Court Opinion

ID: 4027265
Source: CourtListenerOpinion
Date Created: 2016-08-22 21:07:04.49585+00
Date Added: 2024-06-11T14:34:19.025648
License: Public Domain

This opinion will be unpublished and
                           may not be cited except as provided by
                           Minn. Stat. § 480A.08, subd. 3 (2014).

                                STATE OF MINNESOTA
                                IN COURT OF APPEALS
                                      A15-1886

           Mohrman, Kaardal & Erickson, P. A., f/k/a Mohrman & Kaardal, P. A.,
                                     Respondent,

                                              vs.

                                      Gene Rechtzigel,
                                        Appellant,

                       Gene Rechtzigel as Personal Representative for
         Estate of Frank H. Rechtzigel and as Trustee of any Trust thereunder, et al.,
                                        Defendants.

                                   Filed August 22, 2016
                                         Affirmed
                                       Hooten, Judge

                                Dakota County District Court
                                File No. 19HA-CV-13-4181

William F. Mohrman, James R. Magnuson, Mohrman, Kaardal & Erickson, P.A.,
Minneapolis, Minnesota (for respondent)

Gene Rechtzigel, Apple Valley, Minnesota (pro se appellant)

         Considered and decided by Jesson, Presiding Judge; Halbrooks, Judge; and Hooten,

Judge.
                         UNPUBLISHED OPINION

HOOTEN, Judge

       Pro se appellant challenges the district court’s final contempt order arising out of

appellant’s failure to comply with post-judgment discovery requests. We affirm.

                                         FACTS

       From 2000 to 2013, respondent Mohrman, Kaardal & Erickson, P.A., provided legal

services to appellant Gene Rechtzigel in a range of matters. Mohrman & Kaardal, P.A. v.

Rechtzigel, No. A14-1499, 2015 WL 4714883, at *1 (Minn. App. Aug. 10, 2015), review

denied (Minn. Oct. 28, 2015), cert. denied, 136 S. Ct. 1468 (2016). In October 2013,

respondent sued appellant and other defendants after they failed to pay attorney fees for

services rendered, alleging claims of breach of contract, unjust enrichment, account stated,

and attorney lien for compensation. Id. at *2. In May 2014, the district court granted

respondent’s motion for summary judgment on the account stated and breach of contract

claims. See id. at *4. The district court entered judgments against appellant and his

codefendants in amounts totaling $184,890.99 plus interest. On appeal, this court affirmed

the district court’s grant of summary judgment. Id. at *5–7. Both the Minnesota Supreme

Court and the United States Supreme Court denied review.

       On January 14, 2015, respondent served appellant with post-judgment discovery

requests related to the May 2014 judgments.          Specifically, respondent sought full

disclosure of the assets of appellant and the other judgment debtors so that respondent

could collect on its judgments.     After appellant did not comply with the requests,

respondent moved to compel post-judgment discovery, and the district court granted the

                                             2
motion. Appellant still did not respond to respondent’s discovery requests, and respondent

moved for an order to show cause. The district court held a hearing on respondent’s

discovery motion, and on August 20, 2015, the district court filed an order holding

appellant in contempt of court for his failure to respond. On September 4, 2015, appellant

served upon respondent his response to the discovery requests, which consisted of

objections generally based upon the Constitution, including the Fifth Amendment

privilege.

       Respondent subsequently moved to enforce the August 20, 2015 contempt order,

and the district court conducted a hearing on respondent’s motion. At the hearing,

appellant did not elaborate on the basis of his Fifth Amendment objection to respondent’s

discovery requests other than to state that it involved an incident in which respondent

previously represented him and his co-defendants. On September 28, 2015, the district

court filed an order, finding that appellant’s objections to the post-judgment discovery were

untimely and without merit and ordering appellant to respond to the requests by October

2, 2015. However, the district court indicated that it would stay appellant’s obligation to

comply with post-judgment discovery if appellant posted “a supersedeas bond in the

amount of 120% of the original judgment . . . in a form acceptable to [respondent] and filed

[it] with the [c]ourt.” On October 9, 2015, respondent’s attorney filed an affidavit, stating

that appellant had not provided the discovery and had not posted a supersedeas bond.

       On October 21, 2015, the district court conducted an order to show cause hearing.

Appellant declined to provide sworn testimony as to his alleged inability to comply with

the discovery orders, although he offered the testimony of a witness who claimed that

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appellant was having problems with receiving mail. The district court filed a final

contempt order the same day, finding that appellant “ha[d] not complied with the

[c]ontempt [o]rder requiring that he produce responses to [respondent’s] discovery requests

and that he had the ability to do so.” The district court also found that incarceration was

likely to produce compliance with the contempt order. The district court ordered appellant

to be incarcerated for up to 180 days due to his failure to comply with the August 20, 2015

contempt order, unless he met one of the following purge conditions:

                      a. [Respondent’s] notification to the [c]ourt that
              [appellant] has fully responded to [respondent’s] discovery
              requests. Fully responding for purposes of purging this [o]rder
              for [c]ontempt means full disclosure of the assets of each of the
              [j]udgment [d]ebtors, which includes, without limitation,
              disclosure of . . . bank account numbers, locations of
              investment accounts, addresses and legal descriptions of all
              real property and descriptions of all personal property with a
              purchase price in excess of three thousand dollars and
              production of all of the documents in the possession or control
              of [j]udgment [d]ebtors associated with these assets, including,
              but not limited to, lease agreements for all real property any
              [j]udgment [d]ebtor owns; or
                      b. Posting a supersedeas bond in the amount of 120% of
              the original judgment amount; or
                      c. Posting a cashier’s check payable to the Dakota
              County Court Administrator in the sum of 120% of the original
              judgment amount which will be held pending [appellant’s]
              appeal to the Minnesota Supreme Court; or
              d. Full satisfaction of the judgment[s].

       Appellant filed this appeal on November 20, 2015. This court subsequently issued

a special term order clarifying that the appeal is limited to the contempt proceedings.

Respondents moved to dismiss the appeal, arguing that the appeal is moot because

appellant purged the contempt and was released from custody and that the appeal is

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palpably frivolous and without merit. 1 This court issued a special term order denying the

motion to dismiss on the basis that an involuntary purging of contempt generally does not

prohibit a party from appealing the order.

                                     DECISION

       Appellant raises several challenges to the contempt proceedings as well as to the

underlying May 2014 judgment.

Appellant’s challenges to the May 2014 judgment are not properly before this court.

       Appellant asks this court to review “in the interests of justice” the district court’s

May 2014 grant of summary judgment on behalf of respondent. But, we have already

reviewed this judgment, and petitions for review to the Minnesota Supreme Court and the

United States Supreme Court have been denied. Moreover, our first special term order

clarified that only the contempt proceedings are within the scope of this appeal.

       Appellant argues that the district court lacked subject matter jurisdiction to compel

post-judgment discovery and to hold him in contempt, but this argument also relates to the

May 2014 judgment. We note that, as a court of general jurisdiction, the district court had

subject matter jurisdiction over respondent’s account stated and breach of contract and

claims. See Anderson v. County of Lyon, 784 N.W.2d 77, 80 (Minn. App. 2010) (“A district

court is a court of general jurisdiction that has, with limited exceptions, the power to hear

all types of civil cases.”), review denied (Minn. Aug. 24, 2010). Because the district court

1
 In a December 30, 2015 order, the district court stated that appellant had “purged the
contempt and secured his release from the contempt sentence by posting the sum of
$256,000.00 with the Dakota County Court Administrator.” In the same order, the district
court granted respondent’s request to release the funds in order to satisfy the judgments.

                                             5
had subject matter jurisdiction over the underlying claims, it also had subject matter

jurisdiction over the post-judgment discovery proceedings in order for respondent to

enforce its judgment against appellant and his codefendants.

Respondent did not waive its right to post-judgment discovery.

       Appellant argues that, by “us[ing] unripe summary judgment to deny appellant the

right to discovery,” respondent waived its right to post-judgment discovery.            But,

respondent’s right to post-judgment discovery has nothing to do with the fact that

respondent moved for summary judgment in the underlying action or that appellant did not

conduct discovery in the underlying action. See Minn. R. Civ. P. 69 (providing that

judgment creditor may obtain post-judgment discovery “[i]n aid of the judgment or

execution”). Appellant also claims that he and his codefendants “were denied sufficient

time for discovery,” but this is yet another collateral attack on the May 2014 judgment and

is thus not within the scope of this appeal.

Appellant has not shown that respondent’s post-judgment discovery request violated
Minn. R. Civ. P. 69.

       Appellant argues that the proceedings are “null and void” because respondent served

its post-judgment discovery request upon appellant and his codefendants before the

judgments were docketed, in violation of Minn. R. Civ. P. 69. But, nothing in the text of

the rule mandates that post-judgment discovery is void if conducted prior to the docketing

of a judgment. See Minn. R. Civ. P. 69 (“In aid of the judgment or execution, the judgment

creditor, or successor in interest when that interest appears of record, may obtain discovery

from any person, including the judgment debtor, in the manner provided by these rules.”).

                                               6
And, appellant has cited no Minnesota case providing that post-judgment discovery is void

prior to docketing of a judgment. In the absence of any controlling authority, we reject

appellant’s claim. See Midway Ctr. Assocs. v. Midway Ctr. Inc., 306 Minn. 352, 356, 237
N.W.2d 76, 78 (1975) (“[T]he burden of showing error rests upon the one who relies upon

it.”).

The district court did not abuse its discretion by awarding respondent $1,500 in
attorney fees in the August 20, 2015 contempt order.

         Appellant argues that the district court abused its discretion by awarding respondent

attorney fees totaling $1,500 in its August 20, 2015 order. The district court had previously

awarded respondent $750 in attorney fees in its May 11, 2015 order granting respondent’s

motion to compel post-judgment discovery and awarded respondent an additional $750 in

attorney fees in the August 20, 2015 contempt order. We review an award of attorney fees

for an abuse of discretion. County of Scott v. Johnston, 841 N.W.2d 357, 361 (Minn. App.

2013).

         The district court did not abuse its discretion by awarding respondent $750 in

attorney fees in connection with the motion to compel. Under the rules of civil procedure,

if a motion to compel discovery is granted, the district court “shall, after affording an

opportunity to be heard, require the party . . . whose conduct necessitated the motion . . . to

pay to the moving party the reasonable expenses incurred in making the motion, including

attorney fees.” Minn. R. Civ. P. 37.01(d)(1); see Bowman v. Bowman, 493 N.W.2d 141,

143, 145 (Minn. App. 1992) (holding attorney fee award was justified under rule 37.01

where appellant was held in contempt of court due to witness’s failure to testify at

                                               7
deposition and produce documents). Because appellant’s conduct of failing to respond to

respondent’s post-judgment discovery request necessitated respondent’s motion to compel,

an attorney fee award is appropriate. In its motion to compel, respondent requested $750

in attorney fees. We conclude that, under these circumstances, this award is reasonable.

       In its proposed order for contempt, respondent requested an additional $750 in

attorney fees, and the district court awarded respondent fees in this amount in the August

20, 2015 order. Minn. Stat. § 588.11 (2014) provides:

                     If any actual loss or injury to a party in an action or
              special proceeding, prejudicial to the person’s right therein, is
              caused by such contempt, the court or officer, in addition to the
              fine or imprisonment imposed therefor, may order the person
              guilty of the contempt to pay the party aggrieved a sum of
              money sufficient to indemnify the party and satisfy the party’s
              costs and expenses, including a reasonable attorney’s fee
              incurred in the prosecution of such contempt, which order, and
              the acceptance of money thereunder, shall be a bar to an action
              for such loss and injury.

Three factors must be satisfied to sustain an award of attorney fees under section 588.11:

“First, the fees must be based on proof of actual damages. Second, the award must not

penalize the contemnor. Finally, the party receiving the fees must actually incur the fees.”

Hanson v. Thom, 636 N.W.2d 591, 593 (Minn. App. 2001) (citations omitted).

       Applying the factors from Hanson, we conclude that the district court did not abuse

its discretion by ordering this additional attorney fee award. The record contains evidence

of the hourly rate of respondent’s counsel from the underlying proceeding, and the district

court was aware of this evidence. The award does not penalize appellant, and respondent

clearly incurred attorney fees by bringing its motion to show cause and by having counsel

                                             8
appear at the order to show cause hearing. We conclude that, on this record, the district

court’s award of an additional $750 is reasonable.

Contempt was an available remedy.

       Appellant argues that respondent’s only available remedy to collect on its judgments

was execution, not contempt, citing Minn. Stat. § 550.02 (2014), which provides:

                     Where a judgment requires the payment of money, or
              the delivery of real or personal property, it may be enforced in
              those respects by execution. Where it requires the performance
              of any other act, a certified copy of the judgment may be served
              upon the party against whom it is given, or the person or officer
              who is required thereby or by law to obey the same. A person
              so served who refuses may be punished by the court as for
              contempt, and the individual’s obedience thereto enforced.

Section 550.02 gives the district court the authority to hold a person in contempt for failing

to comply with a non-money judgment. But, appellant has cited no relevant authority

indicating that this statute prevents a district court from exercising its inherent contempt

powers in cases, such as this one, involving the failure to comply with post-judgment

discovery that the district court orders in connection with a money judgment. See State by

Johnson v. Sports & Health Club, Inc., 392 N.W.2d 329, 336 (Minn. App. 1986) (“The

power to punish for contempt is an inherent power of constitutionally created courts in

Minnesota.”), review denied (Minn. Sept. 24, 1986); see also Erickson v. Erickson, 385
N.W.2d 301, 304 (Minn. 1986) (“The purpose of the contempt power is to provide the

[district] court with the means to enforce its orders. This power gives the [district] court

inherently broad discretion to hold an individual in contempt but only where the contemnor

has acted contumaciously, in bad faith, and out of disrespect for the judicial process.”

                                              9
(quotation and citation omitted)).     Appellant has not shown that contempt was an

unavailable remedy.

The district court held appellant in civil, not criminal, contempt.

       Appellant argues that the district court improperly imprisoned him for debt and that

the district court held him in criminal contempt. These contentions are without merit. First,

appellant was not imprisoned for debt; he was jailed for not complying with the August 20,

2015 contempt order. As the district court stated during a September 2015 hearing, “[T]he

contempt isn’t because you haven’t paid the judgment. . . . The contempt has to do with

the fact that you failed to produce the discovery requested.”

       Second, as to the nature of the contempt, appellate courts look to the district court’s

“purpose in sanctioning the contemnor” to determine whether contempt is civil or criminal.

State v. Martin, 555 N.W.2d 899, 900 (Minn. 1996). Criminal contempt is designed to

punish past misconduct, id., while “[c]ivil contempt sanctions are intended to operate in a

prospective manner and are designed to compel future compliance with a court order,”

Mower Cty. Human Servs. v. Swancutt, 551 N.W.2d 219, 222 (Minn. 1996) (quotation

omitted). The civil form of the underlying proceeding and the contempt order’s use of a

“purge provision” are two indications that a contempt order is civil, not criminal. Id. A

contempt order that includes a determinate jail sentence is civil in nature if accompanied

by a purge clause. See id. In its October 21, 2015 final contempt order, the district court

clearly held appellant in civil contempt. The underlying proceedings were civil in nature,

the contempt order was designed to secure compliance with the district court’s post-

judgment discovery order, and the contempt order contained purge conditions.

                                             10
The district court did not abuse its discretion by holding appellant in civil contempt.

       Appellant argues that the district court abused its discretion by holding him in

contempt. “The district court’s decision to invoke its contempt powers is subject to reversal

for abuse of discretion.” In re Welfare of Children of J.B., 782 N.W.2d 535, 538 (Minn.

2010). Appellate courts will uphold the findings of fact in a civil contempt order unless

the findings are clearly erroneous. Id.

       “Civil contempt is failing to obey a court order in favor of the opposing party in a

civil proceeding.”   Newstrand v. Arend, 869 N.W.2d 681, 692 (Minn. App. 2015)

(alteration omitted) (quotation omitted), review denied (Minn. Dec. 15, 2015).

              [A] civil contempt proceeding must meet the following
              minimum requirements:
              (1) the court has jurisdiction over the subject matter and the
              person;
              (2) a clear definition of the acts to be performed;
              (3) notice of the acts to be performed and a reasonable time
              within which to comply;
              (4) an application by the party seeking enforcement giving
              specific grounds for complaint;
              (5) a hearing, after due notice, to give the nonperforming party
              an opportunity to show compliance or the reasons for failure;
              (6) a formal determination by the court of failure to comply
              and, if so, whether conditional confinement will aid
              compliance;
              (7) an opportunity for the nonperforming party to show
              inability to comply despite a good faith effort; and
              (8) the contemnor’s ability to gain release through compliance
              or a good faith effort to comply.

Mower Cty., 551 N.W.2d at 223 (quotation omitted).

                                             11
       Finding of contempt

       Here, as discussed above, the district court had subject matter jurisdiction. In its

May 11, 2015 order, the district court granted respondent’s motion to compel answers to

post-judgment discovery. In its August 20, 2015 order, the district court found that

appellant had violated the May 11, 2015 order by failing to answer the discovery.

       Appellant argues that this finding is clearly erroneous because he responded to the

discovery request by asserting the Fifth Amendment privilege.

                      In civil cases, the right to plead the Fifth Amendment is
              not absolute. The availability of the right is delineated by the
              Fifth Amendment’s prohibition against compulsed testimony
              in criminal cases. The Fifth Amendment, therefore, may only
              be invoked when testimony in a civil case would enhance the
              threat of criminal prosecution such that reasonable grounds
              exist to apprehend its danger.

Parker v. Hennepin Cty. Dist. Court, Fourth Judicial Dist., 285 N.W.2d 81, 83 (Minn.

1979) (emphasis omitted). The Fifth Amendment privilege “is properly invoked when the

testimony or papers sought would tend to incriminate the witness.” Minn. State Bar Ass’n

v. Divorce Assistance Ass’n, Inc., 311 Minn. 276, 278, 248 N.W.2d 733, 737 (1976). The

protection offered by the Fifth Amendment privilege “must be confined to instances where

the witness has reasonable cause to apprehend danger from a direct answer.” Prod. Credit

Ass’n of Redwood Falls v. Good, 303 Minn. 524, 528, 228 N.W.2d 574, 577 (1975)

(quotation omitted). “To sustain the privilege, it need only be evident from the implications

of the question, in the setting in which it is asked, that a responsive answer to the question

or an explanation of why it cannot be answered might be dangerous because injurious

disclosure could result.” Id. (quotation omitted). The court determines whether the Fifth

                                             12
Amendment privilege applies, and “[t]he witness is not exonerated from answering merely

because he declares that in doing so he would incriminate himself—his say-so does not of

itself establish the hazard of incrimination.” Id. (quotation omitted). The district court

“has relatively broad discretion to determine whether a question innocuous on its face could

nevertheless have a tendency to incriminate the witness.” Id. at 527–28, 228 N.W.2d at

577.

       Appellant’s argument fails because there is nothing in the record that would indicate

that responsive answers to these questions or an explanation of why the questions could

not be answered would result in incriminating disclosures. Respondent’s post-judgment

discovery request simply called for answers to interrogatories and production of documents

related to appellant’s and his codefendants’ accounts and other financial assets. Appellant

has provided no indication of how his response to the discovery request would incriminate

him. Appellant stated that he was invoking his Fifth Amendment right because he felt

“very fearful and threatened by [respondent] creating false criminal charges against [him],”

and because he had “great fear for the safety of [appellant’s life], private information and

honor from being slandered and damaged maliciously.”            These general conclusory

statements, indicating only appellant’s fear of respondent somehow “creating” a criminal

prosecution and fear of noncriminal consequences, do not provide any indication that

requiring appellant to respond to the discovery request would expose him to criminal

prosecution. See United States v. Conces, 507 F.3d 1028, 1040 (6th Cir. 2007) (“To the

extent that [the defendant] vaguely contends that any sort of response to the [g]overnment’s

post-judgment discovery requests might tend to incriminate him, his blanket assertion of a

                                            13
Fifth Amendment privilege is impermissible, and he has failed to demonstrate a real danger

of incrimination if he were to respond to any particular discovery request.” (alterations

omitted) (quotations omitted)). And, “the privilege does not extend to consequences of a

noncriminal nature, such as threats of liability in civil suits, disgrace in the community, or

the loss of employment.” United States v. Apfelbaum, 445 U.S. 115, 125, 100 S. Ct. 948,

954 (1980).

       Indeed, allowing appellant to invoke the Fifth Amendment here, where there is no

indication that the requested discovery would expose him to criminal liability, would

permit appellant to gain an unfair advantage, especially since, in civil litigation, the

plaintiff’s only source of evidence is often the defendant himself. See Parker, 285 N.W.2d

at 83. While the Minnesota Supreme Court has stated that the right to invoke the Fifth

Amendment exists in civil cases, it has cautioned that “[t]he interdiction of this

constitutional safeguard in civil cases must be balanced against the purposes and policies

supporting the discovery rules.” Id. Allowing appellant to assert the Fifth Amendment

privilege here would allow appellant to circumvent the discovery rules and unfairly hinder

respondent’s attempts to satisfy its judgments.

       Accordingly, we conclude that the district court was within its relatively broad

discretion by finding that appellant had no adequate basis for his failure to respond to

respondent’s discovery request and that he violated the May 11, 2015 order granting

respondent’s motion to compel discovery. The district court did not abuse its discretion by

holding appellant in contempt.

                                             14
       Sanction for contempt

       After appellant failed to comply with the May 11, 2015 order, respondent moved

for an order to show cause, and a hearing was held on the motion. In the August 20, 2015

contempt order that followed, the district court gave appellant the opportunity to purge the

contempt “by fully responding to [respondent’s] interrogatories and document requests

. . . within [15] days of the date of this [o]rder.” Appellant purported to respond to the

discovery order by asserting the Fifth Amendment privilege, as discussed above, and

respondent subsequently moved to enforce the August 20, 2015 order. The district court

afforded appellant another opportunity to explain his failure to comply with the discovery

orders, but appellant could not elaborate on the basis of his Fifth Amendment objection.

On October 21, 2015, the district court held an order to show cause hearing, where

appellant was given yet another chance to explain why he should not be held in contempt.

The district court found that appellant had not complied with the contempt order, that he

had the ability to do so, and that incarceration was likely to produce compliance. The same

day, the district court ordered appellant to be incarcerated in the county jail for up to 180

days due to his failure to comply with the contempt order. The district court included a

purge clause in the order, which provided that appellant would be released from jail if he

did any of the following: (1) fully responded to respondent’s discovery requests; (2) posted

a supersedeas bond in the amount of 120% of the original judgment amount; (3) posted a

cashier’s check payable to the court administrator in the amount of 120% of the original

judgment amount; or (4) fully satisfied the judgment. We conclude that the contempt

                                             15
proceedings in this case complied with the requirements set forth in Mower Cty. and that

the district court did not abuse its discretion by imposing contempt sanctions on appellant.

Appellant has not shown that the district court judge had a personal interest or was
biased.

       Appellant argues that the district court judge who filed the October 21, 2015

contempt order “had a personal interest and was bias[ed].” In support of these allegations,

appellant refers to an affidavit he submitted along with his appellate brief. A portion of

this affidavit was filed in district court on September 21, 2015. The district court treated

that portion as a notice to remove the district court judge and denied the request. The new

portion of the affidavit, having never been submitted to the district court, is not part of the

record on appeal and is not properly before this court. See Minn. R. Civ. App. P. 110.01

(“The documents filed in the [district] court, the exhibits, and the transcript of the

proceedings, if any, shall constitute the record on appeal in all cases.”); Thiele v. Stich, 425
N.W.2d 580, 582 (Minn. 1988) (“A reviewing court must generally consider only those

issues that the record shows were presented [to] and considered by the [district] court in

deciding the matter before it.” (quotation omitted)).

       “No judge shall sit in any case if that judge is interested in its determination or if

that judge might be excluded for bias from acting therein as a juror.” Minn. R. Civ. P.

63.02. “Bias or prejudice, to be disqualifying, must stem from an extrajudicial source and

result in an opinion on the merits on some basis other than what the judge learned from his

                                              16
participation in the case.” In re Estate of Lange, 398 N.W.2d 569, 573 (Minn. App. 1986).

Nothing in the record indicates the presence of extrajudicial bias or prejudice in this case.

       Affirmed.

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