Unpublished Disposition, 902 F.2d 1578 (9th Cir. 1989)

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U.S. Court of Appeals for the Ninth Circuit - 902 F.2d 1578 (9th Cir. 1989)

GRANITE STATE INSURANCE COMPANY, Plaintiff-Appellant,v.ATLANTIC RICHFIELD COMPANY; Arco Petroleum ProductsCompany; a division of Atlantic RichfieldCompany, Defendants-Appellees,v.Ted HARMER, individually and the marital community of Tedand Bernice Harmer, jointly and severally, ThirdParty Defendants-Appellees.

No. 89-35171.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted March 7, 1990.Decided May 21, 1990.

Before EUGENE A. WRIGHT, REINHARDT and O'SCANNLAIN, Circuit Judges.


MEMORANDUM* 

This appeal involves dismissal of an action for contribution. Appellant Granite State Insurance Company challenges numerous discovery issues as well as the dismissal of its action. We AFFIRM the district court's decision except for its granting of sanctions against appellant.

BACKGROUND

Bart Ogle, an employee of appellee Ted Harmer, died of injuries sustained from an explosion which occurred while he was transferring gasoline from one underground tank to another. Ogle's estate sued the City of Bellingham (the Bellingham fire department had supervised the transfer) and the claim was settled for $1.2 million. Bellingham's insurer, Granite State, then sought contribution from appellee Atlantic Richfield Company. The case was removed to federal district court where, following numerous discovery disputes, the court granted summary judgment for appellee ARCO.

ANALYSIS

We review the district court's supervision of discovery for abuse of discretion. Ah Moo v. A.G. Becker Paribas, Inc., 857 F.2d 615, 619 (9th Cir. 1989).

Granite State challenges the court's limiting of the scope and length of discovery, refusal to grant a motion for continuance of discovery, and denial of its motion to compel responses to its discovery requests.1  These challenges lack merit.

The limitations on discovery were imposed at a status conference in which the Granite State attorney suggested that discovery would probably be limited to the issues of ARCO's alleged negligence and Harmer's alleged agency relationship with ARCO. The attorney did not object to the 60-day time limit set by the court. Neither limitation was an abuse of discretion.

Nor did the court abuse its discretion in denying Granite State's motions to continue the discovery period. Although the court made no findings on this subject, it is apparent from the record that Granite State had taken only two depositions in the allotted discovery period. Also, the need of a continuance was questionable because much of the information sought appeared to be outside the scope of the discovery limitations set by the court and, thus, irrelevant. The circumstances indicate the court was within its discretion to deny the motion for continuance. See Ungar v. Sarafite, 376 U.S. 575, 589 (1964); United States v. 2.62 Acres of Land, More or Less, 791 F.2d 666, 671 (9th Cir. 1985).

Granite State also challenges the denial of its motions to compel responses from ARCO and Harmer. Once again, the record supports the district court's exercise of discretion. We find no abuse.

We review for abuse of discretion the district court's denial of Granite State's Rule 56(f) motion. See Mackey v. Pioneer Nat'l Bank, 867 F.2d 520, 523 (9th Cir. 1989).

The record reflects that Granite State failed to show how additional discovery could preclude summary judgment. Instead, it offered excuses why it could not complete discovery. Given this failure, we see no abuse of discretion in denying the motion. See id. at 524.

We review this issue for abuse of discretion. Kirschner v. Uniden Corp. of America, 842 F.2d 1074, 1079 (9th Cir. 1988).

ARCO obtained a protective order on the grounds that some interrogatories were overly broad and outside the scope of the discovery limitations imposed by the court. Review of the 40 or so challenged interrogatories reveals that many were overly broad and outside the scope of the court's discovery limitations. We conclude the court did not abuse its discretion in issuing the protective order.

We review the district court's decisions about admissibility of evidence for abuse of discretion. Pierre Packing v. John Morrell & Co., 633 F.2d 1362, 1364 (9th Cir. 1980).

Granite State asserts that the district court abused its discretion by excluding two affidavits. The first, that of Holmes, Granite State's private investigator, was offered in support of its motion for partial summary judgment. Rule 56(e) requires that affidavits "set forth such facts as would be admissible in evidence." Fed. R. Civ. P. 56(e). Holmes' affidavit said that he had spoken to witnesses who admitted hearing of rumored safety problems at Harmer's station. These alleged rumors supposedly came from ARCO personnel and some delivery truck drivers. The court excluded this evidence as hearsay.

Granite State argues the affidavit was admissible because: (1) it was not offered to prove truth, but only to show ARCO had knowledge of the dangers; and (2) even if the affidavit was hearsay, it was admissible as a statement against interest.

In arguing that the affidavit was not hearsay at all, Granite State relies upon Webb v. Fuller Brush Co., 378 F.2d 500, 502 (2d Cir. 1967), and Alexander v. Conveyers & Dumpers, Inc., 731 F.2d 1221 (5th Cir. 1984). ARCO distinguishes these cases by arguing that, in both, there existed independent corroboration of the dangers at issue. ARCO emphasizes here that the affidavits would have been the only proof of the dangers that ARCO supposedly had knowledge of. We agree with ARCO.

Granite State's argument for admission of the affidavit as a statement against the declarant's interest fares no better. Hearsay statements are admissible as statements against interest if (1) the declarant is unavailable, and (2) the statement is contrary to the declarant's pecuniary or proprietary interests. Fed.R.Evid. 804(b) (3). Granite State cannot meet either requirement.

It has presented no evidence demonstrating the unavailability of the declarants. It argues instead that, due to the discovery cut-off date, the witnesses were unavailable for all practical purposes. It relies upon a citation to Weinstein on Evidence Sec. 804(a) (07), at 804-05 (1988), that refers to impracticability amounting to unavailability.

Nor did it present any evidence that the declarants were making statements against their pecuniary or proprietary interests. There is an utter lack of evidence that the declarants were even employees of ARCO.

There was no abuse of discretion in excluding the Holmes affidavit.

The second affidavit, that of Hamilton, Executive Director of a gasoline retailers' organization in Washington state, contained his identification of certain standards followed by ARCO and reasons why he thought ARCO should have had actual or constructive notice of the problems at Harmer's station. Granite State argues that this affidavit also was improperly excluded.

This argument is utterly meritless because the court did not exclude the affidavit. In its Order of 1/25/89, the court considered the Hamilton affidavit as evidence of ARCO's control over the Harmer station but found it unpersuasive. Record at Doc. 67.

We review this issue de novo because the awarding of sanctions under Fed. R. Civ. P. 56 is essentially identical to the imposition of sanctions under Fed. R. Civ. P. 11. See Zalvidar v. City of Los Angeles, 780 F.2d 823, 828 (9th Cir. 1986).

ARCO argues that the Holmes affidavit refers to testimony by two men speaking of "venting problems" at the Harmer station between 1974 and 1979. ARCO alleges that the gas tanks at issue here were not installed until 1979 and concludes that this makes the affidavit deserving of sanctions.

The court gave little support for its award of sanctions, concluding simply that the affidavit had misrepresented facts. On this record, we find no sanctionable behavior. The award of sanctions is reversed.

We review de novo the granting of a summary judgment and/or motion to dismiss. Kruso v. Int'l Tel. & Tel. Corp., 872 F.2d 1416, 1421 (9th Cir. 1989).

Granite State attacks ARCO under three different theories: (1) vicarious liability, (2) strict liability, and (3) non-delegable duty. The district court's opinion found the issue of control to be dispositive on all three issues. It determined that it was necessary for Granite State to demonstrate that ARCO exercised control or the right to control the gas station's daily activities. We agree.

There is no evidence in the record of ARCO having actual control or the right to control the daily activities of the Harmer station. We affirm for the reasons in the district court's order.

The motions are denied.

CONCLUSION

The district court's rulings are AFFIRMED except as to the granting of sanctions. The award of sanctions is REVERSED. The present motions for sanctions are DENIED.

O'SCANNLAIN, Circuit Judge, concurring in part and dissenting in part:

I concur in the disposition of the court with the exception of its reversal of sanctions imposed by the district court against Granite State. I would instead vacate the order of sanctions and remand the case so that Judge Coughenour might then determine whether he wished to renew the previous sanctions order based upon a more detailed explanation of reasons. Cf. Thomas v. Capital Sec. Servs., Inc., 836 F.2d 866, 883 (5th Cir. 1988) (noting in Rule 11 context that when "an adequate explanation by the trial court for the [imposition of sanctions]" has not been given, appellate court will make "a prompt remand for such findings").

The advisability of a remand here, as opposed to outright reversal, is demonstrated by the majority's conclusion that " [o]n this record, we find no sanctionable behavior." Ante at 7 (emphasis mine). On the contrary, the district court concluded, after reviewing several filings in support of and in opposition to imposing sanctions, that Thomas Homles's affidavit misrepresented facts. If such is true, then sanctions might well be appropriate. See Fed. R. Civ. P. 56(g) ("Affidavits Made in Bad Faith"--providing that a district court shall impose sanctions " [s]hould it appear to the satisfaction of the court at any time that any of the affidavits presented pursuant to this rule are presented in bad faith or solely for the purpose of delay").

Accordingly, I respectfully dissent from reversal of the sanctions award.

 *

This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3

 1

Although Granite State devoted much of its brief to the district court's allegedly erroneous discovery rulings, it chose not to address these issues at oral argument