United States District Court, D. Arizona
FINDINGS OF FACT AND CONCLUSIONS OF LAW
HONORABLE G. MURRAY SNOW UNITED STATES DISTRICT JUDGE.
August 11, 2016, this matter was tried to the Court without a
jury. Pursuant to Federal Rule of Civil Procedure 52, the
Court hereby makes its findings of fact and conclusions of
case arises out of a lease agreement (the “Lease
Agreement”) between Plaintiff Spirit Master Funding IV
LLC (“Spirit Master”) and Defendant Martinsville
Corral Incorporated (“MCI”). Defendants Victor
Spina, Amber Spina, William Spina and Beth Spina are the
guarantors of the lease. Plaintiff filed suit in this Court
on April 7, 2014, alleging that Defendants had breached the
Lease Agreement. Early proceedings in litigation disposed of
several of Plaintiff's claims. After competing motions
for partial summary judgment, the Court found that MCI had,
by failing to submit timely financial statements, committed a
breach of the lease that was not sufficiently material to
Final Pretrial Order of June 11, 2016, the parties stipulated
that the only contested issue of fact was “[w]hether
Plaintiff incurred damages as a result of Martinsville's
failure to submit timely financial statements.” The
only contested issue of law was “[w]hether Spirit
[Master] is entitled to recover attorneys' fees as
damages.” The parties disagree as to whether this
question should be answered by Arizona or Indiana law.
Lease Agreement contains a choice of law provision providing
that “[t]his Lease shall be governed by, and construed
with, the laws of the state in which the Property is located,
without giving effect to any state's conflict of law
principles.” (Lease Agreement § 17.19.)
Property to which the Lease Agreement refers is located in
the state of Indiana.
Lease Agreement was attached to Plaintiff's Complaint,
filed on April 7, 2014.
Spirit Master's Response to MCI's Motion to Dismiss,
filed on June 16, 2014, contained no references or citations
to Indiana law.
Lease Agreement was attached to Plaintiff's Amended
Complaint, filed on September 3, 2014.
September 18, 2015, Plaintiff submitted a Motion for Partial
Summary Judgment, which included two citations to Indiana
cases and, in a footnote, a reference to the Lease
Agreement's choice of law provision. (Doc. 79 at 7 &
March 21, 2016, this Court ruled that MCI had breached the
Lease Agreement by its failure to submit timely financial
statements, but that this breach was not a material breach.
March 21, 2016, this Court ruled that Spirit Master's
damages as a result of this breach were those, if any,
“that accrued as a result of the delay in
submission” of the financial statements.
March 21, 2016, this Court ruled that a genuine issue of
material fact existed as to whether Spirit Master suffered
damages as a result of MCI's failure to submit timely
June 10, 2016, Plaintiff submitted Proposed Findings of Fact,
which included six citations to Indiana cases and, in a
footnote, a reference to the Lease Agreement's choice of
law provision. (Doc. 104 at 4 & n.1, 5.)
of August 29, 2016, Spirit Master has not presented evidence
as to the amount, if any, of Spirit Master's damages as a
result of MCI's failure to submit timely financial
statements apart from a claim to recover its attorneys'
fees pursuant to the lease.
Lease Agreement provides that: “[I]n the event of any
judicial or other adversarial proceeding concerning this
Lease, to the extent permitted by Law, Lessor shall be
entitled to recover all of its reasonable attorneys' fees
and other Costs in addition to any other relief to which it
may be entitled. In addition, Lessor shall, upon demand, be
entitled to all attorneys' fees and all other Costs
incurred in the preparation and service of any ...