Looks like somebody’s in a snit. The only reason we can see for publishing this very minor case is so that its author can accuse another recent CA1 decision of misconstruing an opinion he wrote several years ago.
Landlord and Tenants sued each other over a lease disagreement. The case went to compulsory arbitration. The arbitrator issued an “award” rather than a notice of decision, giving both parties some money but making no provision for costs or fees. But the arbitrator wasn’t the only one who apparently hadn’t read the rules: Tenants waited until after the appeal time had expired to try to do anything about it. What they then filed to try to get fees and more damages can for our purposes be passed over since they show no particular grasp of law, procedure, or – this opinion suggests – factual accuracy. The trial court denied their motions; they appealed.
The Court of Appeals affirms. Once the appeal time runs its too late for the Superior Court to change an award, nor can the arbitrator since his jurisdiction expires with the appeal time. That’s pretty basic, so no extended analysis is given or necessary.
So why publish? To publicize footnote two.
Tenants argued that the lease gave them a right to fees. The court says, in the footnote, that contractual fees are an element of the breach and so, like the other items of damage, must be pleaded and proved in the case-in-chief (which Tenants apparently hadn’t done). “On this point we do not agree with, [comma in original] and do not follow Keg Restaurants”, decided in June by another panel, “which misreads our opinion in Robert E. Mann Construction“ (App. 2003). “In Mann we held that, because a claim for contractual attorneys’ fees is part of the damages for breach, such fees must be pleaded and proved. 204 Ariz. at 133, ¶ 12, 60 P.3d at 712. The panel in Keg erroneously reads this to mean that contractual fees must be pleaded and proved only ‘when attorneys’ fees are treated as damages.’” “Because it is wrong, we disregard this holding in Keg.”
The italics for “because” and “when” are in the original. You do see the distinction the court is making, right? If so, please explain it. What Keg actually said (and this comes nowhere near being a “holding”) is that an argument that contractual damages must be pleaded and proved doesn’t apply when the claim is for expert witness fees. Keg agreed that fees must be pleaded and proved if “their recovery is dependent on the contractual provision.” But Keg noted (and this also isn’t a holding) that otherwise our courts “generally do not construe ‘damages’ to include attorneys’ fees,” quoting City Center (App. 2015). That “compounds [Keg’s] error,” says footnote two, because in City Center and the cases it cited “fees were not treated as contract damages.” Yet that’s precisely the point Keg was making: some fees aren’t contract damages.
We’ll assume there was at oral argument, or has been in chambers, some disagreement that is not apparent. Otherwise it isn’t clear why Kesla didn’t simply distinguish Keg rather than rant about it. Or, better yet, point out that whatever substantive rights Tenants had didn’t survive letting their appeal time run.