Tri-City National Bank v. Barth (CA1 3/17/15)

Its nice to know that the court will, at least eventually, put its foot down.

The Gradys borrowed money from Tri-City’s predecessor-in-interest, giving a Deed of Trust on their house. They defaulted. Following the normal modern debtor’s playbook, they sued Tri-City. They lost. But they didn’t move out, so Tri-City filed an FED action; the Gradys lost; they appealed. The trial court at first denied a stay of execution of the FED judgment pending appeal so they took a special action; the Court of Appeals ruled that a stay is not discretionary if an appropriate bond is filed. But the Court of Appeals eventually ruled against them on the merits and the Supreme Court denied review. So Tri-City moved to lift the stay, for a Writ of Restitution, and to take the bond. The Gradys responded with a nebulous motion asking the trial court to set aside the judgment, among other things. The trial court denied that motion and granted Tri-City’s. The Gradys appealed, as a special order after judgment, the denial of their motion. And they filed a motion to stay execution of the FED judgment until the completion of that appeal. The trial court granted that, feeling that it had to do so given the previous special-action ruling. Tri-City took this special action from that order.

The Court of Appeals accepts it and grants relief.

Both sides argued, again, whether a stay was discretionary. But the Court of Appeals decides the case on a different issue: “In our view, the real issue is whether the trial court had the authority to stay execution of a judgment not currently pending appeal. We hold that it did not.” “A stay can only be granted of the judgment that is being appealed,” based on the language of ARCAP 7(b) and 12-1182.

The court may be right but the analysis is more complicated than that. Although the opinion rules on an issue not briefed or argued, neither the opinion nor the record indicates that the court requested supplemental briefing. Why not? Its hard to think of a good reason but perhaps the court was reluctant to drag this out further. Tri-City has been trying for six years to get the Gradys out of the house and the court goes out of its way to suggest that their bond was inadequate. “Put simply, the Gradys are receiving a continuing unjust benefit through procedural gamesmanship.”

(link to opinion)