Tucson Estates v. Estate of Jenkins (CA2 11/12/19)

The defendant didn’t care about this case; it made no appearance at any stage of it. The plaintiff cared mostly about attorney’s fees — but not those in this case, as only a couple of thousand dollars were at issue. The point, as the court suggests between the lines, was to set an easy-fee precedent for its future cases.

Plaintiff, a homeowners’ association, sued Defendant alleging violations of the CC&Rs. Plaintiff took default judgment and submitted a China Doll affidavit for its fees. The trial court awarded fees but reduced them, finding some of the requested fees excessive. Plaintiff appealed. A non-appearance on appeal is normally a confession of error but Plaintiff wanted a precedent set instead, so that’s what the court did: it reviewed the issue and published but set a precedent opposite to what Plaintiff wanted.

Plaintiff argued that the trial court’s ability to reduce the amount evidenced by a China Doll affidavit is limited when there is no opposition to it. Although that sounds dangerous considering the routine effronteries of China Doll affidavits there is decent support for it in some of the language of the precedent, including China Doll itself. The court has to step around that; not all of its steps are equally deft.

China Doll “authorizes a trial court to adjust a fee award ‘upon the presentation of an opposing affidavit.'” But it didn’t involve a situation where no one was available to file one.

McDowell (App. 2007) said that a China Doll affidavit establishes a “prima facie entitlement to fees in the amount requested.” McDowell was an HOA case involving contractual fees. This opinion distinguishes McDowell on the grounds that the CC&Rs in that case gave the HOA a claim to “all” fees whereas Tucson Estates’ give it a claim to “reasonable” fees.

Which leads the court to a conclusion: in order to ensure that the fee awarded is reasonable the trial court has broad discretion to review the fee request despite lack of an opposition. Otherwise, the intent of the parties to the contract could be frustrated.

This is good policy, the court tells us, because limiting the trial court “would incentivize some prevailing parties to overreach in their fee applications.” No, really?

(The irony is that this plaintiff didn’t, at least not much. Some of the items criticized by the trial court seem a bit overstated but others certainly don’t.)

But wait a minute. Is the court really suggesting that its rule doesn’t apply if the fee agreement says “all”? Can a default judgment include an unreasonable fee if the contract is worded correctly? What about the rule that that’s unethical? Isn’t it also against public policy? And if it is indeed against public policy, what is the legal difference between a contract that says “all” and a contract that says “reasonable”?

(Opinion: Tucson Estates Property Owners Association vs. Estate of Jenkins)

Apache Produce v. Malena Produce (CA1 8/12/19)

This nice opinion, a case of first impression that has the taste not to boast of it, concerns an interesting issue regarding injunctive relief.

Plaintiff and Defendant are rival Nogales produce importers. Plaintiff was in litigation in Mexico with a certain Mexican grower about whether it had a contract to distribute the grower’s produce; Plaintiff said it did, the grower said it didn’t. When the grower hired Defendant Plaintiff brought this case for intereference with contract and unjust enrichment, seeking damages and injunctive relief. It applied for a TRO and a hearing on a preliminary injunction. Defendant then moved to stay the case, apparently until the Mexican litigation was resolved. The trial court granted the stay without ruling on the injunctive issues. Plaintiff filed a special action, which the Court of Appeals declined. So Plaintiff filed an appeal.

12-2101(A)(5)(b) permits appeal from an order “refusing to grant . . . an injunction.” Plaintiff argued that by not ruling on the injunction the trial court refused it. Defendant argued that the court didn’t refuse it but instead merely deferred it until after the stay. There is no Arizona authority on point. Because preliminary injunctions are to provide speedy relief from irreparable injury, the court concludes that by indefinitely postponing it the trial court had effectively denied it. Cases from other jurisdictions are to the same effect.

On the merits the court holds that granting a stay to avoid ruling on a preliminary injunction is an abuse of discretion. The factors considered in ruling on the two are different. Using one to dispose of the other employs the wrong legal standard.

A good opinion but one that should never have existed. We have no idea whether Plaintiff deserves a preliminary injunction. But how can a trial court believe that a party’s request for relief could be dealt with by not ruling on it? There is a reason why there was no Arizona authority, and why these cases are few and far between elsewhere. And it isn’t because defendants don’t ever try to stay a case to avoid an injunction.

(Opinion: Apache Importers v. Malena Produce)

Duff v. Lee (CA2 3/29/19)

By coincidence here is an example of a phenomenon we mentioned the other day, a litigant’s attempt to avoid the claw-back. This one is a bit unusual because it comes from a class of cases — low-end PI claims — that will not do so from now on. But, needless to say, the court does not allow it.

Plaintiff wanted to avoid Pima County’s FASTAR program. (Bureaucrats no doubt think the acronym exceedingly clever. This is the program that is to bring us “more efficient and inexpensive, yet fair” resolution of cases, according to the order enacting it; good of the Supreme Court to mention that last part, at least in passing. It is a pilot program in Pima until 2020, at which time it will be deemed a success and come to a courthouse near you.) The program junks compulsory arbitration and replaces it with a choice between a short trial (following abbreviated discovery) and an arbitration from which the plaintiff cannot appeal. Plaintiff filed a motion to get compulsory arbitration instead and took special action from its denial.

The court summarizes her arguments as being that the compulsory arbitration statute, 12-133, gives her substantive rights that the FASTAR rules violate. The respondent judge filed a brief arguing that the rules and the statute are consistent; the concurring opinion agrees but the majority does not. So it concludes that, while an appeal from compulsory arbitration has been held to be a substantive right, the arbitration itself is procedural. And as to the right of appeal, FASTAR merely “conditions” it. The rules therefore displace the statute under Seisinger (2009) and several earlier separation-of-powers cases.

Plaintiff also argued that FASTAR did not apply to her. The Supreme Court’s administrative order establishing the pilot program lowered Pima’s jurisdictional limit for compulsory arbitration to $1,000. But although the county, in order to set itself up for FASTAR, had requested this as part of a new set of local rules the Supreme Court’s separate order approving those rules was not entered until several months after FASTAR began. Plaintiff filed her case after FASTAR but before the separate order. The Supreme Court’s rules don’t actually allow local rules to be changed by administrative order but the Court of Appeals tells us decisively that “we cannot say the supreme court [sic.; the opinion capitalizes Superior Court but not Supreme Court] lacked authority” to do so in order to implement FASTAR. Whether an order is “administrative” makes a difference to lower courts but not to the Supreme Court because of that court’s “broad constitutional authority to make administrative rules.” And, apparently, to ignore them.

Plaintiff also argued that 12-133 should be read in conjunction with 22-201, which now gives the Justice Court exclusive jurisdiction up to $10,000. So the legislature didn’t intend that the limit for compulsory arbitration in Superior Court be reduced to a point below that court’s jurisdiction. (At least we think that’s what was being argued; neither opinion really explains it.) The majority “responds” to the argument by rejecting it in a footnote as “somewhat strained.” The concurrence adds, in language slightly oblique, that it makes no difference because the legislature has no power to prevent FASTAR anyway.

Based on the figure we have heard, the number of civil jury trials held in Pima County last year would, thirty years ago, have kept one division of that court busy for perhaps six weeks. But remember the iron rule: delays in the system are always your fault, never the bureaucrats’. This requires the strictly procedural decisions that, first, some people haven’t been damaged badly enough to deserve actual discovery and an actual trial and, second, even those who have been must be micromanaged by functionaries whose real concerns are the numbers on their “processing” spreadsheets. Whether any of that is fair is an afterthought, to be tacked on clumsily with a comma.

(Opinion: Duff v. Lee)