McCloud v. Kimbro (CA2 3/23/10)

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Here, for a change, is a plaintiff trying to argue that the defendant was not within the course and scope of employment and a court trying to find that he was. But this intro may spoil the court’s surprise; it drops a couple of early hints but waits until page 8 of 10 to make this clear.

Kimbro was a Phoenix DPS officer on temporary duty in Cochise County, where he rear-ended McCloud’s car while driving to lunch. McCloud promptly gave notice of her claim against the state, DPS, and Kimbro but then blew the one-year statute of limitations. So everybody but Kimbro got out and she was reduced to arguing that he wasn’t working for the state after all.

The rule elsewhere is that travelling employees are in the course and scope even when eating and sleeping, unless on distinctly personal business, but the Arizona precedent for that was in workers comp cases. This opinion adopts the rule for civil cases. Kimbro was working for the state, the claim against him was barred, summary judgment for him affirmed.

McCloud argued that Kimbro was covered by state insurance at the time of the accident. The court counters that under the Administrative Code having state insurance doesn’t create liability. The response is correct but unfortunate. It is an endlessly tempting idea that the scope of insurance shapes the scope of liability rather than the other way around. The courts should squash it definitively rather than by citing a line or two in the Risk Management regulations – but they won’t, since it is occasionally useful to them.

Our own endless temptation is to charge the windmills, so let’s try to improve opinion-drafting:

“Kimbro, as the moving party, is entitled to judgment as a matter of law.” That’s an unfortunate way to phrase it, no doubt an inadvertence, since summary judgment can also be granted against the moving party.

“Under Arizona law, “[a]n employer is vicariously liable for the negligent or tortious acts of its employee acting within the scope and course of employment,” the court explains, and cites a case for it. Please next time remember also to explain what “employer” and “employee” mean. Lawyers who benefit from that sort of thing will also appreciate a review of the the order of the alphabet and a primer on the tying of shoes. And cite cases.

Is it really necessary to include footnotes to discuss the things the court has decided that it doesn’t need to discuss?

Finally, please do remember, honestly, that the insertion of headings and sub-headings is not a substitute for organization, its a crutch for the organizationally-challenged.

(link to opinion)

Aqua Management, Inc. v. Abdeen (CA1 3/23/10)

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This discusses how costs, fees, and interest affect the question of whether an appeal from arbitration is 23% successful.

AMI sued Abdeen; the case went to compulsory arbitration. The arbitrator gave AMI an award plus costs and fees but denied prejudgment interest. Abdeen appealed; after a bench trial the court awarded AMI slightly less principal, denied costs and fees, but added prejudgment interest. AMI then moved for fees and costs under Rule 77(f), arguing that Abdeen hadn’t beaten the arbitration award by 23%. The trial court denied the motion, ruling that the fee award doesn’t count toward the comparison. AMI appealed.

(We simplify somewhat. The trial court got mixed up about which party had appealed, didn’t say whether it had taken prejudgment interest into account, and thought it had jurisdiction to rule on a substantive motion after the Notice of Appeal. And the final judgment didn’t add the numbers up correctly, which nobody but the Court of Appeals noticed. This all makes the opinion a bit tedious and confusing, which could largely have been avoided by better drafting but wasn’t much, what else is new.)

So, do the attorney’s fees count? A case called Vega (199 Ariz.) had said that everything counts, which is what the rule clearly means (“at least twenty-three percent (23%) than the monetary relief . . . granted by the arbitration award”). Vega meant that costs count. This case holds that the same analysis means (1) that fees count and (2) that prejudgment interest counts, too.

The case also holds (3) that post-judgment interest on the arbitration award does not count.

(link to opinion)

Wilshire Insurance v. S.A. (CA1 3/23/10)

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A case about the “criminal acts” exclusion.

Wilshire’s insured went to prison for sexually assaulting S.A. in his basement. She sued him for false imprisonment. Wilshire denied coverage because its policy, while covering false imprisonment, excluded criminal acts. Wilshire filed this action for declaratory judgment that it had no coverage. Wilshire won; S.A. appealed.

The policy said that it applied to injury caused by an “offense.” S.A. argued that that meant a crime and since the policy explicitly covered false imprisonment the criminal-act exclusion couldn’t deny coverage for the crime of false imprisonment.

But Arizona Supreme Court precedent requires that contracts be construed against “indemnifying a person against loss resulting from his own willful wrongdoing.”  That construction does not render illusory coverage for the false imprisonment or other intentional acts. Intentional acts that unintentionally result in “wrongful conduct” remain covered (e.g., the security guard who detains a customer without proper cause or for too long).

S.A. argued that the precedent preceded the Arizona Victims’ Bill of Rights. The court agreed that that established a public policy to compensate victims but said that it can’t change the precedent “even where the crimes are as horrific” as in this case; that’s up to the Supreme Court. It would perhaps have been better to point out that the Bill of Rights doesn’t talk about insurance, that the insured and victim ends of things are governed by different – and to some extent opposite – principles, and that allowing people to buy insurance against committing crimes – especially “horrific” ones – is  a rotten idea. But its easier to pass the buck to the Supreme Court, especially if you want it to change the precedent.

Is that what this court wanted? Maybe not, since it ruled on only one of Wilshire’s two arguments, which means that if the Supreme Court reverses it will probably kick the case back to let the Court of Appeals rule on the other one. On the other hand, maybe the court wanted that, too.