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Drew v. Prescott Unified School District

Court of Appeals of Arizona, First Division

November 26, 2013

DR. ROBERT P. DREW and SHEILA KING, husband and wife, Plaintiffs/Appellants,
v.
PRESCOTT UNIFIED SCHOOL DISTRICT, a political subdivision of the State of Arizona; SHARI BAYOMI and JOHN DOE BAYOMI, wife and husband, Defendants/Appellees.

Appeal from the Superior Court in Yavapai County No. P1300CV201200332 The Honorable Anna C. Young, Judge

Hymson Goldstein & Pantiliat, P.L.L.C., Scottsdale By Eddie A. Pantiliat, Lori N. Brown Co-Counsel for Plaintiffs/Appellants

Holm Wright Hyde & Hays, P.L.C., Phoenix By Matthew W. Wright, David K. Pauole Co-Counsel for Defendants/Appellees

Presiding Judge Lawrence F. Winthrop delivered the opinion of the Court, in which Judge Margaret H. Downie and Judge Jon W. Thompson joined.

OPINION

WINTHROP, Presiding Judge

¶1 Before a public entity properly can be sued for damages, a notice of claim that complies in all respects with Arizona Revised Statutes ("A.R.S.") section 12-821.01[1] first must be served. Pertinent to this appeal, the statute requires the claimant to provide a sum-certain offer that, if accepted, will settle the claim. In this opinion, we hold that, absent an earlier response from the public entity, § 12-821.01(E) requires the settlement offer contained in the notice to be held open for sixty days. Because the notice of claim in this case unilaterally withdrew the offer after only fifteen days, the notice did not comply with the statute. Accordingly, we affirm the superior court's entry of judgment in favor of the governmental defendants.

PROCEDURAL AND FACTUAL BACKGROUND

¶2 Dr. Robert P. Drew and Sheila King (collectively "Plaintiffs") offer speech therapy services through their business, Arizona Speech & Hearing Professionals, L.L.C. ("ASHP"). In 2010, Plaintiffs submitted a bid in response to the Prescott Unified School District's request for proposal to provide professional special education services. ASHP made the District's list of approved service providers for the 2010-11 school year and was awarded "a possible five-year term of contract, " renewable on an annual basis.

¶3 On May 27, 2011, a District superintendent acted to exclude Plaintiffs from the District's grounds, ostensibly because they had verbally intimidated other special education service providers. Although the District's governing board subsequently approved renewal of ASHP's contract for the 2011-12 school year, Shari Bayomi, the District's special education director, allegedly intercepted the renewal letter and instructed the District not to renew ASHP's contract. After learning of Bayomi's alleged actions in September 2011, Plaintiffs protested and retained legal counsel to pursue claims against the District and Bayomi (collectively "Defendants").

¶4 On December 15, 2011, Plaintiffs served the District with a notice of claim stating they planned to seek damages totaling $921, 600 and offering to accept a settlement in the amount of $120, 200 plus reinstatement of their status as a service provider. That same day, Plaintiffs mailed a copy of the letter to Bayomi, who received it on December 20, 2011. The letter, dated December 15, stated that Plaintiffs' settlement offer would "remain open until December 30, 2011, unless earlier withdrawn." (Emphasis in original.)[2]

¶5 In March 2012, Plaintiffs filed their complaint against Defendants. Defendants moved to dismiss the complaint for failure to comply with A.R.S. § 12-821.01, arguing in part that, because the notice of claim had not allowed them the sixty days contemplated by § 12-821.01(E) in which to respond, they had not received a realistic and meaningful opportunity to investigate the claim and make a decision regarding settlement before the offer was withdrawn per its express terms.

¶6 The superior court granted the motion to dismiss, concluding that Plaintiffs' claims were barred because the notice of claim, by its own terms, unilaterally shortened the sixty-day period provided in A.R.S. § 12-821.01(E). Pursuant to A.R.S. § 12-2101(A)(1), we have jurisdiction over Plaintiffs' timely appeal of the resulting judgment dismissing their complaint with prejudice.

ANALYSIS

¶7 Plaintiffs attached exhibits to their response to Defendants' motion to dismiss, and Defendants referenced those exhibits in their reply. Because matters outside the pleadings were presented to and not excluded by the superior court, the court should have construed the motion to dismiss as a motion for summary judgment. See Ariz. R. Civ. P. 12(b); Frey v. Stoneman, 150 Ariz. 106, 108-09, 722 P.2d 274, ...


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