Opinion
Nos. 63743-6-I; 63885-8-I.
October 4, 2010. UNPUBLISHED OPINION
Appeals from a judgment of the Superior Court for King County, No. 07-2-14407-2, Cheryl B. Carey, J., entered July 9, 2009.
Affirmed in part and reversed in part by unpublished opinion per Becker, J., concurred in by Dwyer, C.J., and Spearman, J.
This appeal primarily concerns RCW 4.84.260, under which attorney fees will be awarded to a plaintiff who has made a formal offer of settlement before "trial" and then recovers more than the amount offered. The "trial" in this case was a mandatory arbitration. The trial de novo that followed was an appeal. The plaintiffs made offers to settle before the trial de novo, but after the arbitration. Because these offers were not made before "trial," they did not secure the statutory right to attorney fees. The attorney fee awards are reversed. We affirm the court's decision to include the cost of future treatment in the damages awarded to plaintiff Harris.
The litigation arose from a collision on December 25, 2005. Appellant Fesseha Tilaye lost control while driving a taxi and hit a car driven by Patrick Williams. Andrea Harris and her two children were in the car with Williams. All four suffered pain and soft tissue damage and received treatment from Dr. Marisa DeLisle, a chiropractor. They filed a personal injury lawsuit alleging Tilaye's negligence.
On December 14, 2007, the superior court transferred the case to mandatory arbitration under chapter 7.06 RCW. On March 28, 2008, an arbitration award was filed in Tilaye's favor, the arbitrator having been unable to find proximate cause. The plaintiffs timely requested a trial de novo in superior court.
On May 20, 2008, Williams offered to settle for $3,900. On August 14, 2008, Harris offered to settle for $9,000. Their offers were made pursuant to RCW 4.84.280. The offers were not accepted.
The trial de novo began on May 4, 2009. The case was tried to the bench. The two children settled before trial.
After a four day trial, the court ruled in favor of Harris and Williams. The judgment for Harris was in the amount of $20,512. This included $10,000 in general damages and special damages of $10,512. The judgment for Williams was in the amount of $7,852, including $3,000 in general damages and special damages of $4,852. As the amounts awarded exceeded the amounts for which Harris and Williams had offered to settle, they moved for an award of reasonable attorney fees under RCW 4.84.260 and .280. Over Tilaye's objection that the offers of settlement should have been made before the arbitration in order to be timely, the court found both plaintiffs were prevailing parties and awarded them attorney fees under RCW 4.84.250. The award of attorney fees to Williams was $25,722. The award of attorney fees to Harris was $49,847.50.
Tilaye appeals. In addition to his argument that the attorney fee awards were unauthorized, he contends the court erred by including the cost of future treatment in the special damages awarded to Harris. Harris cross-appeals the court's denial of her request for a multiplier in the award of attorney fees. Tilaye's codefendant, taxi owner Mamuye Ayeleka — voluntarily dismissed by the plaintiffs on the first day of the trial de novo — appeals the court's refusal of his request for attorney fees as a prevailing party under RCW 4.84.250.
ATTORNEY FEES
In an action for damages where the amount pleaded by the prevailing party is $10,000 or less, the prevailing party is entitled to an award of reasonable attorney fees. RCW 4.84.250. The plaintiff shall be deemed the prevailing party when the recovery, exclusive of costs, "is as much as or more than the amount offered in settlement by the plaintiff." RCW 4.84.260. Offers of settlement must be served on the adverse party at least ten days prior to "trial." RCW 4.84.280. If the case is appealed, the prevailing party on appeal shall be considered the prevailing party for the purpose of applying RCW 4.84.250. RCW 4.84.290. The issue in this case is how to apply the above cited statutes in a case that begins with a mandatory arbitration. The answer is found in Singer v. Etherington, 57 Wn. App. 542, 547, 789 P.2d 108, 802 P.2d 133 (1990). A mandatory arbitration proceeding under chapter 7.06 RCW "is treated as the original trial" when applying RCW 4.84.290. The trial de novo is the appeal that makes RCW 4.84.290 applicable. Singer, 57 Wn. App. at 546. It follows that the arbitration is the proceeding in which the plaintiff must invoke RCW 4.84.260 in order to be deemed a prevailing party. The plaintiff can do this only by making an offer of settlement in the manner prescribed by RCW 4.84.280 — that is, at least 10 days before the arbitration that constitutes the "trial."
Harris and Williams contend that Singer is no longer good law after Malted Mousse, Inc. v. Steinmetz, 150 Wn.2d 518, 79 P.3d 1154 (2003). The court in Malted Mousse was asked to decide whether a party to a mandatory arbitration under chapter 7.06 RCW could appeal only the attorney fee portion of the arbitration award. The court's answer was no; the only way to appeal an erroneous ruling from mandatory arbitration is through a trial de novo of all the issues. Malted Mousse, 150 Wn.2d at 529. The court stated that trial de novo must be "`conducted as though no arbitration proceeding had occurred'" and that once trial de novo is granted, "the entire case begins anew." Malted Mousse, 150 Wn.2d at 528 (emphasis omitted), quoting MAR 7.2(b)(1). These statements, on which Harris and Williams rely, do not address whether a mandatory arbitration proceeding is the "trial" for purposes of the fee statutes at issue here. That issue simply was not in the case. Thus we conclude that Malted Mousse does not overturn Singer, even implicitly. To the contrary, Malted Mousse recognizes that trial de novo under chapter 7.06 RCW is an appeal.
The purposes of RCW 4.84.250.290 are to encourage out-of-court settlements, penalize parties who unjustifiably bring or resist small claims, and enable parties to pursue meritorious small claims without seeing the award swallowed up by the expense of paying an attorney. Beckmann v. Spokane Transit Auth., 107 Wn.2d 785, 788, 733 P.2d 960 (1987). Treating the arbitration proceeding as the "trial" furthers these purposes. It creates an incentive for both sides to settle before going to the considerable expense of a full arbitration hearing.
Because Harris and Williams did not comply with the statutory requirement of serving their offers of settlement 10 days before "trial," they did not successfully invoke the statutory scheme. They were not entitled to attorney fees for the "trial" before the arbitrator; they were not entitled to attorney fees for the appeal (i.e., the trial de novo) in superior court; and they are not entitled to attorney fees for their appeal in this court. This conclusion makes it unnecessary for us to address any of the other fee-related issues in the appeal by Tilaye and the cross appeal by Harris.
Ayeleka concedes that if Harris and Williams did not invoke RCW 4.84.250-.280, that statute does not authorize an award of attorney fees to him. We accept his concession and deny his appeal as well.
FUTURE TREATMENT COSTS
Tilaye also contends the court erred by allowing Dr. DeLisle to testify that Harris would continue to suffer damages in the future as a result of the collision when her opinion on this topic was not properly disclosed in answers to interrogatories.
The answers Harris provided in December 2007 stated that she had received chiropractic treatments from Dr. DeLisle for six months. Harris itemized the cost of these treatments and other related medical expenses, totaling $6,032. She said she had suffered neck, shoulder, and muscle pain as the result of the collision and these conditions had "improved very much, but did not completely heal." Asked in interrogatory 24 to state the nature, duration, and estimated cost of any future care or additional treatment that she had been advised might be necessary, Harris answered, "Dr. DeLisle recommended further treatments." At her deposition on March 6, 2008, Harris testified she had not seen Dr. DeLisle since May 24, 2006.
The discovery cutoff date was February 2, 2009. On February 24, 2009, Harris returned to Dr. DeLisle for another examination. On Wednesday, April 27, 2009, Dr. DeLisle advised counsel for Harris that based on her most recent examination of Harris, she recommended further treatment. She detailed the length of the recommended treatment and its estimated cost. Two days later, Harris filed her trial brief stating that "Harris will also request future medical expenses as the evidence will show that she needs future treatments to resolve her continuing neck and shoulder pain. Dr. DeLisle will testify at the trial to support Plaintiff's future treatment evidence." When the trial began the following week, Tilaye objected that Dr. DeLisle should not be permitted to give testimony about the future treatment because of the late disclosure. He had just been advised on the first day of trial about the examination that occurred on February 24.
The court allowed Dr. DeLisle to include the topic of future treatment in her testimony, reserving Tilaye's objection for later resolution. Dr. DeLisle described her diagnosis and treatment of Harris during the six months after the accident, ending in May 2006. At that time, she had recommended ongoing treatment for Harris to sustain the improvement in her condition, but Harris could not afford it. Harris had come back recently, in February 2009, complaining of intermittent neck pain and headaches. Dr. DeLisle testified that she reexamined Harris to determine the state of her cervical spine. In a new X-ray, she saw that the curve within Harris's neck was "fairly consistent with the last film that I did take," but she did see a change in one of the vertebrae and the growth of scar tissue, which she attributed to the fact that Harris did not continue treatment as recommended in 2006. Dr. DeLisle recommended 10 months of further chiropractic treatment, at a cost of $4,480, to resolve the neck pain and get Harris back to preaccident status.
When the court later returned to the issue of admissibility of this testimony, Tilaye argued that the evidence of future treatment costs should be excluded because Harris had failed to supplement her interrogatory answers as required by CR 26(e) once the examination in February 2009 made the original answers no longer complete. He asked the court to exclude the evidence as a willful discovery violation and unfair surprise. The court denied this request, reasoning that Tilaye should not have been surprised to hear about the need for more treatment:
In this particular case, the interrogatories indicated they did plan on calling a health-care provider. The health-care provider was the only expert that was called. There hadn't been a laundry list of other folks. No surprises there.
The health-care provider did state and indicate that Ms. Harris was going to need continuing treatment. Ms. Harris herself testified that, in fact, she had not completely healed. . . .
The court awarded Harris $4,480 in damages as the cost of future treatment. Tilaye contends the court erred in refusing to exclude Dr. DeLisle's testimony about future damages and that the remedy is to deduct $4,480 from the judgment for Harris.
"A trial court's determination regarding whether to impose discovery sanctions under CR 26 is reviewed for abuse of discretion." Harmony at Madrona Park Owners Ass'n v. Madison Harmony Dev., Inc., 143 Wn. App. 345, 360, 177 P.3d 755, review denied, 164 Wn.2d 1032 (2008). An abuse of discretion occurs if the trial court decision is manifestly unreasonable or based on untenable grounds. Mayer v. Sto Indus., Inc., 156 Wn.2d 677, 684, 132 P.3d 115 (2006).
A party must seasonably update a response to an interrogatory asking about the substance of the testimony an expert witness is expected to give. CR 26(e). The duty arises when the party obtains information upon the basis of which the party "knows that the response though correct when made is no longer true and the circumstances are such that a failure to amend the response is in substance a knowing concealment." CR 26(e)(2)(B). The duty to supplement is the duty of the party, not just her attorney, and so the fact that Harris failed to inform her attorney about her recent visit to Dr. DeLisle in February 2009 does not factor into the analysis. A violation of the discovery rules may be deemed willful or intentional if done without a reasonable excuse. Hampson v. Ramer, 47 Wn. App. 806, 812, 737 P.2d 298 (1987). Sanctions may be imposed for failure to supplement as the rule requires. CR 26(e)(4). Exclusion of evidence, though a harsh remedy, is not an abuse of discretion if the violation substantially prejudices the opponent's ability to prepare for trial. Hampson, 47 Wn. App. at 812-13. On the other hand, where substantial prejudice does not result from a failure to disclose, it is not an abuse of discretion to refuse to exclude the evidence. In re Estate of Foster, 55 Wn. App. 545, 779 P.2d 272 (1989), review denied, 114 Wn.2d 1004 (1990).
Tilaye argues that in the absence of an updated answer to interrogatory 24, he was entitled to assume Dr. DeLisle would not give testimony supporting an award of damages for future treatment. He contends he was prejudiced because when he learned the testimony would include an estimate of the costs of future treatment, it was too late to depose Dr. DeLisle on this topic and too late to retain an expert who might have been able to contradict Dr. DeLisle's findings.
There is no doubt that the failure to update answers to interrogatories concerning the anticipated testimony of an expert witness can be so prejudicial as to justify exclusion of the testimony. Cases cited by Tilaye are illustrative, including Hampson as well as Port of Seattle v. Equitable Capital Group, Inc., 127 Wn.2d 202, 209-10, 898 P.2d 275 (1995), superseded on other grounds by rule as stated in Ashley v. Hall, 138 Wn.2d 151, 978 P.2d 1055 (1999). But in this case, the trial court had a tenable basis for concluding that Tilaye was not unfairly surprised. The answers Harris gave initially put Tilaye on notice that she was not completely healed and that Dr. DeLisle recommended further treatment. The cost of the treatment Harris had already received from Dr. DeLisle indicated the likely range of any future cost. Dr. DeLisle's testimony about what she saw during the more recent visit was consistent with the information she had previously provided; it did not represent a changed diagnosis.
Tilaye's decision not to retain his own expert witness to challenge Dr. DeLisle on causation and damages was understandable given the nature of the case as a relatively small claim. But he knew future treatment was a possibility, and he fails to demonstrate convincingly that he would have made a different decision if he had been informed there was a specific estimate of $4,480 as the cost of future treatment. We conclude the trial court did not abuse its discretion in admitting and considering the challenged testimony.
The judgment awarding damages to Harris, including future damages, is affirmed. The judgments awarding attorney fees to Harris and Williams are reversed. The denial of Ayeleka's motion for attorney fees is affirmed.