Lead Opinion
Opinion
As a sanction for wilful and deliberate refusal to obey discovery orders, the trial court in this case struck the answer and entered a default judgment in an amount exceeding the prayer of the complaint. We granted review to consider whether a default judgment entered as a discovery sanction is excepted from the general rule that “if there be no answer” filed, the plaintiff’s relief “cannot exceed that which he shall have demanded in his complaint. . . .” (Code Civ. Proc., § 580.)
Following unsuccessful demurrers, defendants answered and plaintiff commenced discovery. Rodman was recalcitrant throughout this process, actively resisting both document production and deposition. After repeated failures to appear and numerous postponements, he appeared at a deposition on February 12, 1981, rescheduled at his request, only to refuse to answer questions because it was Lincoln’s Birthday—assertedly a “legal holiday.” At a June 1981 deposition, on a court order to appear with records at the office of plaintiff’s counsel, Rodman produced an assortment of papers in a box filled with straw and horse excrement, which he laughingly dumped on the table. After counsel and the court reporter had inspected the documents for an hour, Rodman announced they must be sure to wash their hands thoroughly because the straw had been treated with a toxic chemical readily absorbed through the skin. The reporter, five months pregnant, asked to be excused, and the session was terminated by plaintiff’s counsel.
On November 6, 1981, plaintiff moved to strike the answer and enter a default judgment. The court ordered defendants to pay $1,000 in sanctions (adding $500 to an earlier sanction that Rodman had failed to pay) and to appear at the office of plaintiff’s counsel with the requested documents on December 23, 1981. When Rodman again refused to comply, plaintiff renewed her motion, demanding that a default be entered.
On August 24, 1982, the court granted plaintiff’s motion to strike the answer and enter a default. However, it was not until September 24, 1982— i.e., a month after the default had been entered—that she filed a request to enter a default judgment (Cal. Rules of Court, rule 982(a)(6)), stating for the first time the amount of damages she claimed. After several continuances at plaintiff’s request, an ex parte “prove-up” hearing was held. (Code Civ. Proc., § 585, subd. (b).) Plaintiff put on evidence in support of her claim of damages; defendants were not present either in person or by counsel.
I
Section 580, and related sections 585, 586, 425.10 and 425.11, aim to ensure that a defendant who declines to contest an action does not thereby subject himself to open-ended liability. Reasoning that a default judgment that exceeds the demand would effectively deny a fair hearing to the defaulting party, the Courts of Appeal have consistently read the code to mean that a default judgment greater than the amount specifically demanded is void as beyond the court’s jurisdiction. (Devlin v. Kearny Mesa AMC/Jeep/Renault, Inc. (1984)
We affirmed that strict construction of section 580 in Becker v. S.P.V. Construction Co. (1980)
Nevertheless, plaintiff here maintains that the court acted within its jurisdiction in granting her increased award. She first argues that the terms of her complaint amply notified defendants of the extent of damages she would claim. While conceding that she omitted to state an amount of damages in her demand for judgment as section 425.10, subdivision (b), requires, she points to the usual inconsequence of such error. It is true that a general demurrer will not lie for a defective prayer alone. (Miller v. Superior Court (1922)
It is precisely when there is no trial, however, that formal notice, and therefore the requirement of section 425.10, become critical. Notice is at the heart of the provision, as the Legislature underscored by adding section 425.11, which provides that in the single instance in which the amount of damages shall not be specified in the complaint—an action for personal injury—“the plaintiff shall give notice to the defendant of the amount of special and general damages sought” before obtaining a default judgment. (See, e.g., Jones v. Interstate Recovery Service (1984)
Plaintiff’s more substantive claim, and the central issue before us, is that the foregoing limits on default judgments do not, either as a matter of statutory language or policy, apply in the present context. She concedes that section 580 governs the judgment even when, pursuant to section 2034, subdivision (b)(2)(C), a court strikes an answer and enters a default judgment for refusal to make discovery. She would construe the language of section 580, however, to permit unlimited damage judgments when an answer is stricken as a discovery sanction. She asserts that the first clause of the section—i.e., “The relief granted to the plaintiff, if there be no answer, cannot exceed that which he shall have demanded in his complaint”—applies only to “ordinary” defaults, presumably defaults at the pleading stage. And she concludes that when, as here, a default is entered after the defendant has filed his answer, the judgment falls within the more liberal rule of the second clause of section 580, i.e., “but in any other case, the Court may grant [the plaintiff] any relief consistent with the case made by the complaint and embraced within the issue.”
In effect, plaintiff maintains that defendants entered irreversibly into an adversarial contest by filing a sufficient answer; having crossed that threshold, they may no longer claim the protection of section 580. In this way, plaintiff attempts to exclude answers stricken for discovery violations from the long line of precedents viewing a failure to answer as including the case in which an answer is filed but is later stricken by the court. (Brown v. Ridgeway (1983)
We are unpersuaded. The rationale stated in Brown, i.e., that striking the answer renders it a nullity (see Brown v. Ridgeway, supra,
Arguing that default judgments entered for discovery violations should be held to differ fundamentally from other defaults as a matter of policy, plaintiff cites to the minority of federal cases that have upheld judgments exceeding the demand of the complaint. (Trans World Airlines, Inc. v. Hughes (2d Cir. 1971)
Certainly these holdings give bite to discovery sanctions in cases in which the defendant’s own actions obstructed the plaintiff from fixing the amount of damages to which he was entitled. But while unlimited discretion to award such default judgments might further the policy behind discovery sanctions, our paramount concern remains due process. Plaintiff overlooks a crucial difference between state and federal procedures in default judgments: as the courts in Trans World Airlines and Sarlie emphasized, federal defendants who default are entitled to a minitrial on the sole issue of damages. (Trans World Airlines, Inc. v. Hughes, supra,
It is here that plaintiff’s analogy to federal law—and her contention that merely by filing an answer defendants have irreversibly contested this action—breaks down: under section 585 there is no contest whatever once a defendant defaults. (Jones v. Interstate Recovery Service, supra,
Plaintiff contends that defendants deliberately thwarted her discovery efforts because they believed they owed an actual debt to her in excess of her demand. Yet this is no less true of many defendants who fail to answer in the first instance. As we emphasized in Becker, no matter how reasonable an assessment of damages may appear in the specific case, we cannot open the door to speculation on this subject without undermining due process— a protection to which every defendant is entitled, even one as obstreperous and as guilty of reprehensible conduct as this defendant.
II
Because the default judgment in this case exceeded the ceiling on damages to which plaintiff is subject, we conclude that the award must be amended to conform to the limitations specified in section 580. Defendants argue that because plaintiff stated no amount of damages in her prayer, she is entitled to no compensatory damages whatever. In Becker, however, we specifically held that the allegations of a complaint may cure a defective prayer for damages. (Becker v. S.P.V. Construction Co., supra,
Each of plaintiff’s causes of action, with the exception of her personal injury claim, concluded with the allegation that she suffered damage “in an amount that exceeds the jurisdictional requirements of this court.” Plaintiff brought her action in the Los Angeles Superior Court, which is a court of limited jurisdiction subject to the requirement that the amount in controversy exceed $15,000. (Former § 86.) By her allegations, plaintiff thus gave sufficient notice to defendants that she claimed at least $15,000 in compensatory damages. While an award in excess of $15,000 would be improper, a judgment in that amount was within the jurisdiction of the court. (See Engebretson & Co. v. Harrison, supra,
Even as so modified, the judgment will clearly support an award of punitive damages. We need not, therefore, reach defendants’ contention that an award of punitive damages cannot stand if there is no compensatory damage award. For the reasons given, however, the award of punitive damages must be reduced to the amount of $100,000 pleaded in the complaint.
Ill
We recognize that the damages thus authorized may not fully compensate plaintiff for her loss. Because this case appears to be the first reported decision to hold that a default judgment entered as a discovery sanction is governed by the general rule that such a judgment cannot exceed the relief demanded in the complaint, both plaintiff and the trial court may have been unaware that the deficiency in her prayer could have been corrected in the same way as in cases of default for failure to answer, i.e., by giving plaintiff the option of serving and filing an amended complaint.
In the interest of fairness plaintiff should now be given that option. Specifically, she should be allowed to choose to forego the reduced award prescribed herein and instead to file an amended complaint praying for a different amount of damages and/or other appropriate relief. If she so elects, she must serve her amended complaint on defendants, who will be entitled to file a new answer; all issues will then be at large, including liability. Of course, if defendants thereafter continue to disobey discovery orders and incur a second default judgment as a sanction, plaintiff will have the right, at a second ex parte hearing, to prove her actual damages up to the limits of her amended prayer.
Broussard, J., Reynoso, J., Grodin, J., Lucas, J., and Panelli, J., concurred.
Notes
Section 580 provides: “The relief granted to the plaintiff, if there be no answer, cannot exceed that which he shall have demanded in his complaint; but in any other case, the Court may grant him any relief consistent with the case made by the complaint and embraced within the issue.”
All statutory references hereinafter are to the Code of Civil Procedure.
We are equally unpersuaded by defendants’ attempt to use federal majority interpretation of rule 54(c) to support their contention that our discovery statutes must be read as conforming to the federal statutes on which they were modeled. Because the language and procedure of our code differs so markedly from the federal rule, federal case law and policy are at best suggestive on this point.
Concurrence Opinion
I write separately to express a concern that has been overlooked by the majority. Civil defendants who wish to limit their liability to the minimum amount specifically pleaded can (1) force plaintiffs to undergo the frustration and expense of discovery, and then (2) absent themselves allowing a default to be entered. This is exactly what happened here.
As the majority note, Code of Civil Procedure section 425.10, subdivision (b)
In addition, Witkin notes, “C.C.P. 580 provides that if the defendant answers the court may grant ‘any relief consistent with the case made by the complaint and embraced within the issue,’ and the rule is well settled that in a contested case the plaintiff may secure relief different from or greater than that demanded. [Citations.]” (4 Witkin, supra, § 449, p. 492, italics added; maj. opn. at p. 827.)
Although the majority acknowledge the fact that the statutory scheme does not address this situation, they insist that due process requires a “strict construction of section 580. . . .” (See maj. opn. at p. 826.) However, this interpretation would mandate the application of the damage ceiling to actions in which answers are stricken as a discovery sanction. In so doing, the majority expand the parameters of section 580 by incorporating all cases falling within the ambit of section 2034.
The justification proffered for equating defaults entered at the pleading stage with those resulting from sanctions imposed under section 2034 is the concern that defaulting parties may be denied the formal notice of the maximum amount of potential liability required by due process. (See maj. opn. at pp. 826-827.)
The first clause of section 580 was set down by the Legislature to guarantee defendants adequate notice of the maximum judgment that may be assessed against them. (See maj. opn. at p. 826.) However, it is clear that the statutory language contemplates two different situations. The first clause of section 580 addresses the traditional default context where a defendant has failed to answer. In this situation, fundamental fairness requires that the defendant be notified. The second clause of section 580, by contrast, refers to contested cases.
In the present proceeding, defendants not only filed an answer to the complaint, they gave both plaintiff and the court the impression that they would participate in the discovery process. For the two-year period between the date plaintiff filed the complaint—August of 1980—and the date the court granted plaintiff’s motion to strike the answer and enter a default—
The record demonstrates that during this two-year period defendants had no intention of providing plaintiff with any information through the discovery process. As the majority note, defendant Rodman “actively resist[ed] both document production and deposition.” (See maj. opn. at p. 825.) He repeatedly failed to appear at scheduled meetings and, during the one deposition he chose to attend, engaged in behavior that can only be described as shocking, inhumane, and inexcusable.
In light of these circumstances, I cannot agree with the majority’s conclusion that default judgments entered as a sanction for obstruction of discovery must be treated as if no answer had been filed in the first instance. The policy considerations underlying a decision to uphold judgments exceeding the demand where the defendant’s affirmative actions invite a default judgment are considerably more compelling than the majority allow.
The principal purpose of the ceiling set forth in section 580 is to apprise defendants of their potential liability so that they may evaluate the consequences of exercising their right not to answer. Here, the defendant Rodman has answered and then obstructed the discovery process. In so doing, he prevented the plaintiff from ascertaining the proper amount of damages. If the ceiling on damages is applied to this situation, it would permit the defendants to profit from wrongdoing.
Consider the facts of this case. Defendants answered the complaint, thereby indicating their intention to contest plaintiff’s allegations. The ensuing evasive maneuvers permitted defendants to gauge plaintiff’s case while raising the stakes by forcing her to file expensive and futile discovery motions. When it became clear that plaintiff could not realistically estimate the losses she suffered as a result of the dissolution without defendants’ cooperation, defendants attempted to limit their liability by suddenly withdrawing from the proceedings.
The majority admit that the rule they delineate will undercut the effectiveness of discovery sanctions in causes where, as here, only the defendants know the dollar value of the losses suffered. Nevertheless, they claim that due process mandates such a result. If their concern is proper notice to defendants, I see no reason why plaintiffs must suffer the frustration and expense of refiling their claims so that obstreperous defendants may choose the optimal point at which to drop out of the litigation. The majority’s
To avoid this inequity, I would suggest an alternative procedure. The trial court, at the time it enters the default, would send a notice to the defendant stating that it will consider evidence in support of a claim of damages in an amount exceeding the prayer of the complaint at the scheduled “prove-up” hearing under section 585. During that proceeding, the defendant would be permitted to present rebuttal evidence.
This procedure
Appellants’ petition for a rehearing was denied December 31, 1986.
Code of Civil Procedure section 425.10 provides in pertinent part: “A complaint or cross-complaint shall contain ... the following: [I] (b) A demand for judgment for the relief to which the pleader claims he is entitled. If the recovery of money or damages be demanded, the amount thereof shall be stated . . . .”
Unless otherwise noted, all statutory references are to the Code of Civil Procedure.
Section 580 states: “The relief granted to the plaintiff, if there be no answer, cannot exceed that which he shall have demanded in his complaint; but in any other case, the court may grant him any relief consistent with the case made by the complaint and embraced within the issue.”
Section 2034 empowers the courts to impose sanctions against litigants who wrongfully fail or refuse to participate in the discovery process.
See footnote 2, ante.
This procedure would be analogous to that employed in the federal courts in cases where a plaintiff seeks damages exceeding the demand in the complaint. (See, e.g., Trans World Airlines, Inc. v. Hughes (2d Cir. 1971)