United States: Florida’s 4th DCA Underlines Importance Of Rules Governing Depositions Of Designated Corporate Representatives

Last Updated: May 13 2013
Article by Timothy N. Bench

In a recent decision, a Florida appellate court discussed why we have rules allowing for corporate entities to designate corporate representatives to speak for them, and the implications of failing to utilize the designated procedures properly. In Carriage Hills Condominium, Inc. v. JBH Roofing & Constructors, Inc., --- So. 3d ---, 2013 WL 1136399, 38 Fla. Law Weekly D643 (Fla. 4th DCA, March 20, 2013), the court addressed the appeal of a summary judgment granted by a trial court following the deposition of an employee of a corporation.

Carriage Hills, a condominium association, through its board of directors, hired JBH Roofing to perform building repairs necessitated by Hurricane Wilma pursuant to a contract which obligated JBH to perform only work approved by Carriage Hills' public adjuster, and to accept payments approved by and received from Carriage Hills' insurer. Less than a year later, Carriage Hills had terminated JBH's contract and JBH sued alleging breach of contract and other related claims. The breaches alleged by JBH included (a) failure to pay for repairs approved by the carrier; (b) failure to diligently present claims for loss to the carrier; and (c) retention of other roofing contractors to perform work that should have gone to JBH pursuant to the contract.

Carriage Hills answered and asserted affirmative defenses alleging, among other things, that (1) the contract was "executed without Board approval"; (2) that it had already paid JBH in full for all work performed; (3) that JBH failed to mitigate damages; and (4) that JBH failed to perform its repairs satisfactorily or with due diligence.

JBH noticed for deposition the "Corporate Representative of Carriage Hills Condo with the most knowledge of the allegations contained in the complaint." The notice made no reference to any particular issue(s) to be addressed, or to Carriage Hills' affirmative defenses and counterclaims.

Carriage Hills tendered Ms. Diane Foley, who in her then-capacity as President of the association, executed the JBH contract and was apparently the person with "the most knowledge" of the allegations in JBH's complaint.

After testifying that she was authorized to execute the contract, Ms. Foley was repeatedly asked whether, in her "opinion," contentions within the parties' pleadings were accurate. When asked whether she "believed" JBH had breached the contract, she responded, "In my layman opinion, no." She testified that she was "not aware" of any unauthorized work performed, and that she "believed" that JBH completed all the tasks it was authorized to do up to the time of termination. She also did not believe JBH's work was defective.

Armed with this testimony, JBH filed its Motion for Summary Judgment, in response to which Carriage Hills filed affidavits of another former president of the association and of its treasurer, in which it was asserted that JBH performed "substandard work with respect to the roof systems", "submitted duplicate charges", and "conducted unauthorized work, including work that was not paid for [by the carrier]." The affiants further asserted that due to JBH's shoddy repair work, Carriage Hills was forced to retain other roofing contractors to fix "water leaks and problems encountered with the roof system," and that JBH was paid all of the funds approved by -- and received from -- the insurer.

The trial court held that Ms. Foley, as its corporate representative, was "Carriage Hills," and that her testimony was therefore binding on Carriage Hills. Accordingly, it struck the two affidavits, reasoning that "[i]n situations where the non-movant in a motion for summary judgment submits an affidavit which directly contradicts an earlier deposition . . . , courts may disregard the later affidavit." Based upon Ms. Foley's deposition testimony, the trial court granted summary judgment to JBH, and Carriage Hills appealed.

On appeal, Florida's 4th District Court of Appeals addressed the proper procedure for noticing and taking the deposition of a designated corporate representative in Florida. Florida Rule of Civil Procedure 1.310(b)(6), which governs depositions of designated corporate representatives, requires the party seeking the deposition to describe, with reasonable particularity, the matters for examination. This allows the corporate entity to select an individual or individuals able to testify on its behalf regarding the designated subjects. The Rule does not require that the person with "the most knowledge" regarding anything be produced. In fact, the court pointed out that the "knowledge" as to which the designated representative(s) are produced to testify is that of the corporation, and not the personal knowledge of the selected individual(s). The deponent needn't have any relevant personal knowledge at all.

Against this backdrop, the appellate court noted that Ms. Foley had not been properly noticed as a corporate representative, since the notice failed to designate specific areas of inquiry, instead asking for the person "with the most knowledge' regarding the allegations in the complaint. And JBH got exactly what it asked for as a result – a deponent with personal knowledge of relevant facts but not a person who would testify to the knowledge and litigation positions of Carriage Hills. To add insult to injury, the deposition was also not properly conducted, in that Ms. Foley was repeatedly asked about her personal opinions rather than the positions of the corporation. The result was that Ms. Foley's testimony did not directly contradict the affidavits subsequently submitted by Carriage Hills, and the appellate court held that the trial court had acted improperly when it struck them and entered summary judgment based on Ms. Foley's testimony. The summary judgment was therefore reversed and the case remanded to the trial court for further proceedings.

It has, unfortunately, become a common practice in Florida for notices for corporate representative depositions to request the "person or persons with the most knowledge" regarding designated subject areas or, most broadly, "the issues set forth in the pleadings." The Carriage Hills decision serves as an important reminder of how failure to properly notice and conduct a corporate representative deposition can severely diminish the usefulness of the resulting deposition and the streamlining purpose of Rule 1.310(b)(6). Conversely, practitioners receiving such notices should consider filing objections and/or objecting on the record to such improper language.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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