CHURCH OF SCIENTOLOGY FLAG SERVICE, etc., et al., Petitioners,
v.
Samuel W. WILLIAMS, O.D., et al., Respondents.
No. 95-1244.
District Court of Appeal of Florida,
Fifth District.
April 12, 1996.
Action was brought against religious institutions alleging that individuals
gave money to institutions based upon false and misleading promises. The
Circuit Court, Lake County, Jerry T. Lockett, J., compelled discovery with
regard to certain financial information. Institutions sought certiorari
review. The District Court of Appeal, Griffin, J., held that: (1) individuals
were entitled to financial worth discovery in support of punitive damages
claim, but (2) discovery ordered exceeded that which was material to prove
issue of net worth.
Writ granted.
W. Sharp, J., filed dissenting opinion.
[1] APPEAL AND ERROR
Court of Appeal was without jurisdiction to vacate order in which circuit court
refused to strike punitive damages claim, even though circuit court erred in
refusing to strike claim, where timely appellate review was not sought.
[2] PRETRIAL PROCEDURE
Plaintiffs were entitled to financial worth discovery, even though punitive
damages claim should have been stricken, where punitive damages claim remained
because timely appellate review of lower court's to strike refusal punitive
damages claim had not been sought. West's F.S.A. s 768.72.
[3] PRETRIAL PROCEDURE
Requested net worth and financial discovery exceeded that which was material to
prove net worth with regard to punitive damages claim; continued vitality of
punitive damages claim was doubtful, and discovery required disclosure of every
aspect of defendant religious institution's financial existence. West's
F.S.A. s 768.72.
[4] APPEAL AND ERROR
It is within power of Court of Appeal to intervene when lower court has abused
its broad discretion in ordering discovery, although lower court has broad
discretion in discovery matters.
[5] PRETRIAL PROCEDURE
Court should exercise special care to ensure that financial discovery sought
from religious institutions is legitimately needed for litigation.
*841 Petition for Certiorari Review of Order from the Circuit Court for
Lake County, Jerry T. Lockett, Judge.
Robert E. Johnson, of Johnson & Johnson, Tampa, and Eric M. Lieberman and
Laurence Helfer, of Rabinowitz, Boudin, Standard, Krinsky & Lieberman, P.C.,
New York City, for Petitioners, Church of Scientology FLAG Service
Organization, Inc. and Church of Scientology, Mission of San Francisco.
Peter James Hobson, Tampa, for Petitioner, The Emery Wilson Corporation.
George H. Russ, of Sellar, Sewell, Russ & Saylor, P.A., Leesburg; Peter N.
Georgiades and Andrea R. Barter, of Wile, Georgiades, Homyak & Norkus, P.C.,
Pittsburgh, PA, for Respondents, Samuel W. Williams, O.D., Janet Miller and
Williams Vihlen, O.D.'s, P.A.
GRIFFIN, Judge.
Petitioner, Church of Scientology FLAG Service Organization, Inc., seeks
certiorari review of an order below compelling discovery. Because we find the
ordered discovery impermissibly exceeds its proper scope under the
circumstances, we grant the writ.
In 1992, respondents, Samuel W. Williams, O.D., Janet Miller and Williams
Vihlen, O.D.'s, P.A., filed suit below against petitioner and two other
defendants, The Church of Scientology, Mission of San Francisco and The Emery
Wilson Corporation, claiming that they were tricked into giving money to these
defendants by false and misleading promises that, by purchasing scientifically
developed management programs, their business would be increased and
debilitating personality defects that interfered with the success of their
business and marriage would be eliminated. They alleged that they expended
more than $500,000 based on false and misleading promises. Contained in this
verified complaint was a claim for punitive damages. Served with this
complaint were interrogatories, numbering ten, and a request for production of
documents. In addition to the net worth of the petitioner, the interrogatories
requested the following:
1. State your average monthly gross income from all sources, including
business income and donations, from all sources, including, but not limited to,
partnerships, close corporations and/or independent contracts.
2. List your average monthly net income, after subtracting all ordinary and
necessary expenses required to produce said income.
3. State the average amount of income received by you by way of interest and
dividends.
4. State the average monthly amount of income received by you by way of
rental income after subtracting ordinary and necessary expenses required to
produce said income.
5. Itemize any additional average monthly income received by you, but which
is not referred to in the preceding interrogatories, after subtraction of all
ordinary and necessary expenses required to produce said income.
6. List and describe all tangible or real property owned by you, or in which
you own any interest of any nature, and indicate the approximate value of same.
7. State the amount of cash on hand or in any banks in your name alone or
joint with others.
8. Identify any stocks, bonds, notes, mortgages or other negotiable
instruments payable to you alone or joint with others, and indicate the
approximate value of same.
9. Identify any assets not previously requested in the above interrogatories,
and indicate the approximate value of same.
The request for production asked for production of all documents utilized or
reviewed in the formulation of answers to these interrogatories.
Petitioner promptly moved to strike the punitive damage claim, on the grounds
it was not properly asserted as required by section 768.72, Florida Statutes.
Also, objections to the discovery were filed on the grounds that the
information sought was not reasonably *842 calculated to lead to the
discovery of admissible evidence and that such discovery was premature under
section 768.72. Respondents then served their motion to compel but, for some
reason not clear on the record, the motion to compel was not heard until 1995.
After a hearing, the lower court ordered all the discovery in question to be
provided to respondents within ten days. Petitioner now seeks review in this
court, urging that because section 768.72 was not complied with, the discovery
should not be allowed; that such extensive discovery into the financial
records of religious institutions violates the protections of the first
amendment and, finally, the discovery ordered grossly exceeds that which is
material to prove the issue of net worth pertinent to the punitive damage
claim.
[1][2][3][4][5] As the recent decision of Globe Newspaper Co. v. King,
658 So.2d 518 (Fla.1995), makes clear, petitioner is correct that the lower
court erred in refusing to strike the punitive damage claim. However, timely
appellate review of this order was not sought in this court so this court is
without jurisdiction to vacate the order. Because the punitive damage claim
stands at this stage of the proceedings, respondents are entitled to financial
worth discovery in support of the punitive damage claim. See s 768.72, Florida
Statutes (1993). Nevertheless, we agree with petitioner that the discovery
petitioner has been ordered to provide far exceeds what is appropriate at this
stage of the proceedings to prove net worth for purposes of a punitive damage
claim. Although the lower court has broad discretion in discovery matters, it
is within the power of this court to intervene when the lower court has abused
its broad discretion in ordering discovery. Present in this case are several
factors that, standing alone, might not support certiorari; in combination,
however, we believe they do. First, the discovery ordered is relevant only on
the issue of net worth, and net worth is relevant only to a punitive damage
claim whose continued vitality under current case law is doubtful. Second, the
discovery requires the disclosure of literally every aspect of petitioner's
financial existence. Third, petitioner is a religious institution and the
court should exercise special care that such discovery is legitimately needed
for litigation, not desired for some other purpose. We do not say that such
discovery could not ultimately be ordered in this case if the record disclosed
special circumstances that would warrant it. However, given the issue on which
this discovery is sought, the nature and extent of the discovery demanded, and
the nature and relationship of the parties, this discovery should be more
narrowly drawn. Accordingly, we grant the petition for certiorari, vacate the
appealed order and remand to the lower court with directions to limit the
financial discovery of the petitioner in a manner consistent with this opinion.
WRIT GRANTED.
COBB, J., concurs.
W. SHARP, J., dissents, with opinion.
W. SHARP, Judge, dissenting.
I would deny the Church of Scientology Flag Service Organization's petition
for certiorari review of the trial court's order compelling discovery which was
adopted by Church of Scientology, Mission of San Francisco and Emery Wilson
Corporation, because the record discloses that petitioners failed to timely
raise below the grounds urged in the petition as the basis for making the
discovery sought improper. See McNatt v. City of Orlando, 526 So.2d 1022
(Fla. 5th DCA 1988). See also Allstate Insurance Co., Inc. v. Walker, 583
So.2d 356 (Fla. 4th DCA 1991); Dade County School Board v. Soler, 534 So.2d
884 (Fla. 3d DCA 1988). Further, the petitioners' argument that the trial
court erred by not granting their motion to strike the punitive damage claim is
not timely. This court should not allow petitioners to raise this issue in the
guise of seeking a protective order some two years after the trial court's
ruling, sustaining the punitive damage claim as legally sufficient.
The record discloses that petitioners objected to the first set of
interrogatories as being irrelevant to the subject matter, not reasonably
calculated to lead to the discovery of admissible evidence, and seeking
information not a proper subject matter of discovery *843 pursuant to
section 768.72, Florida Statutes. That section provides:
In any civil action, no claim for punitive damages shall be permitted unless
there is a reasonable showing by evidence in the record or proffered by the
claimant which would provide a reasonable basis for recovery of such damages.
The claimant may move to amend his complaint to assert a claim for punitive
damages as allowed by the rules of civil procedure. The rules of civil
procedure shall be liberally construed so as to allow the claimant discovery of
evidence which appears reasonably calculated to lead to admissible evidence on
the issue of punitive damages. No discovery of financial worth shall proceed
until after the pleading concerning punitive damages is permitted.
The same objections were made to the Request to Produce. However, no motion
for a protective order was filed.
Respondents filed a Motion to Compel Discovery and a hearing was held on March
28, 1995. The transcript of the hearing includes arguments on seven different
discovery matters, most involving failure of petitioners to produce documents
ordered by the court to be produced in 1993. The trial court commented
repeatedly that the arguments being made at the hearing should have been made a
long time ago. Petitioners also argued that the burden imposed by section
768.72 had not been met. However, the trial court responded that this issue
had been raised in 1993 by motions to strike or dismiss, and petitioners had
lost. Thus, that issue was foreclosed. Had petitioners thought the trial
court erred in allowing the punitive damage claim to stand, they should have
sought certiorari review in 1993. It is anomalous to now allow petitioners to
make the same argument in the guise of an objection to the scope of discovery.
See generally, Bensonhurst Drywall, Inc. v. Ledesma, 583 So.2d 1094 (Fla.
4th DCA 1991). At the end of the hearing, the trial court requested memoranda
concerning whether discovery of financial information should be allowed.
In Flag's memoranda, the argument was made for the first time that the
order sought by respondents to compel disclosure of the church's financial
affairs was overbroad. It argued that any legitimate interest in the
disclosure could be more narrowly tailored, to require at most a statement of
net worth. For the first time, Flag asked for a protective order to limit use
and disclosure of the financial information. Mission adopted Flag's
memorandum.
Florida Rule of Civil Procedure 1.340(a) provides that a party shall serve
answers or objections to interrogatories within forty-five days after service.
Likewise, rule 1.350(a) provides that a written response shall be filed to a
request to produce within forty-five days after service, which shall include
the objections and reasons therefor. In this case, the objections made below
in a timely manner were limited to claims that the discovery requested was
irrelevant, immaterial and not calculated to lead to admissible evidence, and
premature under section 768.72. The claim of being overbroad was raised for
the first time in the post-hearing memorandum, as was the request for a
protective order to limit disclosure of the information. This is two years
late.
But assuming that the objections on grounds of overbreadth were timely made,
as pointed out in First City Developments of Florida, Inc. v. Hallmark of
Hollywood Condominium Association, Inc., 545 So.2d 502 (Fla. 4th DCA 1989), an
objection to a discovery request as being overbroad or burdensome, standing
alone, is not a proper basis for granting certiorari relief. Further,
petitioners do not explain why the discovery requests are overbroad, except to
argue for protection afforded by the First Amendment. U.S. Const. Amend. I.
On the merits, I question whether the ordered discovery violates the First
Amendment of the United States Constitution. The cases relied on by
petitioners involve a government agency requiring the disclosure of membership
lists. See, e.g., Bates v. City of Little Rock, 361 U.S. 516, 80 S.Ct. 412,
4 L.Ed.2d 480 (1960); NAACP v. Alabama, 357 U.S. 449, 78 S.Ct. 1163, 2
L.Ed.2d 1488 (1958); United States v. Church of World Peace, 775 F.2d 265
(10th Cir.1985); United States v. Life Science Church of America Chapter
No. 10075, 636 F.2d 221 (8th Cir. *844 1980); United States v. Holmes,
614 F.2d 985 (5th Cir.1980); United States v. Church of Scientology of
Boston, Inc., 739 F.Supp. 46 (D.Mass.1990), affirmed, 933 F.2d 1074 (1st
Cir.1991). In this case, no government agency is involved and no membership
lists have been requested, which could have an indirect chilling effect on the
freedom of association. Respondents are seeking net and average income
figures, not disclosure of the identity of the individual contributors. Nor is
there any threat of government entanglement or interference. The only
governmental involvement is to order a response to discovery requests, which
has been held not to constitute a potential threat to the free exercise of
religion. See Ambassador College v. Geotzke, 675 F.2d 662 (5th Cir.1982),
cert. denied, 459 U.S. 862, 103 S.Ct. 138, 74 L.Ed.2d 118 (1982). See also
Roberts-Douglas v. Meares, 624 A.2d 405 (D.C.App.1992); In re The Bible
Speaks, 69 B.R. 643 (D.Mass.1987); In re Contemporary Mission, Inc., 44
B.R. 940 (D.Conn.1984); Hutchison v. Luddy, 414 Pa.Super. 138, 606 A.2d
905 (1992).
In the present case, the information sought is relevant to the punitive
damages claim and the civil action does not involve any improper governmental
entanglement or demonstrate any chilling effect on the free exercise of
religion. To sustain petitioners' position, it is necessary to carve out some
kind of blanket immunity from all discovery for religious organizations. The
majority opinion asks the trial court to limit the discovery on remand. It is
abundantly clear, however, that there are no guidelines as to how this should
be properly done. In a civil action against a church involving a secular
claim, it appears that the church stands in the same shoes as any other
litigant. To be discoverable, the matter sought to be discovered must simply
be relevant to the subject matter and not privileged. Fla.R.Civ.P. 1.280. The
discovery sought here passes both tests.
In Tennant v. Charlton, 377 So.2d 1169 (Fla.1979), the court considered the
extent of discovery to be allowed on a punitive damage claim. The court
quoted Donahue v. Hebert, 355 So.2d 1264, 1265 (Fla. 4th DCA 1978), with
approval as follows:
[It] is the height of naivete' to suggest that a sworn statement of one's net
worth must be accepted as the final word on that important subject. The search
for forgotten or hidden assets is of the essence of the discovery process....
One must be afforded reasonable latitude in double and cross checking a party's
statements about his current net worth. This, of course, can be done by
reviewing income tax returns, recent financial statements, and the myriad of
other sources of financial information.
The supreme court in Tennant did indicate that a trial court should always
be sensitive to the protection of a party from harassment and from overly
burdensome inquiry and pointed out that Florida Rule of Civil Procedure
1.280(c) provides that, for good cause shown, a protective order may be issued
to protect a party from annoyance, embarrassment, oppression, or undue burden
or expense as justice requires.
However, the petitioners in this case made no motion pursuant to rule 1.280.
In fact, there is no mention in any of the pleadings below that the discovery
requests result in annoyance, embarrassment, oppression or undue burden. At
the hearing, there was an objection made to the overburdensomeness of an
unrelated discovery request, with petitioners claiming it would take 600 hours
to obtain the material sought in the unrelated request. The trial court was
unsympathetic, noting that petitioners had two years to locate and produce the
requested documents. Regardless, no similar claim was made as to the items
challenged in this petition.
It should also be noted that respondents argue that the financial information
sought is not relevant only to the punitive damages issue. In the hearing and
respondents' memorandum filed below, it is argued that the information is
relevant to establishing a conspiracy to defraud between the petitioners based
in part on evidence of the financial interrelationships between the
organizations as shown by the discovered financial records. Therefore,
respondents contend that the discovery is relevant and allowable as to a
substantive element of their complaint.
*845 In my view, the petitioners have failed to establish that the
trial court abused its discretion in allowing and compelling the discovery
requested. The legal sufficiency of the punitive damage claim was established
at the beginning of the case, and cannot now timely be raised on certiorari
review. Only limited objections to the discovery were timely made. The
overbroad objections were not only untimely but conclusory. Further, the
request for protection from overbroad discovery and disclosure of the
information was raised for the first time in petitioners' post-hearing
memoranda. Thus, I would deny the petition of certiorari in toto.