Senate Bill 235 Makes Huge Changes To Discovery Rules In Civil Cases

In a momentous shift for California's legal framework, Governor Gavin Newsom's signing of Senate Bill (SB) No. 235 on September 30, 2023, heralds a new era in the state's judicial proceedings. This landmark legislation marks a significant overhaul of the discovery process in civil litigation, aligning it more closely with the Federal Rules of Civil Procedure. Understanding the nuances and implications of SB 235 is crucial for effective legal practice in California. This new bill reshapes the procedural dynamics of civil litigation, setting new standards and expectations for legal practitioners. 

Senate Bill 235 does essentially two things that every civil litigation practitioner must know. The first is that the early disclosure procedures laid out in Code of Civil Procedure Section 2016.090 will now be mandatory unless otherwise modified by stipulation of the parties. The Second is that the sanctions set forth in Code of Civil Procedure Section 2023.050 have been increased from $250 to a mandatory $1,000 minimum.

Let’s break down SB 235 down further:

California Code of Civil Procedure Section 2016.090 now requires that within 60 days of a demand by any party to the action, each party that has appeared in the action, including the party that made the demand, shall provide to the other parties an initial disclosure that includes the following:

Witness Information: The names, addresses, telephone numbers, and email addresses of all persons likely to have discoverable information, along with the subjects of that information, that the disclosing party may use to support its claims or defenses, or that is relevant to the subject matter of the action or the order on any motion made in that action, unless the use would be solely for impeachment. The disclosure does not require the parties to include persons who are expert trial witnesses or are retained as consultants who may later be designated as expert trial witnesses;

Relevant Documents: A copy, or a description by category and location, of all documents, electronically stored information, and tangible things that the disclosing party has in its possession, custody, or control and may use to support its claims or defenses, or that is relevant to the subject matter of the action or the order on any motion made in that action, unless the use would be solely for impeachment;

Insurance Policies: Any contractual agreement and any insurance policy under which an insurance company may be liable to satisfy, in whole or in part, a judgment entered in the action or to indemnify or reimburse for payments made to satisfy the judgment;

Indemnification Documents: Any and all contractual agreements and any and all insurance policies under which a person, as defined in Section 175 of the Evidence Code, may be liable to satisfy, in whole or in part, a judgment entered in the action or to indemnify or reimburse for payments made to satisfy the judgment. Only those provisions of an agreement that are material to the terms of the insurance, indemnification, or reimbursement are required to be included in the initial disclosure. Material provisions include, but are not limited to, the identities of parties to the agreement, the nature and limits of the coverage, and any and all documents regarding whether any insurance carrier is disputing the agreement’s or policy’s coverage of the claim involved in the action.

Notably, SB 235 is not retroactive. The changes apply only to civil actions filed on or after January 1, 2024 and shall remain in effect until January 1, 2027. The purpose of the SB 235 is likely to streamline the discovery process by requiring the disclosure of all relevant witness information and documents at the outset –reducing the amount of discovery needed, forcing the parties to evaluate their positions earlier, and, at least in theory, cutting down costs and making litigation more efficient for everyone.

Upon demand, parties are now required to make initial disclosures based on the information then reasonably available to it. A party is not excused from making its initial disclosures because it has not fully investigated the case, because it challenges the sufficiency of another party’s disclosures, or because another party has not made its disclosures. Counsel must be more proactive in identifying what information and documents are relevant early on in a case, and then obtain that information from the client and/or other source in a timely manner to ensure that such information is contained in the initial disclosure. Counsel will need to implement processes and/or procedures for obtaining pertinent information at a far earlier phase in the case.

This is especially true in light of the increase in discovery sanctions where counsel fails to timely respond to a documents request, intends to cause unnecessary delay, and/or where counsel fail to meet and confer to resolve any dispute regarding the request, among other things. The court now must impose a mandatory non-compliance sanction of no less than $1,000, significantly higher than the previous $250 suggested penalty.

There are certain situations where SB 235 may not apply. For example, certain parties and cases are exempted from these requirements, including those not represented by counsel, unlawful detainer actions, small claims cases, and actions initiated under specific codes. For that reason, it is important that you take the time to fully understand SB 235 and the implications that may affect you and/or your firm.

For more information of Senate Bill 235, you can visit:  https://sjud.senate.ca.gov/sites/sjud.senate.ca.gov/files/sb_235_umberg_sjud_analysis.pdf