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Skiff v. Carl

Court of Appeals of Arizona, First Division, Department B

October 8, 2013

KENNETH SKIFF, Appellant,
v.
SONJA CARL, Appellee.

Not for Publication – Rule 28, Arizona Rules of Civil Appellate Procedure

Appeal from the Superior Court in Coconino County Cause No. CV2000-0647 The Honorable Mark R. Moran, Judge

Kenneth Skiff, Attorney at Law Phoenix Appellant in Propria Persona

Michael E. Hurley, Attorney at Law Phoenix Attorney for Appellee

MEMORANDUM DECISION

DONN KESSLER, Judge

¶1 Appellant Kenneth Skiff ("Skiff") appeals the trial court's entry of an order awarding Appellee Sonja Skiff Carl ("Carl") $12, 269[1] and the denial of his motion for rehearing. Skiff contends that Carl was only entitled to $2, 745. For the following reasons, we affirm.

FACTUAL AND PROCEDURAL HISTORY

¶2 In 2002, the trial court ruled in favor of Eleanor Skiff ("Eleanor") [2] and Carl in an action to quiet title to property filed by Gilberta Richards ("Gilberta"). The court determined Gilberta had an undivided one-half interest in the property, Eleanor had an undivided one-third interest, and Carl had an undivided one-sixth interest. James Harries ("Harries"), the attorney who represented both Eleanor and Carl on the merits of the quiet title action, filed an application for an award of $41, 040 in attorneys' fees. In 2002, the court granted $37, 134 in fees, and the judgment became a lien upon the property. When the property was sold eight years later in 2010, approximately $67, 400 of the proceeds, representing the amount of the fee award plus interest, was withheld and placed in a trust account with Carl's attorney to be disbursed upon mutual agreement of the parties.[3]

¶3 In November 2011, Carl filed a motion to clarify the judgment and establish the parties as equal co-judgment creditors, each entitled to a one-half share of the sale proceeds and accrued interest. Skiff argued an equal distribution of the proceeds would unjustly enrich Carl as she had paid only $1, 500 of the $37, 134 in attorneys' fees due to Harries, and Skiff and his family[4] had paid the remainder. He contended that Carl should be entitled to only $1, 500 of the lien amount plus interest, or $2, 745. The court found that no injustice would be done to Carl if it allowed the application of equitable subrogation, and the failure to do so would result in Carl receiving a windfall. In applying the doctrine, the court found that both parties should share equally in the attorneys' fees owed. As a result, the court found that Skiff had an equitable lien on the sale proceeds to the extent the Skiff family paid more than one-half of the legal fees owed, and ordered that Skiff be equitably subrogated to Carl's rights in the judgment proceeds except the $1, 500 plus interest Carl paid in attorneys' fees. Finally, the court concluded that if the parties could not reach an agreement as to the amounts to be divided, it would set the matter for further hearing.

¶4In 2012, Carl filed a request for an evidentiary hearing because the parties could not agree on the amount of reimbursement owed to Skiff. The court scheduled an evidentiary hearing for June 25, 2013. Skiff responded in three ways. First, he filed an opposition to the motion for an evidentiary hearing. Second, he filed a motion in limine also opposing any evidentiary hearing, asserting the request was actually a "ruse" to discuss a new issue of whether he was entitled only to proceeds the Skiff family paid to Harries that he could actually prove. Skiff could not prove the exact amount the Skiff family paid Harries. However, Skiff argued Carl should be barred by laches from contesting the amount because he had offered to confirm the final payment amount with Carl in 2004, Carl remained silent until the proceeds became available for distribution, and Eleanor's old bank account records and statements were no longer available. Finally, Skiff filed a hearing brief, attaching various documents including an affidavit in which he claimed that the actual attorneys' fees exceeded $43, 000, and the Skiff family paid $23, 749 plus a lump sum settlement for the rest. He believed that the rest of the payments were $2, 000 to $4, 000 less than the full amount owed.

¶5 The court granted oral argument on the motion in limine. However, the court later sua sponte cancelled the evidentiary hearing and heard only oral argument.

¶6 At oral argument, Carl argued that: (1) Skiff was entitled to $23, 749 paid toward the attorneys' fees plus an additional $19, 394 in interest, totaling $43, 143; (2) Carl was entitled to $1, 350[5] paid toward the attorneys' fees plus an additional $1, 102 in interest, totaling $2, 452; and (3) the remaining $22, 376 should be divided equally between both parties. Skiff argued that Carl was entitled only to the amount she paid toward attorneys' fees plus interest, and Skiff should receive the remainder of the proceeds. At the end of the argument, Skiff stated he had no other additional evidence to submit to the court beyond the affidavits and exhibits he attached to his pleading. The court took the matter under advisement, indicating that since new numbers were being presented as to the attorneys' fees, it would reflect on those numbers to determine if it had to hear evidence to modify its earlier ruling.

¶7 The trial court ruled that each party was entitled to one-half of the amount in escrow before adjustments for the prior payments of fees. It then held that each party was liable for one-half of the fee award of $37, 134, amounting to $18, 567 each. Next, because the Skiff family had paid $23, 749 in fees, or $5, 182 in excess of what they owed, the court found that amount plus interest should be deducted from Carl's share of the proceeds and used to reimburse Skiff. This left Carl with $24, 155. From that the court deducted $11, 886 (representing the difference between what Carl did and should have paid——the $18, 567 due less the $1, 500 paid and the $5, 182 in principal already reimbursed to Skiff). This left Carl with a total of $12, 269. The remaining $55, 731 of the proceeds went to Skiff.

¶8 Skiff filed a motion for rehearing pursuant to Arizona Rules of Civil Procedure ("Rules") 59(a) and 60(c)(6), arguing he was deprived of a fair hearing and the decision was not justified by the record or evidence. The trial ...


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