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Ryan v. State

Court of Appeals of Arizona, First Division, Division One

November 19, 2013

MARK A. RYAN, for and on behalf of himself and as next friend for HESTER and HANNAH RYAN, minors; and MARGARET LEE RYAN; ANTHONY J. FOSTER; and VIRGINIA FOSTER and RICK PATTEN, his parents, Plaintiffs/Appellants,
STATE OF ARIZONA, Defendant/Appellee.

Not for Publication See Ariz. R. Sup. Ct. 111(c); Ariz. R. Crim. P. 31.24

Appeal from the Superior Court in Maricopa County No. CV2011-017196 The Honorable Mark H. Brain, Judge

Treon Aguirre Newman & Norris, PA, Phoenix By Richard T. Treon Counsel for Plaintiffs/Appellants

Arizona Attorney General, Phoenix By Claudia Acosta and Michael E. Gottfried Co-Counsel for Defendant/Appellee

Judge Patricia A. Orozco delivered the decision of the Court, in which Presiding Judge Randall M. Howe and Judge Samuel A. Thumma joined.


OROZCO, Judge:

¶1 Mark A. Ryan and Anthony J. Foster (collectively Appellants) appeal the trial court's order granting the State's motion to dismiss. For the reasons set forth below, we convert part of this appeal to a special action, accept jurisdiction, and grant relief in part and reverse and remand the motion to dismiss.


¶2 This appeal arises from a lawsuit Appellants filed against the State of Arizona in May 2006, for wrongful incarceration, designated CV 2006-008189. Originally, the trial court granted the State's motion for summary judgment. However, this court reversed and remanded for further proceedings in light of McDonald v. Thomas, 202 Ariz. 35, 404 P.3d 819 (2002). In reversing, we noted that after McDonald, the Board of Executing Clemency lacked probable cause to continue Appellants' respective incarcerations.

¶3 On remand, before trial on the false imprisonment claim and damages commenced, the parties entered into an Agreement (Agreement) on February 9, 2011, where the parties agreed to dismiss CV 2006-008189 without prejudice and to give Appellants six months to re-file their claim if the parties could not reach a settlement. Pursuant to the Agreement, Appellants agreed that failure to re-file their lawsuit within the six month period would forever bar their ability to re-file the lawsuit. Upon a timely re-filing of the case by Appellants, the State agreed to waive any statute of limitations or notice of claim defense as a bar.

¶4 On February 14, 2011, the trial court (a different Judge than was assigned the subsequent case filed by Appellants) accepted the parties' stipulated dismissal and entered the order of dismissal, but struck "out" so the dismissal was "with prejudice." The parties neither appealed nor objected to the trial court's alteration. Under the letter agreement, Appellants needed to re-file the case by August 14, 2011, if the parties did not reach a settlement.

¶5 The State presented Appellants with offers of settlement on July 12, 2011, about one month before the six-month re-filing deadline. On July 15, 2011, Appellants' counsel, Richard Treon, sent the State's counsel, Michael Brodsky, a letter asserting to commemorate a phone conversation between Brodsky and Treon from earlier that day. Treon's letter purported to affirm Brodsky and Treon's agreement to extend the re-filing deadline from August 14 to September 11, 2011. Treon also emailed a copy of the letter to Brodsky's supervisor, Terry Harrison, because Brodsky informed Treon in their conversation that Brodsky was leaving on indefinite medical leave, and Harrison was taking over the case. No one from the State responded to Treon's July 15 letter. The State claims that Brodsky did not agree to the deadline extension and that Brodsky did not receive Treon's communication before Brodsky left the State's office on indefinite medical leave.

¶6 The parties did not reach a settlement and Appellants re- filed their complaint on September 9, 2011, designated CV 2011-017196. The State filed a Rule 12(b)(6) motion to dismiss the suit on the grounds that Appellants did not file their complaint by the August 14, 2011, deadline. The trial court granted the State's motion to dismiss on June 28, 2012.

¶7 Appellants timely appealed. As explained below, we have jurisdiction over the Motion to Dismiss pursuant to Article 6, Section 9, of the Arizona Constitution and Arizona Revised Statutes (A.R.S.) § 12-2101(B) (2011).


I. Jurisdiction

¶8 Even though the parties have not challenged this court's jurisdiction, we must examine our jurisdiction over an appeal as a threshold matter. Kool Radiators, Inc. v. Evans, 229 Ariz. 532, 534, ¶ 8, 278 P.3d 310, 312 (App. 2012) (internal quotation marks and citations omitted). "We may resolve only those appeals authorized by statute." Id. Pursuant to A.R.S. § 12-2101.A, our appellate jurisdiction is limited to appeals from a trial court's final judgments in an action with few exceptions, none of which is applicable here. See A.R.S. § 12-2101.A (Supp. 2012).

¶9 Appeals must be timely. See ARCAP 15(a). An untimely appeal may be dismissed upon motion. See ARCAP 15(c). Here, neither party objected to or appealed the dismissal of the 2006 case "with prejudice" even though the parties stipulated to the dismissal "without prejudice." Accordingly, because this dismissal with prejudice occurred in 2011, it is not a timely appeal, and Appellants cannot obtain relief from this dismissal by appeal.

¶10 Nonetheless, we may exercise special action jurisdiction when there is no "equally plain, speedy, and adequate remedy by appeal." Ariz. R.P. Spec. Act. 1(a) (2013). We exercise our discretion and accept special action jurisdiction to address the trial court's dismissal of the 2006 case with prejudice because Appellants would not otherwise have a remedy by appeal. See Villares v. Pineda, 217 Ariz. 623, 624, ¶ 10, 177 P.3d 1195, 1196 (App. 2008). II. The Dismissal of the 2006 Case

¶11 We review a trial court's order granting a motion to dismiss de novo. See Coleman v. City of Mesa, 230 Ariz. 352, 355-56, ¶ 7, 284 P.3d 863, 866-67 (2012). We will only uphold the dismissal if the "plaintiff[] would not be entitled to relief under any facts susceptible of proof in the statement of the claim." Id. (quoting Mohave Disposal Inc. v. City of Kingman, 186 Ariz. 343, 346, 922 P.2d 308, 311 (1996)).

¶12 An action may be voluntarily dismissed "by order of the court pursuant to a stipulation of dismissal signed by all parties who have appeared in the action. . . . Unless otherwise stated in the notice or order of dismissal, the dismissal is without prejudice . . . ." Ariz. R. Civ. P. 41(a)(1)(B) (1999). Under Rule 41(a)(2), except as otherwise provided in Rule 41(a)(1), "an action shall not be dismissed at the plaintiff's insistence save upon order of the court and upon such terms and conditions as the court deems proper." Id. at 41(a)(2).

¶13 The decision to grant or deny a motion for voluntary dismissal is within the trial court's sound discretion, and the trial court has broad discretion in setting the terms and conditions of dismissal. See State ex rel. Corbin v. Portland Cement Ass'n, 142 Ariz. 421, 426, 690 P.2d 140, 145 (App. 1984). However, Rule 41(a)(2) is a rule based in the rules of equity, which confers equitable powers on the court. Id. at 424, 690 P.2d at 144. Accordingly, the court has the authority and the responsibility to weigh the equities for both parties when dismissing a case pursuant to Rule 41(a). Id.

¶14 In this case, the parties stipulated to dismiss the action without prejudice. Stipulations "not unreasonable, not against good morals, or sound public policy, have been and will be enforced." Assignment of Rich Hardware, Co., 22 Ariz. 254, 260, 196 P. 454, 456 (1921). Generally, courts look favorably "upon stipulations designed to simplify and settle litigation and save cost to the parties when [the stipulation is not] illegal or contrary to public policy." Id. In many ways, parties' stipulations design the law for the legal proceedings to which they are parties. Id. Such stipulations bind not only the parties, but the courts involved in legal proceedings between the parties. Id. Also, "a dismissal with prejudice is a judgment on the merits . . . and is therefore [r]es judicata as to every issue reasonably framed by the pleadings." Torres v. Kennecott Copper Corp., 15 Ariz.App. 272, 274, 488 P.2d 477, 479 (1971).

¶15 In this case, the parties entered into a valid contract on February 9, 2011, in the Agreement. The Agreement evidences the parties' intention to dismiss the action without prejudice. The trial court abused its discretion in dismissing CV 2006-008189 with prejudice, contrary to the parties' Agreement. To hold otherwise, would mean that Appellants could never re-file their lawsuit, if the parties were unable to reach an agreement, which was clearly contrary to the written Agreement. III. Rule 80(d)

¶16 Both parties briefed the effects of Rule 80(d) on the oral modification of the Agreement. Rule 80(d) states, "[n]o agreement or consent between parties or attorneys in any matter is binding if disputed, unless it is in writing, or made orally in open court, and entered in the minutes." Ariz. R. Civ. P. 80(d).

¶17 The State asserts, and the trial court agreed, that Rule 80(d) barred Appellants from relying on any oral modification to the Agreement to argue that their re-filing of the new complaint was timely. While we recognize that Rule 80(d) is akin a statute of frauds designed "to prevent fraudulent claims of oral stipulations" between litigants, Hackin v. Rupp, 9 Ariz.App. 354, 356, 452 P.2d 519, 521 (1969), we agree with Appellants that Rule 80(d) does not apply to this case.

¶18 The scope of the Arizona Rules of Civil Procedure is limited to cognizable civil proceedings at law or in equity. See Ariz. R. Civ. P. 1. Because no cognizable civil proceeding was pending before the trial court at the time of the alleged modification, Rule 80(d) could not have barred the parties from modifying their Agreement and therefore, Rule 80(d) is not dispositive here.

¶19 Moreover, Rule 60(c), which allows parties to seek relief from a judgment or order in a civil proceeding, is not rendered ineffective under Rule 1's scope limitation because 60(c) directly addresses changing a final judgment for limited, specific reasons and within a limited, specific time frame. A case that has reached a final judgment has been decided upon the merits, thus a proceeding attempting to change that final judgment keeps the civil proceeding within Rule 1's scope. However, with this case, there were no civil proceedings before a trial court at the time the parties discussed modifying their Agreement's deadlines. Accordingly, because there was no then-pending civil proceeding at the time of the purported oral modification, any such modification was not within the scope of the Arizona Rules of Civil Procedure, and Rule 80(d) does not apply. The Motion to Dismiss Was Converted to a Motion for Summary Judgment

¶20 A trial court must convert a Rule 12(b)(6) motion into a motion for summary judgment under Rule 56 when the movant presents "matters outside the pleading" and the court does not exclude such matters when issuing its ruling. See Ariz. R. Civ. P. 12(b)(6) (1987); Ariz. R. Civ. P. 56(a) (2013); Brosie v. Stockton, 105 Ariz. 574, 576, 468 P.2d 933, 935 (1970). In this process, all parties "shall be given reasonable opportunity to present all material made pertinent to such a Motion by Rule 56." Ariz. R. Civ. P. 12(b). Under Rule 56, the trial court will only grant summary judgment if "the moving party shows that there is no genuine dispute as to any material fact and the moving party is entitled judgment as a matter of law." Ariz. R. Civ. P. 56(a). Further, the "court should state on the record the reasons for granting or denying the request." Id.

¶21 The State filed a "Declaration of Michael Brodsky" as Exhibit A with its Reply in Support of the State's Motion to Dismiss. Brodsky's declaration recounted the discussion between Treon and Brodsky in the July 15, 2011, phone conversation. Brodsky claimed that he did not consent to extending the deadline for re-filing the suit beyond the August 14, 2011, deadline.

¶22 Treon also provided the trial court with a description of the July 15 phone call in a declaration he filed with Appellants' Motion to Strike. In his declaration, Treon directly contradicted Brodsky's description of the July 15 phone conversation.

¶23 Accordingly, because both parties presented matters outside the pleading, the trial court effectively converted the Motion to Dismiss into a Motion for Summary Judgment and provided the corresponding notice and an opportunity to respond. Ariz. R. Civ. P. 12(b). Even then, the trial court could have only granted summary judgment in favor of the State if there were no genuine issues of material fact. See Ariz. R. Civ. P. 56(a).

¶24 Because the State provided a declaration that Brodsky did not approve a deadline extension in the July 15 phone conversation, and Treon filed a sworn declaration to the contrary, there was a clear factual dispute beyond the pleadings among the parties. Therefore, a genuine issue of material fact exists as to whether the Agreement was modified, thus rendering summary judgment inappropriate.


¶25 For the foregoing reasons, we accept jurisdiction and grant relief regarding the dismissal of CV 2006-008189. We also reverse the trial court's order granting the State's motion to dismiss and remand this case for further proceedings consistent with this decision.

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