someone or have been sued, you should hire a competent attorney to handle the case appropriately.

Tuesday, 8 March 2016

What Happens After The Lawsuit Is Served?

After the lawsuit papers are served, the defendant has formal notice of the case and needs to decide what they are going to do.  Will they fight the case?  Will they lawyer-up? Will they settle?  Will they ignore it and suffer a default judgment?  If the lawsuit papers or a later served statement of damages do not say how much the plaintiff is suing for then a default judgment may not even be available.   This goes back to the concept of notice and a hearing.  If the defendant does not know how much they are being sued for then it would be unfair to tag them with a money judgment.  This does not apply in smaller size cases.

This is not to suggest that ignoring a lawsuit under any circumstances is a good idea.  To the contrary, defaulting in a civil case is a very dangerous thing to do.  You are then locked out of the proceeding.  What happens from there is without your input.  You lose the right to be heard or participate.  You cannot put on a defense.  You cannot attack the other side’s evidence, legal presentation, or claims for recovery.  You are not even in a position to critique their math.  Failing to timely respond to a lawsuit is rarely a good idea.

Assuming the defendant fails to timely respond, the plaintiff can take a default against the defendant.  This basically locks the defendant out of court.  The plaintiff can then make a one-sided presentation to the court regarding the plaintiff’s case.  Without any opposition you can imagine that the plaintiff has a high likelihood of success.  And the plaintiff will probably have a judgment entered as requested.

A defaulting defendant might be able to set aside a default or default judgment.  The defendant might be able to have the case re-opened.  But the defendant will be arguing about whether or not the case should be re-opened instead of arguing about who is right or wrong.  Talk about being behind on things.  And the request to re-open the case may be denied. 

So after the lawsuit papers are served, the defendant will need to decide if and how to respond.  They may attack the legal sufficiency of the case.  They may defend the case.  They may counter-sue.  It depends on the circumstances. 

It is a suspenseful time for plaintiff.

Monday, 1 February 2016

Proper Service of Court Papers – It is More Important Than You Think

If you have to sue someone, one of the first things that happens after the case is filed is serving the defendant with the court papers.  This is after consulting with a lawyer, hiring an attorney, the case being researched and investigated and a lawsuit being filed.

Properly serving the defendant with the court papers is a very important step in the case.  It tells the defendant that they are being sued.  This is important so the defendant has notice of the case.  And then they can decide if or how they want to respond.  This is a fundamental part of our legal system. The concept is due process of law.  At its most simple and fundamental it boils down to notice and a right to be heard.  Proper service is the notice part of it.  

And proper service does not mean that the defendant knows about the case through gossip or the grapevine.  Or a demand letter warning the defendant that they are going to get sued if they do not pay is not the same thing as proper service of the court papers.

Proper service brings the defendant under the jurisdiction of the court.  This means that the court has the power to determine the defendant’s rights and claims.  Think of it as a form of tag.

Proper service of the court papers involves some formality. 

The correct papers need to be served. Typically this will involve a summons which has certain notices on it.  There will be the complaint which lays out the claims against the defendant.  There may be other documents furnished by the court at the time of filing.  Often these have to do with setting the case for a case management conference a few months after filing and information about alternative dispute resolution options, i.e. alternatives to a trial.  Mediation and arbitration are common forms.

The papers need to be served by an appropriate person.  At a minimum it will be an adult over the age of eighteen.  Better is using a registered process server.  They have their tricks of the trade for serving papers and finding people.  They should also know how to properly complete the proof of service.  And that paperwork is important, as discussed more below.  There is a legal presumption that a process server’s proof of service is accurate.  This means the burden is on the other side to show that it is wrong.  That is not an insurmountable barrier.  I once had a client who was allegedly served personally while he was overseas.  Thank goodness for passports.

Service using a registered process server also presents another advantage over the plaintiff using friends and family.  The process server is more objective and disinterested.  To them this is just one of a zillion serves they are trying to get accomplished.  They don’t know anyone in the case and could probably care less about the whole thing.

The papers need to be served in the proper way.  Ideally this is personal delivery to the defendant.  That is not always possible.  There are other legitimate forms of service.  One is called substituted service.  This is where papers are left with an adult at the defendant’s home, place of business or usual place of mailing. A set of papers is then mailed to the defendant.  This is available after making reasonable efforts at personal service. 

In more extreme cases you have to resort to service by publication for individuals or service through the Secretary of State for entities.  Basically you have to exhaust all other avenues for service.  So on the road to this you will try to serve the papers personally or by substituted service.  You will undertake investigation and “skip tracing” to try to locate current, good addresses for the defendant.  But if all else fails – the person has disappeared for a while or is just evading so successfully, then there are still ways to have the person served. 

But if you think about it, service through a legal notice that very few people read in the back of a newspaper is not too likely to actually inform anyone that the defendant has been sued. So the defendant has more time to try to set aside a judgment because they did not have actual notice of a case. 

I had one instance in my career so far where a defendant who was served by publication actually called me about it not long after notice was published. I could not believe it.  She said her friend saw it in the paper and informed her of it.  So, sometimes it will provide actual notice.  That is the great exception…

Once papers are served in one way or another you need a proof of service that is properly completed.  This is an important legal document that can make a judgment stand or fall.  So it is a good idea to have papers served by someone who knows what they are doing and have the proof of service reviewed after it comes back to make sure it is accurate and appropriate.  

Word to the wise: if you have a small claims case, do not have the clerks serve the papers by certified mail/return receipt requested.  It is cheap and sometimes the little green card comes back with a legible signature or a signature plus a printed name.  But if the defendant does not sign it or the signature is illegible, you are nowhere.  Spend the money on the process server.  Get it done right the first time.

And the same holds true for larger cases.  It does not pay to cut corners on service of court papers.