Arizona Court of Appeals Division One Holds that Rent Payments Pending Appeal in Eviction Action Should be Made as they Come Due.

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.