Court Opinion

ID: 992340
Source: CourtListenerOpinion
Date Created: 2013-07-03 23:50:26.961764+00
Date Added: 2024-06-11T11:03:02.298343
License: Public Domain

UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

In Re: PLANTATION FORD TRACTOR,
INCORPORATED,
Debtor.

ROBERT F. ANDERSON, Trustee,
Plaintiff-Appellant,
                                                               No. 96-2085
and

FORD MOTOR CREDIT COMPANY,
Defendant-Appellant,

v.

GODLEY AUCTION COMPANY,
Defendant-Appellee.

Appeal from the United States District Court
for the District of South Carolina, at Charleston.
David C. Norton, District Judge.
(CA-96-319-2-18, CA-95-3668-2-18, BK-92-74100, AP-94-8086)

Argued: May 8, 1997

Decided: June 3, 1997

Before LUTTIG, Circuit Judge,
COPENHAVER, United States District Judge for the
Southern District of West Virginia, sitting by designation,
and MICHAEL, Senior United States District Judge for the
Western District of Virginia, sitting by designation.

_________________________________________________________________

Reversed by unpublished per curiam opinion.

_________________________________________________________________
COUNSEL

ARGUED: Thomas Whatley Bunch, II, ROBINSON, MCFADDEN
& MOORE, P.C., Columbia, South Carolina, for Appellants. Richard
Robert Gleissner, FINKEL, ALTMAN & BAILEY, L.L.C., Colum-
bia, South Carolina, for Appellee. ON BRIEF: H. Flynn Griffin, III,
ANDERSON & ASSOCIATES, P.A., Columbia, South Carolina, for
Appellants.

_________________________________________________________________

Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

_________________________________________________________________

OPINION

PER CURIAM:

Appellant Anderson, Plantation Ford's Trustee in its bankruptcy
proceedings, originally brought this action on April 14, 1994, seeking
to have certain pre-petition transfers from Plantation Ford to Godley
avoided as preferential and certain of Godley's consignment interests
in Plantation Ford's equipment avoided as imperfect.

During the course of discovery in this lawsuit, Godley violated five
separate court orders, including a court order to pay sanctions for its
violation of a previous court order. One of these orders, entered by
the court with Godley's consent on January 23, 1995, was issued in
response to Anderson's motion for sanctions following Godley's vio-
lation of the court's previous order to fully answer a particular inter-
rogatory. The January 23 court order compelled Godley to comply
with the court's prior order or suffer the entry of judgment by default,
specifically stating:

          ORDERED, ADJUDGED, AND DECREED that the Defen-
          dant, Godley Auction Company, shall comply with this
          Court's Order of October 21, 1994, on or before December
          5, 1994. If the Defendant has not complied with the October

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          21, 1994 order at that time, the Court will, upon appropriate
          motion by the Plaintiff, enter an order striking the Defen-
          dant's answer and holding it in default.

J.A. at 39. Godley violated this order as well, by providing an incom-
plete answer to the interrogatory at issue. At a hearing on June 10,
1995, in response to Anderson's second motion for sanctions, the
bankruptcy court struck Godley's answer, and thereafter entered a
default judgment in favor of Anderson.

On appeal, the district court reversed, as an abuse of discretion, the
bankruptcy court's order striking Godley's answer, and ordered the
case remanded to the bankruptcy court for the consideration of a
lesser sanction. Anderson appeals to this court, claiming that the dis-
trict court erred in holding that the bankruptcy court's order amounted
to an abuse of discretion. We agree, and accordingly reverse the judg-
ment of the district court.

The district court's sole basis for reversing the bankruptcy court
was that the "bankruptcy court did not consider the Wilson factors"
prior to striking Godley's answer. J.A. at 85. Our decision in Wilson
v. Volkswagen of America, Inc., 561 F.2d 494, 503 (4th Cir. 1977),
explains that lower courts should consider four factors prior to impos-
ing default judgment as a sanction for discovery abuse: (1) whether
the noncomplying party acted in bad faith, (2) the extent of prejudice
to the noncomplying party's opponent, (3) the need for deterrence,
and (4) the effectiveness of less drastic sanctions. It is evident on the
face of the bankruptcy court's opinion that, contrary to the district
court's conclusion, the bankruptcy court did in fact explicitly consider
each of factors in turn. As the bankruptcy court's order explained:

           In reviewing the entire record in this case, it appears that
          Godley has acted in bad faith. Godley has demonstrated a
          continuing pattern of abusing the rules of discovery and
          ignoring the Orders of this Court. Godley has ignored sev-
          eral Orders including this Court's Orders of January 23,
          April 27, and June 1. Godley refused to use reasonable dili-
          gence to answer interrogatories, refused to answer questions
          at depositions, and refused to pay sanctions in a timely man-
          ner. The information which Godley refused to produce was

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          material to its defenses, and Godley's failure to provide the
          information was prejudicial to the other parties' preparation
          for trial. Godley's Answers to the Trustee's Complaint and
          Ford Motor Credit's cross claim should be stricken and it
          held in default. Less drastic sanctions would serve no useful
          purpose, and would encourage others to act with impunity
          regarding the Court's Orders.

J.A. at 85. Presented with Godley's flagrant discovery misconduct,
the bankruptcy court was not required to provide a more elaborate
exegesis of its consideration of the Wilson factors than that quoted
above. In holding that the bankruptcy court's opinion insufficiently
analyzed these four factors, the district court performed what
amounted to a de novo review of the bankruptcy court's decision,
weighing the Wilson factors itself and determining that only lesser
sanctions were appropriate in response to Godley's violations. Since
the district court was reviewing the bankruptcy court's decision under
an abuse of discretion standard, it was simply without authority to
substitute its judgment for that of the bankruptcy court in this way.

Accordingly, the judgment of the district court is reversed.

REVERSED

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