Banner University v. Gordon (CA2 5/29/20)

We have elected not to blog this — at least not yet — for one or more reasons set forth in our FAQ. It is a follow-up to Kopp.  The nature of the majority’s analysis reminds one of that case for reasons that are clear enough given who the players are. You may want to read the dissent first in order to be reminded of the traditional view before wading into the majority’s baroque analysis. 

Humphrey v. State of Arizona (CA1 4/30/2020)

Sadly, yet another notice-of-claim case. This one has some interesting complications but that’s basically what it is.

Plaintiffs’ decedents were killed when they crossed over to the wrong side of I-10 and ran into a truck. A few months later one of the plaintiffs saw an article about cable barriers that prevent crossovers and the other plaintiff tried to follow that up with the ADOT and get from it some statistics about crossover accidents. Meanwhile, a lawyer friend told them they needed to file a notice of claim and they authorized him to do so. The notice failed to state a sum certain for settlement.

Cut to about two years later. A letter one plaintiff sent to ADOT requesting information hadn’t produced much of an answer. A new lawyer had taken over the case. He filed a supplemental notice which fixed the problem with the original. (Naturally, it said that the first notice was just fine and that the supplement was filed in an “abundance of caution” — which, like “reserve the right,” has become a shibboleth intended to cover all ills and asses. In fairness, this lawyer knew better and what else could he say? But these phrases are words of weakness, not of strength.)  When the State failed to respond Plaintiffs filed suit for wrongful death and for not replying to their records request.

The State moved for summary judgment because a sufficient notice had not been filed within 180 days of the accrual of the claim. Plaintiffs argued that it hadn’t accrued — that they didn’t know or have reason to know that they had a claim — until the second lawyer’s expert witness told them so, that this was a question of fact, and that in any event the period should be tolled because the State hadn’t given them the information they asked for. The State also moved for summary judgment on Plaintiffs’ allegation that it hadn’t properly responded to their records request. The trial court denied the first motion, ruling that accrual was a fact issue. The record is “not entirely clear” on whether it ruled on the second; in any event, the case was then transferred to another judge, who also heard that motion and granted it.

When the wrongful-death claims went to trial the State moved for JMOL on the notice/accrual issue; the court denied it. The jury returned a massive plaintiffs’ verdict. (In a rare example of an appropriate footnote, the court points out that the statute now requires a separate trial on notice-of-claim issues, before trial on the merits. We frankly haven’t checked the timing but the court indicates that the provision applied at the time of these rulings. Why the plaintiffs’ attorney decided not to ask for that is apparent. That the trial judge didn’t know how to handle the case unless the lawyers told him is nowadays par for the course, as is the fact that he’d evidently never read the statute that the parties had been arguing about. We don’t know, though, what subtle and sophisticated reason the State’s lawyers had for not raising the issue. There must have been a subtle and sophisticated reason, right?). The State appealed.

The Court of Appeals reverses. Under these facts both plaintiffs had ample reason to know of the claim long before the second notice. They were “aware of an injury and [had] a reason to connect it to a particular cause such that ‘a reasonable person would be on notice to investigate whether the injury might result from fault.’” Whether they had an expert or had done all their investigation or were ready to file a lawsuit doesn’t matter. The notice of claim isn’t measured by the standards of a cause of action; its purpose is to allow the government to do its own investigation and evaluation.

Plaintiffs also argued that the time period should be tolled because the State hadn’t given them the information about crossover accidents and costs they had asked for. Although the court doesn’t expressly analyze it this way, that’s really just a variation of the first argument: the period shouldn’t run until Plaintiffs had the details they needed to prepare the case. But the time period is triggered by knowing enough to investigate, not by the results of the investigation.

Plaintiffs also argued that even if they had notice early on, the statutory beneficiaries didn’t. This is the interesting wrinkle to the case, though not the one most thoroughly analyzed. As a legal matter the court says vaguely that only the statutory plaintiffs can litigate liability, though statutory beneficiaries can participate in the determination of damages. That’s true, though that line of cases also says that the beneficiaries are parties to the action. (It also says that wrongful-death plaintiffs have fiduciary duties to the beneficiaries; perhaps that would help in deciding how to resolve this sort of problem.) In any event, as a factual matter the court says that the beneficiaries knew about the accident but didn’t do anything to investigate it and that “‘a reasonable jury would not have a legally sufficient evidentiary basis’ to determine that any of the Plaintiffs complied with the notice-of-claim statute.” Though it is not necessarily ironclad legal reasoning, the court understandably has trouble with the notion that claimants can benefit by doing nothing. “We reject the proposition that parties may receive the benefit of tolling simply because they fail to take any action to discover information relevant to the cause of an injury. Accepting that premise would run counter to the plain language and the purposes of [the notice-of-claim statute] as well as years of established precedent applying the discovery rule.”

Plaintiffs cross-appealed the second trial judge’s grant of summary judgment on the records-request cause of action. The first judge, they argued, made it “implicitly clear” that he intended to deny it, that this was therefore the “law of the case,” and that presenting the issue to the second trial judge was an “impermissible horizontal/lateral appeal.”

“Law of the case” is actually an appellate doctrine; in the trial court (unless you’re retrying a case on remand) it doesn’t mean much. This opinion doesn’t mention the first point but does make the second pretty clear, quoting from State v. King (1994); it does not “prevent a different judge, sitting on the same case from reconsidering the first judge’s prior, nonfinal rulings.” (If you’re wondering what “nonfinal” means, stop. Like the word “prior” in that sentence, it is superfluous and was considered neither by the court that wrote it — King plucked the language from another jurisdiction to address briefly a minor issue in a big capital case — nor by the courts that have quoted it.)

Horizontal appeals are discouraged but discretionary. These parties couldn’t agree on whether the first judge had even ruled on the issue. They did agree that he didn’t do so “expressly” and for that reason considering it was within the second judge’s discretion.

Reviewing the facts the court concludes that the State’s response to the records request was appropriate.

That ruling is affirmed; reversed on the other issue for entry of judgment for the State.

Weep not for these plaintiffs, though; the huge jury award gave them the leverage to arrange a high/low settlement contingent on the outcome of the appeal. (The opinion mentions the agreement in a footnote, one of those totally irrelevant but juicy details that courts sometimes just can’t pass up. Or maybe this is part of that make-the-outcome-seem-just ethos that seems to be taking over the appellate courts.) Its nice to know that of all the legal professionals involved with this case, at least one of them did a good job. But we confess to feeling good also for his predecessor, the lawyer who filed the first notice, who is presumably now off the hook of a ginormous malpractice claim.

(Opinion: Humphrey v. State)

Sholem v. Gass et al. (3/30/20)

We had at first thought to skip this one, which may fall into the category Too Boring For Even Us To Blog. But it will open new opportunities for plaintiffs and new challenges for the defense. And it illustrates once again why it isn’t necessarily a good idea to outsource Arizona law to those unfamiliar and unconcerned with it.

This is about abatement of a Complaint under Rule 4(i). The rule says this:

If a defendant is not served with process within 90 days after the complaint is filed, the court–on motion, or on its own after notice to the plaintiff–must dismiss the action without prejudice against that defendant or order that service be made within a specified time. But if the plaintiff shows good cause for the failure, the court must extend the time for service for an appropriate period.

Eleven months after filing it, Plaintiff had not served her case. The trial court had not dismissed it or required service. Plaintiff moved for an extension; the court granted it and she filed within the extended time. Defendant moved to dismiss because Plaintiff had not shown good cause. The trial court denied the motion; the Court of Appeals declined jurisdiction of Defendant’s special action.

The Supreme Court affirms.

It first reviews the history of abatement. Arizona has had abatement since 1913, when it was enacted by the first state legislature. Originally, an action abated if not filed within one year. This law eventually became a rule and the rule went through various changes until, in 1996, we got the present version. It was adopted, as had been its predecessor, so that the Arizona rule would match the federal rule.

Then begins the analysis: “The plain language of Rule 4(i) permits extensions absent a showing of good cause.” The rest of the opinion is a coda to this pronouncement. The idea is that good cause is a requirement only of a mandatory extension, that other extensions are discretionary and do not require it.

Defendant argued that Rule 6(b)(1) requires excusable neglect if a request for extension is made after the applicable time limit has expired. The court agrees that it applied before 1996 but says that the present version of Rule 4 is inconsistent with Rule 6. It disapproves of Toy v. Katz (App. 1997), which said that the 1996 rule didn’t change anything substantively. Rule 6 now applies only if plaintiff gets a Rule 4 extension then blows that time period, too.

The court agrees with Defendant that Plaintiff did not show good cause. The extension was therefore not mandatory but could be discretionary. The court says that factors considered by trial courts in exercising their discretion are whether the statute of limitations bars refiling, whether the defendant evaded service, and whether the defendant would be prejudiced by the extension. The court decides that there was no prejudice and that Defendant might have been hiding.

So, despite 107 years of “shall” and “must” and ever-shorter time periods, abatement is now a chimera, replaced by arguments about prejudice and blame. And the change was made 26 years ago by people who said they hadn’t really changed anything.

Is the court wrong? Perhaps; Rule 6 should of course apply if you want to preserve some measure of consistency with longstanding Arizona law. But the people who wrote federal rule 4 knew nothing of that and their rule doesn’t really fit with it. This is what happens when you make law by cutting and pasting. How many times have we been told that a rule has been changed “merely” to make it consistent with a federal rule? Consistency is a pleasant-sounding shibboleth, not a cogent goal; the two sets of rules — made in the context of different law, history, needs, policies, and procedures — rarely match. In any event, you may not intend a change when you’re “merely” making things consistent but the next generation of judges won’t know or remember or care about that when it comes time for them to try to reconcile Arizona’s apples with the federal orange you stuck in the barrel.

The opinion is too long but is well-organized and its fourteen pages contain not a single footnote. So, for style, a solid C+.

(Opinion: Sholem v. Hon. Gass et al.)