Prime RX, LLC v. McKendree, Inc.
| Docket Number: | 2004-CA-01761-SCT Linked Case(s): 2004-CA-01761-SCT |
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| Supreme Court: | Opinion Link Opinion Date: 10-13-2005 Opinion Author: GRAVES, J. Holding: Affirmed |
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| Additional Case Information: |
Topic: Contract - Admissions by default - M.R.C.P. 36(b) - Summary judgment - Discovery sanction - M.R.C.P. 37 - Statutory penalty - Section 11-3-23 - Attorney’s fee - Section 11-53-81 Judge(s) Concurring: Smith, C.J., Waller and Cobb, P.JJ., Carlson, Dickinson and Randolph, JJ., Non Participating Judge(s): Diaz, J., Dissenting Author : Easley, J., Procedural History: Summary Judgment Nature of the Case: CIVIL - CONTRACT |
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| Trial Court: |
Date of Trial Judgment: 07-22-2004 Appealed from: MADISON COUNTY CIRCUIT COURT Judge: Samac Richardson Disposition: The County Court of Madison County granted summary judgment to McKendree Case Number: 2003-0247 |
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| Party Name: | Attorney Name: | |||
| Appellant: | PRIME RX, LLC AND DALE WEAVER GUINS d/b/a
PRIME RX |
MARGARET WILLIAMS HOLMES |
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| Appellee: | McKENDREE, INC. d/b/a McKENDREE WHOLESALE | CHARLES VERNICE HOMAN, JR., JAMES RAY MOZINGO |
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| Topic: | Contract - Admissions by default - M.R.C.P. 36(b) - Summary judgment - Discovery sanction - M.R.C.P. 37 - Statutory penalty - Section 11-3-23 - Attorney’s fee - Section 11-53-81 |
| Summary of the Facts: | McKendree, Inc., d/b/a McKendree Wholesale filed a complaint for breach of contract against Prime Rx, LLC and Dale Weaver Guins d/b/a Prime Rx in the County Court of Madison County, alleging that defendants owed it $54,103.37 on an open account. McKendree filed its first motion for summary judgment, which was denied. Following discovery, McKendree filed a second motion for summary judgment, alleging that there were no disputed issues of material fact because defendants admitted all of the facts in the requests for admissions by failing to timely answer. McKendree also filed a motion to compel defendants to respond to its discovery requests. The trial court ordered the defendants to fully respond to McKendree’s discovery requests in proper legal form within fourteen days. Guins, individually, timely complied with the trial court’s order by submitting her responses. McKendree then filed a motion to strike her responses to the requests for admission. The court ultimately struck the responses to the requests for admission and deemed them admitted. The court granted summary judgment in favor of McKendree and entered final judgment, finding Guins and Prime LLC jointly and severally liable for the amount of $58,729.37, which represented the outstanding balance of $54,103.37, attorney’s fees of $4,500.00, and court costs of $126.00. Defendants filed their timely notice of appeal with the Madison County Circuit Court. McKendree filed a cross-appeal as to the issue of attorney’s fees. The circuit court affirmed the trial judge’s grant of summary judgment yet ordered that it would conduct an evidentiary hearing to determine attorney’s fees. The circuit court found the trial court had considered the defendants’ requests for admission as being admitted and properly granted summary judgment under M.R.C.P. 56. Additionally, the circuit court stated that the proper way to seek relief from a matter that was conclusively established by being deemed admitted under Rule 36 is to move to amend or withdraw the admission under section (b), which defendants failed to do. The defendants appeal. |
| Summary of Opinion Analysis: | Issue 1: Admissions by default Defendants argue that the court erred in failing to consider the answers to the complaint, answers to interrogatories, documents produced, and deposition testimony to contradict any admissions made by default. A trial court is under no obligation to consider these other discovery devices to refute matters already conclusively established if the defaulting party does not make a motion to withdraw or amend under M.R.C.P. 36(b). In the instant case, Prime LLC did not respond to the requests for admission at all, and Guins did not file a motion to withdraw or amend under Rule 36(b). As these defendants did not seek the appropriate relief for their failure to comply with the discovery rules, the county court judge was under no obligation to review any interrogatory answers or deposition testimony to refute matters conclusively established by the requests for admission. Issue 2: Summary judgment Though the trial court had no duty to review any pleadings, deposition testimony, interrogatory answers, etc., to refute a matter conclusively established by defendants’ deemed admissions, it does have a duty to review these other documents to determine whether a genuine issue of material fact exists in spite of the admitted matters. The order of final judgment entered by the county court contains no explanation as to the court’s reasoning in granting summary judgment. Guins, via the deemed admissions, admitted that she is the only member of Prime LLC, that McKendree was not a member of Prime LLC, that she was the sole proprietor of Prime Rx before it became Prime LLC, and that she and McKendree had never entered a written agreement to form any business. Based on these admissions, one must logically conclude that the named defendants, Guins and Prime LLC, are the only parties liable for payment of the account that Prime Rx maintained with McKendree. Since there is no longer a basis in fact for Guins’ defense that she does not owe McKendree $54,103.37 because of a business arrangement between the parties, there is no longer a genuine issue of material fact to be adjudicated at a trial on the merits. Thus, the circuit court correctly affirmed the county court’s grant of summary judgment in favor of McKendree. Issue 3: Discovery sanction Prime LLC and Guins argue that the circuit court erred in affirming the county court judgment, claiming that the actions of the county court amounted to a harsh discovery sanction which led to an improper final dismissal with prejudice. While M.R.C.P. 37 would be an appropriate ground for sanctioning a party for failure to timely answer an interrogatory or failure to appear at a deposition, its application is neither necessary nor appropriate in this case, where Rule 36 specifically provides a remedy for untimely discovery responses. The trial court properly exercised its discretion in deeming the matters in McKendree’s requests for admissions admitted and conclusively established under Rule 36. Issue 4: Attorney’s fees McKendree requests an award of all costs and attorneys’ fees associated with this cause, claiming there is no arguable basis for the defendants’ appeal. The statutory penalty of section 11-3-23 applies only to unconditional affirmances. Section 11-53-81 specifically provides for reasonable attorney’s fees where suit is brought to collect on an open account. On appeal to the circuit court, the circuit court determined that to review the award of attorney’s fees it would conduct an evidentiary hearing, with McKendree’s attorney producing detailed billings and/or time sheets, to determine an appropriate award of attorney’s fees. The circuit judge took appropriate action for the limited purpose of conducting a hearing on attorney’s fees. In addition, McKendree is awarded the statutory penalty as provided in section 11-3-23 in the amount of $8,115.51. |
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