Arizona Court of Appeals Division Two holds that a trial court may reduce the fees and costs requested in an uncontested fee application when the contract provides for the award of reasonable attorneys’ fees.

A property owners’ association sued the estate of a former resident to enforce an assessment lien. The estate did not appear. The association applied for an entry of default and requested attorneys’ fees of $3,155.50 and costs of $985.71. The association based its request on A.R.S. § 33-1807(H) and the Covenants, Conditions, and Restrictions (“CC & Rs”), both of which allow for the recovery of reasonable attorneys’ fees and costs in a lien action. The trial court granted the association’s request for a default judgment but reduced the fee award to $1,000 and the cost award to $631.26. The association appealed. The estate did not file a responsive brief.

On appeal, the association argued that because the estate did not oppose its request for fees and costs, the association was entitled to its entire request, and the trial court had no authority to reduce the amount. The Court of Appeals disagreed. The court held that when a trial court is enforcing a contract that provides for reasonable attorneys’ fees and costs, the court retains broad discretion to evaluate the reasonableness of the requested fees and costs when the non-prevailing party has not appeared, even if the prevailing party has filed affidavits and fee applications in accordance with China Doll. The Court of Appeals explained that this rule would enforce the parties’ intent and prevent prevailing parties from overreaching in fee applications. The court distinguished this situation from a case in which a trial court is enforcing a contract that provides that the prevailing party shall be awarded “all” its attorneys’ fees, in which case the trial court has limited discretion. See McDowell Mountain Ranch Cmty. Ass’n v. Simons, 216 Ariz. 266 (App. 2007).

The Court of Appeals also found that the trial court’s reductions were not an abuse of discretion. It therefore affirmed.

Judge Eckerstrom delivered the opinion of the court; Judges Eppich and Espinosa joined.