AU Enterprises v. Edwards (CA2 1/21/20)

Posted on by

There are things called Rules of Procedure for Eviction Actions. We don’t recall reading through them before, not having handled a forcible entry and detainer since the days when they had to remind us were to park at that courthouse. They seem to have been novelties as well to everyone involved in this FED.

Plaintiff won in the trial court. The court’s order allowing the eviction also allowed fees and costs in amounts to be determined. But it was in the form of a “judgment” and contained Rule 54(c) language (“no further matters remain pending.”). Plaintiff filed for attorney’s fees. Defendant filed an appeal and then filed an objection to the fee request. The court granted fees but deferred a cost award “until the time a final judgment is entered.” That unsigned minute entry was the last thing done in the trial court.

Apparently (we’re reading between the lines), the court and parties thought that the decision on possession had a life of its own, independent of the rest of the action. The Court of Appeals first needs to figure out if that’s true; otherwise the appeal is premature.

FED actions are purely statutory. The statute (A.R.S. 12-1178) provides that the court “shall” give judgment for restitution, damages, fees, and costs. “Thus . . . the statute contemplates that a judgment in an FED action shall include an award of attorney fees.”

Technically that should conclude the analysis but the court goes on to consider the Rules of Procedure for Eviction Actions. Rule 13 says that the court “shall” award fees when applicable.

(The court also points out that Rule 54(c) doesn’t apply to the case, being superseded by the eviction rules.)

So the final judgment in an FED action includes restitution, damages, costs, and fees. Since there never was such a judgment here, even after the appeal, the appeal is premature and can’t be saved. Dismissed pending the entry of a proper final judgment.

But the court is troubled by the result and so includes a few paragraphs of hand-wringing dicta: what about the evicted tenant who can’t yet appeal the eviction? “[A] public policy argument exists for a rule triggering appellate jurisdiction when a trial court issues any judgment for possession and a writ of restitution.” “[O]ur trial judges should consider issuing immediately enforceable judgments of possession only in conjunction with final orders.” The opinion doesn’t appear to understand clearly the difference between the FED judgment and the writ of restitution. Under Rule 13 the latter can’t issue until five days after the former has been signed. And the tenant can then post a bond to stay execution. (There are circumstances involving immediate possession but they are statutory and the rules deal with them appropriately.)

But, but . . . other than that “[a]ll other procedural means of securing . . . a stay would require defendants to challenge the merits . . . before the very court that has recently ruled adversely to them.” In other words, the rules provide various additional ways of avoiding a writ by going back to the trial court. And if that is a problem then we should also revisit such other unjust practices as rehearing, reconsideration, or, for that matter, remand.

(Opinion: AU Enterprises v. Edwards)

Center for Auto Safety v. Goodyear Tire (CA1 11/26/19)

Posted on by

We’re not here to criticize lawyers and judges. Really, no. But these might have saved themselves a remand had any of them read the Arizona Rules of Civil Procedure.

Omitting the tiresome details, which are most of them, the parties settled this personal-injury case involving a tire (see what we did there?). CAS then intervened in order to open sealed records. The trial court had ordered them sealed after finding that they contained Goodyear trade secrets. The intervenor argued the public interest, that the tire was dangerous, that Goodyear and its lawyers were bad guys, etc. (The Court of Appeals does suggest that the lawyers’ actions were less than optimal. There has apparently been a fair amount of controversy involving these tires and, reading between the lines, there was some serious maneuvering going on here. Things happened that should raise eyebrows but the defense lawyers were not the only ones involved.) The trial court, relying on federal law cited by both parties, agreed. It found that “Goodyear’s interests did not outweigh the public’s need for access,” especially because Goodyear did not “particularize” how it would be harmed and because the information was “old.” The court authorized release of the records. Goodyear appealed.

It seems that of the six law firms involved at the trial-court level none managed to point the court to the applicable Arizona rule. (In fairness to the Arizona firms involved, its a fair bet that none of the lawyers doing the heavy lifting practice here. That’s an old problem with cases that involve national counsel; always double-check your out-of-state colleagues’ homework.)

The Court of Appeals reverses. By this time someone had mentioned Rule 5.4(c)(2). Documents can be sealed only if the court finds, in effect, that a need for a seal “overcomes the right of public access.” Under Rule 5.4(h), unsealing is governed by the same standards. But the trial court did not make a 5.4 analysis in ordering the unsealing. Instead, it used some sort of balancing test. It did, however, find that there were trade secrets involved — which the uniform act, adopted in Arizona, requires be kept secret. Age doesn’t vitiate them (which is a main reason why manufacturers keep stuff secret rather than patent everything). Their disclosure “necessarily implies that particularized harm exists because trade secrets derive their value from their secrecy.” “[A] court may expose trade secrets only in extraordinary circumstances, such as when the information has lost the independent economic value created by its secrecy, or when secrecy represents a significant threat to the public welfare.” An intervenor has a “heavy burden to show why the public needs access to confidential trade secrets.”

The court remands for a 5.4 analysis. But it puts its thumb on the scale by saying that since a summary of the secrets was already leaked “it is difficult to see what marginal benefit to the public would be achieved by unsealing the remaining trade secrets.”

Yes, it should probably have occurred to the trial court that you can’t just “balance” away a right to property, intellectual or otherwise. But in a strange land you depend on your guides — and the reality is that nowadays almost all civil law, not just its specialized branches, is off the edge of most trial judges’ maps. The rules, though, shouldn’t be.

(Opinion: CAS v. Goodyear)

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

Posted on by

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)