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Salero Ranch, LLC v. Union Pacific Railroad Co.

Court of Appeals of Arizona, Second Division, Department B

August 28, 2013

SALERO RANCH, LLC, an Arizona limited liability company, Plaintiff/Counterdefendant/Appellant,
v.
UNION PACIFIC RAILROAD COMPANY, a Delaware corporation, Defendant/Counterclaimant/Appellee.

Not for Publication Rule 28, Rules of Civil Appellate Procedure

APPEAL FROM THE SUPERIOR COURT OF SANTA CRUZ COUNTY Cause No. CV10574 Honorable Kimberly A. Corsaro, Judge Pro Tempore

Heurlin Sherlock PC By Kevin M. Sherlock and Shanelle C. Schmitz, Attorneys for Plaintiff/Counterdefendant/Appellant

Beaugureau, Hancock, Stoll & Schwartz, P.C., Anthony J. Hancock and Terrance L. Sims, Attorneys for Defendant/Counterclaimant/Appellee

MEMORANDUM DECISION

P. PHILIP G. ESPINOSA, Judge

¶1 Plaintiff/appellant Salero Ranch, LLC appeals from the trial court's award of attorney fees to defendant/appellee Union Pacific Railroad Company pursuant to A.R.S. § 12-1103(B). For the following reasons, we modify the award and affirm as modified.

Factual and Procedural Background

¶2 In August 2010, Salero Ranch and other plaintiffs[1] filed a quiet title action, seeking declaratory and other relief against Union Pacific, including a prescriptive easement across Union Pacific's railroad tracks and right-of-way. Union Pacific filed its answer and a counterclaim to quiet title to its tracks and right-of-way against the prescriptive easement asserted by Salero Ranch. It subsequently filed a motion for summary judgment based in substantial part on the trial court's decision in another action that had been brought against the railroad company, Tumacacori Mission Land Development, Ltd. v. Union Pacific Railroad Co., Santa Cruz Superior Court No. CV09711. In that case, the same trial court had ruled the plaintiff could not obtain any private property interest over Union Pacific's railway because it was a "public highway" under the Arizona Constitution.[2] However, in May 2011, the court denied Union Pacific's motion for summary judgment, concluding that its previous ruling was "not binding on the court in this case, " and allowed Salero Ranch to move forward with its prescriptive-easement claim against Union Pacific.

¶3 In August 2011, this court decided Tumacacori Mission Land Development, Ltd. v. Union Pacific Railroad Co., 228 Ariz. 100, 263 P.3d 649 (App. 2011), in which we held that a prescriptive easement may not be obtained over a railroad right-of-way. Thereafter, Salero Ranch filed a motion for summary judgment in which it argued, in part, that Tumacacori was not controlling authority for its prescriptive-easement claim because this court could not overrule the Arizona Supreme Court's decision in Curtis v. Southern Pacific Co., 39 Ariz. 570, 8 P.2d 1078 (1932), which held an easement of passage may be acquired over a railroad right-of-way. Union Pacific filed its response and cross-motion for summary judgment. The trial court denied Salero Ranch's motion and granted Union Pacific summary judgment pursuant to Tumacacori, concluding Salero Ranch could not obtain a prescriptive easement over a railway.

¶4 The trial court awarded Union Pacific its costs pursuant to A.R.S. §§ 12-341, 12-1103(B), and 12-1840, and attorney fees pursuant to § 12-1103(B). Union Pacific filed a verified statement of costs and attorney fees and a supporting affidavit, asserting it had incurred $58, 686.54 in attorney fees and computerized legal research costs plus $118 in taxable costs.

¶5 Salero Ranch filed a motion for reconsideration of the attorney-fees award, objections to Union Pacific's form of judgment and to its verified statement of costs and fees, and a motion for a new trial on the fees award. The trial court denied the motions and overruled the objections. Salero Ranch timely filed a notice of appeal. We have jurisdiction pursuant to A.R.S. §§ 12-120.21(A)(1) and 12-2101(A)(1), (5)(a).

Discussion Basis for Award

¶6 Under § 12-1103(B), a court may award attorney fees to a party who brings an action to quiet title to real property if that party timely tenders five dollars to a person or entity who holds an adverse interest or right in exchange for the execution and delivery of a quit claim deed disclaiming any such interest or right. An award of fees under § 12-1103(B) is left to the discretion of the trial court, and we will not disturb the award absent an abuse of that discretion. See Jones v. Burk, 164 Ariz. 595, 598, 795 P.2d 238, 241 (App. 1990).

¶7 The purpose of § 12-1103(B) "is to avoid needless litigation, " Mariposa Dev. Co. v. Stoddard, 147 Ariz. 561, 565, 711 P.2d 1234, 1238 (App. 1985), and "mitigate the expense of litigation to establish a just claim, " Scottsdale Mem'l Health Sys., Inc. v. Clark, 164 Ariz. 211, 215, 791 P.2d 1094, 1098 (App. 1990). In determining fees under the statute, trial courts should consider several factors, including the merits of the losing party's ...


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