December 11, 2012
MICHAEL GASKILL, PLAINTIFF-APPELLANT,
ABEX CORPORATION, FORMERLY AMERICAN BRAKE AND SHOE COMPANY, HONEYWELL INTERNATIONAL, INC. INDIVIDUALLY AND AS SUCCESSOR TO ALLIED SIGNAL, INC. AND AFTERMARKET BRAKE AND FRICTION MATERIALS DIVISION OF BENDIX CORPORATION, VOLKSWAGEN OF AMERICA, INC., AND
FORD MOTOR COMPANY, DEFENDANTS-RESPONDENTS, AND AMERICAN HONDA MOTOR COMPANY, INC., BORG-WARNER CORPORATION C/O BURNS INTERNATIONAL SERVICES CORPORATION; CHRYSLER CORPORATION, GENERAL MOTORS CORPORATION, GENUINE PARTS COMPANY, MARTIN CHRYSLER, NISSAN NORTH AMERICA, INC., TOYOTA MOTOR MFG. NORTH AMERICA, AND QUALITY AUTO, AS SUCCESSOR IN INTEREST TO MARTIN AUTO PARTS, INC., DEFENDANTS.
On appeal from Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-1772-08.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued December 20, 2011
Before Judges Messano, Yannotti and Kennedy.
Plaintiff appeals from a May 7, 2010 order of the Law Division dismissing with prejudice his complaint for personal injury, as a consequence of plaintiff's pervasive lies during discovery and his efforts to subvert the discovery process. We affirm essentially for the reasons expressed by Judge Ann G. McCormick in her thorough opinions from the bench.
On March 6, 2008, plaintiff filed a complaint in the Law Division alleging that he developed mesothelioma through the "inhalation and ingestion" of asbestos dust and particles while working as a mechanic's helper at "local auto body shops throughout Williamstown, New Jersey," and while assisting his grandfather in "extensive automotive maintenance and repair work," beginning in the early 1980s. The thirteen named defendants were alleged to have marketed asbestos-containing products for the automobile industry "which plaintiff used or [to which he] was exposed."
In his initial answers to interrogatories, plaintiff, who was born in 1975, stated he would "regularly assist neighborhood mechanics . . . repairing and replacing brakes and clutches" between 1981 and 1991. During the course of such work, plaintiff "believe[d] he worked with and around" brakes and clutches manufactured and sold by various defendants and that he "was exposed to asbestos containing brakes, clutches and gaskets . . . ."
In his answer to an interrogatory asking plaintiff to set forth a "complete history" of his employment, plaintiff asserted he worked as a cook at several restaurants; as a Manpower employee for a cereal company and a "junk mail" company; as a cabinet installer at Stanford University for a period in 2002; and as a sales associate at Home Depot. He also stated that "[f]rom time to time throughout his early childhood," he helped family members "who performed various construction side jobs including new residential home construction." Plaintiff added he "does not recall exposure to any types of fumes or dust" at any of these jobs.
During depositions commencing in 2009, plaintiff stated he had helped his uncle and cousin in the construction of two homes in the 1990s, but denied otherwise working "on a construction or demolition work site." When presented with a copy of his Home Depot employment application which stated he had worked at Hahnel and Sons Construction prior to 2003, plaintiff denied that he had ever worked there, denied knowing the telephone number for the entity's owner, Stan Hahnel, and denied he had spoken with Hahnel recently. He also denied speaking about the lawsuit with anyone other than his lawyers and his family.
Defense counsel was able to secure an affidavit of Nancy Walling, who stated that plaintiff worked for her husband, Kenneth Walling, at TLB Construction, on "many occasions." Plaintiff did roofing work, trench work, and "general labor duties on construction sites[,]" according to Walling, who also stated she knew plaintiff and was not aware that he ever worked on cars.
Telephone records revealed that plaintiff called Walling and her daughter over twenty-five times both before and after their depositions in November 2008. Thomas L. Berardi, the owner of TLB Construction, later gave a statement confirming that plaintiff had worked for his construction company in 1993. These records and the statement were secured through investigators hired by defense counsel.
In addition, Michael Massaro gave several statements pertaining to plaintiff. In an affidavit, Massaro stated he worked with plaintiff at Hahnel and Sons Construction for four or five years in the mid-1990s, and that he and plaintiff, among other things, removed asbestos roofs and asbestos siding without wearing protective respirators. In a supplemental statement, Massaro stated he grew up with plaintiff and never saw plaintiff undertake any automotive work.
Massaro also indicated in another statement that in late December 2008, plaintiff began calling him every day and urged Massaro to avoid a deposition, or to testify that he knew plaintiff worked on cars. According to Massaro, plaintiff stated he was "about to get rich" and offered to fly Massaro and his family to Florida for a vacation in which "we would not want [for] anything."
Massaro was later deposed and stated that he and plaintiff worked at Hahnel and Sons for three summers between 1992 and 1995, doing demolition work and remodeling which exposed both of them to asbestos. He also testified to the telephone conversations he had with plaintiff, noted above.
Stanley Hahnel was located and deposed. He confirmed that he had, in fact, spoken to plaintiff about the litigation. However, Hahnel testified that neither plaintiff nor Massaro had ever worked for his company.
Further, Peter Chupashko and Anthony Boyd testified that they worked with plaintiff at Mid-Atlantic Rigging and that the company had performed work at sites with asbestos. The owner of Mid-Atlantic later claimed plaintiff had not worked for him.
Trial was scheduled for September 14, 2009. However, on September 8, 2009, plaintiff's counsel at the time,*fn1 wrote to defense counsel to advise "we have recently learned that plaintiff Michael Gaskill's trial testimony will differ from his sworn testimony at his depositions, in the following manner[,]" and then listed six changes. Counsel stated that plaintiff would testify that he worked in construction for Hahnel, TLB Construction, Mid-Atlantic Roofing, Tom Berardi, and Ken Walling. He added that plaintiff would also testify he had telephone conversations with Massaro and Hahnel after the filing of suit.
Defense counsel promptly wrote to the court requesting an adjournment of the trial date, and on October 19, 2009, Judge McCormick entered an order allowing defendants to undertake additional discovery and to obtain supplemental expert reports. The order also established a date for a conference to consider "outstanding issues."
During his subsequent deposition, plaintiff admitted that he lied about his prior employment and omitted various jobs he had had because he did not want defendants "let off the hook." He further admitted lying about not communicating with Massaro and with Hahnel. After being shown phone records, plaintiff conceded that he had several telephone conversations with them at or about the time of their depositions. Plaintiff further conceded that he had spoken to the witnesses and then concealed his actions, in order to prevent defendants from contending that his asbestos exposure occurred while working for other employers.
Plaintiff also admitted concealing and lying about his work for Mid-Atlantic Rigging and others, including Kenneth Walling. Plaintiff additionally conceded that he had lied about his work history on prior job applications and lied about his prior drug treatment.
On December 23, 2009, defendants filed a joint motion to dismiss plaintiff's complaint with prejudice on the ground that plaintiff had perpetrated a fraud upon the court. On January 8, 2010, Judge McCormick stated:
So, if I take all of the facts that are uncontroverted -- I mean undisputed, which are basically the admissions that Mr. Gaskill has made about his lying, the admission that Mr. Ha[h]nel lied, is that enough in and of itself for me to conclude that the defendants have been so prejudiced that the only sanction that would uphold the integrity of the judicial system would be dismissal with prejudice? And my response to that is I'm not sure. I'm just not sure.
She thereafter decided to allow the parties to complete their discovery and submit briefs to the court.
On March 1, 2010, Judge McCormick considered the record and the arguments of the parties and found it to be undisputed that plaintiff lied about his work history and his contacts with witnesses. The judge also found that plaintiff allowed Hahnel's deposition to be presented as part of the original pretrial order, despite knowing that Hahnel had lied in the deposition when he denied that plaintiff ever worked for him. The judge added, "there is a very strong presumption that [plaintiff] did speak to Hahnel which resulted in Mr. Hahnel lying."
Judge McCormick determined that plaintiff's lies about his work history are "critical" because a plaintiff's work history is the basis for determining his asbestos exposure. The judge continued:
We have misstatements of fact and omissions of fact . . . . You have admitted [that] to me - - and I think it's true. I think the work history is material.
He did it intentionally and purposefully to prevent the defendants from learning information which at the time, . . . he thought was critical to his alternate exposures, because at the time he lied he thought something about asphalt involved asbestos exposure. So he lied to hide what he believed to be asbestos exposure.
[V]ery honestly based on the facts that I have before me that are undisputed, I have a fraud on the Court. I have a fraud on the Court. He lied in his interrogatories, he lied in his depositions, he continued to lie in his depositions.
Those lies were material because at the very least omissions, misstatements vis-a-vis work history are material.
[The] intent and purpose [was] . . .
[t]o deprive the defendants of information relevant to his asbestos exposure.
The judge thereafter concluded that she had found defendants sustained their burden of proof of a fraud upon the court by "clear and convincing" evidence and invited the parties to submit briefs on the issue of the appropriate remedy.
On March 26, 2010, the judge heard the parties' arguments on the issue, and announced her opinion from the bench on April 1, 2010. Judge McCormick opined, in pertinent part:
[T]he common definition of fraud on the court is not limited to court proceedings, orders, or any other defined procedure. Instead, "a fraud on the court occurs" - -"where it can be demonstrated, clearly and convincingly, that a party has sentiently set in motion some unconscionable scheme calculated to interfere with the judicial system's ability impartially to adjudicate a matter by improperly influencing the trier or unfairly hampering the presentation of the opposing party's claim or defense." Triffin v. Automatic Data Processing, Inc., 394 N.J. Super. 237, 251 (App. Div. 2007) (quoting Aoude v. Mobil Oil Corp., 892 F.2d 1115, 1118 (1st Cir. 1989)).
[T]his Court does not believe that the ultimate sanction of dismissal with prejudice would be upheld in New Jersey absent a showing of sufficient prejudice that would preclude the imposition of a lesser sanction.
In evaluating whether dismissal is an appropriate sanction, courts consider various factors. The Federal District Court for the District of New Jersey in Perna v. Electronic Data Systems Corp., 916 F.Supp. 388 (D.N.J. 1995), set forth factors which seem to encompass all of the factors generally followed by courts in assessing the appropriate penalty.
One, existence of extraordinary circumstances. Clearly this case involves extraordinary circumstances. . . . Plaintiff lied from the very inception of this case, commencing with his answers to interrogatories, continuing through his six days of deposition, until five days before the scheduled trial date when he recanted by way of a letter written by his attorney. His recantation precipitated the adjournment of the trial, further discovery, and the commencement of these dismissal hearings. Even now the truth is in question and may never be ascertained.
Two, presence of willfulness, bad faith or fault of the offending party and the degree of the wrongdoer's culpability. It is undisputed the Plaintiff willfully lied about his work history from the inception of this lawsuit. It also is undisputed that he lied to prevent Defendants from learning about any asbestos exposure other than that alleged in connection with the Defendants. In his own words, he didn't want the defendants to be let off the hook. He didn't want the companies he was suing to get away with what they're doing to me.
Three, the relationship or nexus between the misconduct and the matters in controversy. Without dispute, Plaintiff lied about his work history. In asbestos litigation, an accurate statement of work history is critical. It is only by investigation of a Plaintiff's work history the Defendants can learn about all of Plaintiff's asbestos exposures, an issue that is central to all asbestos cases. As a result, Plaintiff's lies about his work history have had a substantial detrimental impact on Defendants' ability to conduct discovery and ultimately prepare expert reports which are dependent upon asbestos exposure history.
Four, consideration of lesser sanction to rectify the wrong and to deter similar conduct in the future. Plaintiff argues that his lies had no impact on his history of asbestos exposure because, even now that he is telling the truth, Defendants have not been able to confirm any alternate asbestos exposure. As a result, Plaintiff argues the dismissal sanction is too extreme because Defendants already have taken any necessary additional discovery, and that, if there is to be a sanction, it should be limited to any further discovery Defendants show is necessary.
The fallacy of Plaintiff's argument is that his representation that he is now telling the truth is far from clear. He may be, but there are more than sufficient inconsistencies in his testimony, as well as that of others, to suggest that he is not.
Plaintiff has throughout this litigation exhibited a pattern of lying. He lied in his answers to interrogatories. He repeatedly lied throughout his six days of depositions, including his videotaped de bene esse deposition to be used in place of his trial testimony, if necessary.
Even third parties cannot be relied on to tell the truth, the example being Stanley Hahnel. His deposition was taken before Plaintiff's recantation. Plaintiff had lied [about] speaking to Hahnel before that deposition, a fact that he now admits was a lie. Hahnel testified that Gaskill had never worked for him and that he had't spoken to Gaskill in years. Both lies are not admitted by Gaskill.
At this point, the truth is a question mark, and this Court does not know how to now undo the web of lies and half-truths from the truth. This case is already two-years old. In order to explore all the factual inconsistencies still existing, because to take Plaintiff at his word would be beyond naive, discovery would have to be reopened and perhaps start anew.
The judge entered an order dismissing the complaint with prejudice and this appeal followed.*fn2
Plaintiff argues that Judge McCormick erred in dismissing his complaint with prejudice "based upon specious allegations of witness tampering and plaintiff's failure to disclose inconsequential evidence." In support of this argument plaintiff asserts "[his] lies were corrected" and that "[he] will certainly not lie in the future . . . ." We reject these arguments and, as noted earlier, affirm essentially for the reasons expressed by Judge McCormick. We add the following.
The concept of fraud upon the court is most often invoked as a ground for vacating a judgment alleged to have been procured by perjured testimony or the submission of falsified evidence. See, e.g., Shammas v. Shammas, 9 N.J. 321, 330 (1952) ("Perjured testimony that warrants disturbance of a final judgment must be shown by clear, convincing and satisfactory evidence to have been, not false merely, but to have been willfully and purposefully falsely given, and to have been material to the issue tried . . . ."); Gilgallon v. Bond, 279 N.J. Super. 265, 267 (App. Div. 1995). Rule 4:50-1(c) expressly authorizes a court to vacate a judgment procured through fraud, as well as "other misconduct of an adverse party." See Von Pein v. Von Pein, 268 N.J. Super. 7, 16 (App. Div. 1993) (conspiring to "hide assets and deprive defendant and the court of knowledge to the true facts" is also a ground to vacate.)
However, the concept is not restricted to an attack upon a judgment, but applies as well to any "scheme to interfere with the judicial machinery performing the task of impartial adjudication, as by preventing the opposing party from fairly presenting his case or defense." Hyland v. Kirkland, 204 N.J. Super. 345, 374 (Ch. Div. 1985) (quoting Pfizer, Inc. v. International Rectifier Corp., 538 F.2d 180, 195 (8th Cir. 1976), cert. den. 429 U.S. 1040, 97 S. Ct. 738, 50 L. Ed. 2d (1977)). In Triffin v. Automatic Data Processing, Inc., supra, 394 N.J. Super. at 251-52, we further stated:
A fraud on the court occurs "where it can be demonstrated, clearly and convincingly, that a party has sentiently set in motion some unconscionable scheme calculated to interfere with the judicial system's ability impartially to adjudicate a matter by improperly influencing the trier or unfairly hampering the presentation of the opposing party's claim or defense." Aoude v. Mobil Oil Corp., 892 F.2d 1115, 1118 (1st Cir. 1989); Perna v. Elec. Data Sys. Corp., 916 F. Supp. 388, 397 (D.N.J. 1995). Unlike common law fraud on a party, fraud on a court does not require reliance. Separate and distinct from court rules and statutes, courts possess an inherent power to sanction an individual for committing a fraud on the court. See, e.g., Chambers v. Nasco, Inc., 501 U.S. 32, 111 S. Ct. 2123, 115 L. Ed. 2d 27 (1991); Perna, supra, 916 F. Supp. at 388.
While dismissal with prejudice is a drastic remedy, to be employed "only sparingly," Zaccardi, supra, 88 N.J. at 253, it is appropriate where the discovery violation "goes to the very foundation of the cause of action, or where the refusal to [provide discovery] is deliberate and contumacious." Lang v. Morgan's Home Equip. Corp., 6 N.J. 333, 339 (1951) (citations omitted).
In United States v. Shaffer Equip. Co., 11 F.3d 450, 462-63 (4th Cir. 1993), the Fourth Circuit stated that in determining whether a trial court has abused its discretion in dismissing an action with prejudice, an appellate court must be guided by the manner in which the trial court has balanced the following factors:
(1) the degree of the wrongdoer's culpability; (2) the extent of the client's blameworthiness if the wrongful conduct is committed by its attorney, recognizing that we seldom dismiss claims against blameless clients; (3) the prejudice to the judicial process and the administration of justice; (4) the prejudice to the victim; (5) the availability of other sanctions to rectify the wrong by punishing culpable persons, compensating harmed persons, and deterring similar conduct in the future; and (6) the public interest.
See also Poulis v. State Farm Fire and Cas. Co., 747 F.2d 863, 870 (3d Cir. 1984) (Similar "factors should be weighed by the district courts in order to assure that the 'extreme' sanction of dismissal or default is reserved for the instances in which it is justly merited"). The factors identified in Shaffer Equip. Co., supra, were relied upon in Perna, supra, which had been cited with approval in Triffin v. Automatic Data Processing, Inc., supra, 394 N.J. Super. at 251-52, and thus serve as a useful guide here.
Further, in Abtrax Pharmaceuticals, Inc. v. Elkins-Sinn, Inc., 139 N.J. 499 (1995), the Supreme Court considered a circumstance analogous to the case before us. There, the plaintiff's owner had knowingly concealed records and documents relevant to its claims against defendant; testified falsely at depositions; and knowingly failed to provide documents and other information pursuant to discovery orders. The plaintiff's misconduct was revealed during the course of trial, and, after adjourning the trial to permit discovery pertaining to the misrepresentations, the trial court dismissed the complaint with prejudice pursuant to Rule 4:23-2(b), holding that the plaintiff's conduct was "clearly contumacious" and that defendants were prejudiced because they would be required to pursue discovery anew. Abtrax Pharmaceuticals, supra, 139 N.J. at 511.
The Supreme Court held that the trial court did not abuse its discretion in dismissing the plaintiff's complaint with prejudice in that circumstance. Moreover, the Court explained:
A litigant that deliberately obstructs full discovery corrupts one of the fundamental precepts of our trial practice--the assumption by the litigants and the court that all parties have made full disclosure of all relevant evidence in compliance with the discovery rules. A litigant who willfully violates that bedrock principle should not assume that the right to an adjudication on the merits of its claims will survive so blatant an infraction. Wholly apart from the prejudice caused by Abtrax's discovery violations, the conclusion is inescapable that Abtrax's failure to comply with discovery demands and orders, if undetected, would have afforded Abtrax an unfair advantage at trial, because of Abtrax's familiarity with facts and documents that had never been disclosed to Elkins. Prevention of such an unfair advantage is a basic premise of our discovery rules. On this record, we are fully satisfied that the sanction of dismissal imposed by the trial court was justified. [Id. at 521-22.]
These observations apply to the case before us as well.
Plaintiff's conduct not only is an egregious violation of our discovery rules, which are designed to eliminate "concealment and surprise in the trial of lawsuits," Oliviero v. Porter Hayden Co., 241 N.J. Super. 381, 387 (App. Div. 1990), but also is clearly and convincingly a fraud upon the court. We employ the factors identified in Shaffer Equip. Co., supra, in evaluating the conclusions of the trial court, which we review for an abuse of discretion. See Abtrax Pharmaceuticals, supra, 139 N.J. at 517. ("[T]he standard of review for dismissal of a complaint with prejudice for discovery misconduct is whether the trial court abused its discretion, a standard that cautions appellate courts not to interfere unless an injustice appears to have been done.")
In this case, plaintiff's deliberate concealment and outright lies during the discovery process richly warrant imposition of the ultimate sanction of dismissal of his complaint with prejudice. Plaintiff admitted that his deception was deliberate and that he intended to thwart discovery. Plaintiff's actions have forced defendants to undertake great efforts and incur expense to uncover his deceit; such effort, expense and delay supports defendants' claim of prejudice. The type of prejudice that will support dismissal of an action, or the striking of an answer, for abuse of discovery obligations need not be irreversible and can consist of the extra costs and repeated delays incurred in filing motions necessitated by the improper behavior on the part of a litigant. See Curtis T. Bedwell & Sons v. Int'l Fidelity Ins. Co., 843 F.2d 683, 693-94 (3d Cir. 1988).
Where fraud on the court is the underlying misconduct upon which the trial court predicates dismissal, the "prejudice" prong encompasses not only the prejudice to the litigants but also the impact on the judicial system and the threat to the integrity of the courts, which cannot command respect if they cannot maintain a level playing field amongst the participants. Derzack v. County of Allegheny, Pennsylvania, 173 F.R.D. 400, 414 (W. D. Pa. 1996). Thus, at least of equal, if not greater, importance is the public interest in preserving the integrity of the judicial system that fraud on the court serves to erode. Aoude v. Mobil Oil Corporation, 892 F.2d 1115, 1118 (1st Cir. 1989). As noted by the United States Supreme Court: tampering with the administration of justice in the manner indisputably shown here involves far more than an injury to a single litigant. It is a wrong against the institutions set up to protect and safeguard the public, institutions in which fraud cannot complacently be tolerated consistently with the good order of society. Hazel-Atlas Glass Co. v. Hartford-Empire Co., 322 U.S. 238, 246, 64 S. Ct. 997, 88 L. Ed. 1250, (1944), overruled on other grounds by Standard Oil Co. v. United States, 429 U.S. 17, 97 S. Ct. 31, 50 L. Ed. 2d 21 (1976).
Further, plaintiff has engaged in a pattern and practice of bad faith and lack of candor as well as submitting falsified material to the Court. His deceptions commenced with his first discovery responses and continued to the eve of trial. Hence, this factor favors dismissal with prejudice.
Moreover, there are no alternative sanctions which would adequately punish plaintiff for his actions. Imposing a monetary sanction on him clearly would be ineffective. Also, imposing a lesser sanction would be inadequate and hollow and would merely send the message that justice can be bought. See Aoude, supra, 892 F.2d at 1119; Pope v. Federal Express Corp., 138 F.R.D. 675, 683 (W. D. Mo. 1990) ("Permitting this lawsuit to succeed would be an open invitation to abuse the judicial process. Litigants would infer they have everything to gain, and nothing to lose, if manufactured evidence merely is excluded while their lawsuit continues. Litigants must know that the courts are not open to persons who would seek justice by fraudulent means"). Thus, this factor clearly favors dismissal.
Finally, as Judge McCormick aptly observed, the breadth of plaintiff's deceptions and lies have irretrievably obscured the truth in this case. It is naive to suggest, as plaintiff has in his brief, that he has admitted his lies and will not lie again. His deceptions and lies pierce the heart of his cause of action. Consequently, Judge McCormick properly exercised her discretion in dismissing plaintiff's complaint with prejudice.
The remainder of plaintiff's arguments are without sufficient merit to warrant discussion in a written opinion.