Opinion
No. 2 CA-CV 2018-0168
04-08-2020
RICHARD PAUL VENABLE AND VICKY VENABLE, HUSBAND AND WIFE; ANGELO'S PIZZA & GYROS, LLC, Defendants in Intervention/Appellants, v. SAFECO INSURANCE COMPANY OF AMERICA, Plaintiff-Intervenor/Appellee.
COUNSEL Law Offices of Miniat & Wilson L.P.C., Tucson By Kevin E. Miniat Counsel for Appellants Foran Glennon Palandech Ponzi & Rudloff PC, Phoenix By Amy M. Samberg Counsel for Appellee
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NOT FOR PUBLICATION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 Pima County
No. C20133966
The Honorable Kenneth Lee, Judge
The Honorable D. Douglas Metcalf, Judge
AFFIRMED
COUNSEL Law Offices of Miniat & Wilson L.P.C., Tucson
By Kevin E. Miniat
Counsel for Appellants Foran Glennon Palandech Ponzi & Rudloff PC, Phoenix
By Amy M. Samberg
Counsel for Appellee
MEMORANDUM DECISION
Presiding Judge Staring authored the decision of the Court, in which Chief Judge Vásquez and Judge Brearcliffe concurred. STARING, Presiding Judge:
¶1 Richard Venable appeals from the trial court's grant of summary judgment to Safeco Insurance Company of America, denial of his motions for reconsideration and new trial, and award of attorney fees in favor of Safeco. We affirm.
Factual and Procedural Background
¶2 In January 2013, while delivering food for his employer, Angelo's Pizza & Gyros, Christian Burton's vehicle struck Venable, who was in a wheelchair. Venable and his wife, Vicky, subsequently filed an action for personal injury, alleging: (1) Burton negligently caused the collision by veering off the road because he was distracted by a GPS device; (2) Angelo's as well as its owner/manager, Danny Walsh, Danny Walsh Enterprises LLC, and Walsh's wife (collectively "Walsh") were vicariously liable for Burton's negligence; and (3) Angelo's and Walsh negligently hired, trained, and/or supervised Burton.
¶3 Safeco had issued an automobile insurance policy to Burton's step-father, who was the named insured, but which covered Burton as an insured family member. The policy provided liability coverage for bodily injury and property damage, subject to a "Food Delivery Exclusion" that expressly disclaimed liability coverage for "[a]ny insured using any vehicle while employed in the pickup or delivery of . . . food or any products for the purpose of compensation." Burton, Angelo's, and Walsh made claims under the policy for defense and indemnification. Safeco agreed to defend Burton, Angelo's, and Walsh, but concluded the Food Delivery Exclusion limited coverage to $15,000 because Arizona law requires insurers to provide named insureds and permissive users with automobile liability coverage in an amount no less than $15,000 per person. See A.R.S. § 28-4009(A)(2)(a).
In 2015, while the Venables' personal injury action was pending in superior court, Safeco filed a declaratory action in federal court, seeking a declaratory judgment that the Food Delivery Exclusion limited coverage for the accident to $15,000. That matter remains pending.
¶4 In February 2016, the Venables, Angelo's, and Walsh entered a "Morris agreement" in which Angelo's and Walsh stipulated to a $400,000 judgment in favor of Venable. See United Servs. Auto. Ass'n v. Morris, 154 Ariz. 113 (1987). The Morris agreement also resulted in the dismissal of Danny Walsh and his wife as individual defendants, and expressly provided that it had no effect on the action against Burton. The trial court entered judgment accordingly on February 17, 2016, and specifically stated: "Neither the Stipulation and its recitals nor this Order apply to the ongoing and pending claim against Defendant Christian Burton or bind Defendant Burton in any way."
"[W]e use the term 'Morris agreement' to describe a settlement agreement entered into when the insurer is defending under a reservation of rights, under which the insured stipulates to a judgment, assigns his rights against the insurer to the claimant, and receives in return a covenant from the claimant not to execute against the insured." Parking Concepts, Inc. v. Tenney, 207 Ariz. 19, n.1 (2004).
¶5 On February 29, 2016, the trial court dismissed Venable's complaint with prejudice as to Burton because of Venable's failure to comply with various court orders. The next day, Safeco moved to intervene "as a matter of right with regard to the validity and reasonableness of the judgment entered by the Court on February 17, 2016." The court granted Safeco's motion over Venable's objection.
¶6 In March 2018, Safeco moved for summary judgment, arguing "there is no dispute of material fact that the most . . . Venable can recover from Safeco is the $100,000 auto liability policy limit" and that it was "entitled to judgment as a matter of law that in the event the Food Delivery Exclusion is not enforceable, Safeco's maximum exposure is the $100,000 auto liability limit." At the hearing on Safeco's motion, the trial court determined "further briefing [was] necessary regarding whether [Safeco] is responsible due to the dismissal of . . . Burton." After both Safeco and Venable briefed the issue, the court granted summary judgment in favor of Safeco and ruled that Venable could not recover any portion of the stipulated judgment from Safeco:
Once the Plaintiffs' claims against Defendant Burton were dismissed with prejudice, even if the dismissal was based on . . . pretrial discovery sanctions, Safeco's policy was no longer available to satisfy the stipulated judgment. The Court in this ruling is not voiding the Morris agreement. This Court is simply holding that Safeco's policy is not available to satisfy that stipulated judgment, due to the dismissal of the employee/agent which also released the employer/principal from any claims based on vicarious liability.This appeal followed.
Venable first filed a motion to reconsider and a motion for new trial based on the alleged "irregularity of proceeding," the court's judgment being "contrary to law," and "newly discovered additional financial information." Both motions were denied.
Jurisdiction
¶7 We have jurisdiction over the trial court's order granting summary judgment and its denial of Venable's motion for a new trial pursuant to A.R.S. §§ 12-120.21(A)(1) and 12-2101(A)(1), (5)(a). Because the court's order denying Venable's motion to reconsider its grant of summary judgment presents the same questions as an appeal from the grant of summary judgment, the denial of the motion to reconsider is not appealable and we lack jurisdiction to review it. See § 12-2101(A)(2) (allowing appeal "[f]rom any special order made after final judgment"); but see Reidy v. O'Malley Lumber Co., 92 Ariz. 130, 136 (1962) ("An order made after judgment is not appealable if the appeal presents the same question as would be presented on an appeal from the judgment.").
Discussion
¶8 On appeal, Venable argues the trial court erred by: (1) impermissibly considering liability as a basis for ignoring the Morris agreement; (2) improperly concluding the policy did not provide coverage to Burton for the liability established in the Morris agreement; (3) improperly applying claim preclusion to the Morris agreement; (4) not finding Safeco either waived or was estopped from contesting Angelo's liability; (5) denying Venable's motion for a new trial; (6) awarding attorney fees to Safeco; and (7) including Vicky Venable in the summary judgment. We review de novo the court's grant of summary judgment. See Jackson v. Eagle KMC L.L.C., 245 Ariz. 544, ¶ 7 (2019). The Trial Court Did Not Ignore the Morris Agreement
¶9 Venable argues the trial court erred by considering the absence of Burton's liability because Morris, 154 Ariz. 113, prohibits insurers from "re-litigating the liability or damage circumstances that underlie the stipulated judgment." According to Venable, Safeco is only permitted to challenge the Morris agreement based on Burton's reasonableness or fraudulent behavior in reaching the settlement, and the Morris agreement "bound the insurer to the existence and extent of its insured's liability." Venable contends the court "could not rule that Angelo's has no liability," and therefore, its ruling was contrary to Morris, Associated Aviation Underwriters v. Wood, 209 Ariz. 137 (App. 2004), and Quihuis v. State Farm Mut. Auto. Ins., 235 Ariz. 536 (2014).
¶10 Safeco counters that the trial court's order granting summary judgment did not ignore or invalidate the Morris agreement. Specifically, Safeco argues the Morris agreement remains valid to the extent that it establishes Angelo's liability, but that Wood, 209 Ariz. 137, does not apply because the court's determination that Safeco's policy did not provide coverage for Angelo's and Walsh's direct negligence did not require relitigation of the facts supporting the agreement. Safeco also asserts Quihuis, 235 Ariz. 536, does not apply because that case was about an insurer's broad duty to defend, and the issue here is whether Safeco's "narrower duty to indemnify Angelo's for its independent negligence survived the dismissal of Burton."
¶11 As noted, a "Morris agreement" is a settlement agreement entered into by an insured who stipulates to a judgment in favor of a third-party tort claimant, when the insurer has defended the insured in the underlying litigation under a reservation of rights. Morris, 154 Ariz. at 119-20. A Morris agreement "allows a plaintiff and defendant, whose insurer will only defend under a reservation of rights, to agree that judgment may be entered against the defendant in a specified amount with the understanding that the plaintiff will not execute on the judgment against the defendant." Munzer v. Feola, 195 Ariz. 131, ¶ 11 (App. 1999). The plaintiff may then proceed against the defendant's insurer; that is, if the plaintiff prevails on the coverage issue, he may collect his judgment from the insurer to the extent that the judgment is reasonable and prudent. Id. And, "neither the fact nor amount of liability to the claimant is binding on the insurer unless the insured or claimant can show that the settlement was reasonable and prudent." Morris, 154 Ariz. at 120; Parking Concepts, Inc. v. Tenney, 207 Ariz. 19, ¶ 15 (2004).
¶12 In Wood, the insurer sought to litigate its insured's liability after its insured entered a Morris agreement with the plaintiffs. 209 Ariz. 137, ¶¶ 10, 24. There, the insurer argued that even when the facts underlying the tort liability and coverage cases were the same, it should be permitted to relitigate those facts in the coverage case after its insured entered a Morris agreement. Id. ¶ 24. This court disagreed with the insurer and explained: "Morris does not authorize, but rather essentially prohibits, an insurer's attempt in that context to litigate tort liability and damage issues in the guise of a coverage defense." Id. ¶ 37.
¶13 Here, however, Safeco did not seek to litigate Burton's, Angelo's, or Walsh's liability after Angelo's and Walsh entered the Morris agreement with Venable. Rather, in its motion for summary judgment, it asked the court to find that in the event the Food Delivery Exclusion was not enforceable, Safeco's maximum exposure was the $100,000 auto-policy limit. Thus, Wood does not apply.
¶14 Next, Venable cites Quihuis, 235 Ariz. 536, and asserts that although our supreme court allowed the insurer in that case to dispute coverage based on lack of ownership of the vehicle, it "reaffirmed the limitations recognized in [Morris] and [Wood]" and "approved the holding in Wood." Venable, however, does not explain how Quihuis supports his position, and merely cites the court's holding.
¶15 In Quihuis, our supreme court considered whether a default judgment entered pursuant to a Damron agreement that stipulated facts determinative of both liability and coverage had a preclusive effect on the insurer's ability to litigate coverage. Id. ¶ 1. There, the insurer declined to defend its insured because it believed the accident was not covered under the policy. Id. ¶¶ 3-4. The court held that "when an injured party obtains a default judgment against an insured pursuant to a Damron or Morris agreement, that judgment will bind the insurer in a coverage case as to the existence and extent of the insured's liability," but explained that the judgment would "not preclude the insurer from litigating its identified basis for contesting coverage, irrespective of any fault or damages assessed against the insured." Id. ¶ 38. In other words, an insurer is not bound by a stipulation between its insured and the plaintiffs as to facts essential to establishing coverage; rather, the insurer is free to litigate those facts in its coverage case. Id.
"An agreement with the same general characteristics [as a Morris agreement] entered into when the insurer refuses to defend is referred to as a 'Damron agreement.'" Parking Concepts, 207 Ariz. 19, n.1 (citing Damron v. Sledge, 105 Ariz. 151 (1969)).
¶16 Here, Safeco did not seek to litigate its insured's liability, but rather sought to litigate its exposure to a stipulated judgment based on the terms of its insurance policy. That is, Safeco only sought to litigate its responsibility to satisfy the judgment—not Angelo's or Walsh's liability established in the Morris agreement. Under Quihuis, Safeco was not precluded from litigating the reasonableness of the Morris agreement or its exposure to the judgment. Venable's reliance on Quihuis is misplaced and we find no error on this point. Therefore, the court's grant of summary judgment was not contrary to law.
We also note that because the Morris agreement did not establish liability as to Burton, Safeco would have been permitted to litigate the existence and extent of Burton's liability, in compliance with Wood, 209 Ariz. 137, and Quihuis, 235 Ariz. 536.
¶17 Additionally, to the extent Venable argues the trial court erred in considering liability when it "ignored" the Morris agreement, we disagree. Venable made two types of claims against Angelo's and Walsh: (1) vicarious liability for Burton's negligence in causing the accident; and (2) Angelo's and Walsh's independent negligence in hiring, training, and/or supervising Burton. Here, the court did not consider the existence or extent of Angelo's or Walsh's direct liability for their own negligence. Rather, the court considered whether the absence of Burton's liability due to dismissal extinguished Angelo's and Walsh's vicarious liability. The court concluded it did and explained: "In cases of vicarious liability, the liability of the principal cannot exist without the liability of the agent." We agree.
¶18 "Under the doctrine of respondeat superior, an employer is vicariously liable for 'the negligent work-related actions of its employees.'" Kopp v. Physician Grp. of Ariz., Inc., 244 Ariz. 439, ¶ 9 (2018) (quoting Engler v. Gulf Interstate Eng'g, Inc., 230 Ariz. 55, ¶ 9 (2012)). "Vicarious liability results solely from the principal-agent relationship . . . ." Id. It is well-settled that "[w]hen a plaintiff sues both the agent and the principal for the negligence of the agent, a judgment in favor of the agent bars the plaintiff's vicarious liability claim against the principal, even when the judgment is the product of a settlement." Jamerson v. Quintero, 233 Ariz. 389, ¶ 6 (App. 2013); see also Chaney Bldg. Co. v. City of Tucson, 148 Ariz. 571, 574 (1986) ("In cases of derivative liability, a judgment or dismissal in favor of the servant relieves the master of liability."). Further, "[w]hen a judgment on the merits—including a dismissal with prejudice—is entered in favor of the 'other person' in [Arizona's vicarious liability statute] . . . there is no fault to impute and the party potentially vicariously liable . . . is not 'responsible for the fault' of the other person." Law v. Verde Valley Med. Ctr., 217 Ariz. 92, ¶ 13 (App. 2007) (quoting A.R.S. § 12-2506(D) ("[A] party is responsible for the fault of another person, or for payment of the proportionate share of another person, if . . . [t]he other person was acting as an agent or servant of the party.")).
¶19 Venable's first claim alleges that Angelo's and Walsh are vicariously liable for Burton's negligence. As noted, vicarious liability as to Angelo's and Walsh can only exist because of their principal-agent relationship with Burton. See Kopp, 244 Ariz. 439, ¶ 9. Here, however, the court dismissed Venable's complaint against Burton with prejudice, thus entering a judgment on the merits in his favor. See Ariz. R. Civ. P. 41(b) (with limited exceptions, involuntary dismissal "operates as an adjudication on the merits"). Without any liability on the part of Burton, there was no fault to impute to Angelo's or Walsh; thus, they could not be held vicariously liable. See Law, 217 Ariz. 92, ¶ 13.
¶20 Lastly, the trial court specified that its ruling did not void the Morris agreement—it "simply h[eld] that Safeco's policy is not available to satisfy that stipulated judgment" because the dismissal of the agent/employee released the principal/employer from any claims based on vicarious liability. Thus, the court did not ignore or invalidate the Morris agreement.
The Policy Did Not Cover Angelo's in Absence of Burton's Liability
¶21 Venable argues the trial court improperly concluded the policy did not cover "the insured for the liability established by the Morris [j]udgment." He asserts the policy requires Safeco to pay the damages established in the Morris agreement because the policy reads: "We will pay damages for bodily injury or property damage for which any insured becomes legally responsible because of an auto accident." According to Venable, the insured became legally responsible when the court signed and entered the stipulated judgment arising from the Morris agreement.
Venable also argues there is no case law, policy, or equitable reason to support the court's ruling. Based on our resolution, we need not address this argument.
¶22 Safeco counters that Angelo's could only be considered an "insured" under the policy if Burton was found liable and that because the only claim against Angelo's or Walsh that could be covered under the policy was vicarious liability, Burton's dismissal with prejudice rendered the Safeco policy unavailable to satisfy the judgment against Angelo's and Walsh. That is, according to Safeco, because Angelo's vicarious liability was extinguished with the dismissal of Burton, the only remaining bases for Angelo's or Walsh's liability were their own acts or omissions—for which they could not be considered insureds. Safeco argues that because the policy never covered Angelo's or Walsh directly, it is not obligated to indemnify Angelo's or Walsh for any direct negligence on their part. We agree.
¶23 As to liability coverage, the Safeco policy reads, in relevant part:
We will pay damages for bodily injury or property damage for which any insured becomes legally responsible because of an auto accident. We will settle or defend, as we consider appropriate, any claim or suit asking for these damages. In addition to our limit of liability, we will pay all defense costs we incur. Our duty to settle or defend ends when our limit of liability for this coverage has been exhausted. We have no duty to defend any suit or settle any claim for bodily injury or property damage not covered under this policy.And, the "Liability Coverage" section of the policy provides:
B. "Insured" as used in this Part means:
1. You or any family member for the ownership, maintenance or use of any auto or trailer.
2. Any person using your covered auto with your express or implied permission. The actual use must be within the scope of that permission.
3. For your covered auto, any person or organization but only with respect to legal responsibility for acts or omissions of a person for whom coverage is afforded under B.1. and B.2. above.
¶24 The named "insured" on the policy here was Burton's step-father. Therefore, Burton qualifies as an "insured" under B.1. Angelo's and Walsh are neither family members nor "persons" Burton's step-father permitted to use the auto under B.2. Angelo's and Walsh could only qualify as "insured" under B.3., which in this instance applies "only with respect to legal responsibility for acts or omissions" of Burton, who is an "insured" under B.1. Because the trial court dismissed Burton from the suit with prejudice, he could not have been found legally responsible for the accident. Absent Burton's legal responsibility, neither Angelo's nor Walsh could be an "insured" under the policy. Therefore, the policy does not cover Angelo's or Walsh, notwithstanding their liability as established in the Morris agreement.
The Trial Court Did Not Preclude Venable's Claim
¶25 Venable argues the trial court erred in applying claim preclusion because a judgment is not a "claim" and claim preclusion only applies to rulings on claims entered after an agent is released from liability. Generally, we review de novo the application of claim preclusion. Howell v. Hodap, 221 Ariz. 543, ¶ 17 (App. 2009). Here, however, the court did not apply or base its ruling on claim preclusion, nor did Safeco argue that claim preclusion applied. Therefore, we need not address this argument.
Although the trial court's ruling briefly notes the distinction between claim preclusion and issue preclusion, issue preclusion did not apply either.
Waiver and Estoppel Do Not Apply
¶26 Venable argues Safeco waived any res judicata argument when it failed to raise the defense in its intervention complaint or its federal declaratory action, and waived its ability to challenge the validity of the Morris agreement because it did not do so in its intervention complaint or disclosure. Because the trial court did not grant summary judgment based on Safeco challenging the validity of the Morris agreement, we need not address this argument.
¶27 Next, Venable appears to argue that because Safeco litigated its intervention action and federal declaratory action "for over 2 years without ever claiming the dismissal against Burton undermined or voided the 'Morris' agreement and Judgment," it was estopped from doing so because its failure to raise the argument earlier induced Venable to rely on Safeco's position. He further asserts that although Rule 56(f), Ariz. R. Civ. P., allows the trial court to grant summary judgment on grounds not raised by a party, "nothing states the trial court can simply ignore the pleadings and grant summary judgment based on a claim or contention never made over a two and one half year period." We disagree.
Venable also argues "[t]he totality of the circumstances indicates an abuse of discretion by the trial court," but cites no legal authority for this argument; thus, we do not address it. See Ariz. R. Civ. App. P. 13(a)(7)(A); see also Brown v. U.S. Fid. & Guar. Co., 194 Ariz. 85, ¶ 50 (App. 1998) (rejecting assertion unsupported by argument or citation of authority). --------
¶28 Rule 56(f) provides that, "[a]fter giving notice and a reasonable time to respond, the court may: (1) grant summary judgment for a nonmoving party; (2) grant summary judgment on grounds not raised by a party; or (3) consider summary judgment on its own after identifying for the parties material facts that may not be genuinely in dispute." The trial court has broad discretion in granting summary judgment and by Rule 56(f)'s plain terms, it may grant summary judgment on grounds not raised by a party or if it independently determines no material facts are in dispute. Compassionate Care Dispensary, Inc. v. Ariz. Dep't of Health Servs., 244 Ariz. 205, ¶ 14 (App. 2018).
¶29 Here, the trial court identified the issue of "whether Safeco . . . is responsible due to the dismissal of . . . Burton" on its own, ordered counsel to "submit simultaneous briefings regarding the aforementioned issue," and gave the parties twenty-one days to do so. Thus, the court gave the parties notice and a reasonable amount of time to respond in accordance with Rule 56(f). After reviewing the parties' briefing on the issue, the court granted summary judgment in favor of Safeco because it concluded: "Once [Venable's] claims against . . . Burton were dismissed with prejudice, even if the dismissal was based on . . . pretrial discovery sanctions, Safeco's policy was no longer available to satisfy the stipulated judgment." Because Rule 56(f)(2) plainly allows the court to grant summary judgment on grounds not raised by either party, we find no error.
Motion for New Trial
¶30 Venable argues the trial judge, who was newly assigned to the case after another judge granted the summary judgment, erred by denying his motion for a new trial pursuant to Rule 59, Ariz. R. Civ. P. In cursory fashion, he asserts that the judge's "[d]odging the issue by characterizing the circumstances as forum shopping was unfounded" because the case was reassigned to the judge through the normal court procedure. Venable, however, cites no authority for this argument. Therefore, we do not address it. See Ariz. R. Civ. App. P. 13(a)(7)(A) (opening brief must contain citations of legal authorities and supporting reasons for each argument); see also Brown v. U.S. Fid. & Guar. Co., 194 Ariz. 85, ¶ 50 (App. 1998) (rejecting assertion unsupported by argument or citation of authority).
Attorney Fee Award
¶31 On appeal, Venable argues the trial court erred in awarding attorney fees to Safeco because Safeco "did not establish itself as the prevailing party," as the court's grant of summary judgment "granted no relief sought by Safeco in its petition [for intervention]." We review the court's award of attorney fees pursuant to A.R.S. § 12-341.01 for an abuse of discretion, but we review de novo whether § 12-341.01 allows an award of attorney fees. See Tucson Estates Prop. Owners Ass'n v. McGovern, 239 Ariz. 52, ¶ 7 (App. 2016).
¶32 Here, the trial court awarded Safeco $45,000 in attorney fees. Although the court did not make specific findings on the record as to its determination that Safeco was a successful party for purposes of awarding attorney fees pursuant to § 12-341.01 or its determination of the amount to award, we "may affirm such a decision if it has any reasonable basis." Peterson v. City of Surprise, 244 Ariz. 247, ¶ 25 (App. 2018).
¶33 Venable contends that, although the trial court's summary judgment ruling concluded that Safeco's policy is not available to satisfy the judgment, the ruling did not make Safeco a "prevailing" party, and therefore, Safeco is not entitled to attorney fees under § 12-341.01. Venable also asserts the $45,000 award to Safeco was inequitable and the court abused its discretion by failing to consider the factors outlined in Associated Indemnity Corp. v. Warner, 143 Ariz. 567 (1985). Safeco counters that because this action arose from a contract—the insurance policy agreement between Safeco and Burton's step-father—and "[t]here is no legitimate question that Safeco prevailed as the Superior Court determined that it was not liable to pay any portion of the Venables' claims against Angelo's," it was entitled to attorney fees under § 12-341.01(A). Safeco also asserts the court properly weighed the factors outlined in Warner, 143 Ariz. 567, and did not abuse its discretion.
¶34 Section 12-341.01(A) provides that the trial court "may award the successful party reasonable attorney fees" in any contested action arising out of a contract. "Determining the prevailing party for the purposes of attorneys' fees is within the trial court's discretion and 'will not be disturbed on appeal if any reasonable basis exists for it.'" Vortex Corp. v. Denkewicz, 235 Ariz. 551, ¶ 39 (App. 2014) (quoting Berry v. 352 E. Virginia, L.L.C., 228 Ariz. 9, ¶ 21 (App. 2011)). And, "[t]he superior court, in its discretion, role, and experience, may determine the prevailing party from all the circumstances, the reasonableness of the parties' positions, and their respective financial positions." Bobrow v. Bobrow, 241 Ariz. 592, ¶ 25 (App. 2017).
¶35 Once the trial court has determined the prevailing party and decided to award attorney fees pursuant to § 12-341.01(A), "[t]he award of reasonable attorney fees . . . should be made to mitigate the burden of the expense of litigation to establish a just claim or a just defense." § 12-341.01(B). We review a court's decision on the amount of fees for an abuse of discretion. Rudinsky v. Harris, 231 Ariz. 95, ¶ 27 (App. 2012). In exercising its discretion, the court should consider:
[T]he merits of the unsuccessful party's claim, whether the claim could have been avoided or settled, whether the successful party's efforts were completely superfluous in achieving the result, whether assessing fees against the unsuccessful party would cause an extreme hardship, whether the successful party did not prevail with respect to all of the relief sought, the novelty of the legal question presented, and whether an award to the prevailing party would discourage other parties with tenable claims from litigating legitimate contract issues for fear
of incurring liability for substantial amounts of attorneys' fees.Fulton Homes Corp. v. BBP Concrete, 214 Ariz. 566, ¶ 10 (App. 2007) (quoting Uyleman v. D.S. Rentco, 194 Ariz. 300, ¶ 27 (App. 1999)). Further, "no single factor requires or prohibits an award of fees." Id. ¶ 15. And although a court must consider these factors, it "need not make findings on the record." Hawk v. PC Vill. Ass'n, 233 Ariz. 94, ¶ 21 (App. 2013).
¶36 Although the trial court did not make a specific finding that Safeco was a prevailing party, the court had the discretion to do so. See Vortex Corp., 235 Ariz. 551, ¶ 39. And, given the circumstances of this case, we conclude there was a reasonable basis for the court to find Safeco had prevailed. See Bobrow, 241 Ariz. 592, ¶ 25. As Venable notes, Safeco did not seek relief from all responsibility to satisfy the stipulated judgment, but rather sought only to have its maximum exposure capped at $100,000. Venable, however, cites no authority, and we find none, requiring a party to receive the specific relief requested in order to be a successful party under § 12-341.01(A). Here, Safeco obtained relief that was more favorable than the relief it requested: rather than having its maximum responsibility being limited to $100,000, Safeco was relieved of all responsibility and is required to pay nothing to Venable.
¶37 Next, we review whether the trial court acted within its discretion in awarding $45,000. See Rudinsky, 231 Ariz. 95, ¶ 27. First, Venable's claim for coverage under the Safeco policy became meritless when Burton was dismissed, as his dismissal extinguished any vicarious liability claims against Angelo's or Walsh, and the policy did not cover their direct negligence. Second, Safeco attempted to settle by offering the $15,000 Food Delivery Exclusion limit on multiple occasions. Third, because the result here was not sought by Safeco and was due to the court's own initiative, Safeco's efforts may have been superfluous in achieving the result. Fourth, Venable properly asserted that "any financial award in favor of Safeco would create a severe hardship to [his] current living status" in a sworn affidavit. See Woerth v. City of Flagstaff, 167 Ariz. 412, 420 (App. 1990) (party asserting hardship must present specific facts by affidavit or testimony). Fifth, although Safeco sought only to have its responsibility to satisfy the Morris judgment capped at a particular amount, the end result went above and beyond the relief sought. Thus, Safeco prevailed with respect to the relief sought. Sixth, contrary to Venable's argument that "whether the later dismissal of the agent could affect the entered stipulated judgment from the Morris agreement is novel," Burton's dismissal did not affect the judgment; his dismissal simply extinguished any vicarious liability claims for which Safeco could be responsible. The issue of whether the dismissal of an agent extinguishes the principal's vicarious liability is not novel. See Jamerson, 233 Ariz. 389, ¶ 6; see also Chaney Bldg. Co., 148 Ariz. at 574. Finally, an attorney fee award would not discourage other parties with tenable claims from litigating similar cases or pursuing Morris agreements because the dismissal of Burton, which ultimately released Safeco from all responsibility, was a sanction against Venable for his failure to comply with court orders. Based on these factors, we cannot say the court abused its discretion in awarding Safeco $45,000 in attorney fees. See Rudinsky, 231 Ariz. 95, ¶ 27.
Inclusion of Vicky Venable in Form of Judgment
¶38 Venable asserts the trial court "ha[d] no basis to include [Vicky] in any award of attorney's fees or costs in favor of Safeco" because the previous trial judge dismissed Vicky from the action in connection with the stipulated judgment and reaffirmed Vicky's dismissal when the court dismissed Burton. Venable, however, cites no authority for this argument; therefore, we do not address it. See Ariz. R. Civ. App. P. 13(a)(7)(A); see also Brown, 194 Ariz. 85, ¶ 50.
Attorney Fees
¶39 Safeco seeks attorney fees and costs pursuant to Rule 21, Ariz. R. Civ. App. P., and A.R.S. §§ 12-341 and 12-341.01(A). Because the action underlying this litigation arises from a contract, we award Safeco reasonable attorney fees against Venable under § 12-341.01. And, as the prevailing party, Safeco is entitled to taxable costs pursuant to § 12-341 upon compliance with Rule 21.
Disposition
¶40 For the reasons above, we affirm.