Filed 6/30/16 Li v. Chiu CA1/3
                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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or ordered published for purposes of rule 8.1115.


              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                       FIRST APPELLATE DISTRICT

                                                DIVISION THREE


CHARLES LI,
         Plaintiff and Respondent,
                                                                     A145509
v.
THAI MING CHIU et al.,                                              (City & County of San Francisco
                                                                     Super. Ct. No. CGC-14-537574)
         Defendants and Appellants.


         Defendants Thai Ming Chiu and Kaman Liu (defendants) appeal from an order
awarding $8,425 to plaintiff Charles Li (plaintiff) as discovery sanctions. Defendants
contend the award is unreasonable and arbitrary because it exceeds the amount requested
by plaintiff in a sanctions motion. They also claim that sanctions are unwarranted under
the circumstances.
         We conclude the trial court did not abuse its discretion in awarding monetary
sanctions for discovery abuses. Further, the challenged order includes rulings in favor of
plaintiff on two separate discovery motions—a motion for sanctions filed by plaintiff and
a motion to compel filed by one of the defendants. When the record associated with both
motions is taken into account, there is factual support for the amount of the sanctions
award. Accordingly, we affirm.
                              FACTUAL AND PROCEDURAL BACKGROUND
         The discovery dispute giving rise to this appeal has its origin in an effort by
plaintiff to enforce a judgment against Demas Yan, an attorney whom plaintiff had sued
for legal malpractice and breach of fiduciary duty, among other claims. (See Li v. Yan


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(2016) 247 Cal.App.4th 56, 62.) A second amended judgment against Yan awarded
plaintiff $552,412.30, inclusive of prejudgment interest. (Id. at p. 62.)
       Through efforts to enforce the judgment, plaintiff learned that Yan had transferred
rental property he owned in San Francisco (the San Francisco rental property) to a wholly
owned limited liability company (LLC) in 2007, even though Yan had an active
bankruptcy case at the time. According to plaintiff, after the trial against Yan had
commenced in 2012, Yan transferred his ownership interest in the LLC to his mother and
defendants, who are Yan’s brothers-in-law. The transfer was purportedly undertaken to
repay debts Yan owed to these relatives. Then, in November 2013, after the court issued
an order for the LLC to appear for an examination in connection with enforcement of the
judgment, the San Francisco rental property was transferred yet again to a newly formed
LLC owned by the same individuals who owned the LLC that transferred the property.
       After plaintiff learned of these transactions involving the San Francisco rental
property, which he interpreted as efforts by Yan to protect his main asset from being used
to satisfy the judgment against him, plaintiff filed a separate action in February 2014 for
fraudulent transfer against Yan, Yan’s parents, the two LLCs, and the two individuals
who are parties to this appeal—Yan’s brothers-in-law, defendants Thai Ming Chiu and
Kaman Liu.1 Yan appeared as an attorney for defendants in the trial court and is their
counsel of record in this appeal, which arises out of the fraudulent transfer action.
       Plaintiff served discovery requests upon defendants in April 2014. Among other
things, plaintiff sought documents related to the San Francisco rental property that
evidenced mortgages, liens, loans secured by the property, rental agreements, and rent
payments. The documents sought by plaintiff would tend to show who exercised control
over the San Francisco rental property or derived ownership benefits from it, and thus
would bear upon whether the various transfers of the property were structured to keep the
San Francisco rental property out of the reach of judgment creditors while maintaining




       1
           Yan, Yan’s parents, and the two LLCs are not parties to this appeal.

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Yan’s equitable ownership in the property. Defendants responded solely with objections
to the discovery requests.
       Following efforts to meet and confer, plaintiff moved to compel defendants to
produce documents and to answer interrogatories. A pro tem judge heard the motion in
August 2014. Because plaintiffs did not consent to have the judge pro tem decide the
motion, the pro tem judge issued a detailed report and recommendation to the trial court.
The pro tem judge’s recommendation called for defendants to produce virtually all of the
requested documents, including those related to rents and mortgages. The pro tem judge
also recommended that the court award $3,500 in monetary sanctions to plaintiff. The
pro tem judge reasoned that defendants’ position in the discovery dispute was not
substantially justified and that, in his opinion, they were “just out to stonewall and be
obstructive for as long as they can get away with it.” In November 2014, the trial court
entered an order adopting the pro tem judge’s report and recommendation in its entirety.
       Defendants served amended discovery responses in early December 2014,
although they produced no documents at the time. According to plaintiff, the amended
discovery responses included objections that had not been raised previously. Defendants
ultimately produced a set of documents in late December 2014. They were the first
documents produced by defendants in response to the April 2014 discovery requests.
       Upon review of the documents, plaintiff came to the conclusion that the document
production was deficient and omitted highly relevant documents that plaintiff had
uncovered through independent research. Accordingly, in late January 2015, plaintiff
filed a motion for sanctions against defendants. Plaintiff asserted that sanctions were
warranted because defendants had willfully disobeyed the court’s November 2014 order
granting plaintiff’s motion to compel by failing to produce all documents required to be
turned over, by providing false and evasive supplemental responses, and by continuing to
make unmeritorious objections that had been overruled previously by the court. Among
other things, plaintiff argued that the production of mortgage-related documents, bank
statements, rental agreements, and rent checks were conspicuously incomplete. Plaintiff
sought terminating sanctions or, in the alternative, issue sanctions or monetary sanctions.


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As support for monetary sanctions, plaintiff’s counsel included a declaration seeking
$4,200 as attorney fees for pursuing the sanctions motion.
       About one week after plaintiff filed his sanctions motion, defendant Chiu filed his
own motion to compel against plaintiff. In opposition to the motion, plaintiff argued that
the documents defendant Chiu sought were already in his possession or were equally
available to him from public sources. Plaintiff also contended that counsel for defendant
Chiu had failed to discharge his obligation to meet and confer before filing the motion.
Plaintiff’s counsel sought monetary sanctions of $4,250 against defendant Chiu for
unsuccessfully making a motion to compel. Plaintiff’s counsel included a declaration
setting forth the basis for seeking $4,250 in attorney fees to oppose the motion to compel.
Therefore, plaintiff’s counsel sought a total of $8,450 as monetary sanctions for pursuing
plaintiff’s sanctions motion and for opposing defendant Chiu’s motion to compel.
       Plaintiff’s motion for sanctions and defendant Chiu’s motion to compel were
heard jointly by a pro tem judge. Because defendants did not agree to have the pro tem
judge decide the motions, the pro tem judge prepared a report and recommendation for
the trial court. Defendant did not choose to include the pro tem judge’s report and
recommendation in the record on appeal. Nevertheless, we can gather from documents
that are included in the record on appeal that the pro tem judge recommended imposing a
$500 monetary sanction associated with plaintiff’s sanctions motion. The pro tem judge
apparently also recommended granting defendant Chiu’s motion to compel as to four
categories of documents. One of the contested issues raised in response to the pro tem
judge’s report and recommendation was whether defendants had an obligation to produce
documents within their control, such as bank statements, even if they did not have the
documents in their immediate possession.
       At a hearing in early April 2015, the trial court tentatively denied defendant Chiu’s
motion to compel as moot and ordered defendants to produce numerous documents,
including responsive records required to be obtained from defendants’ financial
institutions, or suffer terminating sanctions. The trial court expressed the view that $500
in monetary sanctions was “a drop in the bucket” and inadequate.


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       At a follow-up hearing in May 2015, the trial court considered whether defendants
had complied with the order to produce further documents. Plaintiff’s counsel stated that
defendants had produced additional documents but that he believed there still was not full
compliance with the order. Defendants’ counsel took the position that they had complied
with the order and produced all responsive documents. In response to the statement of
defendants’ counsel that he had been “bending over backwards to provide” the requested
documents, the court disagreed, telling counsel “you must really be into yoga” to “bend
and . . . stretch” for over a year without resolving the dispute. Upon taking the matter
under submission, the court expressed that it was hesitant to grant terminating sanctions
but stated it would grant monetary sanctions and would consider issue sanctions.
       On June 10, 2015, the trial court entered an amended order addressing both
plaintiff’s motion for terminating sanctions and defendant Chiu’s motion to compel. The
court denied terminating and issue sanctions but awarded monetary sanctions. The court
found that defendants had substantially complied with the requests for production but
noted that defendants’ eventual compliance was the result of “multiple motions and
numerous hearings” beginning in June 2014. The order declared that defendant Chiu’s
motion to compel was moot. Plaintiff was awarded monetary sanctions in the amount of
$8,425.2 Defendants timely appealed the order awarding monetary sanctions.
                                       DISCUSSION
       “ ‘We review the trial court’s ruling on a discovery sanction under the deferential
abuse of discretion standard. [Citation.]’ [Citation.] ‘A court’s decision to impose a
particular sanction is “subject to reversal only for manifest abuse exceeding the bounds of
reason.” ’ ” (Doe v. United States Swimming, Inc. (2011) 200 Cal.App.4th 1424, 1435.)
       One of defendants’ primary complaints on appeal is that the court awarded more
in monetary sanctions than was requested by plaintiff. They claim plaintiff only


       2
         On the same day the court issued its order awarding monetary sanctions, it also
denied a defense motion seeking to impose sanctions against plaintiff pursuant to Code of
Civil Procedure section 128.7. The court awarded monetary sanctions of $4,250 to
plaintiff. That order and award of sanctions is not encompassed within this appeal.


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requested $4,250 as monetary sanctions and that there is no factual basis to justify an
award of $8,425. According to defendants, the award violates the rule that discovery
sanctions must be limited to the opposing party’s actual costs, including attorney fees.
(See In re Marriage of Niklas (1989) 211 Cal.App.3d 28, 37.)
       The problem with defendants’ contention is that the challenged order encompasses
not only plaintiff’s motion for discovery sanctions but also defendant Chiu’s motion to
compel. Plaintiff sought $4,200 as reasonable attorney fees for pursuing his discovery
sanctions motion and an additional $4,250 as reasonable attorney fees for opposing the
motion to compel. A court may award attorney fees to a party that successfully opposes a
motion to compel. (Code Civ. Proc., § 2031.300, subd. (c).) Thus, in awarding a total of
$8,425 the trial court did not exceed the actual costs incurred by plaintiff and supported
by attorney declarations.
       Defendants contend the sanctions order is clear on its face that the $8,425 award is
related solely to plaintiff’s motion for sanctions. They point out that the order contains
two separate paragraphs, one of which addresses plaintiff’s motion for sanctions and one
of which addresses defendant Chiu’s motion to compel. The award of $8,425 is included
in the first paragraph addressing the sanctions motions, whereas the second paragraph
simply states that the motion to compel “is moot.” Defendants interpret the court’s
disposition of the motion to compel to mean that there was no prevailing party and thus
no basis to impose monetary sanctions.
       Defendants’ proposed interpretation of the challenged order violates the principle
of appellate review dictating that we presume the correctness of the trial court’s ruling
and indulge “ ‘[a]ll intendments and presumptions . . . to support it on matters as to which
the record is silent . . . .’ ” (Gee v. American Realty & Construction, Inc. (2002)
99 Cal.App.4th 1412, 1416.) While the order is susceptible to being interpreted in the
manner suggested by defendants, that is not the only reasonable interpretation of the
order. It is equally plausible that the court simply stated the total amount of monetary
sanctions associated with both motions in the first paragraph of the order. Nothing in the
court’s order affirmatively demonstrates or clarifies that the sanctions award relates


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solely to plaintiff’s sanctions motion. Further, the disposition of the motion to compel as
moot is consistent with a denial of the motion, even if the court did not specifically use
the word “denied,” because the end result was that the court did not award any
affirmative relief to defendant Chiu. Indeed, when the court announced its tentative
ruling in open court, it stated that it intended to deny the motion as moot.
       Defendants’ proposed interpretation of the order fails for the additional reason that
they did not provide this court with a record adequate to assess their claims of error, at
least with respect to defendant Chiu’s motion to compel. A fundamental corollary to the
rule providing that error must be affirmatively shown is that “ ‘if the record is inadequate
for meaningful review, the appellant defaults and the decision of the trial court should be
affirmed.’ ” (Gee v. American Realty & Construction, Inc., supra, 99 Cal.App.4th
at p. 1416.) Here, even though the challenged order plainly encompasses two motions,
defendants did not provide this court with a record related to the motion to compel. We
have a limited record related to the motion to compel but only because plaintiff provided
those limited portions to us. This record is inadequate to support defendant’s proposed
interpretation of the court’s sanctions order. Specifically, the record does not compel a
conclusion that the award of monetary sanctions was limited to plaintiff’s motion for
discovery sanctions.
       Defendants also contend that it was an abuse of discretion to award monetary
sanctions in any amount.3 They advance a number of arguments, none of which has
merit. First, they contend that, if plaintiff felt that defendants had not adequately
complied with the November 2014 order compelling the production of documents, then
the proper recourse was for plaintiff to file a renewed motion to compel. Defendants are
mistaken. A party is not required to file a renewed motion to compel when the other
party has failed to comply with a court order compelling the production of documents.


       3
       Defendants do not challenge the propriety of the sanctions amount associated
with defendant Chiu’s motion to compel, other than to argue that sanctions were
unauthorized because there was no prevailing party. As explained above, we reject
defendants’ claim that the court neither granted nor denied the motion.


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Instead, the Code of Civil Procedure authorizes a court to impose sanctions upon the
violation of any single order compelling a party to comply with discovery requests.
(Code Civ. Proc., § 2031.300, subd. (c).) Plaintiff was justified in bringing his motion for
sanctions in light of defendants’ failure to comply with the earlier order compelling
defendants to produce documents.
       Defendants further argue that it is unfair to place the blame for any delay in
compliance upon them. They assert that there was a legitimate dispute about their
obligation to produce bank records that were not actually in their possession, and they
claim it was necessary to secure a stipulated protective order to address privacy concerns.
But these concerns—even if legitimate—do not necessarily justify the lengthy delay in
obtaining the requested documents.
       Although the court acknowledged in its written order that defendants had
“substantially complied” with the requests for production, it also noted that their eventual
compliance only followed after “multiple motions and numerous hearings . . . .” The
court expressly disagreed with the statement of defendants’ counsel that they had been
“bending over backwards” to comply with discovery requests and suggested that
defendants had, without adequate justification, managed to stretch the proceedings out for
over one year. Under the circumstances, we discern no abuse of discretion in awarding
monetary sanctions for defendants’ persistent refusal to produce the requested documents
and to comply with the court’s discovery orders.
                                       DISPOSITION
       The June 10, 2015 order awarding monetary sanctions in the amount of $8,425 is
affirmed. Plaintiff shall be entitled to recover his costs on appeal.




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                                _________________________
                                McGuiness, P.J.


We concur:


_________________________
Pollak, J.


_________________________
Jenkins, J.




A145509




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