Riverbend v. Edwards ( 2016 )

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.
IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE
RIVERBEND HOMEOWNERS ASSOCIATION,
an Arizona non-profit corporation, Plaintiff/Appellant,
v.
FELICIA EDWARDS, Defendant/Appellee.
_________________________________
BANNER HEALTH SYSTEMS,
Garnishee/Appellee.
No. 1 CA-CV 15-0513
FILED 12-13-2016
Appeal from the Superior Court in Maricopa County
No. TJ2012-002192
The Honorable Michael L. Barth, Judge Pro Tempore
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED
COUNSEL
Vial Fotheringham, LLP, Tempe
By Quinten T. Cupps
Counsel for Plaintiff/Appellant
RIVERBEND v. EDWARDS
Decision of the Court
MEMORANDUM DECISION
Judge Randall M. Howe delivered the decision of the Court, in which
Presiding Judge Kenton D. Jones and Judge Donn Kessler joined.
H O W E, Judge:
¶1 Riverbend Homeowners Association appeals the trial court’s
denial of its request for post-judgment attorneys’ fees against Felicia
Edwards. Riverbend argues that it should have been awarded fees pursuant
to the 2012 default judgment order and the Homeowners Association’s
Declaration of Covenants, Conditions, and Restrictions (“CC & Rs”). For
the following reasons, we affirm in part, reverse in part, and remand for
further proceedings consistent with this ruling.
FACTS AND PROCEDURAL HISTORY
¶2 In 2012, Riverbend obtained a default judgment against
Edwards for $2,611.86. The judgment also awarded future costs of
collection, including reasonable attorneys’ fees. In 2015, after failed
attempts to collect the judgment, Riverbend applied for a writ of
garnishment for earnings.
¶3 Riverbend also sought an award of post-judgment attorneys’
fees pursuant to the 2012 judgment and the CC & Rs. The CC & Rs included
an attorneys’ fee provision that stated, “[a]ll Assessments, together with
interest and all costs, including, without limitation, reasonable attorneys’
fees, incurred by [Riverbend] in collecting or attempting to collect
delinquent Assessments,” would be the personal obligation of the lot
owner. In its application for attorneys’ fees, Riverbend separated
post-judgment attorneys’ fees relating to the garnishment proceedings from
those that occurred before the garnishment proceedings. Edwards failed to
respond or appear in the proceedings.
¶4 The trial court granted the writ of garnishment and signed an
ordered of continuing lien against Edwards but rejected Riverbend’s
request for attorneys’ fees. The trial court noted that “attorneys’ fees in a
garnishment proceeding are controlled by statute, and not by the terms of
contract,” and that Riverbend’s fees were outside the scope of the statute.
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RIVERBEND v. EDWARDS
Decision of the Court
Riverbend moved for reconsideration, which the trial court denied.
Riverbend timely appealed.
DISCUSSION
¶5 Riverbend contends that the trial court erred by refusing to
award post-judgment attorneys’ fees. Specifically, Riverbend argues that
the 2012 judgment already awarded post-judgment attorneys’ fees and that
the CC & Rs should control whether attorneys’ fees are granted, not the
garnishment statute.
¶6 We review the denial of attorneys’ fees for an abuse of
discretion, see Democratic Party of Pima Cty. v. Ford, 228 Ariz. 545, 547 ¶ 6,
269 P.3d 721, 723 (App. 2012), but review questions of law, including the
court’s authority to award fees and issues of contract interpretation, de
novo, Bennett Blum, M.D., Inc. v. Cowan, 235 Ariz. 204, 205 ¶ 5, 330 P.3d 961,
962 (App. 2014). If a contract has an attorneys’ fees provision, fees are
generally awarded according to its terms. Sirrah Enters., LLC v. Wunderlich,
240 Ariz. 163, 168 ¶ 11, 377 P.3d 360, 365 (App. 2016). Attorneys’ fees
relating to garnishment proceedings for earnings, however, are governed
exclusively by statute. A.R.S. § 12–1598.07(E); see also Bennett Blum, 235 Ariz.
at 208–09 ¶¶ 17–18, 330 P.3d at 965–66 (recognizing that garnishment
statutes control when attorneys’ fees in a garnishment proceeding for
monies may be awarded).
¶7 Arizona Revised Statutes section 12–1598.07(E) provides that
in a garnishment proceeding for earnings, the prevailing party “may be
awarded costs and attorney fees in a reasonable amount determined by the
court.” The reasonable attorney fees “shall not be assessed against nor is it
chargeable to the judgment debtor unless the judgment debtor is found to
have objected solely for the purpose of delay or to harass the judgment
creditor.” A.R.S. § 12–1598.07(E) (emphases added). Here, Edwards did not
object to the garnishment proceeding. In fact, Edwards failed to make any
appearance at either the garnishment proceeding or the 2012 default
judgment hearing. Therefore, pursuant to the statute’s language, because
Edwards never objected, Riverbend was ineligible for an award of
attorneys’ fees relating to the garnishment proceeding. Consequently,
because A.R.S. § 12–1598.07(E) is the exclusive means by which attorneys’
fees may be granted in a garnishment proceeding for earnings, the trial
court did not err by denying Riverbend’s attorneys’ fees relating to the
garnishment proceeding.
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RIVERBEND v. EDWARDS
Decision of the Court
¶8 This court came to the same conclusion in Bennett Blum. In
Bennett Blum, this court interpreted A.R.S. § 12–1580(E), which discusses
when attorneys’ fees may be awarded in a garnishment proceeding for
monies. 235 Ariz. at 208–09, 330 P.3d at 965–66. Like the statute here, A.R.S.
§ 12–1580(E) states that attorneys’ fees “shall not be assessed . . . unless the
judgment debtor is found to have objected to the writ solely for the purpose
of delay or to harass the judgment creditor.” The court held that attorneys’
fees related to the garnishment proceeding for monies could be awarded
only under A.R.S. § 12–1580(E). Id. at 209 ¶ 18, 330 P.3d at 966.
¶9 Citing Bennett Blum, Riverbend argues that only garnishment
of monies under A.R.S. § 12–1580(E), not garnishment of earnings under
A.R.S. § 12–1598.07(E) is exclusively controlled by statue. But both statutes
describe when attorneys’ fees may be awarded in a garnishment
proceeding. Further, the language of both statutes is clear: attorneys’ fees
shall not be assessed against a debtor unless the debtor is found to have
objected solely for the purpose of delay or to harass the judgment creditor.
Because Edwards chose not to appear, and therefore did not object, the
judge had no authority to grant Riverbend those attorneys’ fees. See Bennett
Blum, 235 Ariz. at 208 ¶ 17, 330 P.3d at 965 (finding a statutorily mandated
limitation on the trial court’s authority to award attorney fees against a
judgment debtor in a garnishment proceeding).
¶10 Riverbend also argues that other garnishment statutes
support its request for attorneys’ fees. Arizona Revised Statutes section
12–1598.03(3) requires that an application for a writ of garnishment include
the outstanding balance due on the judgment. Additionally, A.R.S.
§ 12–1598.04(B)(1) mandates that a writ of garnishment state the amount of
the outstanding balance due on judgment. Riverbend contends that the
mention of “due on judgment” in these statutes requires awarding
attorneys’ fees because those fees were a part of the 2012 default judgment
that gave rise to the garnishment proceeding. In light of A.R.S.
§ 12–1598.07(E), however, Riverbend’s argument is not compelling.
“Statutes relating to the same subject or having the same general purpose
[] should be read in connection with, or should be construed with other
related statutes, as though they constituted one law.” Respect the Promise in
Opposition to R-14-02-Neighbors for a Better Glendale v. Hanna, 238 Ariz. 296,
303 ¶ 27, 360 P.3d 92, 99 (App. 2015). Therefore, the statutes Riverbend
relies on need to be read in connection with A.R.S. § 12–1598.07(E), and that
statute clearly states when attorneys’ fees may be awarded.
¶11 Riverbend next argues that even if the garnishment statute
provides the exclusive means by which to obtain attorneys’ fees, because
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RIVERBEND v. EDWARDS
Decision of the Court
future attorneys’ fees were awarded in the 2012 default judgment, the trial
court had no discretion to deny the request. But as the trial court found, this
argument ignores that garnishment proceedings are treated in all respects
as actions independent from the underlying lawsuit. See Bennett Blum, 235
Ariz. at 207 ¶ 13, 330 P.3d at 964. Therefore, the award of reasonable
attorneys’ fees in collection of the 2012 default judgment is not
determinative for all of Riverbend’s requested attorneys’ fees.
¶12 In contrast, the attorneys’ fees provision in the CC & Rs
controls Riverbend’s request for non-garnishment related attorneys’ fees.
Riverbend requested attorneys’ fees both related and unrelated to the
garnishment proceeding. Riverbend argues that the trial court erred by
denying its attorneys’ fees not related to the garnishment proceeding. The
attorneys’ fees accrued before the garnishment proceeding all relate to
collecting on the default judgment. Further, the 2012 default judgment and
collection of the judgment fall within the broad attorneys’ fees provision of
the CC & Rs. Therefore, the trial court “had no discretion to refuse to award
[non-garnishment attorneys’ fees] under the contract.” See Bennett Blum, 235
Ariz. at 207 ¶ 11, 330 P.3d at 964; McDowell Mountain Ranch Cmty. Ass’n v.
Simons, 216 Ariz. 266, 269 ¶ 14, 165 P.3d 667, 670 (App. 2007). But any award
of such fees is limited to the reasonable amount of fees requested. Geller v.
Lesk, 230 Ariz. 624, 628 ¶ 14, 285 P.3d 972, 976 (App. 2012). Accordingly, the
trial court erred by denying Riverbend’s request for non-garnishment
related attorneys’ fees.
CONCLUSION
¶13 For the foregoing reasons, we affirm the trial court’s denial of
attorneys’ fees relating to the garnishment proceeding. However, we
reverse the trial court’s denial of Riverbend’s non-garnishment related
attorneys’ fees and remand this matter back to the trial court for further
proceedings consistent with this ruling. Riverbend requests an award of
attorneys’ fees on appeal pursuant to A.R.S. § 12–341.01 and Arizona Rule
of Civil Appellate Procedure 21. In the exercise of our discretion, we decline
to grant attorneys’ fees on appeal.
AMY M. WOOD • Clerk of the Court
FILED: AA
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