### TEXA S C OU R T OF A PPEAL S, THIR D DIST R ICT , AT AU STIN

NO. 03-04-00641- CV

Ci ti Bank (S out h Da kot a) N. A. , A ppe lla nt

v. Julia A. Han ke, Appellee

F ROM THE DISTRICT CO URT OF BASTRO P COUNTY , 21ST JUDICI AL DISTRICT

NO. 24670 , HO NORAB LE JOH N L. PLACK E, JUDGE PRESIDI NG

M E M O R

A N D U M O P I N I O N
Citi B a nk (S ou th Da

ko ta ) N. A. (“ Citi B a nk ” ) a pp e a ls the tr ia l c ourt ’s dis mis sa l of its suit to collect a cr edit car d debt from Juli a A. Ha nke. CitiBan k fa i l ed to respond to a r equest for disclosure a

nd, as a result, the trial court imposed sanctions under Texas Rule of Civil Procedur e 215 for a buse of the disc overy

proce ss. The sanctions included, in addition to an attorney ’s fe es aw ard, the str iki ngof

Citi B a nk ’s ple a din g s, re su lti ngin dis mis sa l of the c a se . We a ff ir m in pa rt a nd re ve rs e
and re mand in p a rt fo r f ur the r p ro c e e din g s.
F ac tu al a nd P r oc e dur al B ac kgr ound Citi Ba nk sued Hanke , claiming nonpay ment of a cre dit c ard acc ount it had provide d to Hanke a

nd seeking$7,479.63 in damag es. Citi Ba n k fi led its origina l petition on November 4, 2003. On December 19, Hanke ’s attorney sent an email to Citi Ba nk’s attorney reque sting c redit ca rdOn appe al, Citibank also claims to have sent Ha nke its response to he r re quest for 1 disclosures bef

ore the J uly

28 sanctions hea

ring ; however , the re cord r efle cts, and Citibank’s attorney testified at the motion for new trial, that Citibank sent its response to Hanke ’s re quest for disclosures on September 2. 2 rec ords per

taining to t h e account in dispute, to which Citi Ba nk’s attorne y

did not respond. On J anuar y 16, 2004, Hanke serve d reque sts for disclosure upon CitiBa nk, which we re due Fe bruar y 18 but were never answe red. Citi Ba nk’s attorne y

claims to have r esponded, but mistakenly transmitted the re sponses to the wrongtelecopy number. CitiBank filed a motion for summary judgme nt on J une 9, 2004. On J une 10, Hanke ’s attorney emailed Citi Ba nk’s attorney to inf

orm him that Ci tibank had not responded to the January 16 reque st f

or disclosures. Hanke ’s attorne y reque sted that CitiBank withdraw its motion for summary judgme nt and t hreatened to file a moti on for sa nctions if Citi Ba

nk did no t do so . Whe n Ci tiB a nk did no t r e sp on d, Ha

nk e fi le d a

mot ion fo r s a nc tio ns un de r T e xas R ule of Civil P roce dure 215 on June 24. The he aringon the motion for sanc tions was set for July 28. Citi Ba nk did not at t en d t h e h ear ing on H anke’ s motion for sanctions. Citibank claims it was not proper ly serve d with notice of the hear ing; however , it rec eived two letters, each one attache d to a copy of Ha nke’s motion for sa

nctions, eac h one two sentenc es in le ng th, the second se ntence stating i nb o l d t h e t i m e a n d

d at e o f t h e s an ct i o n s h ea ri n g. 1 On Aug ust 3, 2004, the trial court denied CitiBank’ s motion for summary judgme nt
an d g r an te d H a n k e ’ s mo ti o n f o r s a n c ti o n s . T h e o r d e r , c it in g Ci ti B a n k ’ s f a il u r e to r e s p o n d to the reque st f or disclosure and to inf

ormal email reque sts f

or pertinent information, stru ck C i t iBa nk’s ple a din g s and a wa

rd e d a tto rn e y ’s fe e s to Ha

nk e . Th e fe e a wa

rd fo llo we d a g ra du a te d sc he du le , w ith $2 ,5 00 awa

rd e d f or re pr e se ntatio n th ro ug h th e tr ia l cou rt le ve l and $7 ,5 00 fo r e a c h le ve l of a pp e llateNo written orde r appe ars in the c lerk’s r ecor d. 2 3 revie w, in the event the c ase w as appe aled. Citibank filed a motion for ne w trial, and a hear ing w as held. At the close of t estimony , the m otion was denied. Citi Ba nk appea ls the order , challeng ing 2 (i n a sin g le iss ue ) b oth

sanc tio ns : th e fe e a wa

rd a nd the or de r s tr iki ngits ple a din g s. We s us ta in i n part a nd overr ule in part CitiBank’ s issue.
Discussion Stand ard of Review

A trial cour

t’s ru l i n g o n a mot ion for sanc tions is reviewed unde r an a buse of discretion standa

rd. Cire v. Cummings, 13 4 S. W.3 d 8 35 , 83 8 (T e x. 20 04 ); Bo dn ow C or p. v . Ci ty of Hondo , 7 21 S.W. 2d 83 9, 84 0 (T e x. 19 86 ); Downer v. Aquam arine Operators, Inc

. , 701 S.W .2d 238, 241 (Tex. 1985). The test for an a b u s e o f d i s cr eti on is not whether, in the opinion of the revie wing court, the f

acts pre sent an a

ppropriate case for the tr ial court’s a ction, b u t “whe ther the court acte d without r efe renc e to a ny g uiding rules and pr inciples.” Downer , 701 S.W. 2d a t 24 1; see als o Cir e , 1 3 4 S
. W
. 3 d a t83 9; B odnow Corp. , 7 21 S.W. 2d a t 84 0. Th e tr ia l c ourt ’s ru lin g sh ou ld be reverse d only if it was arbitrary or unre asonable
. Cir e , 1 34 S.W. 3d a t 83 9; Downer , 701 S.W .2d at 242.
Di sc ov e r y Sa nc ti ons

Texas Rule of Civil Procedur e 215.2 allows a trial court to sanc tion a party for f ailure to comply wi t h a dis cover y order or re quest. Permissible sanctions include “a n order striking out pleadings ” and an orde r re quiring the disobedient par ty to pay “re asonable expenses, includingTh e tr ia l c ourt a lso a pp e a re d to ba se its or de r fo r sa nc tio ns on Citi ba

nk ’s la c k o f r e sp on se 3 to Hanke’ s informal ema il reque st for information. Fa ilure t o respond to an informal reque st is not s an c ti o n a b le u n d e r r

ule 215. See Tex. R. C iv. P. 215.2(b) (identifying sa nctionable c onduct as fa ilu re “to com ply

wi th p ro pe r d isc ov e ry

re qu e sts or

to o be y an o rd e r t o p ro vid e or

pe rm it discovery”). H oweve r, Citibank’s failu re t o respond to Ha nke’s f ormal re quest for disclosure s independe ntly

supports the $2,500 sanction. 4 attorney fee s, cause d by

the failure ” to obey

a discove ry

order . Tex. R. C iv. P. 215.2(b). “Sanctions
are us e d to a ssu

re c omp lia

nc e wi th d isc ov e ry

a nd de te r t ho se who mi ght be te mpt e d to a bu se d is c o v e r y in th e a b s e n c e o f a d e te r

r ent.” Cire , 1 34 S.W. 3d a t 83 9; Downer , 701 S.W .2d at 242. Ho we ve r, a tr i a l c o u rt m a y n o t i mp o s e a s a n c t i o n t h a t i s m o r e s e v e r e t h a n n e c e s s a r y t o s a t i s f y its leg itimate purpose. Cir e , 1 34 S.W. 3d a t 83 9; Hamill v. Leve l , 917 S.W .2d 15, 16 (Tex. 1996). The justness of a sanc tion is measure d by two components: (1) a direc t relationship must exis t betwee n the offe nsive conduc t and the sanc tion impos ed, and ( 2) the sanc tion must not be excessive. Cir e , 13 4 S. W.3 d at 83 9; TransAmerican Natural G as Cor p. v . P owe ll , 811 S.W .2d 913, 917 (Tex. 1991).
Attor ney’s F ees

I n th is case , th e tr ia l c ourt did no t a bu se its dis c re tio n b y

a wa rd ing$2 ,5 00 in attorney ’s fe es for

repr esentation at the trial court level in c onnection with the filing and prose cution of the motion for sanc tions. Ci tiBank f ailed to comply

with a pr o p er discove ry reque st for dis c los ur e s. Al tho ug h Citib a nk c la ims to have se nt its re sp on se to the wr on g te le c op y nu mbe r, it

3 had anothe r cha

nce to r espond af

ter re ceiving Hanke ’s motion for sanctions, and did not do so. The trial court ha s d i s cr et i o n to sanction such conduc t. Tex. R . Civ. P . 215.2(b). F urthermor e, the
sanc tio n f or a tto rn e y ’s fe e s in c on ne c tio n w ithfi lin g the mot ion fo r s a nc tio ns is d ir e c tly

re la te d to the failure t o respond to the request for disclosures. The fine of $2,500 at t he trial court level was5

me ant t o a ssu

re c omp lia

nc e wi th d isc ov e ry

a nd to d e te r a

bu se of dis c ov e ry . Su c h a

fi ne c ou ld
ratio na lly have be e n tho ug ht to ind uc e Citi B a nk to a ns we r the re qu e st f or dis c los ur e s, wh ic h it

did
o nS e p t e mb e r

2 , t h i rt y d a ys a f

t e r t h e t r i a l c o u rti mp o s e d s a n c t i o n s . A d d i t i o n a l l y, $2,500 was not excessive in this case, but re asonable in light of the f act that Citibank’s lac k o f re s p o n s e for ced Hanke ’s attorney to prepa re and file a motion for sanctions and attend a hea ring for sa

nctions. See, e.g ., Martin v. Zieba , N o . 0 3

- 0 3

- 0 0 5 8 4

- C V , 2 0 0 4 T e x . A p p . L E X I S 3 7 4 2 , a t * 1 1

- 1 3 ( T e x. App.—Austin 2004, no pet.) (me m. op.) (upholding sanctions of $2,500 whe re a ppellant made

“ re pe a te d att e mpt s to sch e du le he a ri ng s on a da y that a pp e lla nt k ne w [o pp os ing ] le a d c ouns e l w ou ld be ou t of tow n” ); Eldred v. Eldred , No. 03-98-00167- CV, 1999 Tex. App. L EXI S 2570, at *5-27 (Tex. App.—Austin 1999, no pet.) (not desig nated f or publication) (upholding sanctions of $3,500 wher e appellant withheld information and ref used deposition r equests). For these rea sons , we uphold the $2,500 sanction.

Howeve r, aw ards of $7,500 “for repr esenta tion in the C ourt of Appe als,” $7,500 for

“ fi lin g a pe tit ion fo r r e vie w” by the Sup re me Court , a

nd $7 ,5 00 fo r r e pr e se ntatio n in the Sup re me Court “in t h e event a petition for re view is g rante d” we re not prope r sanc tions in t his case.

“ Al tho ug h a

tr ia l c ourt

may g ra nt a pp e llate a tto rn e y ’s fe e s a s p a rt of a sa nc tio ns or de r u

nd e r R ule 215, the court must c ondition the awa rd on the outcome of the appea l.” In re Ford M otor Co. , 988 S.W. 2d 71 4, 72 1 ( Te x. 19 98 ). “ An un c on dit ion a l awa

rd of a pp e llate a tto rn e y ’s fe e s . . . un jus tly penalizes a pa

rty for se eking mandamus re lief fr om the trial court' s sanction orde r.” Id. I n this case, the tr ia l c ourt

did no t c on dit ion

the $7 ,5 00 sanc tio ns on

the ou tc ome of

the a pp e a l. T he c ourt

sim ply
or de re d Ci tiB a nk

a nd its a tto rn e y

“ to p a y , jo int ly

a nd se verall y , [H a nk e ’s ] at tor ne y ’s fe e s in6

connec tion with the filing and prosecution of the motion.” Unc onditional fines for a ppealing the trial court’s order dismiss ing the case are not sa nctions desig ned to a ssure c ompliance with discove ry or deter abuse of discovery . “Such an a

war d in no way relates to the harm suffe red as a r esult of the alleg ed discove ry

abuse a nd serve s only

as an imprope r dete rr en t to appellate r eview of the underlying sa

nction order .” Id . The $7,500 fine s in this ca s e were mea nt to deter CitiBank f

rom purs uin g its ri g ht t o a

pp e a l, n ot t o a ssu

re c omp lia

nc e wi th d isc ov e ry . T he tr ial cou rt abu se d it s discretion by imposing unconditional sanctions trig g ere d by the appea l of its ruling; ac cording ly , we
reve rse e a c h a w a r d

o f $ 7 , 5 0 0 in

s a n c ti o n s . We tu

r n n o w to th e s a n c ti o n th a t s tr u c k Ci ti Ba nk’s ple a din g s.
“D e at h P e nal ty ” Sa nc ti ons

Case-de terminative discove ry sanctions, such as an order striking pleading s, may not be imp os e d “ un le ss a

pa rt y ’s hind ranc e of

the dis c ov e ry

pr oc e ss j us tif

ie s a pr e su mpt ion

tha t it s claims or def

enses lac k m erit.” TransAmerican , 811 S.W .2d at 917. Such sanc tions are r eser ved for “ ‘exceptional ca ses’ whe re t h ey are ‘cle arly justified’ and it is ‘fully appar ent that no lesser sanction s wo u l d promote complianc e with the rule s.’” Cir e , 1 3 4 S
. W
. 3 d at 8 4 1 (q u o t i n g GTE Communications Sys. Corp. v. Tanner , 856 S.W .2d 725, 729-30 (Te x . 1993)). Thus, “ the trial cour t [mus t] c on sid e r t

he a va ila bil ity of le ss s tr ing e nt s a nc tio ns , a nd in a ll but the mos t e xce pti on a l c a se s, actua lly test the lesser sa

nctions befor e striking the pleading s.” Cir e , 134 S.W .3d at 8 4 1
. When consideringless er sa

nctions, the “trial c ourt must analy ze the available sanctions and of fer a
rea soned explanation as to the appr opriatene ss of the sanc tion impos ed.” Id a t 84 2; se e als o G TE , 856 S.W .2d at 729.7 B a se d o n th e se pr inc ipl e s, we wi ll r e ve rs e the or de r s tr iki ngCiti B a nk ’s ple a din g s. The re cord c ontains no indication that the trial cour t considere d l es s er s anctions, which alone constitutes gr ounds for re versa l. Se e Cir e , 134 S.W .3d at 841

. Nor doe s t h e trial court’s orde r
a tte mpt to j us tif y the a pp ro pr ia te ne ss o f s tr iki ngCiti B a nk ’s ple a din g s. W hi le the or de r r e fe rs to
cer tain behavior

by Citi Ba nk in suppor

t of the sanc tions, it contains no re asoned e x planation of the
a pp ro pr ia te ne ss, ba se d o n th a t be havio r, of de ath p e na lty

sa nc tio ns . F ur the rm or e , th e tr ia l c ourt

did no t te st le sse r sa

nc tio ns . E ve n v ie wi ngthe re c or d in the light most favor able to Ha nke, the discovery abuses in this case do not justi fy striking CitiBank’ s ple a din g s a s a

fi rs t me a sure . T hat is , fai li ngto a ns we r a re qu e st f or dis c los ur e , w hil e punis ha ble litigation m isconduct, i s not so abusive as to place this ca se into the exceptional categ ory of ca ses fo r wh ic h de a th pe na lty sanc tio ns may be imp os e d wi tho ut a c tua lly te sti ngles ser sanct ion s. Com pa re Spohn Hosp. v. May er , 104 S.W .3d 878, 880-83 (Tex
. 2003) (holding sanctions dee ming
c e rt a in k e y

fa c ts as tr ue to b e too se ve re wh e re de fe nd a nt r e fu se d to pr od uc e wi tne ss s ta te me nts un til
on e mon th b e fo re tr ia l) ; Chrysler Corp. v. Blackm on , 841 S.W .2d 844, 845-53 (Te x . 1992) (holding death pe nalty

sanctions t hat were gra

nted wit hout lesser sanctions first being tested to be too seve re wher e Chry sler ref

used to pr oduce c rash- test repor ts that were repe atedly

reque sted by

plaintiffs); TransAmerican , 811 S.W .2d 913, 915-19 (holding death pe nalty sanctions, imposed wher e company ’s pre sident repe atedly ref used to schedule and then f ailed to appe ar for deposition, to be too se ve re and wi tho ut dir e c t re la tio ns hip to the mis c on du c t) ; and Fl e tc he r v . B lai r , 874 S.W .2d 83, 84 -8 6 (T e x. Ap p. —A us tin 19 94 , wr it de nie d) (h old ing de a th pe na lty sa nc tio ns le vi ed agai nst pla int if f f or fa lse state me nts duri ngdis c ov e ry re la tin g to h e r d a ma g e s to be too se ve re ); with Cire,8

134 S.W .3d 835, 837-43 (upholding death penalty sanctions that wer e imposed in the first instance wher e plaintiff destroy ed evidenc e containing “the hear t of the proof neede d” to def end cla ims; such conduct justified the pr esumption that plaintiff’s claims lacke d merit).
Conclusion Be cause the t rial court abused its discretion by striking the plaintiff’s plea dings, w e
reve rse the dismissal of the c ase a nd rema nd for f urther pr ocee dings. The $7,500 s an ct i o n s for appea ling the c ase a

re likew ise reve rsed. The sanction aw arding $ 2 ,500 in attorney ’s fe es for repr esentation at the trial court leve l is affirmed.

W. Kenneth L aw, Chief Justice Be fore Chief J ustice L aw, Justi ces Patter son and Pury ear : Opinion by Chief J ustice L aw; ConcurringOpinion by

J ustice Patterson Affir med in Part; Reverse d and Remande d in Part Filed: Apr il 14, 2006