The court concludes that real-estate salespeople are not employees of their brokerage for tort purposes.

A real-estate salesman, while on the job, caused a car accident that killed Plaintiff’s decedent. She sued the brokerage firm for which he worked on the basis of  respondeat superior. The firm moved for summary judgment, arguing that the salesman was an independent contractor. The trial court granted the motion; Plaintiff appealed.

The Court of Appeals affirms.

Plaintiff cited R4-28-1109(D) of the Administrative Code: a broker “is responsible for the acts of all . . . salespersons . . . acting within the scope of their employment.” But other regulations require the broker to supervise only licensed activities and the handling of forms and records, so “a broker’s responsibility is more limited than that of an employer that supervises all aspects of an employee’s work.” In addition, though real-estate salespersons are “employees” for purposes of workers comp and unemployment, the Arizona Supreme Court has declined to apply that to tort law;  “cases arising under . . . social legislation are not necessarily authorities for principles giving rise to common law liability . . .”

Plaintiff cited an illustration from Restatement §220 (elements of employer-employee relationship) to the effect that a real-estate salesman who causes an accident makes his broker liable but not his principal. The court says that the point of the illustration is the part about the principal, for purposes of which it simply assumes that the broker is an employee.

The court also declines to hold that Defendant had a non-delegable duty. Nothing in Arizona law requires even a duty, much less a non-delegable one.

Plaintiff also contended that in this particular case there was a question of fact about the relationship. The court, after reviewing the facts, disagrees.  

(Opinion: Santorii v. MartinezRusso)

Looks like somebody’s in a snit. The only reason we can see for publishing this very minor case is so that its author can accuse another recent CA1 decision of misconstruing an opinion he wrote several years ago.

Landlord and Tenants sued each other over a lease disagreement. The case went to compulsory arbitration. The arbitrator issued an “award” rather than a notice of decision, giving both parties some money but making no provision for costs or fees. But the arbitrator wasn’t the only one who apparently hadn’t read the rules: Tenants waited until after the appeal time had expired to try to do anything about it. What they then filed to try to get fees and more damages can for our purposes be passed over since they show no particular grasp of law, procedure, or – this opinion suggests – factual accuracy. The trial court denied their motions; they appealed.

The Court of Appeals affirms. Once the appeal time runs its too late for the Superior Court to change an award, nor can the arbitrator since his jurisdiction expires with the appeal time. That’s pretty basic, so no extended analysis is given or necessary.

So why publish? To publicize footnote two.

Tenants argued that the lease gave them a right to fees. The court says, in the footnote, that contractual fees are an element of the breach and so, like the other items of damage, must be pleaded and proved in the case-in-chief (which Tenants apparently hadn’t done). “On this point we do not agree with, [comma in original] and do not follow Keg Restaurants”, decided in June by another panel, “which misreads our opinion in Robert E. Mann Construction“ (App. 2003).  “In Mann we held that, because a claim for contractual attorneys’ fees is part of the damages for breach, such fees must be pleaded and proved.  204 Ariz. at 133, ¶ 12, 60 P.3d at 712.  The panel in Keg erroneously reads this to mean that contractual fees must be pleaded and proved only ‘when attorneys’ fees are treated as damages.’”  “Because it is wrong, we disregard this holding in Keg.”

The italics for “because” and “when” are in the original. You do see the distinction the court is making, right? If so, please explain it. What Keg actually said (and this comes nowhere near being a “holding”) is that an argument that contractual damages must be pleaded and proved doesn’t apply when the claim is for expert witness fees. Keg agreed that fees must be pleaded and proved if “their recovery is dependent on the contractual provision.” But Keg noted (and this also isn’t a holding) that otherwise our courts “generally do not construe ‘damages’ to include attorneys’ fees,” quoting City Center (App. 2015). That “compounds [Keg’s] error,” says footnote two, because in City Center and the cases it cited “fees were not treated as contract damages.” Yet that’s precisely the point Keg was making: some fees aren’t contract damages.

We’ll assume there was at oral argument, or has been in chambers, some disagreement that is not apparent. Otherwise it isn’t clear why Kesla didn’t simply distinguish Keg rather than rant about it. Or, better yet, point out that whatever substantive rights Tenants had didn’t survive letting their appeal time run.

(Opinion: Kesla v. Wittenberg)

The third case in six months or so on calculating a supersedeas bond.

AOR sued to collect on a promissory note. It won damages, costs, and fees. Defendant appealed. It asked that the supersedeas bond be the amount of damages awarded AOR less the amount of a bond it had posted as a provisional remedy and also less the amount of attorney’s fees that had been awarded it against AOR in a separate action. The trial court agreed. AOR took special action, arguing that under the statute and Rule 7 the bond must equal the damages.

The Court of Appeals takes jurisdiction and grants relief. AOR had taken down the provisional-remedy bond and used it, with Defendant’s agreement, to cover some of its attorney’s fees. Because it was used to cover a part of the judgment that the statute and rule don’t include in the supersedeas bond, using it to reduce that bond was wrong. In addition, although Rule 7 allows “other security” to be considered when setting a supersedeas bond the trial court did not do so. The opinion emphasizes this repeatedly as a reason for its ruling – that, apparently, the trial court’s order didn’t specifically say that it considered the first bond to be “other security” under Rule 7. Could it properly have done so? How would the case change if it had? The opinion does not say.

As for the attorney’s fees in the separate case, the statute and rule do not provide that a supersedeas bond can be reduced by elements of a judgment in another action. 

Defendant argued that the trial court was taking into account cash that AOR had received in order to maintain the status quo. Rule 7 allows the court to use an order “in lieu of or in addition to” the supersedeas bond” to “preserve the status quo.” But that’s a separate thing from figuring the amount of the bond and doesn’t change its calculation, which is controlled by other provisions of the Rule.

The opinion is not a model of clarity. Its one of those in which the meaning – once you’ve figured it out – explains the language used rather than the other way around. But we have to give it at least a couple of stars since there are no footnotes.

(Opinion: AOR v. Bustamante)