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City Center Executive Plaza, LLC v. Jantzen

Court of Appeals of Arizona, First Division

February 24, 2015

CITY CENTER EXECUTIVE PLAZA, LLC; INFORMATION SOLUTIONS, INC., JERRY AND CINDY ALDRIDGE, Petitioners,
v.
THE HONORABLE LEE F. JANTZEN, Judge of the SUPERIOR COURT OF THE STATE OF ARIZONA, in and for the County of Mohave, Respondent Judge, BRIAN THIENES, an individual; JOHN BALL and MONICA BALL, husband and wife; THE THOMPSON FAMILY TRUST; JUAN BRACAMONTE and JACQUELINE BRACAMONTE, husband and wife; THE REFUGE COMMUNITY ASSOCIATION, INC., Real Parties in Interest.

Petition for Special Action from the Superior Court in Mohave County No. S8015CV2011001563 The Honorable Lee F. Jantzen, Judge

Perkins Coie, LLP, Phoenix By Daniel C. Barr, Joshua M. Crum, John H. Gray Counsel for Petitioners

Ekmark & Ekmark, LLC, Scottsdale By Penny L. Koepke, Nicole A. Miller Beus Gilbert, PLLC, Phoenix By Franklyn D. Jeans, Cory L. Broadbent, Cassandra H. Ayres Counsel for Real Parties in Interest

Judge Randall M. Howe delivered the opinion of the Court, in which Presiding Judge Margaret H. Downie and Judge Patricia K. Norris joined.

OPINION

HOWE, Judge:

¶1 City Center Executive Plaza, LLC; Information Solution, Inc.; and Jerry and Cindy Aldridge (collectively, "City Center") seek special action relief from a trial court order that they must post a supersedeas bond of 25% of the full amount of the money judgments. City Center argues that Arizona Revised Statutes ("A.R.S.") § 12-2108 and Arizona Rule of Civil Appellate Procedure (" ARCAP") 71 limit the amount of the bond to the total amount of damages awarded, which it claims is $1.00.

¶2 Special action jurisdiction is appropriate here because City Center has "no equally plain, speedy and adequate remedy by appeal" and challenges the setting of a supersedeas bond. See Ariz. R.P. Spec. Act. [1](a); Salt River Sand & Rock Co. v. Dunevant, 222 Ariz. 102, 105-06 ¶ 7, 213 P.3d 251, 254-55 (App. 2009) (citing Bruce Church Inc. v. Superior Court, 160 Ariz. 514, 515, 774 P.2d 818, 819 (App. 1989)) (providing that challenge to the setting of a supersedeas bond is a circumstance where special action jurisdiction is appropriate). Therefore, we accept jurisdiction, grant relief and vacate the trial court's order, and remand the matter for the court to set the supersedeas bond at $1.00, the total amount of damages awarded.

FACTS AND PROCEDURAL HISTORY

¶3 In 2010, Brian Thienes, John and Monica Ball, the Thompson Family Trust, Juan and Jacqueline Bracamonte, and the Refuge Community Association (collectively, the "Association") sued City Center - owners of a neighboring golf course-seeking injunctive relief and damages. The Association opposed redevelopment of the golf course, which included reducing the golf course's size to accommodate an RV park. The matter was tried before a jury, and the jury awarded the Association $1.00 in damages and recommended granting injunctive relief. The trial court accepted the recommendation and permanently enjoined City Center from using the golf course for anything other than golf-related activities. The order did not resolve the parties' requests for attorneys' fees and costs. City Center appealed from the injunction.

¶4 In March 2014, the trial court awarded attorneys' fees and costs to the Association and entered two judgments pursuant to Arizona Rule of Civil Procedure 54(b), totaling $2, 390, 296.87.[2]City Center appealed those judgments ("money judgments").[3] City Center then moved to stay the money judgments pending their appeal. It also requested that the court set a supersedeas bond at $1.00 pursuant to ARCAP 7. The rule provides that the bond amount necessary to stay execution of a judgment shall be the lowest of the following: total amount of damages awarded excluding punitive damages, 50% of appellant's net worth, or $25 million. See ARCAP 7(a). Because the total amount of damages awarded was $1.00 and Rule 7 "strictly limits the amount of a supersedeas bond to 'the total amount of damages awarded, '" City Center argued that the court should set the bond at $1.00.

¶5 The Association countered, however, that the bond amount should be set at the full amount of the money judgments ($2, 390, 286.87), arguing that the term "damages" under Rule 7 was synonymous with "judgment." The Association also argued that a bond in the full amount of the money judgments was appropriate because City Center had intentionally dissipated assets outside the ordinary course of business to avoid payment of the judgment. The trial court set the supersedeas bond at the full amount of attorneys' fees and costs, totaling $2, 390, 296.87, without holding a hearing or resolving whether City Center had dissipated assets.

¶6 In May 2014, City Center petitioned for special action relief, contending that the trial court erroneously included attorneys' fees and costs in calculating the supersedeas bond. Specifically, City Center argued that the court's ruling conflicted with Rule 7, as well as A.R.S. § 12-2108, which contains language similar to the rule. We accepted jurisdiction, vacated the trial court's order, and directed the court to conduct a hearing to determine an appropriate amount of the supersedeas bond consistent with § 12-2108 and Rule 7. Specifically, we stated that under the statute and the rule, the trial court "must consider, first, the 'total amount of damages awarded, ' in accordance with § 12-2108(A)(1) and Rule 7 . .., and then determine whether an upward or downward deviation from that amount is appropriate." We did not address whether "damages" was synonymous with "judgment."

¶7 On remand, the trial court held a hearing and reviewed pleadings and evidence from both parties. Pursuant to § 12-2108(A), the court found that the total amount of damages awarded was $1.00, but the "judgment included attorneys' fees." It noted that "[i]t would be highly ineffective to have the verdict of the jury supported by imposing a supersedeas bond of $1.00 because that is the total amount of actual damages awarded. The supersedeas bond should reflect the real stakes and should be posted to protect the rights of the prevailing party." The court then considered § 12-2108(B) and (C). It did not find clear and convincing evidence that City Center dissipated assets, but did find by clear and convincing evidence that posting a bond in the "full amount of the judgment" ...


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