Opinion
No. 2 CA-CV 2015-0203
02-01-2017
COUNSEL Mesch, Clark & Rothschild, P.C., Tucson By Patrick J. Lopez Counsel for Plaintiffs/Appellants Udall Law Firm, LLP, Tucson By Jeanna Chandler Nash Counsel for Defendants/Appellees
THIS DECISION DOES NOT CREATE LEGAL PRECEDENT AND MAY NOT BE CITED EXCEPT AS AUTHORIZED BY APPLICABLE RULES.
NOT FOR PUBLICATION
See Ariz. R. Sup. Ct. 111(c)(1); Ariz. R. Civ. App. P. 28(a)(1), (f). Appeal from the Superior Court in Cochise County
No. CV201400128
The Honorable John F. Kelliher, Jr., Judge
AFFIRMED IN PART; VACATED IN PART AND REMANDED
COUNSEL Mesch, Clark & Rothschild, P.C., Tucson
By Patrick J. Lopez
Counsel for Plaintiffs/Appellants Udall Law Firm, LLP, Tucson
By Jeanna Chandler Nash
Counsel for Defendants/Appellees
MEMORANDUM DECISION
Judge Staring authored the decision of the Court, in which Presiding Judge Howard and Judge Gordon concurred. STARING, Judge:
The Hon. Richard Gordon, a judge of the Pima County Superior Court, is authorized and assigned to sit as a judge on the Court of Appeals, Division Two, pursuant to Arizona Supreme Court order filed October 12, 2016.
¶1 Appellants Danny and Denice Hatch brought an action to quiet title against appellees Ronald and Roy Klump and Dayla Heap and their spouses (collectively the "Klumps"). The trial court granted summary judgment in favor of the Klumps, and denied the Hatches' motion for new trial. This appeal followed. For the reasons that follow, we affirm the grant of summary judgment against the Hatches but remand for further proceedings on the issue of attorney fees.
Factual and Procedural Background
¶2 When reviewing a summary judgment, we view the evidence in the light most favorable to the non-moving party and draw all reasonable inferences in favor of that party. State v. Mabery Ranch, Co., L.L.C., 216 Ariz. 233, ¶ 23, 165 P.3d 211, 217 (App. 2007). In December 1976, Continental Service Corporation dedicated an easement "on the North 30 feet, East 60 feet and South 60 feet of Parcel 32." The easement deed reads:
KNOW ALL MEN BY THESE PRESENT, that the undersigned, CONTINENTAL SERVICE CORPORATION . . . does hereby grant and convey to the public for ingress and egress and public utilities, an easement to construct, operate and maintain utilities and appurtenances across, over and under the surface of the premises hereinafter described.
. . . .
The Hatches purchased Parcel 32 in 2003, subject to "all easements, rights of way, encumbrances, liens, covenants, restrictions, obligations, and liabilities as may appear of record." The Klumps own and reside on land adjacent to the Hatches' land.
Together with said easement is granted the right to operate, repair, replace, maintain and use said easement; to add to or alter any improvements and/or facilities at any reasonable time, with access to said easement and egress therefrom to permit normal operations of public utilities in connection with said easement.
Grantor shall not erect or construct or permit to be erected or constructed any building or other structure in the above described easement.
¶3 In December 2013, the Klumps began using the easterly sixty feet of the Hatches' property to access their property. In response, pursuant to A.R.S. § 12-1103(B), and prior to filing an action to quiet title, the Hatches tendered a check in the amount of five dollars together with a Quit Claim Deed to each of the Klumps. In February 2014, the Klumps having rejected the tender, the Hatches filed a "Complaint to Quiet Title" and an ex parte motion for temporary restraining order (TRO). The trial court denied an ex parte TRO and set a hearing. At the hearing, the court again denied a TRO.
¶4 In March 2015, the Klumps moved for summary judgment, asserting they were "entitled to judgment in their favor for unrestricted use and access to the easement." In opposition, the Hatches asserted the language of the easement deed "limit[ed] the right [of way] to the use to construct, operate or maintain utilities," and, thus, the easement in question was a private easement "subject to extinguishment by adverse possession." The court granted summary judgment in favor of the Klumps and awarded them attorney fees and costs. In the "Final Judgment," the court awarded the Klumps "all rights for use of the easement," and "forever estopped [the Hatches] from interfering with use of the easement for purpose of ingress and egress."
¶5 The Hatches timely moved for a new trial. The court denied the motion for new trial and directed them to pay attorney fees in the amount of $5,000 and costs in the amount of $206.88.
¶6 The Hatches filed a timely notice of appeal. We have jurisdiction pursuant to A.R.S. §§ 12-120.21(A)(1) and 12-2101(A)(1).
Discussion
Waiver
¶7 The Hatches argue the trial court erred in granting summary judgment because the express language of the easement deed limits ingress and egress to the operation and maintenance of public utilities. The parties, however, dispute whether the issue was properly preserved for appeal. Generally, arguments not timely raised in the trial court are waived. Cont'l Lighting & Contracting, Inc. v. Premier Grading & Utilities, LLC, 227 Ariz. 382, ¶ 12, 258 P.3d 200, 204 (App. 2011) (Legal theories must be timely presented "to the trial court so that the court may have an opportunity to address all issues on the merits.").
Waiver of issues not raised below is a rule of procedure, not of jurisdiction, serving the "orderly administration and the attainment of justice." Town of South Tucson v. Bd. of Supervisors, 52 Ariz. 575, 582, 84 P.2d 581, 584 (1938).
¶8 We generally decline to consider an issue raised for the first time in a motion for new trial. Kent v. Carter-Kent, 235 Ariz. 309, ¶ 20, 332 P.3d 56, 60 (App. 2014) (spouse could not use "motion for new trial as vehicle for a revaluation . . . because that remedy was not at issue in the underlying order"); Conant v. Whitney, 190 Ariz. 290, 293, 947 P.2d 864, 867 (App. 1997) (issue not raised until motion for new trial waived). We have on occasion, however, considered arguments first raised in a motion for new trial when the trial court heard "the new arguments and evidence," expressly ruled on them, and the denial of the motion for new trial was itself appealed. Parra v. Cont'l Tire N. Am., Inc., 222 Ariz. 212, ¶ 7 & n.2, 213 P.3d 361, 363 & n.2 (App. 2009). But, even if an issue first raised in a motion for new trial is not deemed waived, "to preserve an argument for review, the defendant must make a sufficient argument to allow a trial court to rule on the issue." State v. Kinney, 225 Ariz. 550, ¶ 7, 241 P.3d 914, 918 (App. 2010); see also State v. Fulminante, 193 Ariz. 485, ¶ 64, 975 P.2d 75, 93 (1999) (objection sufficient if it provides judge with opportunity to remediate).
¶9 The Hatches argue they "preserved the issue concerning the scope of the ingress-egress grant" by filing a motion for new trial following the grant of summary judgment. In the motion, they asserted the language of the easement "expressly defines a public utilities easement that permits ingress and egress to access and maintain said public utilities." However, they went on to claim:
Continental Service Corporation, in creating the "Right of Way Easement" did, by the very language therein, limit same to ingress and egress to access and maintain public utilities. This must be determined by the application of ejusdem generis and more particularly upon the fact the conveyance put a comma after utilities. Consequently, Defendants have the burden
of proving by clear, satisfactory, unequivocal evidence that the roadway was dedicated to the public. Defendants have presented no such evidence to the Court.(Emphasis added.) The Hatches had previously argued in opposition to the Klumps' motion for summary judgment the easement was "a private easement which is subject to extinguishment by adverse possession" and that "[a]lthough, the grant does not expressly state the easement is for the purpose of a road, the use of 'ingress and egress' to describe the easement implies a roadway," which was neither properly dedicated nor accepted by the public. Given the Hatches' previous arguments in connection with the motion for summary judgment, we do not read the motion for new trial as raising a new argument concerning the scope of the easement, but, rather, as the Hatches again urging their argument that the Klumps had failed to provide "clear, satisfactory, unequivocal evidence . . . of a dedication to the public."
¶10 In response to the motion for new trial, the Klumps argued the language of "[t]he easement for public utilities [did] not qualify, limit, or restrict the public easement for ingress and egress." Only then, in their reply, did the Hatches make any argument that the scope of the easement was limited to the operation and maintenance of utilities. Even so, the reply was neither a crucial nor even a significant part of the Hatches' argument that the Klumps "rel[ied] solely on the language of the right of way easement to justify their position" and had "provided no evidence to the Court of the grantor's (Continental Service Corporation) intent" to dedicate to the public a roadway "beyond the granting instrument." In context, we can hardly say the Hatches made "a sufficient argument to allow a trial court to rule on the issue" they advance on appeal, namely whether the express language of the easement deed limits ingress and egress to the operation and maintenance of public utilities. See Kinney, 225 Ariz. 550, ¶ 7, 241 P.3d at 918. Accordingly, we find the argument waived.
First raising an issue in a reply brief is similarly insufficient to first raising an issue in a motion for reconsideration. See Evans Withycombe, Inc. v. W. Innovations, Inc., 215 Ariz. 237, ¶ 15, 159 P.3d 547, 550 (App. 2006) ("[W]hen a new argument is raised for the first time in a motion for reconsideration, the prevailing party below is routinely deprived of the opportunity to fairly respond."). --------
Attorney Fees
¶11 The Hatches argue it was improper for the trial court to award attorney fees to the Klumps because they did not comply with the requirements of A.R.S. § 12-1103(B). In response, the Klumps argue the Hatches have conceded the propriety of the court awarding fees pursuant to A.R.S. § 12-341.01 by asserting the applicability of the statute themselves on two separate occasions. The Klumps also argue the Hatches have waived the issue by failing to object in the trial court. "We review a trial court's award of attorney fees for an abuse of discretion." Bennett Blum, M.D., Inc. v. Cowan, 235 Ariz. 204, ¶ 5, 330 P.3d 961, 962 (App. 2014). However, we review de novo as a question of law whether the court had authority to award attorney fees. Id.
¶12 As noted, generally arguments not raised in the trial court cannot be raised separately on appeal. But, as also noted, this rule is merely one of procedure, and not one of jurisdiction. Town of South Tucson v. Bd. of Supervisors, 52 Ariz. 575, 582, 84 P.2d 581, 584 (1938).
¶13 "[W]hen the record in a case on appeal shows affirmatively that certain facts exist sufficient to determine an issue which though not specifically presented and tried out in the lower court is necessarily decisive of the action" we may consider the appeal on that issue, "notwithstanding it was never formally raised or litigated in the lower court." Int'l Life Ins. Co. v. Sorteberg, 70 Ariz. 92, 98, 216 P.2d 702, 706 (1950), quoting Regan v. First Nat'l Bank, 55 Ariz. 320, 327-28, 101 P.2d 214, 218 (1940). But we generally exercise our discretion to consider unraised issues only when "a constitutional issue is raised; the question is one of statewide public importance; there is clearly a wrong to be redressed; or the unraised issue will dispose of the case on appeal and avoid the futility of returning it to the trial court to produce the same result." Aldrich & Steinberger v. Martin, 172 Ariz. 445, 447-48, 837 P.2d 1180, 1182-83 (App. 1992) (citations omitted). "The exceptions to the general rule operate only where the facts of a particular case so warrant and the question is one of substantive law presenting no dispute as to the facts." Stokes v. Stokes, 143 Ariz. 590, 592, 694 P.2d 1204, 1206 (App. 1984).
¶14 The Hatches concede they failed to object below, but urge us to exercise our discretion "as the issue is purely legal, there are no facts in dispute, and the error is unquestionable." Because we conclude the trial court's award of attorney fees clearly contravenes applicable law, we address their argument. See Bohonus v. Amerco, 124 Ariz. 88, 90, 602 P.2d 469, 471 (1979) (addressing argument first raised on appeal because there was "clearly a wrong to be redressed" as order contravened statute).
¶15 In their motion for summary judgment, the Klumps requested attorney fees and costs pursuant to A.R.S. §§ 12-341.01 and 12-349. In its order granting summary judgment, the court only stated, "Defendants are entitled to an award of attorney's fees and costs," without identifying the applicable statute or stating any specific reasons for the award. But, in the "Final Judgment," the court stated, "Pursuant to A.R.S. § 12-341, there is good cause to allow the Defendants to recover their costs and attorney's fees." The court then awarded the Klumps costs in the amount of $206.88 and attorney fees in the amount of $5,000.
¶16 Section 12-341, however, only permits an award of "all costs expended or incurred"; it does not grant courts the authority to award any amount in attorney fees. Thus, we vacate any amount of attorney fees awarded pursuant to § 12-341.
¶17 The trial court may have intended to award attorney fees pursuant to § 12-341.01(A), which provides in part: "In any contested action arising out of a contract . . . the court may award the successful party reasonable attorney fees." We have previously made clear, however, that § 12-1103(B) is "the exclusive statute for recovery of [attorney] fees in a quiet title action." Lange v. Lotzer, 151 Ariz. 260, 261, 727 P.2d 38, 39 (App. 1986). Therefore, in quiet title actions, "the more general provisions of A.R.S. § 12-341.01(A) are not applicable." Id. at 262, 727 P.2d at 40.
¶18 Moreover, under § 12-1103(B), a prevailing party may only recover attorney fees upon following the prerequisites set out in the statute. Lange, 151 Ariz. at 262, 727 P.2d at 40. Those include: requesting the person "holding an apparent adverse interest or right to execute a quit claim deed thereto, and . . . tender[ing] to him five dollars for execution and delivery of the deed" twenty days before bringing the action to quiet title. § 12-1103(B). The record indicates the Hatches complied with the statute, but there is no indication of any attempt at compliance on the part of the Klumps. Because the Klumps failed to comply with § 12-1103(B), they are not entitled to an award of attorney fees under the statute. See Lange, 151 Ariz. at 262, 727 P.2d at 40 ("Lotzer's failure to comply with these statutory prerequisites precludes an award of fees under A.R.S. § 12-1103(B) . . . .").
¶19 Finally, when reviewing an award of attorney fees pursuant to § 12-349, "[w]e view the evidence in a manner most favorable to sustaining the award and affirm unless the trial court's finding . . . is clearly erroneous." Phx. Newspapers, Inc. v. Dep't of Corrs., 188 Ariz. 237, 243, 934 P.2d 801, 807 (App. 1997). Because a fee award under § 12-349 is mandatory if the requirements of the statute exist, "the question is whether sufficient evidence exists to support [a] finding" under the statute. Id. The application of the statute is a question of law which we review de novo. Id. at 244, 934 P.2d at 808.
¶20 In order for fees to be awarded under § 12-349, an attorney or party must have: (1) brought or defended a claim "without substantial justification"; (2) brought or defended a claim "solely or primarily for delay or harassment"; (3) unreasonably delayed the proceedings; or (4) engaged in abusive discovery. § 12-349(A)(1)-(4). "[T]he trial court must make appropriate findings of fact and conclusions of law" for each element. Bennett v. Baxter Grp., Inc., 223 Ariz. 414, ¶ 28, 224 P.3d 230, 237 (App. 2010), quoting Fisher ex rel. Fisher v. Nat'l Gen. Ins. Co., 192 Ariz. 366, ¶ 13, 965 P.2d 100, 104 (App. 1998). Section 12-350, A.R.S., also mandates the trial court "set forth the specific reasons" for "awarding attorney fees pursuant to § 12-349." The findings "need only be specific enough to allow an appellate court 'to test the validity of the judgment.'" Phx. Newspapers, Inc., 188 Ariz. at 243, 934 P.2d at 807, quoting Miller v. Bd. of Supervisors, 175 Ariz. 296, 299, 855 P.2d 1357, 1360 (1993). But an appellate court "must be able to discern more than a permissible interpretation of the trial court's analysis." Miller, 175 Ariz. at 299, 855 P.2d at 1360. Failure to make findings may be reversible error. Id. at 300, 855 P.2d at 1361.
¶21 The trial court made no findings that would permit us to review its determination that an award of attorney fees was appropriate, or even that an award was based on § 12-349. See id. at 299, 855 P.2d at 1360 (without explanation "an appellate court cannot effectively review the decision-making process of the trial court"), quoting Urban Dev. Co. v. Dekreon, 526 P.2d 325, 328 (Alaska 1974). In its order granting the Klumps' motion for summary judgment, the court only stated, "Defendants are entitled to an award of attorney's fees and costs," without further explanation. In the "Final Judgment," the court stated, "Pursuant to A.R.S. § 12-341, there is good cause to allow the Defendants to recover their costs and attorney's fees." But, as stated above, an award of attorney fees is not authorized under § 12-341, and "good cause" does not permit an award of fees under § 12-349. Accordingly, without a basis from which to review, we vacate the award of attorney fees to the extent it stems from § 12-349.
Attorney Fees
¶22 Both parties have requested an award of attorney fees and costs, citing Rule 21, Ariz. R. Civ. App. P. The Hatches have not, however, "specifically state[d] the statute, rule, decisional law, contract, or other authority for an award of attorneys' fees," Ariz. R. Civ. App. P. 21(a)(2), and Rule 21 does not provide a substantive basis for costs and fees, see Sklar v. Town of Fountain Hills, 220 Ariz. 449, ¶ 23, 207 P.3d 702, 708 (App. 2008). The Klumps, on the other hand, have requested costs and fees pursuant to §§ 12-341 and 12-349. As stated above, § 12-349 provides for an award of attorney fees "when a claim is brought without substantial justification or for delay or harassment." Sklar, 220 Ariz. 449, ¶ 23, 207 P.3d at 708. Because we do not conclude the Hatches' appeal was "frivolous or otherwise unjustified" we deny an award of attorney fees based on § 12-349. See id. Pursuant to § 12-341, however, we grant the Klumps' costs incurred on appeal, upon their compliance with Rule 21.
Disposition
¶23 For the foregoing reasons, we affirm the trial court's order granting summary judgment, but vacate the award of attorney fees, and remand for proceedings consistent with this decision.