AZAPP is a blog that provides a thorough, up-to-date, and efficient resource to stay abreast of significant developments concerning civil cases in Arizona's appellate courts - the two Divisions of the Arizona Court of Appeals and the Arizona Supreme Court.
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Special Action petitioner Williams leased real property from real-parties-in-interest Ray and Barbara Range. The Ranges filed a Forcible Entry and Detainer (“FED”) action against Williams, alleging failure to pay rent. The court ordered Williams to vacate, and awarded the Ranges attorneys’ fees and costs. Williams filed a Motion to Stay Judgment or Other Proceedings to Enforce Judgment and Order Fixing Bond. The court signed a judgment, denied Williams’ motion to stay, and set a bond at $10,000. Williams appealed the FED ruling on the merits, and also filed a special action in Division One requesting a stay and a reduction of the $10,000 bond. Division One accepted jurisdiction, determined that the court did not have discretion to deny Williams’ requested stay, and ordered the court to issue a stay with such terms and conditions as are appropriate under A.R.S. 12-1182(B). Williams then failed to tender a rent payment, and the Ranges filed a motion with Division One to lift the stay. Division One referred the motion to the Superior Court with orders to comply with the appeals court’s previous order by entering a stay if it had not yet done so. The Superior Court issued an order staying the judgment in the FED action pending Williams’ appeal, contingent upon Williams posting a bond of $11,700. Williams filed a second special action, contending that the Superior Court abused its discretion by setting the bond at $11,700.
Division One again accepted jurisdiction, to determine whether the bond had been set in accordance with A.R.S. 12-1182(B). The Court explained that it accepted special action jurisdiction because Williams alleged that the bond was too high for her to pay, and that the Court’s failure to accept jurisdiction and grant relief would cause her to be displaced from her home, meaning that an adequate remedy by appeal was not available to her. Turning to the merits, the Court concluded that the Superior Court had failed to comply with A.R.S. 12-1182(B). First the statute requires the court to condition the stay on appellant prosecuting the appeal “to effect,” which the court failed to do. Second, the court must condition the stay on the requirement that the appellant will pay “the rental value of the premises pending the appeal.” The statute does not, the Court held, authorize a court to require an appellant to pay the full amount of rent expected to come due during the anticipated duration of the appeal, as the court evidently did. The Court believed this approach would conflict with the statute’s plain language, effectively prevent FED defendants from being able to mount an appeal, and unfairly deprive landlords of periodic rental payments that come due during the pendency of an appeal. The Court preferred to adopt the approach set forth in the “companion statute” governing the payment of rent pending appeal in A.R.S. 12-1179(D), which governs FED appeals from justice court. The latter statute provides that rental payments must be made as they come due to the clerk of the court, who then forwards them on to the property owner or landlord. The Court reasoned that the two statutes were in pari materia and should be read together.
The opinion was authored by Judge Snow and joined by Judge Timmer and Superior Court Judge Swann, sitting by designation.
Posted by azapp @ Tue, Feb 28, 2006
On October 27, 1988, the Schuggs, who operated a dairy, entered into a membership agreement with United Dairymen of Arizona (“UDA”), giving UDA exclusive right to market their milk. The agreement required members to deliver to UDA all milk produced by cows that a member owns, possesses or controls, and established liquidated damages in the event a member breached this provision. The agreement also provided that termination could be effected by written notice not more than 90 nor less than 60 days prior to the anniversary of the agreement’s effective date, or upon the dissolution, merger, or consolidation of a Member’s business. On September 28, 2001, the Schuggs informed UDA that they had gone out of business and sold their milk-producing cows and leased their dairy to S&T Dairy, L.L.C. (“S&T”), a company formed by the Schuggs’ adult children. S&T marketed its milk through a UDA competitor.
On December 31, 2001, UDA brought suit against the Schuggs alleging breach of the agreement, breach of implied covenant of good faith and fair dealing, fraudulent misrepresentation, negligent misrepresentation, and claims against the Schugg children. UDA claimed the creation of S&T was a sham transaction to enable the Schuggs to terminate the agreement without waiting for the next anniversary. The Schuggs denied liability and asserted numerous counterclaims. Through summary judgment and stipulation, the court and the parties disposed of all of the claims except UDA’s breach of contract and breach of implied covenant of good faith and fair dealing claims. These remaining claims were tried to a jury. At the close of UDA’s case, the Schuggs moved for judgment as a matter of law (JMOL) on the implied covenant of good faith and fair dealing claim because UDA had failed to proffer any evidence of actual damages. The trial court denied the motion. The jury found that the Schuggs did not breach the written agreement but that the Schuggs did breach the implied covenant of good faith and fair dealing, and the jury awarded liquidated damages to UDA on the implied covenant claim. The Schuggs renewed their motion for JMOL, and the trial court again denied it. The Schuggs then timely appealed.
The Court of Appeals reversed the judgment in favor of UDA and directed entry of judgment for the Schuggs. The Court held that liquidated damages are not recoverable under the common law for breach of the implied covenant of good faith and fair dealing. The Court first noted that “the right to recover liquidated damages is limited by the express terms of the parties’ agreement.” Here, the right to liquidated damages depended on a breach of a specific provision within the agreement. Because the jury determined that the Schuggs had not breached the written agreement, only ordinary contract damages were available for breach of the implied covenant of good faith and fair dealing. UDA did not prove any contract damages at trial, and therefore, failed to present a prima facie claim for breach of the implied covenant of good faith and fair dealing.
On appeal, the Schuggs also challenged the granting of summary judgment for UDA on the Schuggs’ counterclaims. Most of these counterclaims arose out of UDA’s requirement that members “dump” their milk at certain times in order to compel customers to pay a desired price. The Schuggs alleged that by adopting this “dumping” policy, the UDA breached its obligation to “market” members’ milk. The Court disagreed, holding that “marketing” members’ milk pursuant to the contract, could involve taking actions to secure the “long-term ability to sell at prices beneficial to its members.” Moreover, the Court held that even if the “dumping” decision was questionable, it was protected by the business judgment rule. The Court rejected the Schuggs’ contention that the business judgment rule could not shield UDA’s actions, because the “dumping” policy was part of an illegal anti-competitive scheme to limit milk supply in violation of federal and state antitrust laws. The Court noted that agricultural cooperatives are exempt from antitrust laws in these circumstances.
Finally, the Court found contested issues of material fact with respect to the Schuggs’ claims of breach of the implied covenant of good faith and fair dealing and interference with contract. Thus, the Court reversed the trial court’s grant of summary judgment for UDA and remanded for further proceedings.
Judge Winthrop authored the opinion; Judges Lankford and Thompson concurred.
Posted by azapp @ Mon, Feb 27, 2006
The surviving spouse of a woman who died in Tempe in 2002 from an allegedly improper medical treatment by the Guadalupe Fire Department (“GFD”) brought suit against the City of Tempe (“the City”) and others. The GFD had treated the woman while responding to an emergency call pursuant to an agreement with Tempe and five other cities to provide mutual fire protection and emergency services. Under the aid agreement, dispatchers send to an emergency whichever participating responder’s vehicle is closest to the emergency. The trial court granted summary judgment to the City, finding that the City was entitled to absolute immunity because joining the mutual aid agreement was a “fundamental policy decision” under A.R.S. § 12-820.01(A)(2). The court of appeals reversed the judgment in a memorandum decision holding that the City could be liable for implementation of the policy decision, and could not relieve itself of liability by delegating emergency services to another entity.
The Arizona Supreme Court granted review and vacated the court of appeals’ decision. Under A.R.S. § 12-820.01(A)(2), as the Plaintiff conceded, the decision to join the mutual aid agreement could not subject the City to liability because it was “the exercise of an administrative function involving the determination of fundamental governmental policy.” The decision to dispatch GFD to the emergency flowed automatically from joining the agreement (and the resulting automatic dispatch of the nearest unit to the emergency) and thus was not the sort of “implementing decision” that could subject the City to liability. Finally, the City could not be held liable under the non-delegable duty doctrine of vicarious liability because neither the common law nor any statute, regulation, contract, franchise or charter imposed on Tempe a duty to provide emergency services. See Ft. Lowell v. Kelly, 166 Ariz. 96, 101, 800 P.2d 962, 967 (1990).
Chief Justice McGregor wrote the opinion for the unanimous court.
Posted by azapp @ Fri, Feb 24, 2006
Emmett McLoughlin Realty, Inc., and others (“McLoughlin”) sued Pima County and its Board of Supervisors, arguing that the County had violated the due process rights of the owners of three parcels of land due to a lack of notice of a Board meeting that preceded the final zoning decisions at issue. McLoughlin also argued that a Commissioner was biased because the Commissioner was also a County employee. The Court held that Pima County complied with the notice and hearing provisions as well as the jurisdictional requirements set forth in A.R.S. § 11-829 and Pima County Code § 18.91.060. The Board did not rezone McLoughlin’s real property at the meeting about which he failed to receive a personal notice, and McLoughlin did receive a notice of the meeting concerning the zoning decisions. Although the property was discussed at the earlier meeting, the Court explained that under the Legislative Act Doctrine – which exempts legislative functions from the full constitutional due process requirements – McLoughlin was not entitled to personal notice of that meeting. Additionally, the Court found that the Commissioner with the alleged bias did not have a substantial interest in the rezoning of the property, but was rather merely an employee of the County. Consequently, his participation in the Commission hearing did not violate McLoughlin’s right to a fair and impartial hearing. The Court affirmed the trial court’s grant of summary judgment in favor of Pima County.
Justice Howard authored the decision in which Judges Pelander and Brammer joined.
Posted by azapp @ Fri, Feb 24, 2006
By Robert Robb printed
in the Arizona Republic Feb. 15, 2006
A court decision there on school choice sets nerves a'twitching in Arizona advocates.
A Florida Supreme Court decision last month presents a legal and political quandary for Arizona's school-choice movement.
Posted by azapp @ Wed, Feb 22, 2006
Referendum proponents, Stop O.V. Outrageous Giveaways (“SOVOG”), sought to challenge by referendum an ordinance passed by the Town of Oro Valley that would have authorized it to enter into an economic development agreement with Vestar, Arizona, XLI, LLC (“Vestar”). SOVOG collected over 1,200 signatures and attached the ordinance they sought to challenge to each signature sheet. However, SOVOG removed the ordinance from the signature sheets when it actually submitted the completed referendum petition to the Oro Valley town clerk. The clerk refused to accept the petition because the ordinance was not attached as required by A.R.S. § 19-121(A)(3). SOVOG sought special action relief, which the trial court granted.
In compliance with the trial court’s order, the town clerk transmitted a sample of the signed petitions to the Pima County recorder. Vestar wrote to the recorder, asking her to disqualify SOVOG’s petition because the signature sheets had not been filed with the town clerk with the ordinance attached, A.R.S. 19-121.01(A)(1)(a). The recorder declined to do so, and Vespar sought a writ of mandamus and declaratory judgment against the recorder compelling her to disqualify SOVOG’s signature sheets. The trial court found that SOVOG had rebutted the presumption of invalidity that has arisen when it filed the petition without the ordinance attached.
Division Two affirmed, noting that proponents’ failure to strictly comply with a procedural statutory requirement does not always necessitate that the referendum petition be declared void. The court relied in part on Direct Sellers Association v. McBrayer, 109 Ariz. 3, 503 P.2d 951 (1972), in which the supreme court held that the omission of a required avowal in a circulator’s affidavit that the circulators were qualified electors did not render all the attached signatures null and void, but merely destroyed their presumption of validity. The presumption could be reinstated on proof that the circulators were in fact qualified electors. Likewise, the court in Forszt held that the trial court did not err in determining that SOVOG had successfully restored the presumption that their signatures were valid because the undisputed facts showed that the ordinance was attached to the signature sheets when they were circulated. Thus, the “underlying event relevant to assuring the validity of the signatures occurred;” namely, the signatories had a correct copy of the ordinance before them when they signed the petition for referendum. The court noted that it could “conceive of no independent purpose for the requirement that signatures be filed with the ordinance attached other than to confirm that they have been so circulated.”
Judge Howard authored the opinion; Judge Brammer, Jr. and Judge Eckerstrom concurred.
Posted by azapp @ Wed, Feb 22, 2006
In 1998, the City of Phoenix passed an Ordinance rendering the operation of a live sex act business illegal. The Ordinance was upheld as constitutional in an action brought by Guys and Dolls, a sex act business, challenging it as an unconstitutional Fifth Amendment Taking. In 2002, the City of Phoenix conducted a raid on several “swingers clubs,” including Guys and Dolls, and arrested one of its owners. Guys and Dolls again sued the City of Phoenix, alleging that, because of the raid and arrest, it experienced a huge economic downturn that required it to close business, and arguing that the City’s actions thus constituted an unconstitutional as-applied taking. The lower court granted summary judgment in favor of the City of Phoenix, in part because Guys and Dolls could not establish that the City’s actions constituted a partial taking under the Penn-Central partial takings analysis.
On appeal, Division One affirmed the trial court’s ruling, but held that the court need not have conducted an analysis under the Penn-Central test for as-applied partial takings because Guys and Dolls failed to establish the threshold question of whether the act condemned by the Ordinance was a use of property akin to a public nuisance that could ever be compensated under the Fifth Amendment. The Court held that the “nuisance exception” to a takings analysis—e.g., that a regulation does not result in a compensable taking if the state can demonstrate that the regulation only bans conduct that constitutes a public nuisance pursuant to background principles of nuisance and property law—applies equally to all takings claims, including partial regulatory takings that would otherwise be analyzed under the Penn-Central test. Finding that the City’s actions could have been justified in a common-law action for public nuisance and that Guys and Dolls could have been abated as a public health hazard, the Court found that no regulatory taking had occurred.
Opinion By Judge Hall, Judges Kessler and Timmer concurring.
Posted by azapp @ Wed, Feb 22, 2006
George Winn brought suit on behalf of his deceased wife, Mary Winn, against Plaza Healthcare in its various capacities. He claimed, among other things, that Plaza Healthcare violated the Adult Protective Services Act. A.R.S. § 46-455(B). The violations allegedly occurred in 1999 when Mary Winn died. Mr. Winn did not become personal representative for her estate until 2004—one year after he filed suit and five years after the alleged violations.
The Superior Court granted Plaza Healthcare’s motion for summary judgment. It concluded that, because Mr. Winn was a “late-appointed” personal representative, he did not have power to prosecute the claim.
Division One of the Arizona Court of Appeals affirmed. It agreed with the lower court that section 14-3108(4) of the Arizona Revised Statutes did not authorize Mr. Winn to assert the claim on behalf of the estate. Ordinarily, the personal representative would be the proper party to bring the claim. Mr. Winn, however, waited too long before he was appointed. Under Arizona law, if the personal representative is appointed more than two years after the decedent’s death, “the personal representative has no right to possess estate assets as provided in § 14-3709 beyond that necessary to confirm title thereto in the rightful successors to the estate.” A.R.S. § 14-3108(4). Because the claim on behalf of the estate constituted an estate “asset,” Mr. Winn had no power to possess and prosecute it. This reading of the statute accords with the plain language and effects the legislative intent of speedy administration of estates by encouraging timely appointments of personal representatives.
Judge Portley authored the unanimous opinion.
Posted by azapp @ Wed, Feb 22, 2006
Plaintiffs sent notice of a medical malpractice claim to an elected member of the Maricopa County Board of Supervisors, as required by A.R.S. § 12-821.01(A). Maricopa County moved for summary judgment after Plaintiffs filed a medical malpractice claim against the County, claiming that service on only one member of the Board was insufficient to fulfill the requirements of A.R.S. § 12-821.01(A). The trial court granted the motion and this appeal followed.
Judge Timmer reversed based on Rule 4.1(i) of the Arizona Rules of Civil Procedure, which requires that service upon the county be effected by delivering a copy of the pleading to the chief executive officer, among others. Relying heavily on Blauvelt v. County of Maricopa (App. 1988), Judge Timmer held that a county’s board of supervisors constitutes that county’s chief executive officer. Applying secondary principles of construction to other aspects of Rule 4.1, Judge Timmer further held that a board of supervisors can be served through one member of the board.
Judge Timmer authored the opinion and Judge Ehrlich concurred. Judge Orozco concurred in part and dissented in part. Judge Orozco opined that service of the section 12-821.01(A) notice had to be made on either the entire Board of Supervisors or the Clerk of the Board, a statutorily mandated position.
Posted by azapp @ Thu, Feb 16, 2006
Litigation regarding the rights flowing from the Gila River has been ongoing since 1925. In 1925, the United States filed a complaint on behalf of the San Carlos Apache Tribe and others alleging that the Apache Tribe and others were entitled to certain quantities of Gila River water. In 1935 the action was resolved by a Globe Equity Decree ("Consent Decree" or "Decree") defining the parties' rights to water from the flow of the Gila River. This Consent Decree did not, in fact, terminate litigation over Gila River water, but instead, spawned decades of general stream adjudication, including this action filed under legislation passed in 1995 (1995 Ariz. Sess. Law, ch. 9, sec. 25(C)). This legislation directed interested parties to file summary judgment motions challenging claims made by the Apache Tribe or others on its behalf to Gila River water. Various parties, including Phelps Dodge, the Gila Valley Irrigation District and the City of Safford, accepted the invitation to file such motions.
The superior court granted partial summary judgment to these parties, agreeing with them that the Decree precluded additional claims by the Apache Tribe to Gila River mainstream. The court concluded that the Consent Decree did not establish rights as to water from the Gila River tributaries.
The Apache Tribe filed an interlocutory appeal. In determining the preclusive effect of the Consent Decree, the Court applied the so-called "transactional test" outlined in the Second Restatement of Judgments, which precludes subsequent ltigation based upon the same transcaction or stemming from a common nucleus of operative facts. The Court then determined that based on the original 1925 Complaint, the Amended Complaint in that action, and the dismissal of defendants with claims directed solely to tributaries of the Gila River, the Consent Decree was intended to apply only to rights to the Gila River mainstream and did not preclude additional claims to the tributaries.
The Court next considered what particular claims to the mainstream were adjudicated by the Decree. The Tribe argued that only its prior appropriative rights and not its aboriginal or Winters rights (the Tribe's implied right to an amount of water necessary to effectuate the purposes of the reservation), while the other parties' argued that the Decree adjudicated all claims of the Tribe to the Gila River mainstream. The Court held, based on the language of the Complaint, Amended Complaint and Decree, that all of the Tribe's water rights to the Gila River mainstream were resolved in the 1935 Decree. Though the Tribe was not itself a party to that litigation, it was bound, by its privity with the United States, to the terms of the Decree. Additionally, though Phelps Dodge, and others were not parties to the Decree, they were entitled to assert the preclusive effect of the Decree against the Tribe and the United States under the Nevada mutuality exception (from Nevada v. United States, 463 U.S. 110 (1983) (granting an exception to the claim preclusion mutuality requirement when the original litigation involved a comprehensive adjudication intended to settle once and for all all water rights stemming from a river).
Opinion authored by Justice Hurwitz, with Chief Justice McGregor, Vice Chief Justice Berch, Justice Ryan and Judge Pelander concurring.
Posted by azapp @ Mon, Feb 13, 2006
A 1996 initiative measure titled Proposition 200, A.R.S. 13-901.01, mandates that courts sentence certain first- and second-time drug offenders to probation, rather than incarceration. But the measure includes an exception for any defendant “who has been convicted of or indicted for a violent crime.” Gomez had been indicted for manslaughter in 1994, but the indictment was dismissed because the prosecutor concluded that there was no reasonable likelihood of conviction. In 2003, Gomez was convicted of possession of marijuana and methamphetamine. The trial court ruled that Gomez’ indictment made her ineligible for mandatory probation under Proposition 200. The Court of Appeals agreed, reasoning that the statute’s plain language encompassed all prior indictments. Acknowledging that this was a “plausible” reading of the statute, the Arizona Supreme Court disagreed. The Court noted that under its own and the United States Supreme Court’s caselaw, prior convictions that have been reversed or vacated may not be used to enhance a defendant’s sentence. The Court reasoned that the statute’s reference to indictments might reasonably be read to encompass only indictments that remain active. The Court chose this interpretation, for several reasons. First, Proposition 200’s purpose was to require less costly, but more effective, treatment programs for non-violent drug offenders and to promote the imprisonment of violent offenders – a purpose that would not be well served by an interpretation that would make probation unavailable to many defendants who had not actually committed violent crimes. Second, the alternative interpretation could lead to absurd results, insofar as it would make probation unavailable even when the defendant’s indictment was dismissed because, for example, DNA evidence conclusively established that the defendant was innocent. Third, the alternative interpretation would raise serious due process and equal protection concerns, insofar as it would impose harsh consequences and draw significant distinctions based solely on the fact of indictment, with no inquiry into the underlying facts and circumstances of the indictment. The Court concluded that A.R.S. 13-901.01(B) disqualifies a defendant from mandatory probation only if, at the time of sentencing for the drug offense, the defendant stands convicted of, or is under indictment for, a violent crime.
Vice Chief Justice Berch, joined by Chief Justice McGregor, dissented. Justice Berch agreed with the lower courts’ interpretation, which she did not believe was irrational or likely to lead to absurd or arbitrary results. Justice Berch stressed that an indictment issues only after probable cause has been found. She also noted that even a defendant ineligible for mandatory probation under A.R.S. 13-901.01(B) may establish eligibility for probation through an alternative statutory process.
Posted by azapp @ Fri, Feb 10, 2006
Plaintiff, a supplier of concrete and aggregate materials, recorded a mechanic’s lien on a building project to secure payment for materials. Defendant, the contractor on the building project, obtained a lien-discharging bond, which upon recording with the county recorder discharged the lien. Defendant served notice of the lien-discharging bond to Plaintiff before the bond was recorded, but did not serve Plaintiff with the bond after its recording, contrary to the requirement of A.R.S § 33-1004(C). Plaintiff filed an action against the bond seven months after recording the lien and six weeks after learning through correspondence that the lien-discharging bond had been recorded.
The trial court dismissed Plaintiff’s action for failure to commence the action within six months of recording the lien. The Court of Appeals, however, held that the bond was not discharged under A.R.S. § 33-1004(D)(1). Instead, because the lien-discharging bond had been improperly served (pre-recording) upon Plaintiff, the time to commence the action was governed by A.R.S. § 33-1004(F), which allows a claimant to bring an action for up to two years after the bond was recorded, if within six months of discovery of the recorded bond. Plaintiff’s action was timely filed. Given the preliminary phase of the action, the Court declined to award attorney’s fees.
Judge Snow wrote the opinion for the panel; Judges Timmer and Desens concurred.
Posted by azapp @ Mon, Feb 6, 2006
He Never Went To Law School
By Michael Kiefer,The Arizona Republic,Feb.1, 2006
Yale McFate, the Maricopa County Superior Court judge who presided over the 1963 rape case that led to the U.S. Supreme Court's Miranda decision and the police incantation that starts "You have the right to remain silent," died Jan. 28 of cancer. He was 96.
McFate was a lawyer from another century. He was born in Arizona before it was a state, and he served in its Legislature and on the Corporation Commission.
Posted by azapp @ Thu, Feb 2, 2006
Associated Press article, Jan. 31, 2006
Reprinted at azcentral.com
A dozen supporters of an Arizona law denying some government benefits
to illegal immigrants rallied Tuesday outside a courthouse where a legal
challenge was mounted in hopes of strengthening the restrictions.
Posted by azapp @ Thu, Feb 2, 2006
By Thomas Ropp, The Arizona Republic, Feb. 2, 2006
A replacement for former state Rep. David Burnell Smith, who resigned
Monday because of campaign-finance violations, could be announced Friday.
Posted by azapp @ Thu, Feb 2, 2006
By Associated Press, Feb. 1, 2006
Reprinted at azcentral.com
Saying the stakes for their branch of government could hardly be higher,
Republican legislators are gearing to mount a legal challenge to Democratic
Gov. Janet Napolitano's latest line-item veto.
Posted by azapp @ Thu, Feb 2, 2006
By Thomas Ropp,The Arizona Republic, Feb. 1, 2006
District 7 Republican Chairman Nancy Barto is among three candidates in
the running to replace former state Rep. David Burnell Smith, who resigned
this week because of campaign-finance violations.
Posted by azapp @ Thu, Feb 2, 2006
By Robbie Sherwood and Chip Scutari
Gov. Janet Napolitano signed the largest pay increase for state employees in
Posted by azapp @ Thu, Feb 2, 2006

