Friday, July 29, 2016

Notes: CR 36.01 and 37.03 - Rumpel v. Rumpel 438 SW 3d 354, (Ky 2014)

 The trial court found that Kaven violated CR 36.01. That rule permits one party to request another party to admit "the truth of any matters within the scope of Rule 26.02 [the rule defining what is discoverable]." Under the rule, the party receiving the request must, in a timely manner, either admit the matter asserted, deny it, or object to the request. The purpose of the rule is to streamline the litigation by eliminating from controversy factual matters that will not be disputed at trial. Thompson v. King Feed & Nutrition Service, Inc., 153 Wash.2d 447, 105 P.3d 378, 390 (2005) (discussing Washington's virtually identical rule); Dobos v. Ingersoll, 9 P.3d 1020, 1028 (Alaska 2000) (discussing Alaska's version of the rule).

Under CR 37.03, an improper failure to admit the matter asserted, if the requesting party thereafter proves the truth of it, authorizes the trial court, upon the requesting party's application, to order "the other party to pay him [the requesting party] the reasonable expenses incurred in making that proof, including reasonable attorney's fee."[2] CR 37.03 thus provides an exception to the American Rule against the shifting of fees. Because CR 36 and CR 37.03 apply to civil proceedings generally, the fee shifting they allow is potentially of far-reaching effect. Indeed, if under those rules a party could obtain a fee award merely by requesting prior to trial that a disputed fact be admitted and then, if the fact were denied, prevailing on the dispute at trial, prevailing parties would be routinely entitled to fee awards, and our approach to fee shifting would be turned on its head. Cf. Piney Meeting House Investments, Inc. v. Hart, 284 Va. 187, 726 S.E.2d 319 (2012) (disallowing under Virginia's version of CR 37 a request intended merely to subvert the American Rule).

That clearly is not the intent of the rules allowing for fee sanctions. See Bell, 423 S.W.3d at 742 (noting that rules allowing for fees as a sanction must be narrowly construed precisely to prevent this sort of subversion of the American Rule). On the contrary, CR 37.03 provides that, even if the requesting party proves the truth of a matter concerning which an admission was requested and denied, a fee sanction is not appropriate if

    (a) the request was held objectionable pursuant to Rule 36.01, or

    (b) the admission sought was of no substantial importance, or

    (c) the party failing to admit had reasonable ground to believe that he might prevail on the matter, or

    (d) there was other good reason for the failure to admit.

CR 37.03.

The rule does not require, in other words, that a party admit a genuinely disputed fact or risk having to pay fees should the fact-finder ultimately decide the dispute against him. Prevailing at trial, although necessary to invoke the rule, is not the sole issue. The main issue under the rule, rather, is whether the party denying a request for admission acted reasonably in believing that he might prevail, or had some other legitimate reason for making the denial. We review a trial court's grant or denial of discovery sanctions, including fee awards, for abuse of discretion, Turner v. Andrew, 413 S.W.3d 272 (Ky.2013), and we agree with Kaven that the trial court abused its discretion here by failing to consider whether Kaven's denials of Kathie's requests for admission were justified.
 Rumpel v. Rumpel 438 SW 3d 354, (Ky 2014)

Tom Fox, J. D.
Southern Specialty Law Publishing Company
Louisville, Kentucky

A division of Accountable Kentucky Incorporated
a Kentucky Non-profit corporation

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This is not legal advice and I am not a lawyer.

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