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Cardinal & Satchel, P.C. v. Curtiss (CA2 9/3/10)

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The holding here is that legal fees to get a divorce can be a community debt.

The plaintiff law firm represented Mrs. Curtiss in a divorce but she died before the decree was issued. So the firm sued her husband for its fees, on the theory that since the divorce wasn’t final yet her fees were a community debt. (It also sued her estate but this opinion does not deal substantively with that part of the case.) The trial court granted Mr. Curtiss’ motion to dismiss for failure to state a claim; it ruled that divorce fees can’t be a community debt because they’re incurred to destroy the community.

The Court of Appeals rules that divorce fees can be a community debt and that the trial court therefore shouldn’t have ruled on the issue as a matter of law. Community debts are intended to benefit the community, though that need not be the primary intention. The court decides that divorce fees can benefit the community by ensuring “the orderly and lawful division of assets, including temporary orders which protect community assets.” That’s a bit like saying that execution is for the benefit of the accused – orderly and lawful, and in the mean time he’s protected in a warm, comfy jail cell. Division and protection are of course not for the benefit of the late community but for that of the resulting individuals. And so the court offers another reason: divorce fees benefit the community because “the advice of counsel and the entry of temporary orders providing for a spouse‟s necessary living expenses may, when coupled with mediation or counseling, actually preserve the marriage.” How temporary spousal maintenance preserves a marriage is obscure. But mediation and counseling saving a marriage – maybe the court’s on to something. Except that when we last knew (we don’t pretend to be divorce experts) mediation was a necessary part of the process – and normally resented by all involved – not the result of counsel’s sage wisdom and valuable advice.

When all else fails there’s the “think of the children” argument, and so here. “Attorneys for the spouses also play a role in benefiting the children of the community in dissolution.” That’s an interesting notion, that your kids aren’t yours but instead your community’s. Its orderly and lawful death is therefore a benefit for them, too. The court actually cites a case for this: a New Mexico case holding squarely that divorce fees are not community debts but also holding that debts to benefit children can be – because the New Mexico statute specifically includes “dependants,” not just “community.”

Speaking of when all else fails, we spoke too soon. A Louisiana statute says that divorce costs are community. People used to think that nobody outside Louisiana used Louisiana authority except in moments of panic. Even its community property law is unique, based on the Code Napoleon rather than Spanish tradition.   Perhaps the court simply wanted the frisson of using precedent from a legal system that does not, at least in theory, use precedent.

So the court remands “for further proceedings consistent with this opinion.” That means  a motion for summary judgment, the law firm arguing that the wife “objectively” intended to benefit the community. How’s the trial court going to determine that? By considering “the surrounding circumstances at the time of the transaction.” Yep, analyzing surrounding circumstances is just the stuff of summary judgment, all right. But if not then the court can presumably hold a trial to find out if the wife, in hiring lawyers to get her a divorce, “objectively” really wanted mediation to save the marriage, or to improve the lot of the “community’s” children, or some such.

Fidelity National Financial v. Friedman et al. (8/19/10)

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This is an opinion on certified questions from the Ninth Circuit concerning judgment renewal.

Fidelity took judgment against the defendants, in federal court in California, in 2002. It registered the judgment here and unsuccessfully tried to collect it. In 2008 the defendants moved in Arizona federal court to bar further collection efforts because Fidelity hadn’t renewed the judgment. The court denied the motion, concluding that the judgment had been renewed by Fidelity’s attempts to collect it, which included the Arizona collection efforts and a lawsuit it filed against the same defendants, again in California, in 2006, alleging that their attempts to avoid paying the judgment violated RICO. Defendants appealed. The Ninth Circuit certified the questions of whether either collection efforts or filing a related case in another state renews a judgment.

Under 12-1551(B) a judgment must be renewed within five years by affidavit or by “an action . . . brought on” it. Fidelity argued that “’action’ includes any matter or proceeding in a court,” quoting 1-215. But the Supreme Court, after reviewing 1551’s common-law and statutory predecessors – which long predate 215 – determined that it refers to a common-law action on a judgment, not “any matter.”  In that kind of “action” the creditor alleges the old judgment and prays for a new one on the same debt. It wouldn’t make sense to have a well-defined affidavit process if “any matter” would do just as well. And prospective creditors of the judgment debtor would have a hard time knowing if the judgment was still in force if “any matter” could keep it alive rather than something clearly on the docket.

So, Fidelity’s acts did not renew its judgment.

It has been so long since anyone filed a real action on a judgment that Fidelity may actually have believed its arguments. The result shouldn’t surprise those who have worked with the statute or know anything of the history recited by the court, though. It is probably time to remove the “action on a judgment” language, just as an earlier version of 1551 removed scire facias from the law.

But perhaps what confused Fidelity and the District Court was AAU v. Wood, 209 Ariz. 137 (App 2004), which held that intervention counts as “an action . . . on” a judgment. In a footnote this court says “we express no opinion whether, in light of today’s opinion, the court of appeals” was correct. In light of today’s opinion it obviously wasn’t, and was so wrong that the opinion really should mention it, but that’s a problem since Justice Pelander, who joins this unanimous opinion, wrote AAU. That was not his finest hour. AAU might also explain why he did not write this opinion (Justice Hurwitz did) even though he addressed the same basic issue last year in Jones, which was not consistent with AAU either and which the Supreme Court later ordered de-published anyway.

Speaking of Justice Hurwitz, this isn’t quite as clean an opinion as we’ve come to expect from him. “The starting point in resolving the questions before us is the common law background,” he tells us at the beginning. That’s true. But it would have been useful to say why it’s true – because the background illuminates the legislative intent of the present statute – at the beginning, too, rather than waiting until the end of the legal-history analysis to explain why it’s there. But we’re not complaining too much since we’re suckers for legal history; he gets extra points, in our book, for using scire facias in a sentence (although we think it should be set in italics, and that Court of Appeals should be capitalized, two things this opinion doesn’t do).

 

(link to opinion)

Estate of Winn v. Plaza Healthcare (CA1 8/10/10)

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This was an attempt to create a new category of damages.

Mary Winn died in a nursing home. Her estate sued it under the Adult Protective Services Act. The Estate filed a motion for “summary judgment,” admitting that it had no financial loss (Mary had retired) but arguing that it should be awarded the “inherent value” of her life. The trial court denied it. After some procedural clumsiness and a compulsory-arbitration award for the defendant (which the court assumes was for lack of any damages; the Estate admitted it couldn’t prove pre-death pain and suffering, which a Supreme Court case – Denton – had allowed), this appeal resulted.

The APSA says that the court may award “actual and compensatory damages.” The Estate argued that “actual damages” includes the inherent value of life. The Court of Appeals disagreed. There is no evidence that the legislature intended this and if it had then it could have said so. If somebody wanted more damages then Mr. Winn should have filed a wrongful-death claim.

The Estate’s argument isn’t quite as silly as it sounds; it’s an attempt to follow-up Denton, which used verbal slight-of-hand with the “actual damage” language to produce a result the legislature surely never thought of.

The bigger problem here is bigger because it’s one seen all the time: a “motion for summary judgment” that isn’t. A motion for summary judgment seeks a judgment. A motion seeking a ruling on, for example, what the damages include doesn’t.  Most motions for summary judgment “on the issue of” something-or-other can’t properly result in a judgment. They’re motions in limine.

So why do the movants take on the burden of the summary-judgment standard? Two reasons. The first, and by far the most common, is that they haven’t thought about what they’re doing. They call their motion a “summary judgment” because they once saw someone else do that with a similar motion. (That’s how most lawyers learn most things and why so much of what they learn is wrong.) And too many lawyers aren’t comfortable with the fact that a motion “in limine” can be filed months or years before trial.

The other reason is equally wrong but not thoughtless. If the whole point of your case is to make new law then if you can manage to get the ruling called a judgment then maybe you can appeal it without further ado. That’s what these folks tried. But the Court of Appeals caught on – the flaw in this plan is that the court routinely will catch on – and kicked it back for arbitration.

And what of the estate of poor Mary Winn, now reduced by costs if not fees? A touchingly naive question. You surely can’t think that anyone in this saga, except Mr. Winn, was actually concerned about such a thing as that.

 

(link to opinion)