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12/04/92 OZZIE CLAY v. RICHARD C. DEERING

December 4, 1992

OZZIE CLAY, ET AL., APPELLANTS
v.
RICHARD C. DEERING, APPELLEE



Appeal from the Superior Court of the District of Columbia; (Hon. Stephen F. Eilperin, Motions Judge)

Before Ferren and Farrell, Associate Judges, and Gallagher, Senior Judge.

The opinion of the court was delivered by: Per Curiam

PER CURIAM: Appellants Ozzie Clay, individually, Clay Properties, Inc. and Clay and Company, Inc. appeal from the Superior Court's order denying a motion to vacate a default judgment granted in favor of appellee, Richard C. Deering, for appellants' failure to attend a pretrial conference and for noncompliance with prior discovery orders. Appellants claim that they did not receive notice of the pretrial conference. The Superior Court further dismissed appellants' counterclaim and permitted a pre-judgment attachment on one of the appellants' assets to be released to appellee after an ex parte hearing on the issue of damages. Appellants also submitted a motion for reconsideration and a motion to vacate the default judgment based upon newly discovered information and evidence suggesting fraud on appellee's part which the trial court also denied. Appellants now appeal the trial court's decision claiming that it abused its discretion in denying appellants' motion to vacate the default judgment.

I.

This action began on May 1, 1986, when appellee Richard C. Deering, an attorney, filed suit against appellant Ozzie Clay, an individual, Clay Properties, Inc. and Clay and Company, Inc., both close corporations owned by Ozzie Clay, seeking to recover $37,760 in legal fees for services rendered for appellants during the period between October 1, 1982 and July 15, 1986. Appellants denied the allegations of fees owed in their complaint, and filed a counterclaim asserting legal malpractice against appellee.

Various discovery disputes arose between the parties throughout the litigation. These disputes culminated with the trial court ordering appellants, on two separate occasions, to produce all documents and to answer all discovery requests completely. Orders were issued on May 15, 1987 and on October 13, 1987, respectively, for appellants to comply with appellee's discovery requests and to produce all available documents. Appellee filed its discovery requests on December 2, 1986, and nearly eighteen months later, at the time Judge Eilperin issued the May 25, 1988 order, appellants' responses to the discovery requests were found incomplete. No further compliance followed either of the two subsequent court orders compelling discovery.

On March 11, 1988, a pretrial conference was scheduled with notice for the filing of pretrial statements. Counsel for appellants did not appear at the pretrial conference, and subsequently submitted an affidavit swearing that he did not receive notice of the conference. *fn1 Appellants did not become aware of the pretrial conference until they received notice from the trial court that an ex parte hearing on the issue of proof of damages had been scheduled for April 26, 1988. Upon inquiry to the clerk's office, the appellants learned that the pretrial conference scheduled for March 11, 1988, in fact had been held. At the pretrial conference, Judge Stephen F. Eilperin issued a default judgment in favor of the appellee, and also struck the appellants' counterclaim.

Counsel for appellants notified the appellee on April 22, 1988, of his intent to file a motion pursuant to Super. Ct. Civ. R. 60 (b)(6) requesting that the court vacate the default judgment, reinstate the counterclaim, and reschedule the pretrial conference on grounds that appellant did not receive actual notice of the pretrial conference. The trial court granted leave to the appellants to file their motion, and cancelled the ex parte hearing on damages scheduled for April 26, 1988. Appellee received the proceeds of a pre-judgment attachment on July 8, 1988, in the amount of $37,760.00 (not including interest).

Following oral argument and an extensive review of the record, the trial court concluded on May 25, 1988, that the default judgment should stand in both its own right and as a sanction for appellants' refusal to comply with two prior court orders for discovery. In a lengthy, well reasoned and documented order, the court found that appellants willfully failed to produce the requested discovery documents and failed to answer appellee's interrogatories. The court concluded that the appellants' refusal to comply with two prior court orders was equally without cause.

Additionally, the court concluded that appellee was prejudiced by appellants' failure to comply with appellee's discovery requests (appellant wrongly informed appellee of document location) because appellee was unable to pursue its theory that all of the appellants were alter egos of each other, and thus were all responsible to pay his legal fees. Appellee was also prejudiced by appellants' failure to attend the pretrial conference on March 11, 1988. Consequently, this proceeding was unable to go to trial on April 28, 1988, and the first available trial dates began in January of 1989.

Finally, the trial court found that appellants' counterclaim had failed to set forth a prima facie adequate claim of malpractice against appellee. The court noted that appellants failed to produce expert testimony in discovery or to proffer the name of an expert at trial to show that the appellee's representation was below the standard of care expected of a lawyer in appellee's position. For this reason the trial court dismissed appellants' counterclaim.

Appellants then filed a motion for reconsideration and a motion to vacate the default judgment pursuant to super. Ct. Civ. R. 60 (b)(2)(3) & (6) based on newly discovered information suggesting that appellee committed fraud regarding discovery requests. Both motions were denied.

An ex parte hearing on damages was held on July 5, 1988, and the court granted appellee's claims against all three appellants, corporate and individual, jointly and severally in the amount of $41,120.00 plus interest. *fn2 The record contains substantial evidence indicating that Ozzie Clay not only advised appellee to send the legal bills to appellant Clay personally, but that appellant Clay acted as guarantor for all of the corporate bills, irrespective of whether appellant Clay was individually named as a party in the particular litigation. *fn3

On August 5, 1988, Judge Eilperin denied appellants' motion pursuant to Super. Ct. Civ. R. 60 (b)(2)(3) & (6) to vacate the default judgment, set aside the damages awarded at the ex parte hearing, and denied appellants' request to reinstate the counterclaim. The court found that appellants' motion failed to set forth any new information that could not have been discovered ...


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