AZAPP Blog

Acuna v. Kroack and Hampton: Division Two Issues Amended Opinion Apportioning 100% of the Fault to One Defendant

After the Court of Appeals issued its opinion covered in this earlier post, Plaintiff/Appellee Mark Acuna moved for reconsideration. Finding the motion well taken, the Court vacated its original opinion and issued this one in its place. The Amended Opinion largely follows the reasoning of the prior opinion, but finds the evidence of negligent entrustment insufficient. Accordingly, the Amended Opinion vacates the portion of the trial court’s judgment apportioning liability against Hampton on the negligent entrustment claim, modifies the judgment to apportion 100% of the fault against Kroack (which the jury had apportioned Kroack with 70% fault and Hampton with 30% fault), and remands the case to the trial court with directions to enter judgment in favor of Acuna and against Kroack for $200,000, the full amount of the judgment.

Justice Pelander authored the decision in which Judges Espinosa and Druke (sitting by designation to replace Judge Florez) joined.

Posted by azapp @ Tue, Jan 31, 2006

In re Consolidated Zicam Product Liability Cases: Division One Upholds Finding of Lack of Personal Jurisdiction

Plaintiffs filed multiple suits against Zensano, Inc. and Zengen, Inc. in Maricopa County. The trial court ruled that it lacked personal jurisdiction over the defendants and that the plaintiffs had failed to state a claim for relief against the defendants. Judge Ehrlich, writing for a unanimous panel, affirmed the trial court's ruling, noting that plaintiffs had not maintained that Arizona has general jurisdiction over the defendants and that plaintiffs had failed to establish specific jurisdiction through defendants' alleged contacts with Arizona. Noting the plaintiffs' burden of establishing that jurisdiction is proper, the court concluded that plaintiffs unsubstantiated allegations regarding various contacts with Arizona (including alleged loans, cash advances, confidentiality and non-competition agreements, assignment of intellectual property, advertising payment, and distribution agreement) failed to establish a prima facie case for jurisdiction.

Judge Ehrlich authored the opinion; Judges Orozco and Timmer concurred.

Posted by azapp @ Tue, Jan 31, 2006

Pima County v. Clear Channel Outdoor, Inc.: Division Two Holds That The State’s Governmental Function Exemption From Local Zoning and Building Regulations Did Not Transfer To A Private Company Using The Property For Commercial Billboards, Where State Transferred Real Property to The Company as Just Compensation In a Condemnation Action

In 1998, to widen the Interstate 10 freeway (I-10) and construct new frontage roads along it in Pima County, the Arizona Department of Transportation (ADOT) condemned private property on both sides of I-10. Clear Channel owned billboards on several of the condemned parcels, which it was required to remove pursuant to the condemnation. In 2001, ADOT and Clear Channel entered into a settlement agreement in which ADOT agreed, in lieu of paying monetary damages for the condemnation, it would convey unneeded portions of the condemned parcels to Clear Channel on which Clear Channel could erect new billboards.

Immediately following the transfer of title, Clear Channel erected billboards on the parcels without first obtaining permits required by Pima County’s zoning ordinance. The billboards did not comply with Pima County building codes or zoning ordinances. Pima County filed suit against Clear Channel seeking injunctive relief, declaratory judgment, and civil penalties. Clear Channel counterclaimed, arguing that its billboards were not subject to Pima County’s ordinances.

Both parties moved for summary judgment. The trial court denied Pima County’s motion, and granted Clear Channel’s. On de novo review, and writing for a unanimous panel, Judge Howard reversed, rejecting Clear Channel’s argument that it was exempt from local zoning and building regulations because ADOT was acting in its governmental capacity when it entered into the settlement agreement. Clear Channel asserted that in the agreement, ADOT paid Clear Channel just compensation by transferring title to the parcels, thus Clear Channel was entitled to the state’s exemption from local regulations in using those parcels. The court reasoned that the state’s exemption “is not a transferable property right,” and that Clear Channel was in any event not seeking the exemption for a governmental function. Rather, Clear Channel’s erection of the billboards “is a commercial endeavor that directly competes with other commercial enterprises, is privately funded, and not something that can reasonably be considered fundamental or basic to the nature of government.”

The court also rejected Clear Channel’s alternative argument that the exemption arose from the state’s use of the property to pay just compensation. Distinguishing between the state’s “use” of the parcels to satisfy its condemnation obligation, and “use” of its own real property in a physical sense, the court stated that the exemption applies only to “the physical use of its real property.” The court held that the state’s governmental function exemption from local zoning and building regulations did not transfer to Clear Channel, which uses the property for commercial billboards, when the state transferred the real property to it as just compensation in a condemnation action.

Judge Howard authored the opinion; Judge Brammer, Jr. and Judge Eckerstrom concurred.

Posted by azapp @ Tue, Jan 31, 2006

Unitherm Food Systems, Inc. v. Swift-Eckrich, Inc.: United States Supreme Court Clarifies That a Rule 50(b) Motion Must Be Filed to Preserve Sufficiency of Evidence Challenges for Appeal

In a 7-2 decision, the United States Supreme Court issued an opinion resolving an inter-circuit split concerning when a Rule 50(b) motion must be filed to preserve for appeal a challenge based on the sufficiency of the evidence. The Court explained that Rule 50 establishes two stages for challenging the sufficiency of the evidence in a civil jury trial. Rule 50(a) allows a challenge prior to the case’s submission to the jury, authorizing the district court to grant the motion at the court’s discretion. Rule 50(b), by contrast, sets forth the requirements for renewing the challenge after the verdict and entry of judgment. The Court held that a party’s failure to file a Rule 50(b) postverdict motion deprives an appellate court of the power to direct the district court to enter judgment contrary to the one entered. It also deprives an appellate court of the power to order a new trial based on the sufficiency of the evidence.

Justice Thomas authored the decision. Justices Stevens and Kennedy dissented.

NOTE: AZAPP does not normally post United States Supreme Court opinions, but posted this one because of its significance to appellate procedure in federal courts.

Posted by azapp @ Fri, Jan 27, 2006

Article: Ariz. Supreme Court Tells Smith To Vacate Office
Representative says it's 'unlikely' he'll appeal to U.S. Supreme Court

By Thomas Ropp, The Arizona Republic, Jan. 27, 2006

State Rep. David Burnell Smith's tumultuous year in the Legislature came to an abrupt end Thursday when the Arizona Supreme Court upheld his removal from office for violating spending limits in his publicly funded election campaign.

Posted by azapp @ Fri, Jan 27, 2006

Posted by azapp @ Fri, Jan 27, 2006

Article: Arizona Has Ample Safeguards Against Abuse Of Eminent Domain

By Bob Schuster, Southeast Valley editorial page editor
for The Arizona Republic, Jan. 25, 2006

The Southeast Valley has been the center of eminent domain reform in recent years, and now a Mesa lawmaker wants to take private-property protection to the next level - to the protests of our cities. Do we need more reform, or are our rights sufficiently protected?

Posted by azapp @ Wed, Jan 25, 2006

Posted by azapp @ Wed, Jan 25, 2006

Article: Lawmaker Faces Possible Removal Next Week

By Thomas Ropp, The Arizona Republic, Jan. 19, 2006

A freshman state lawmaker, in trouble for overspending his publicly funded
campaign budget, could be removed from office as early as next week following
Thursday's ruling by the Arizona court of Appeals.

Posted by azapp @ Wed, Jan 25, 2006

Article: Appeals Court Upholds Ouster Of Smith From Legislature

By Paul Davenport, Associated Press, Jan. 19, 2006
Reprinted at azcentral.com

An appellate court on Thursday upheld a lower court's ruling that a state legislator
must forfeit his elected office because of overspending when he ran for office with
public funding in 2004.

Posted by azapp @ Wed, Jan 25, 2006

Arizona v. Wall: Supreme Court Holds That A Defendant Has A Right To A Lesser-Included Offense Instruction If Sufficient Evidence Supports The Instruction, Even If The Defendant Has Presented An “All-Or-Nothing” Defense.

According to the evidence at trial, Defendant Emmet Wall, along with two accomplices, attempted to steal money from a convenience store through either force or ruse. The first possibility would have constituted robbery, or attempted robbery, while the second would have constituted theft, or attempted theft. Wall’s sole defense was that he knew nothing of the robbery or theft of the store until after the fact. In response to the State’s successful request for an attempted robbery jury instruction, Wall requested that the trial judge give an instruction on the lesser-included offense of attempted theft. The trial judge denied Wall’s request because he reasoned that the State’s theory of accomplice liability rendered Wall criminally liable for his accomplices’ reasonably foreseeable attempted robbery. The jury convicted Wall of attempted robbery.

Division Two of the Arizona Court of Appeals affirmed, but on a different ground. The Court of Appeals concluded that State v. Van Adams, 194 Ariz. 408, 984 P.2d 16 (1999), precluded a lesser-included offense instruction when the defendant presented an all-or-nothing defense.

The Supreme Court reversed, rejecting both grounds. After concluding that attempted theft was a lesser-included offense of attempted robbery, the Court noted that a lesser-included offense instruction was warranted whenever a jury could conclude that (1) the State failed to prove an element of the greater offense, and (2) the evidence was sufficient to support a conviction on the lesser offense. Both parts were satisfied because, in the words of the trial judge, the “‘the jury could find that the plan here was to not necessarily commit a robbery involving force or threat, but [to] commit a theft by ruse.’”

The Supreme Court disapproved the State’s accomplice liability theory. The Court concluded that Wall was not liable for any reasonably foreseeable crimes of his accomplices. The proper test for accomplice liability under the facts was whether Wall intended to aid his accomplices in committing a robbery or committing a theft.

The Supreme Court also disagreed that Van Adams barred a lesser-included offense instruction whenever a defendant presented an all-or-nothing defense. The rule, rather, was that a lesser-included offense instruction was warranted when sufficient evidence supported the instruction. In Van Adams, it did not; here, it did.

Justice Berch authored the unanimous opinion.

Posted by azapp @ Fri, Jan 13, 2006

Powell v. Washburn: Supreme Court adopts Restatement approach for interpreting restrictive covenants, holding that a restrictive covenant must be interpreted to give effect to the intention of the parties and to carry out the purpose for which it was created.

Edward Powell, along with several other property owners in the Indian Hills Airpark (“Airpark”) sought an injunction against Thomas Washburn and others prohibiting the use of RVs as single family residences within the Airpark. Powell argued that the Airpark’s CC&Rs prohibited such use.

The declared purpose of the CC&Rs for the Airpark was to develop the property “as an aviation related residential and commercial center.” When recorded in 1988, the CC&Rs incorporated, by reference, the La Paz County zoning ordinances. As a manufactured home subdivision, RVs were not permitted as residences in the Airpark at that time under the zoning ordinances. In 1996, however, the zoning ordinances were amended to permit the use of RVs as residences in manufactured home subdivisions. The CC&Rs themselves were silent as to the residential use of RVs in the Airpark.

On cross-motions for summary judgment, the trial court granted summary judgment to Powell, finding that the CC&Rs for the Airpark did not permit the use of RVs as residences. Washburn appealed, arguing that the trial court erred by not strictly interpreting the CC&Rs in favor of the free use of land. In a memorandum decision, Division One of the Court of Appeals agreed, and reversed and remanded. Powell then petitioned for review, arguing that the Supreme Court should eschew the approach of strictly interpreting CC&Rs in favor of an approach based on the rules of contract construction.

In a unanimous decision, the Supreme Court vacated the decision of the court of appeals and affirmed the trial court’s judgment. In so holding, the court adopted the approach of the Restatement (Third) of Property: Servitudes (“Restatement”), which provides that

[a] servitude should be interpreted to give effect to the intention of the parties ascertained from the language used in the instrument, or the circumstances surrounding creation of the servitude, and to carry out the purpose for which it was created.

Restatement § 4.1(1). Although the Court recognized that certain Arizona decisions referred to a policy of strictly construing restrictive covenants in favor of free use of land, the Court found that all such references had been in dicta. Moreover, the Court noted that the Restatement approach reinforces a “contemporary judicial trend of recognizing the benefits of restrictive covenants.”

Applying the Restatement, the Court “conclude[d] that although the CC&Rs neither expressly prohibit nor permit RVs as residences, the plain intent and purpose of the restrictions was to limit residences in the Airpark to mobile or manufactured homes, constructed homes, or hangar-homes. [The Court] base[d] this conclusion on the language used in the CC&Rs and the purpose for which the restrictions were created.”

Justice Ryan authored the unanimous opinion.

Posted by azapp @ Tue, Jan 10, 2006

Chaurisia v. General Motors: A Unanimous Division One Panel Refuses to Expand Terms of "Limited Warranty" Offered by Car Dealer to Permit Revocation of Acceptance by Buyer

After Chaurisia discovered numerous defects in his Corvette and after authorized dealers failed to repair the car to Chaurisia's satisfaction, he sued General Motors for breach of express warranty and implied warranty of merchantability. The trial court granted GM's motion for summary judgment and awarded it attorneys' fees.

The Magnuson-Moss Warranty Act provides two categories of warranty: full warranties and limited warranties. See 15 USC 2304. Because GM's warranty did not meet the requirements of a full warranty under the MMWA, GM was permitted to conspicuously label its warranties as "limited warranties. The only cause of action under MMWA for breach of a limited warranty is for failure to comply with the warranty's express terms. GM’s limited express warranty provided that it would pay for repairs needed to correct defects in materials or workmanship: “Warranty repairs, including towing, parts and labor, will be made at No Charge.” To prove a breach of this warranty, Chaurisia was required to demonstrate that GM refused or otherwise failed to pay for the repair to a covered item. Because GM paid for all claimed warranty repairs made by its authorized facilities, Chaurisia could not prove that GM breached the terms of its express warranty.

Chaurisia also argued that he was entitled to protections offered under a full warranty, namely that the manufacturer is obligated to refund or replace a product if it contains a defect after a reasonable number of attempts by the warrantor to remedy the defect. 15 U.S.C. § 2304(a)(4). Citing decisions of other courts that refused to apply the reasonable number of attempts requirement when the plaintiff holds a limited express warranty, the appellate court rejected Chaurisia's argument, and his attempt to "engraft" protections provided to consumers under the UCC and Arizona's Lemon Law.

Chaurisia's claims based on the alleged breach of an implied warranty failed because he could not demonstrate privity of contract required under Arizona law. Because he bought the Corvette from a dealer, not from GM, he could not sue GM for breach of the implied warranty. Though the Court acknowledged public policy reasons for eliminating the privity requirement, the Court noted that the Arizona Supreme Court had explained that without the privity requirement, the UCC's scheme would be "unduly complicated."

Finally, the Court affirmed the award of attorneys' fees to GM.

Authored by Judge Thompson, Presiding Judge Kessler and Judge Irvine concurring.

Posted by azapp @ Tue, Jan 10, 2006

Article: Size Of Horse At Heart Of AZ Supreme Court Case

Associated Press article re-printed in the Arizona Republic at azcentral.com, Jan 9, 2006

TUCSON - A miniature horse is still a horse, of course. But should size matter when it comes to horse zoning regulations? That's what a Bisbee couple wants the Arizona Supreme Court to decide. They argue that since they have smaller horses, they should be allowed to keep more of them on their residential property.

Posted by azapp @ Mon, Jan 9, 2006

Article: DUI Courts Overhauled To Be Faster

by Michael Kiefer The Arizona Republic Jan. 6, 2006

The Arizona Supreme Court thinks it takes too long for DUI cases to get through the court system. On Thursday, Chief Justice Ruth McGregor unveiled a series of recommendations to speed up the process.

Posted by azapp @ Mon, Jan 9, 2006

Article: State's High Court Lets Redistricting Ruling Stand

An article by the Associated Press, Jan. 4, 2006 re-printed in the Arizona Republic on azcentral.com

The Arizona Supreme Court on Wednesday turned away appeals aimed at forcing the state to adopt new congressional and legislative district maps.

Posted by azapp @ Mon, Jan 9, 2006

Vales v. Kings Hill Condominium Association: Division One Reverses Summary Judgment That Found a “No Rental” Provision Amendment to a Condominium’s Declaration of Rights Enforceable

In 1999, Janet Vales purchased a condominium in the Kings’ Hill complex, which she immediately began leasing to others. In 2000, Kings Hill mailed ballots to the forty-two condo owners proposing to amend the complex’s Declaration of Restrictions to include a “no-rental” amendment (the “Amendment”). The required majority of homeowners adopted the Amendment, but Kings’ Hill recorded the Amendment with additional language not included in the ballot. Meanwhile, Vales continued renting her unit, but in 2003 her tenants cancelled their lease agreement after learning that Kings Hill planned to enforce the “no-rental” restriction. With more than three years lapsing since the Amendment’s recording, Vales then sued. After both parties moved for summary judgment, the Superior Court ruled that Kings Hill had properly adopted the Amendment with the modification (making it enforceable), and that Vales’ claim was time barred by the one-year statute of repose set forth in A.R.S. § 33-1227(B).

The Court of Appeals held that the one-year time bar set forth in A.R.S. § 33-1227(B) as part of the Uniform Condominium Act did not apply to Vales’ action because that statute applies only to actions challenging “the validity of an amendment adopted by the association pursuant to this section . . . .” The Court of Appeals reasoned that the Amendment was not adopted “pursuant to this section” because, under the Uniform Condominium Act’s terms, its voting requirements for adopting amendments apply to complexes built before its effective date (like Kings Hill), only to the extent the Act “does not conflict with an existing declaration of rights.” Because the Kings Hill Declaration included only a majority requirement, not the unanimity requirement specified in the Uniform Condominium Act for measures like the Amendment, the Amendment was adopted under the terms of the Kings Hill Declaration, not “pursuant to this section” for purposes of A.R.S. § 33-1227(B). Accordingly, the Court of Appeals looked to the general statutes of limitation, pursuant to which Vales’ claims were timely.

As for whether the Amendment was properly adopted, the Court found that the additional recorded language did not amount to a minor error, and thus found Villas at Hidden Lakes Condominium Ass’n v. Geupel Construction, 174 Ariz. 72, 76-77, 847 P.2d 117, 121-22 (App. 1992), and Watson Construction v. Amfac Mortgage, 124 Ariz. 570, 576, 606 P.2d 421, 427 (App. 1979), distinguishable. Nevertheless, the Court did not find the entire recorded Amendment void. The Court found the portion of the recorded Amendment adopted by the homeowners enforceable with the exception of an ambiguous restriction that would apply the no rental provision effective retroactively. The Court of Appeals struck as unenforceable the language that would have made the no-rental provision retroactive, finding that the homeowners would have approved the Amendment absent the unenforceable date restriction because it nevertheless prevents subsequent purchasers from buying and then leasing units. The Court vacated the trial court’s grant of summary judgment, and remanded for further proceedings.

Judge Hall authored the opinion in which Judges Snow and Norris concurred.

Posted by azapp @ Wed, Jan 4, 2006