Articles
Bench & Bar of Minnesota is the official publication of the Minnesota State Bar Association.

Wide Variety of New Civil Rules Take Effect in July

What you need to know about the new amendments to the Minnesota Rules of Civil Procedure

On March 13, 2018, the Minnesota Supreme Court promulgated amendments to the Minnesota Rules of Civil Procedure.1 The amendments take effect on July 1, 2018, and are broad in reach, if not necessarily earth-shaking. They change more than 15 rules on many aspects of civil procedure and might be thought of as the “potpourri amendments.” Briefly, the amended rules affect service by mail, third-party practice, class actions, proportionality in discovery, the handling of document requests and responses, sanctions for loss of electronically stored evidence (ESI), summary judgment, and disqualification of judges for cause. In other words, they will affect most civil cases, sometimes in significant ways.

Counting days

The Court also moved forward on its advisory committee’s recommendation that it implement a change in “counting days” to use the current federal system of counting all days to determine deadlines (and adjusting the deadlines accordingly to 7, 14, 21, and 28 days for deadlines measured in days and shorter than 30 days). The Court referred that recommendation to other advisory committees (particularly the General Rules of
Practice and Criminal Rules advisory committees) to ensure that, if adopted, any changes would apply across the court system to the extent feasible. This proposal was first advanced by the Court’s advisory committee in 2009 and was echoed in a petition from the MSBA in 2016. Those changes, if adopted, may come later this year or in 2019. 

Class action settlements

The MSBA Committee for Legal Aid to the Disadvantaged proposed an amendment to Rule 23 that would require that at least one-half of any unclaimed or undistributed funds in a class action
(cy pres funds) be distributed to fund legal assistance to the disadvantaged. Although the advisory committee unanimously recognized that the cause of supporting Legal Aid was most worthwhile, it did not support a hard-and-fast rule that half of such funds would have to go to this purpose. The MSBA-proposed rule had no counterpart in the federal rules and the advisory committee concluded it was inconsistent with well-developed federal law requiring that such funds first be directed to the parties to the litigation—usually to class members, but occasionally to the defendant if the class members were fully compensated. Only if that was not economically feasible (say, because the cost of further distributions would consume the amount to be distributed), then the funds should be distributed to a recipient or organization most closely aligned with the interests of the class members. This is consistent with
established law.2 

The Court rejected the advisory committee’s recommendation that no rule be adopted and also declined to adopt the mandatory rule proposed by the MSBA. Instead, it adopted a rule requiring notice to legal aid organizations3 of a proposed cy pres distribution. It does not require distribution of cy pres funds to such an organization nor create a right to any award of these funds. It does allow the organizations to request participation. Courts, including Minnesota courts, have historically approved distribution of funds to fund legal services where the nature of the case supports that, and declined to do so when it does not. That calculus should not change under the new rule.

Disqualification of judges for actual bias

The third issue the advisory committee was asked to address also came to the Court by petition, this time from the Board of Judicial Standards. The board presented a cogent argument for changing the standard in Rule 63.02 for disqualification (sometimes referred to as recusal) of judges for cause to the same standard in the Minnesota Code of Judicial Conduct used in the judicial disciplinary process. The current rule contains a standard that has been around since Territorial days and provided little practical guidance: “if the judge might be excluded for bias from acting… as a juror.” This change had previously been made in the Minnesota Rules of Criminal Procedure and General Rules of Practice, and the Court has used the Code standard in its decisions.4 The new rule replaces a vague standard with a clearer one, and one that that is both internally consistent across the Minnesota rules and consistent with standards in other states.

The MSBA proposed that the time to bring a motion to disqualify an assigned judge under Rule 63.03 be extended from 10 to 14 days. The advisory committee considered that proposal but rejected it. Indeed, the committee considered that a seven-day period might be appropriate, given the use of immediate e-noticing of judicial assignments and the burdens imposed on case management when multiple parties file serial notices to remove. The committee ultimately decided to recommend leaving the rule unchanged, and the Court adopted that recommendation.

“Federalizing” certain state rules

As is the habit and mission of the advisory committee, it reviewed the overall functioning of the civil rules as well as the status of recent federal rules amendments. Some of these amendments had been included in the MSBA’s petition, and some were not. The committee continues to have an approach to the federal rules that might be described as “cautious parallelism.”5 It recognizes that there are significant advantages in many types of cases to having the state and federal rules identical, but also realizes that state and federal cases and case-management needs are different. The Minnesota Supreme Court has recognized the benefits of being able to use readily the vastly larger body of federal authority on procedural matters under the rules.6 The committee also recognizes, however, the differences between the federal and state systems, caseloads, and resources that make it prudent not to adopt the federal rules blindly. In these 2018 amendments, the MSBA proposed a change to adopt the federal rule regime calling for a scheduling order in every case.7 The advisory committee generally agreed that this system works well in federal court but concluded that the current system, allowing pretrial conferences and orders but not requiring them in every case, works well in Minnesota. Among other things, the committee noted the fact that state judges do not have magistrate judges to assist with case management and that the state court cases often do not require that level of judicial supervision, depending upon case type and county of venue.

Discovery changes

The federal changes recommended by the advisory committee and adopted by the Court comprise the most important of the remaining rule amendments and fit into several groups. Many of these discovery amendments tracked changes that took effect in federal court in 2015. These included adding proportionality to the definition of the scope of discovery. The amended rule underscores the importance of proportionality but should not be life-changing. Minnesota adopted changes to Rule 1 in 2013 on the recommendation of its Civil Justice Reform Task Force. These adopted a more expansive proportionality requirement, applying it to every aspect of the litigation process. Rule 34.01 is now amended to state explicitly a proportionality requirement for document requests.

Another aspect of proportionality relates to the cost of discovery. Rule 26.03 is amended to allow a protective order to allocate the cost of discovery. This cost-shifting provision would change the historic presumption that the cost of complying with discovery is borne by the responding party. Actually, the presumption persists, but is a little less conclusive. The advisory committee comments make it clear that cost-shifting is not intended to be a routine part of discovery, but where a request is particularly burdensome or seems remotely connected to the needs of the case, it may be appropriate. Since the rule is permissive only, it will be up to the parties to ask for this relief from the court, being prepared to say why it is necessary.

Discovery amendments that are certain to change current practice were made to Rule 34, changing both how document requests are made and how responses must be made. First, Rule 26.04 now allows a party to serve document requests earlier, although doing so does not require an earlier response. Why would a party want to give the other side more time to respond? There are two good reasons—the requests create an indisputable date by which the recipient of the request has notice of the duty to preserve documents, and by providing the responding party more lead time, extensions of the deadline will less frequently be necessary. Rule 26.06(c) is amended to require that the parties’ discovery plan explicitly address the document preservation requirements of the case. 

Under the amended Rule 34, document requests must be stated with particularity and must specify a reasonable time, place, and manner of requested production. The bigger changes relate to responses to document requests, which must be responded to with specificity as to each request. These responses must either state that production will be permitted as requested or state grounds for objecting to the request. If the requested time and manner of production is not agreed to, the response must commit to a reasonable alternative. Most important is the requirement in new Rule 34.02(c)(3) that if any responsive materials are being withheld on the basis of any objection, they must be identified. The rule does not require detailed itemization, although if the basis for objection is any claim of privilege, a privilege log is still required by existing Rule 26(f). The purpose of the new rule is to end the obstructive practice of stating a page of boilerplate objections followed by “notwithstanding the foregoing objections, all relevant documents will be produced.” This type of response has been used by some lawyers to conceal that they had withheld any material, and their existence would sometimes not come up until trial (or worse, would never be known to the requesting party). The revised rule will put the requesting party on notice that not all responsive documents are being produced.

Rule 34 further clarifies the form of production, requiring that ESI be produced in the form requested unless an objection is made, but that ESI must in any event be produced in the form it takes in the ordinary course of business. If no form is specified in the request, ESI must still be produced in a reasonably useful form. All of these provisions are trumped by the favored form of production—any format that the parties stipulate to! Rule 37.01(b)(2)(D) is also amended specifically to authorize sanctions for failure to produce information as requested.

The final discovery amendment worth special attention is the new rule on sanctions for failure to preserve ESI, Rule 37.05. The rule follows its federal counterpart and is intended to discourage routine “satellite litigation” over sanctions for the failure to preserve ESI. It allows sanctions only if 1) the party failed to take reasonable steps to preserve the data and 2) the data cannot be restored or replaced, such as by locating other copies. If those two prerequisites are met, then the court can only impose a sanction sufficient to eliminate or cure the prejudice to the other parties. To impose a sanction beyond a playing-field-leveling sanction, the court must find that the party acted with intent to deprive the other side of information, in which case the court may presume that the information was unfavorable, or instruct the jury to that effect, or enter a default or dismissal.

On its face, this new sanction rule applies only to failure to preserve ESI, just like the federal rule. It is not obvious, however, why it doesn’t apply just as well to the failure to preserve paper documents or physical evidence. That may be an amendment for the future.

Impleader and summary judgment

The advisory committee recommended that two Minnesota rules be revamped, if for no other reason than to adopt their federal rule phrasing and to improve the readability of the rule: both Rule 14 and Rule 56. The committee concluded both that the federal rule in each case was a clearer, better rule and that it would be advantageous for the state and federal rules to be the same. 

Rule 14 now attempts to bring order to the chaos that sometimes ensues when third parties are added to a case. Eight subsections should let everyone know where the new claims stand relative to the existing claims.

The Court adopted the federal changes in Rule 56, carefully retaining the existing “no genuine issue of material fact” test instead of the federal articulation of the standard (“no genuine dispute as to any material fact”). It is not clear that this divergence in the precise language of the Minnesota and federal rules will—or should—make any material difference, but it will avoid any argument that a change in the language brings a new standard to bear on these important motions.

Waiver of service/service by mail

Current Rule 4.05 is a rule that has never worked in practice, and since it is labeled “Service by Mail,” has been a trap for the unwary. It has never authorized service to be accomplished by mailing—it only allows a party to mail process and hope that the recipient will accept that as service. Given the due process importance of service, this rule cried out for reform. Here, the federal counterpart adopted in 1993 provides a better model and has now been adopted in Minnesota. Form 23 is replaced by Forms 22A and 22B to simplify use of the rule and compliance with its requirements. It still does not allow service to be accomplished merely by mailing but shouldn’t mislead someone into thinking that was what the rule accomplishes. As amended, the rule allows a party to request a waiver of formal service and also provides both a carrot and stick to encourage that the party consider waiving. Rule 4.05(c) allows a party waiving service additional time to answer—60 days after the request was made—and Rule 4.05(b) provides that the failure to waive service without good cause requires the recipient of the request to pay the cost of service.

One potential trap for the unwary remains under this rule: It places the defendant in control of determining when service is made. Rule 4.05(d) deems service made on the date of signing the waiver—a date under the defendant’s control. Because Minnesota actions are commenced by service, if a statute of limitation or of repose (or any other deadline) looms, a plaintiff should probably go directly to service by other means as allowed under Rule 4.

Miscellaneous rules

Several amendments will barely be noticed. Rule 10.01 was amended to clarify that a party may only proceed by a pseudonym—such as “Jane Doe” or by initials—if allowed by law or court order. A party seeking to proceed this way should seek an order upon commencement of the case if it is not otherwise allowed by statute or common law. The Advisory Committee Comment to Rule 12.01 was amended to point out that the time to respond to certain complaints relating to architectural compliance with disability requirements was extended by legislation in 2017. Rule 67.04 was amended to modernize the procedure for payment of money into court, removing the requirement of a bond for the court administrator and clarifying that a court order is required to permit payment into court.8 Several additional rules were amended to update cross-references, correct errors, or to make minor style changes, such as adding headings to subdivisions of the rules.

Effective date

The amended rules all take effect on July 1, 2018. Most of the amendments apply to pending actions as well as those filed after July 1. The amendments to Rules 26, 34, 37, and 63 apply directly only to actions filed after July 1, although the Court’s adoption order makes it clear that the court may direct the parties to follow the new discovery rules in pending cases.

Conclusion

The rules of procedure are not static. They evolve, as the Court and its advisory committee continue to monitor how they are working and whether further modification of them will help them foster the “just, speedy, and inexpensive determination of every action.”9


Minnesota Civil Rules –
Amended Effective July 1, 2018

          
Rule Subject Change
4.05 (& 3.01) Waiver of service New process for waiving service of summons 

Existing Rule 4.05 (Service by mail) is deleted

Form 23 deleted and new Forms 22A and 22B are adopted

10.01 Caption Sentence added to provide for identification of party by pseudonym only if authorized by law or court order
12.01 Advisory Committee Comment  Comment amended to add reference to legislation changing the time to respond to complaint in certain actions
14 Third-Party Practice Rule is entirely replaced by new Rule 14
23.05 Class action
settlement approval
Rule includes additional provisions for distribution of residual funds and notice to certain potential recipients
26.02(b) Discovery:
 scope and limits
Proportionality requirement incorporated in definition of scope of discovery

Parallel change in Rule 34.01 for document discovery

26.03 Discovery:
protective orders
Allows protective order to allocate cost of discovery
26.04 Discovery: timing Allows early requests for production under Rule 34, without accelerating due date for responses
26.06(c)  Discovery:
discovery plan
Adds requirement that discovery plan cover preservation of ESI
34.02 Document requests 

and responses

1) requires particularity in requests

2)
must specify a reasonable time, place, and manner of requested production

3)
response required to each item, and must either agree to request or state objection with particularity

4)
time must be as proposed or at another specified, reasonable time

5)
any objection must state if anything is being withheld on the basis of the objection

6)
ESI must be produced in requested form or may object, but must produce documents as kept in the ordinary course of business

7)
if no form specified in request, must produce in reasonably usable form

37.01(b)(2)(D) Orders compelling discovery response Provides language consistent with amended Rule 34.02 on failure to produce documents as requested
37.05 Failure to preserve ESI 1) Replaces existing rule

2)
1st step for failure to preserve: can info be restored or replaced?

3)
2nd step: does another party suffer prejudice?
> then sanction only to cure prejudice

4)
Upon finding of intentional destruction to deprive opponent of information,
> then more severe sanction of adverse inference, or enter dismissal or default

56 Summary judgment Rule is entirely revamped
63.02 Disqualification of judge for interest or bias Adopts standard of disqualification under Code of Judicial Conduct 
67.04 Money paid into court Provides for deposit into court by court order and removes bond requirement

Numerous minor changes to correct cross-references, spelling or punctuation issues, or to add paragraph subheadings are not included in this table.

 


HON. ERIC HYLDEN is a district court judge in Duluth. He serves as chair of the Minnesota Supreme Court Advisory Committee on Rules of Civil Procedure.

MICHAEL B. JOHNSON is senior legal counsel in the Legal Counsel Division of Minnesota State Court Administration. Mike serves as staff to the advisory committee.

DAVID F. HERR practices at Maslon LLP in Minneapolis and is reporter for the advisory committee.

The authors are indebted to the entire membership of the advisory committee for their hard work on these amendments. The wisdom of the group clearly exceeded that of any single member.


Notes

1 The Court’s order, including commentary from the court as well as the text of the adopted rules, is available on the Court’s website, at: http://www.mncourts.gov/mncourtsgov/media/Appellate/Supreme%20Court/RecentRulesOrders/ORADM048001-031318.pdf 

2 See ALI Principles of the Law of Aggregate Litigation §3.07 (2010).

3 The rule does not identify specific legal services providers; it simply incorporates the definition of Minn. Stat. §480.24, subd. 3, for “qualified legal services programs.” It may be necessary for the courts to develop a list defining the universe of organizations meeting the statutory definition.

4 See, e.g., Powell v Anderson, 660 N.W.2d 107, 114–15 (Minn. 2003).

5 See, e.g., David F. Herr, “A Parting of Ways? Amendments to the Civil Rules — State and Federal,” Bench & Bar of Minn., July 2000, at 29.

6  See, e.g., Patterson v. Wu Family Corp., 608 N.W.2d 863, 867 n.4 (Minn. 2000).

7 See Fed. R. Civ. P. 16(b)(1).

8 Rent escrow deposits pursuant to Minn. Stat. §504B.385 do not appear to require a separate order prior to deposit with the court administrator.

9 See Minn. R. Civ. P. 1.

Leave a Reply

Articles by Issue

Articles by Subject