Spoliation of Evidence: Serious Consequences for Everyday Actions
Your employee is on a job site, working on a ladder. Even over the noise, the sound of the cracking is so loud that his coworkers stop suddenly and watch the slow-motion fall as the worker descends to the ground. It is a gruesome injury, a greenstick fracture. Bones protruding from the flesh. EMS responds. There is a biohazard clean up on site due to the amount of blood lost.
Your employees start to talk amongst themselves. Those were cheap ladders, and we told you this was going to happen when the job started a year and a half ago. Phones come out and pictures are taken. You know where this is headed. The ladder is mangled and broken. There is blood on several pieces. Someone scoops it up and it ends up in a dumpster. But you’ve got photos. Nothing to worry about because you have the employee covered for workers compensation and you have notified the carrier.
Enjoy that one good night of sleep before reality sinks in. There are all the derivative lawsuits that will arise out of that accident. The suit against the general contractor, for failure to provide a safe workplace (do you owe defense and indemnity under the contract?) and the third-party claim against the defective ladder manufacturer. Wait, where’s the ladder?
The same is true, and often hits hardest in Texas, is the matter of the preservation of electronic evidence. The case in point is Brookshire Brothers v. Aldridge. Spoliation occurs when a party owes a duty to preserve relevant and material evidence and then breaches that duty by failing to exercise reasonable care to preserve evidence. Common types of evidence in spoliation disputes are electronically stored information (ESI), motor vehicle and maintenance records, security camera footage, construction site damage, malfunctioning equipment, medical notes, and social media posts, just as examples.
Sanctions imposed must be proportional, meaning that they must relate directly to the conduct giving rise to the sanction and may not be excessive. The major considerations are the level of culpability of the spoliator and the degree of prejudice towards the opposing party.
Sanctions may include the following:
• an order prohibiting further discovery by the spoliator.
• an order designating certain facts established;
• a contempt order;
• exclusion of the evidence;
• award of attorney’s fees and/or costs;
• dismissal with or without prejudice;
• striking pleadings, default judgment; and
• a jury instruction.
All these things can be extremely detrimental to
the defense of your case. Because of spoliation, you
can lose a case you would otherwise win.
To avoid a spoliation claim, develop and document retention policies.
When an accident or equipment malfunction occurs, preserve the
evidence, even if you believe it will not lead to litigation. Even if they
carry workers’ compensation insurance (which would prevent a finding
of liability for negligence), you can be sued for gross negligence in
certain situations, which implicates all the evidence preservation issues
involved in an ordinary negligence case. Some industries, such as
trucking and insurance, have specific federal regulations regarding the
preservation of evidence. When in doubt, ask. You can always dispose of
items later that are not needed, but the opposite is not true.