NO. 85-271
IN THE SUPREME COURT OF THE STATE OF MONTANA
1985
FIRST BANK (N.A. ) -BILLINGS
Plaintiff and Respondent,
JIMMY RAY HEIDEMA, Personal Representative
of the estate of Louis Heidema, et al.,
Defendants and Appellants.
APPEAL FROM: District Court of the Thirteenth Judicial District,
In and for the County of Yellowstone,
The Honorable Charles Luedke, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Jimmy Ray & Leilla May Heidema, pro se, Sheperd,
Montana
Agnes Heidema, pro se, Billings, Montana
Louis J. Heidema, pro se, Billings, Montana
Judith Gail Heidema, pro se, Billings, Montana
For Respondent :
AP.c.,
Moulton, Bellingham, Longo & Mather;~GregoryG.
Murphy, Billings, Montana
Submitted on Briefs: Oct. 24, 1985
Decided: January 7, 1986
Filed:
f ~ #
Clerk
Mr. Justice John Conway Harrison delivered the Opinion of the
Court.
This is an appeal from an order of the District Court
of the Thirteenth Judicial District, the Honorable Charles
Luedke presiding, in and. for Yellowstone County, Montana,
awarding plaintiff certain sums of principal and interest
owing on a note, and ordering defendant to pay plaintiff's
attorney fees and costs. We affirm.
Louis and Agnes Heidema, husband and wife, had been
customers of First Bank (N.A.)-Billings (Bank) since the
mid-1950's. Their loans had been administered by various
lending officers. One loan taken out prior to 1976 was
criticized by the bank examiner. In order to give additional
substance to the loan and get it off the classified list, the
Bank applied for and received a loan guarantee from the
Farmers Home Administration (FHA). Subsequently First Bank
loaned the Heidemas $350,000 on which they were to make an
annual $50,000 payment, plus accrued interest. Heidemas fell
behind in repaying the loan. The Bank made repeated efforts
to assist them in working out a plan for reducing their debt,
to no avail. Frequent letters from agricultural loan officer
Ralph Stenehjem detailing the precariousness of their
financial situation were ignored. At one point the Bank even
refunded some $9,000 interest Heidema believed he had been
overcharged. When the complaint was filed Heidemas had at
least two notes outstanding, including the one guaranteed by
FHA.
This case is one of delay and avoidance by Heidemas.
The complaint was filed and a writ of attachment issued in
June, 1982, against the defendants d/b/a Heidema Partnership.
Counsel in Billings, Montana, appeared for the partnership by
motion t o a l t e r o r amend an o r d e r o f a t t a c h m e n t . Three weeks
Later counsel again appeared on behalf of the named
d e f e n d a n t s by a motion t o dismiss for failure t o state a
claim. Defendants d i d n o t f i l e a b r i e f i n support of the
motion and p u r s u a n t t o Rule 5 o f t h e Rules o f t h e D i s t r i c t
Court o f the Thirteenth Judicial District, t h e motion was
denied. Louis Heidema died in July 1982, and Jimmy Ray
Heidema was a p p o i n t e d p e r s o n a l r e p r e s e n t a t i v e o f t h e e s t a t e .
The Bank moved to substitute the estate for the deceased
defendant. Thereafter, in 1982 and 1983, the parties
exchanged w r i t t e n d i s c o v e r y .
In September, 1982, defendants moved to substitute
counsel. Soon a f t e r , Heidemas' new c o u n s e l f i l e d an answer
on behalf of all defendants. First Bank requested a
pre-trial or t r i a l setting. A pre-trial c o n f e r e n c e and t r i a l
were scheduled. Heidemas took depositions of two bank
o f f i c i a l s and t h e n moved f o r c o n t i n u a n c e o f t h e t r i a l . After
being fired, Heidemas' new counsel moved to withdraw as
counsel. The t r i a l d a t e was c o n t i n u e d . The c o u r t a d v i s e d
Jimmy Ray Heidema to seek counsel and that it would not
a c c e p t f u r t h e r d e l a y by r e a s o n o f f a i l u r e t o o b t a i n c o u n s e l .
T h e r e a f t e r Heidemas f i l e d a f l u r r y o f p r o se motions.
The court allowed them to file an amended answer and a
counterclaim, but denied a request f o r a j u r y t r i a l on t h e
grounds t h e y had waived t h e r i g h t by f a i l i n g t o demand a j u r y
trial within the time allotted by Rule 38(b) and (d),
M.R.Civ.P. Heidemas appealed the denial and the Supreme
C o u r t d i s m i s s e d t h e a p p e a l on t h e grounds t h e o r d e r was n o t
an a p p e a l a b l e o r d e r .
The record is replete with examples of Heidemas'
failure to appear for timely noticed depositions. They
failed to appear at a hearing on the Bank's motion to compel
production of documents. Twice they failed to appear at a
hearing on a motion to take depositions, they did not appear
for the depositions, nor did they produce any documents.
This despite court orders directing them to appear. They
also failed to appear at the Bank's deposition of loan
officer Ralph Stenehjem.
When the Bank served notice on the Heidemas that it
intended to move for entry of judgment at the pre-trial
hearing, none of the Heidemas appeared at the hearing to
contest the motion. Their absence made it impossible to work
out a pre-trial order and make other arrangements for tria.1.
The District Court entered a judgment in favor of First Bank
and Heidemas appeal.
Although Heidemas assert some nine issues for review by
this Court, the only genuine issue is whether the District
Court abused its discretion in entering judgment in favor of
First Bank. We find it did not. In fact, the court showed
inordinate patience, and a refusal to act would have
prejudiced the rights of First Bank.
Resolution of the issue depends on the application of
Rule 37(b), (c) and (d), M.R.Civ.P. Rule 37 (d) gives the
court the power to enter an order of judgment if a party
fails to attend his own deposition or to produce documents.
Rule 37(b) and (c) gives the court the discretionary power to
enter an order of judgment when a party refuses to comply
with court orders directing responses to discovery. Heidemas
refused to attend their own deposition, refused to produce
documents, and ignored court orders directing them to comply.
This Court's attitude towards dilatory discover tactics
is unequivocal:
In adopting a position that dilatory
discovery actions are no longer to be
dealt with leniently, we are in accord
with the recent trend of cases intent
upon punishing transgressors rather than
patiently trying to encourage their
cooperation ... When litigants use
willful delay, evasive responses, and
disregard of court direction as part and
parcel of their trial strategy, they must
suffer the consequences.
Owen v. F.A. Buttrey (Mont. 1981), 627 P.2d 1233, 1235, 1236,
The emerging standards for willfullness in the Ninth
Circuit should dispel1 any reluctance on the part of trial
judges to apply sanctions.
Where it is determined that counsel or a
party has acted willfully or in bad faith
in failing to comply with rules of
discovery or with court orders enforcing
the rules or in flagrant disregard of
those rules or order, it is within the
discretion of the trial court to dismiss
the action or to render judgment by
default against the party responsible for
the default. ..
Litigants who are
willful in halting the discovery process
act in opposition to the authority of the
court and cause impermissible prejudice
to their opponents. It is even more
important to note, in this era of crowded
dockets, that they also deprive other
litigants of an opportunity to use the
courts as a serious dispute-settlement
mechanism.
G-K Properties v. Redevelopment Agency, Etc. (9th Cir. 1978),
While we are predisposed to give pro se litigants
considerable latitude in proceedings, that latitute cannot be
so wide as to prejudice the other party, as happened in the
case at bar. To do so makes a mockery of the judicial system
and denys other litigants access to the judicial process. It
is reasonable to expect all litigants, including those acting
pro set to adhere to the procedural rules. But flexi-bility
cannot give way to abuse. We stand firm in our expectation
that the lower courts hold all parties litigant to procedural
standards which do not result in prejudice to either party.
The judgment ordered by the lower court in this case was well
within the boundaries of its discretion and it is affirmed.