Monthly Archives: October 2009

Minjares v. State (CA1 10/29/09)

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Citing Rule 60(c)(6) is normally an act of desperation. But here a litigant not only won the motion, it did so without even making it.

Minjares was hurt in a a car accident in Kingman. She sued the other driver and also sued Kingman, Mohave County, and the State on road-design issues. The County escaped by dismissal before trial, Kingman by JMOL at trial; the jury awarded just over three million dollars and found the State 33% at fault. Judgment was entered accordingly, plus post-judgment interest at 10%

The State appealed the Kingman JMOL; it lost. It then filed a motion in the trial court under 60(a) and 60(b)(2) asking it to “correct” the judgment to state a different interest rate for appeal, pursuant to 41-622f: “Interest on any judgment against this state  . . .  shall accrue at the average yield offered by United States treasury bills during the course of the appeal.”  The court granted the motion.

Minjares appealed, arguing that res judicata barred relief, that the State had waived the issue, and that Rule 60 does not permit amending a judgment after appeal.

It is not clear from the opinion that anybody in the case, including the Court of Appeals, had a very firm grasp of res judicata or collateral estoppel but the opinion decided that they don’t apply.

As to waiver, the State argued in essence that it couldn’t ask that the judgment reflect a reduced interest rate on appeal until it appealed, by which time it couldn’t ask for it because it hadn’t asked for it in the court below, and anyway, if it won the appeal it might not have had to pay interest in the long run anyway, and on top of that, it couldn’t know how much the “average yield” on T-bills would be. Why it couldn’t or didn’t simply request that the judgment incorporate the statute or statutory language is left tantalizingly unexplained. Division One, although with a comment apparently intending to suggest  that to its eye there was a waiver, ruled that it “cannot say” that the trial court committed “clear error” in finding no waiver.

This was, after all, the trial court’s factual finding,  and so the ruling is perhaps correct even though the State’s arguments were silly. (For some reason the opinion does not – contrary to modern convention – explain at great length the applicable standard of review, nor mention it at all. We applaud this – it shouldn’t be necessary to mention the standard unless it is an issue of dispute in the case.)

Judge Norris dissented on the waiver issue, taking the eminently sensible position that the State could have and should have taken care of the matter before judgment was entered. Had she been the trial judge, we would have had a more reasonable result.

Finally, as to Rule 60, the court ruled that 60(a) and 60(b)(2) didn’t apply since the judgment was correct when entered.  The “omission of a proviso that, if the State appealed, the interest rate would be modified to the average interest of treasury bills during the pendency of the appeal” was not a clerical error nor a mistake about money since the trial court hadn’t intended to include it. (Of course, this admits that the court could have included it and therefore that the State’s waiver arguments were ridiculous.)

But the court then considered Rule 60(c)(6), using one of those rules that the courts use or ignore as they please: an appellate court will affirm a trial court’s ruling if there is any reason why the ruling was correct. The Court of Appeals decided that 60(c)(6) relief was appropriate, citing a case in which a wife was allowed to modify her divorce decree when her ex filed bankruptcy, which she hadn’t expected. Why should that allow the party who did the “unexpected” to amend a judgment to its benefit by incorporating after the fact a statute that it knew about  as a matter of law at the time of the original judgment? Also unexplained. The court concludes that the trial court did not abuse its discretion in granting Rule 60 relief for the wrong reasons.

The last several pages of the opinion are devoted to deciding that the statute means what it more-or-less seems to say, namely, that the T-bill interest rate applies to judgments against the State while they are on appeal.

Zeagler v. Buckley (CA2 10/27/09)

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This is an appeal from an award of attorneys fees in a contract case. The holding is this: just as fees may be awarded where contract and non contract claims are intertwined, they may be awarded where contract and non-contract actions are intertwined – at least where the fees would have been incurred anyway, at least where the “non-contract” action is a bankruptcy about which there is a strong smell of gamesmanship.

Zeagler sued Buckley for breach of contract. Buckley responded by filing for bankruptcy; she withdrew her petition months later, the day before a hearing on Zeagler’s motion to dismiss it for bad faith. The contract action resumed, Buckley lost at trial, the court awarded fees. The award included fees incurred in the bankruptcy action, which the trial court found – and Buckley apparently did not deny – were for “obtaining information and establishing contractual rights” that would have been obtained and established regardless of the bankruptcy.

Buckley appealed. Her only argument was that the court could not award the bankruptcy fees because bankruptcy is not a “contested action” as required by 12-341.01. Division Two decided that that didn’t matter, that the “intertwined” rule applies, and that if it didn’t then parties would file bankruptcy just to avoid fees.

We tend to think that the those-fees-would-have-happened-anyway aspect is important but the appeal wasn’t structured to emphasize that much. And while we agree that some would try to take advantage of a bankruptcy loophole to avoid a fee award, what does that say about the responsible-lawyers-will-never-do-this-bad-thing line we get from the courts whenever they decide to allow that particular bad thing to be done?

The Court of Appeals seems annoyed by the fact that Buckley based her appeal on an issue of law rather than on a factual debate about abuse of discretion. Why a lawyer would do that seems fairly obvious. The opinion nevertheless spends a long footnote whining that Buckley’s “scant” briefs fail to argue an issue she didn’t raise. We would have thought them a Godsend: briefs that really are brief and that present a clear question of law rather than rehashing facts disputing a forgone conclusion. Had Buckley’s briefs violated ARCAP 13, we bet that at least one footnote would have said so. Maybe her lawyer said something at oral argument to set the court off; if so, the footnote should have said that so as not to seem utterly clueless.

Grosvenor Holdings, L.L.C. v. Pinal County (CA2 11/22/09)

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In our last review we called the lawyering “weird.” Here it is pretty good.

Some home builders (“Grosvenor”) wanted to build homes in Pinal County. They entered into a development agreement with the Board of Supervisors that let them do so for five years  and then request an extension, under  typical  “not to be unreasonably withheld” language, for another five. The Board promised in the agreement not to charge impact fees. When the time came, Grosvenor requested an extension; the Board refused it because it wanted to impose impact fees on all future construction. Grosvenor sued. The County moved for summary judgment because the agreement said that all disputes had to be resolved pursuant to the Administrative Review Act. The agreement did say that; the wrinkle is that the A.R.A. does not apply to a Board of Supervisors. The Board argued that it could voluntarily agree to use it; Grosvenor, arguing that it couldn’t, filed a motion for partial summary judgment. The trial court agreed with the Board and denied the motion.

This is where good lawyering pays off. Among Grosvenor’s arguments was a clear issue of law that made a fine hook for special action: the Board couldn’t voluntarily use the A.R.A. because that would expand the trial court’s subject-matter jurisdiction. The hook was so good that the Court of Appeals accepted review of the denial of a partial summary judgment. (For some reason Grosvenor’s petition also raised other issues; Division Two essentially ignored them.)

The Court of Appeals reversed. The holding is that a court has the power to review administrative decisions only as granted it by the A.R.A.; agreements use the A.R.A. in situations that it does not cover are void. You cannot extend a court’s subject-matter jurisdiction by stipulation.

Judging by the opinion it looks like Grosvenor’s lawyers briefed the matter well, though perhaps at too much length. The opinion is clearly-written and well-organized but is the sort that wants to cite a case with every breath, proving with at least one citation every legal commonplace. But that has become the courts’ style, so we probably shouldn’t blame it on the parties.

The court’s notification of the case calls it “Grosvenor Holdings v. Pinal County,”  which we applaud since it avoids the “Hon” problem we vented about recently and shows, by not throwing the judge’s name around as if he were a party to a lawsuit, what we old-fashioned types would consider a proper measure of grace and respect.