Roberts v. Del Webb ( 2015 )

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UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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
DAVID and ROBIN ROBERTS, Trustees of the Roberts Family Trust Joint
Living Trust dated February 12, 1999; et al., Plaintiffs/Appellees,
v.
DEL WEBB COMMUNITIES, INC., an Arizona corporation; DEL WEBB
HOME CONSTRUCTION, INC., an Arizona corporation; DEL WEBB
CORPORATION, a Delaware corporation; and PULTE HOME
CORPORATION, a Michigan corporation; PULTE DEVELOPMENT
CORPORATION, a Michigan corporation, Defendants/Appellants.
No. 1 CA-CV 13-0119
FILED 2-24-2015
Appeal from the Superior Court in Maricopa County
No. CV2012-003956
The Honorable Katherine M. Cooper, Judge
AFFIRMED
COUNSEL
Kasdan Weber Turner, L.L.P., Phoenix
By Stephen L. Weber, Michael J. White, James W. Fleming
Osborn Maledon, P.A., Phoenix
By Thomas L. Hudson
Counsel for Plaintiffs/Appellees
Koeller Nebeker Carlson & Haluck, L.L.P., Phoenix
By William A. Nebeker, Troy G. Allen
Counsel for Defendants/Appellants
MEMORANDUM DECISION
Judge Maurice Portley delivered the decision of the Court, in which
Presiding Judge Donn Kessler and Judge Patricia K. Norris joined.
P O R T L E Y, Judge:
¶1 Del Webb1 appeals from the superior court’s confirmation of
an arbitration award in favor of 460 claimants (the “homeowners”). For the
reasons that follow, we affirm.
BACKGROUND
¶2 Sun City Grand residents who had purchased their homes
from Del Webb reported a variety of problems with their homes, ranging
from the expanding and collapsing of soils beneath the slab to defective
window seals. They requested arbitration pursuant to their sales contracts2
and ultimately the homeowners brought a consolidated claim against Del
Webb for breach of the sales agreement, breach of express warranty, and
1 “Del Webb” refers collectively to Appellants Del Webb Communities, Inc.,
Del Webb Home Construction, Inc., Del Webb Corporation, Pulte Home
Corporation, and Pulte Development Corporation.
2 Paragraph 5.5 of the agreement provided:
Any controversy, claim or dispute arising out of or relating to
this Agreement or Your purchase of the Home shall be settled
by arbitration in accordance with the Construction Industry
Arbitration Rules of the American Arbitration Association
(“AAA”) and the Federal Arbitration Act (Title 9 of the United
States Code) and judgment rendered by the arbitrator(s) may
be confirmed, entered and enforced in any court having
jurisdiction. The arbitration shall take place in Maricopa
County, Arizona.
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breach of the implied warranty of workmanship and habitability, though
the claimants only proceeded on the breach of implied warranty claim.
¶3 Following fifty-two days of hearings, the unanimous three-
person panel issued an interim award to the homeowners of $7,884,534.87
on November 17, 2011. After briefing on the issues of fees and costs, the
panel included $5,774,144 for attorneys’ fees, expert witness fees, and costs
in the award. The homeowners then sought confirmation of the final
arbitration award in superior court and requested prejudgment and post-
judgment interest. Del Webb moved to vacate the award, but after an
evidentiary hearing the court confirmed the final award and included pre-
and post-judgment interest. Del Webb filed an appeal and we have
jurisdiction pursuant to Arizona Revised Statutes (“A.R.S.”) sections
12-2101.01(A)(6) and (B).3
DISCUSSION
¶4 This court reviews the superior court’s confirmation of the
arbitration award in the light most favorable to upholding the decision and
we will affirm absent an abuse of discretion. Atreus Cmtys. Grp. of Ariz. v.
Stardust Dev., Inc., 229 Ariz. 503, 506, ¶ 13, 277 P.3d 208, 211 (App. 2012).
We review the court’s construction of statutes de novo, mindful that judicial
review of arbitration awards is severely restricted. Nolan v. Kenner, 226
Ariz. 459, 461, ¶ 4, 250 P.3d 236, 238 (App. 2011).
¶5 The Federal Arbitration Act (“FAA”) provides that a court
must confirm an arbitration award unless the award is otherwise vacated,
modified, or corrected. 9 U.S.C. § 9; see Hall St. Assocs., L.L.C. v. Mattel, Inc.,
552 U.S. 576, 582 (2008). The FAA provides the following grounds for
vacating an award:
(1) where the award was procured by
corruption, fraud, or undue means;
(2) where there was evident partiality or
corruption in the arbitrators, or either of them;
(3) where the arbitrators were guilty of
misconduct in refusing to postpone the
hearing, upon sufficient cause shown, or in
refusing to hear evidence pertinent and material
to the controversy; or of any other misbehavior
3 We cite to the current applicable statutes unless otherwise noted.
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by which the rights of any party have been
prejudiced; or
(4) where the arbitrators exceeded their powers,
or so imperfectly executed them that a mutual,
final, and definite award upon the subject
matter submitted was not made.
9 U.S.C. § 10(a) (2002). Unless a court finds grounds to vacate or modify,
“confirmation is required even in the face of erroneous findings of fact or
misinterpretations of law.” Lagstein v. Certain Underwriters at Lloyd’s,
London, 607 F.3d 634, 640 (9th Cir. 2010), cert. denied, 131 S. Ct. 832 (2010)
(quoting Kyocera Corp. v. Prudential-Bache Trade Servs., Inc., 341 F.3d 987, 997
(9th Cir. 2003) (en banc)).
I. Expert Testimony
¶6 Del Webb first contends that the arbitrators exceeded their
authority by admitting evidence from John Bardin, the homeowners’
primary expert, in violation of 9 U.S.C. § 10. Specifically, Del Webb argues
that because Barden was not paid on an on-going basis he was working on
a contingent fee basis and, as a result, had a financial stake in the arbitration.
In making this argument, Del Webb relies on Laos v. Soble, where we held
that a “contract providing for compensation of a witness contingent on the
success of the litigation is subversive of public justice” and “[p]ublic policy
considerations brand such contract illegal.” 18 Ariz. App. 502, 503, 503 P.2d
978, 979 (1972); see also, Westin Tucson Hotel Co. v. State Dept. of Revenue, 188
Ariz. 360, 367, 936 P.2d 183, 190 (App. 1987) (holding that the Tax Court
properly denied taxpayer’s motion for sanctions after Pima County moved
to strike the affidavit of the witness for the taxpayer because his fee was
contingent on the outcome of the case).
¶7 A court may vacate an arbitration award “where the
arbitrators exceeded their powers[.]” 9 U.S.C. § 10(a)(4). An arbitration
panel exceeds its powers not by “merely interpret[ing] or apply[ing] the
governing law incorrectly,” but must “exhibit[] a manifest disregard of
law[.]” Kyocera, 341 F.3d at 997 (citations and internal quotation marks
omitted). Or stated differently, (1) “[t]he governing law alleged to have
been ignored by the arbitrators must be well defined, explicit, and clearly
applicable[,]” and (2) the record clearly shows that “the arbitrators
recognized the applicable law and then ignored it.” Collins v. D.R. Horton,
Inc., 505 F.3d 874, 879-80 (9th Cir. 2007) (quoting Carter v. Health Net of Cal.,
Inc., 374 F.3d 830, 838 (9th Cir. 2004)).
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¶8 Here, the issue – was Bardin a “contingent fee” expert – was
not one of law, but of fact as the panel had to determine the circumstances
of his retention. Thus, the issue was clearly within the province of the
arbitrators. See Smitty’s Super-Valu, Inc. v. Pasqualetti, 22 Ariz. App. 178, 182,
525 P.2d 309, 313 (1974) (“decisions of the arbitrators on questions of
fact . . . are final and conclusive”). Del Webb raised the issue and the panel
received briefs, including conflicting expert declarations, and heard
Bardin’s testimony on the issue. The panel did not find, as the trial courts
had in Laos and Westin, see Laos, 18 Ariz. App. at 502, 503 P.2d at 978 (noting
that the handwritten contract demonstrated that the appraisal witness had
a contingent fee agreement based on the outcome of the condemnation
proceeding); Westin, 188 Ariz. at 366-67, 936 P.2d at 189-90 (noting that Pima
County’s motion to strike was properly based on the fact that the taxpayer’s
witness fee was contingent on the outcome of the case), that Bardin had a
contingent fee contract based on the outcome of the litigation. Instead, the
panel concluded that Del Webb’s objections to the payment of Bardin’s
hourly fee went “to the weight and credibility of his testimony, not its
admissibility.” Accordingly, the panel did not disregard the pertinent law
after considering the facts as they found them, and the superior court
properly declined to disturb its ruling. See Collins, 505 F.3d at 884 (“In short,
the arbitrators could not manifestly disregard the law because no binding
precedent existed . . . .”).
¶9 Del Webb also argues that admission of Bardin’s testimony
violated public policy. Even if we assume the non-statutory ground
survives Hall Street, 552 U.S. at 582,4 we disagree. Given the determination
of the arbitration panel, Del Webb cannot rely merely on an allegation that
public policy was violated, but must show “an overriding public policy
rooted in something more than ‘general considerations of supposed public
interests’ and, of equal significance, it must demonstrate that the policy is
4 It is unclear whether public policy, or even manifest disregard, is available
under the FAA in light of Hall Street, which held that § 10(a) provides the
exclusive grounds for vacating an arbitration award. 552 U.S. at 584-85; see
also Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662, 672 n.3 (2010)
(leaving the question of manifest disregard’s survival open). Cf. Comedy
Club, Inc. v. Improv W. Assocs., 553 F.3d 1277, 1290 (9th Cir. 2009), cert. denied,
558 U.S. 824 (2009) (holding that the manifest disregard ground survives
because it is “shorthand for § 10(a)(3) or 10(a)(4)”); In re Wal-Mart Wage &
Hour Emp’t Practices Litig., 737 F.3d 1262, 1267 n.7 (9th Cir. 2013) (explaining
that standard is a judicial gloss on § 10(a)(4)) with Frazier v. CitiFinancial
Corp., 604 F.3d 1313, 1323-24 (11th Cir. 2010) (holding that judicially created
bases for vacatur were not available after Hall Street).
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one that specifically militates against the relief ordered by the arbitrator.”
Stead Motors of Walnut Creek v. Auto. Machinists Lodge No. 1173, 886 F.2d
1200, 1212-13 (9th Cir. 1989) (citation omitted). Given that the issue was
fully briefed and the panel heard testimony before making its ruling, we
perceive no “overriding public policy violation” that now requires the
award to be vacated because the panel allowed Bardin to testify.
II. Fair Hearing
¶10 Del Webb argues that the superior court should not have
confirmed the award because the homeowners’ counsel employed undue
means in procuring the award and deprived Del Webb of a fair hearing.
Specifically, Del Webb contends opposing counsel improperly solicited
homeowners, used expert witnesses to develop a large-scale construction
defect case, and owned Tiger Labs, which took pictures in preparation for
the arbitration. Del Webb bears the burden to prove undue means with
clear and convincing evidence. Barcume v. City of Flint, 132 F. Supp. 2d 549,
556 (E.D. Mich. 2001).
¶11 “Undue means,” as interpreted by both federal and Arizona
courts, requires proof of intentional misconduct amounting to bad faith.
PaineWebber Grp., Inc. v. Zinsmeyer Trusts P’ship, 187 F.3d 988, 991-94 (8th
Cir. 1999), cert. denied, 529 U.S. 1020 (2000); FIA Card Servs., N.A., v. Levy, 219
Ariz. 523, 525, ¶ 7, 200 P.3d 1020, 1022 (App. 2008). The term “clearly
connotes behavior that is immoral if not illegal[,]” but excludes “sloppy or
overzealous lawyering.” A.G. Edwards & Sons, Inc. v. McCollough, 967 F.2d
1401, 1403 (9th Cir. 1992) (holding that offering a meritless defense did not
constitute undue means), cert. denied, 506 U.S. 1050 (1993).
¶12 Although Del Webb contends the solicitation of homeowners
was overzealous and unethical, it cites no authority that the circumstance
under which parties decide to file claims constitutes undue means and
justifies denial of relief. We find no basis for reversal. See id. Additionally,
Del Webb does not explain why the conduct it complains of is tantamount
to corruption or fraud. Likewise, Del Webb does not allege that Tiger Labs’
photos were fraudulent.
¶13 Moreover, relief for undue means is only available when the
conduct (1) is not discoverable before arbitration even with the exercise of
due diligence, (2) materially relates to an issue in the arbitration, and (3) is
established by clear and convincing evidence. Edwards, 967 F.2d at 1404;
Nolan, 226 Ariz. at 461-62, ¶¶ 5-7, 250 P.3d at 238-39 (applying an undue
means standard identical to the FAA). Because Del Webb has
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acknowledged on appeal that the arbitration panel “was aware of the
manner in which the claims were developed” (and Del Webb had the ability
to conduct discovery into any misconduct and bring it to the attention of
the arbitration panel), the arbitration award was not procured by “undue
means.” See Edwards, 967 F.2d at 1404 (stating the standard not satisfied
because the arbitrators and opposing party were aware of the meritless
defenses from the outset); accord Nolan, 226 Ariz. at 461-62, ¶¶ 6-7, 250 P.3d
at 238-39 (holding that openly using a foreign lawyer is discoverable and
not “sufficiently nefarious” to warrant undermining the award’s finality).
III. Attorneys’ Fees
¶14 Del Webb also argues that the arbitration panel exceeded its
authority by determining that the homeowners were the prevailing party
and awarding attorneys’ fees. The arbitration panel awarded the
homeowners $2,628,178 in attorneys’ fees, after finding it had the authority
to determine the issue and award fees and costs to the prevailing party
pursuant to ¶ 6.4.12 of the sales agreement.
¶15 Del Webb, however, contends the award was improper
because the homeowners had abandoned their contract-based claims by
only pursuing a claim of breach of implied warranty. We disagree.
¶16 Although the homeowners did not pursue the breach of sales
agreement and breach of warranty claims, the sales agreement required
arbitration providing “[a]ny controversy, claim or dispute arising out of or
relating to this Agreement . . . shall be settled by arbitration.” See
Schoenduve Corp. v. Lucent Techs., Inc., 442 F.3d 727, 732 (9th Cir. 2006)
(adopting the premise that an arbitration clause that “calls for any dispute
relating to or arising out of the agreement to be submitted to arbitration” to
mean that “the parties intend[ed] the clause to reach all aspects of the
relationship”) (citation and internal quotation marks omitted). And
paragraph 6.4.12 of the sales agreement contained the following fee
provision:
Attorneys Fees: In the event of any arbitration
or mediation between Us and You, before or
after the Closing, the prevailing party shall be
entitled to an award of all attorneys fees and costs
(including, if We prevail, the cost of Our in-
house counsel based on equitable
apportionment of the salary and overhead
attributable to the work of such in-house
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counsel), in an amount to be determined by the
arbitrator or mediator hearing the matter. Any
court or arbitrator hearing any matter on appeal
may also award such fees to the prevailing party
in and for any prior mediation or arbitration.
(Emphasis added.) Because the sales agreement required the arbitration
and had a specific fee provision that expressly governed the arbitration, Del
Webb cannot now complain that the arbitration panel exceeded its
authority in awarding attorneys’ fees.
¶17 Moreover, even if the sales agreement did not authorize the
panel to award fees in the absence of a breach of contract claim, Del Webb
can still not complain that the fee provision was inapplicable here because
both parties submitted the issue of attorneys’ fees to the arbitration panel at
the outset of the action. As a result, the parties gave the arbitration panel
authority to address the attorneys’ fees claim and cannot – after the fact -
claim that the panel exercised that authority. See Coutee v. Barington Capital
Grp., L.P., 336 F.3d 1128, 1136 (9th Cir. 2003) (noting the exception to the
general rule is that an “arbitration panel may award attorney’s fees, even if
not otherwise authorized by law to do so, if both parties submit the issue to
arbitration”).5 Consequently, the action of the parties supplied additional
support for the panel’s action and we do not find that the arbitration panel
exceeded its authority by awarding attorneys’ fees.
¶18 Del Webb also argues that the fee award was improper
because the homeowners were not the prevailing party. Del Webb argues
that “[a]summing arguendo that the contract and/or A.R.S. § 12-341.01(A)
applied, the [p]anel was required to determine who was the prevailing
party before awarding attorneys’ fees.” As a result, Del Webb contends that
because the homeowners received less ($7.8 million) than their demand for
settlement ($25 million), they are not entitled to attorneys’ fees.
5 Even if we accept Del Webb’s assertion that the arbitration panel
committed legal error, such is insufficient to demonstrate that the panel
exceeded its authority. See Nolan, 226 Ariz. at 463, ¶¶ 12-13, 250 P.3d at 240
(noting that the arbitrator’s award of attorneys’ fees, even if legally or
factually erroneous, could not be modified unless specific statutory factors
allowing modification were proven); Kyocera, 341 F.3d at 1003 (holding that
the risk that arbitrators may imperfectly construe the governing law is a
risk that arbitration parties assume).
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¶19 Although the attorneys’ fees provision uses the term
prevailing party, Del Webb has not cited to the FAA or any case law
interpreting the FAA that supports its argument. Moreover, there is
nothing in the arbitration agreement that suggests that the offer of
settlement provisions of Arizona Rule of Civil Procedure 68 apply by
requiring the party prevailing at arbitration to be awarded more than their
settlement offer before being entitled to an award of attorneys’ fees. And
there is no indication in the arbitration agreement or fee provision that the
arbitration panel had to determine any “percentage of success factor” or a
“totality of the litigation test” to determine the successful party as outlined
in Schwartz v. Farmers Ins. Co., 166 Ariz. 33, 38, 800 P.2d 20, 25 (App. 1990).
¶20 Instead, we look to the plain meaning of the term “prevailing
party” in the fees provision to determine whether the arbitrators properly
construed the term. See, e.g., Grubb & Ellis Mgmt. Servs., Inc. v. 407417 B.C.,
L.L.C., 213 Ariz. 83, 90, ¶ 26, 138 P.3d 1210, 1217 (App. 2006) (a contractual
attorney’s fee provision controls to the exclusion of a statute); Keggi v.
Northbrook Property & Cas. Ins. Co., 199 Ariz. 43, 46, ¶ 11, 13 P.3d 785, 788
(App. 2000) (noting that contracts are construed according to their plain and
ordinary meaning); United Cal. Bank v. Prudential Ins. Co. of Am., 140 Ariz.
238, 258-59, 681 P.2d 390, 410-11 (App. 1983) (same). The plain meaning of
the contractual term suggests that the party who succeeded at arbitration is
the prevailing party. See, e.g., Grubb & Ellis, 213 Ariz. at 90, ¶ 25, 138 P.3d
at 1217. Moreover, we have no reason to decide that it means anything else.
And we need not decide whether the arbitrators correctly interpreted the
contract provision; we need only determine whether their interpretation
was plausible. Lagstein, 607 F.3d at 643, 644-45; see generally Berklee Coll. of
Music v. Berklee Chapter of Mass. Fed’n of Teachers, Local 4412, 858 F.2d 31, 34
(1st Cir. 1988) (“Whether we would find these arguments convincing were
it up to us to interpret the contract is beside the point.”). Because the issue
was fully briefed and the arbitrators’ interpretation of the sales agreement
provision was plausible, we affirm. See Lagstein, 607 F.3d at 643, 644-45
(affirming and holding that arbitrators plausibly determined that their
initial award was an interim award under the agreement); see generally
Oxford Health Plans L.L.C. v. Sutter, 133 S. Ct. 2064, 2068 (2013) (an
arbitrator’s decision even arguably interpreting the contract must stand).
IV. Expert Witness Fees
¶21 Del Webb also argues that the panel exceeded its authority by
awarding expert witness fees to the homeowners because the sales
agreement did not authorize an award of expert witness fees, only “costs,”
which, it argues, means only taxable costs. Del Webb also challenges the
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reasonableness of certain expert fee expenses and contends that because it
demonstrated that the panel exceeded its authority in awarding fees, the
award should have been vacated. We disagree with these arguments.
¶22 Although the sales agreement is silent about expert witness
fees or whether such fees would be considered a cost, Del Webb did not
object to the request the homeowners made in their arbitration demand for
expert witness fees. As a result, the arbitrators had authority to decide that
issue. See Schoenduve Corp., 442 F.3d at 732 (noting that in view of the failure
to object to the arbitration demand, “the scope of the arbitrator’s authority
is determined not only by the [arbitration agreement], but also by the
Demand for Arbitration”). Consequently, because the resolution on expert
fees fell within the scope of the arbitration submission, the arbitrators’
decision is final. See id.
V. Interest Awarded
¶23 Finally, Del Webb challenges the superior court’s addition of
prejudgment interest to the interim award. The homeowners asked for
interest on the interim award from November 17, including the corrected
award on November 21 “through [the] date of the [f]inal [a]ward, February
7, 2012.” In its ruling, the court granted the homeowners interest on the
interim award from November 17, 2011 through February 7, 2012, the date
of the arbitration panel’s final award.6 We look to Arizona law to determine
whether a party is entitled to interest on an FAA interim arbitration award
before confirmation. Northrop Corp. v. Triad Int’l Mktg., S.A., 842 F.2d 1154,
1155 (9th Cir. 1988). Because the issue of a party’s entitlement to interest is
a legal issue, we review it de novo. Gemstar Ltd. v. Ernst & Young, 185 Ariz.
493, 508, 917 P.2d 222, 237 (1996).
¶24 Under Arizona law, “prejudgment interest on a liquidated
claim is a matter of right.” Id.; Aqua Mgmt., Inc. v. Abdeen, 224 Ariz. 91, 95,
¶15, 227 P.3d 498, 502 (App. 2010). The sum being claimed becomes
liquidated when it is capable of exact calculation. Alta Vista Plaza, Ltd. v.
Insulation Specialists Co., 186 Ariz. 81, 82, 919 P.2d 176, 177 (App. 1995).
Here, the homeowners’ claim for damages was unliquidated until after the
6 The court’s order also provides that the homeowners will receive
“prejudgment and post-judgment interest at the statutory rate of four and
one-quarter percent (4.25%) per annum ($1,586.90 per day) from and after
February 7, 2012, the date of the arbitrators Final Award, until paid.”
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panel’s interim award. Once the panel set the amount of damages,
however, the claim became liquidated.
¶25 Moreover, the homeowners were entitled to interest on the
interim award and final award because the homeowners did not raise the
issue and the arbitration panel did not address it. In Lagstein v. Certain
Underwriters at Lloyd’s of London, 725 F.3d 1050, 1055 (9th Cir. 2013), the
Ninth Circuit Court of Appeals stated that “[c]ourts do not lack authority
to award interest where an arbitration award is silent” because the failure
of the arbitrators “to speak on interest otherwise does not constitute a
denial of interest[.]” Consequently, once the arbitration panel issued its
interim award, the award was a liquidated sum and the homeowners were
entitled to interest.
¶26 Del Webb also contends that the court erred by ordering
interest on the interim award because it was not a final award. We disagree
and find that our decision in Creative Builders Inc. v. Avenue Developments,
Inc., 148 Ariz. 452, 458, 715 P.2d 308, 314 (App. 1986), is instructive. There,
the arbitration panel issued its ruling, but the trial court twice returned the
award for consideration of additional issues. Id. at 453-54, 715 P.2d at 309-
10. After recognizing that prejudgment interest on a liquidated claim is a
matter of right, id. at 457, 715 P.2d at 313, we noted that the trial court had
erred by awarding pre-award interest from the date of its first demand, id.,
but stated that our holding did not preclude the court from awarding
interest on the award “from the date of the of the issuance of the initial
award.” Id. at 457-58, 715 P.2d at 313-14.7
¶27 Although the trial court sent the initial award in Creative
Builders back to the panel two times to address different issues, the case
helps inform our decision because the arbitration panel’s interim award in
this case was corrected by the panel within four days as follows: the
homeowners were awarded $7,878,934.87 on November 17, and the panel
corrected the sum by modification to $7,884,534.87 on November 21, 2011.
Accordingly, the interim award was a liquidated amount and entitled to an
award of interest beginning November 17, 2011. Consequently, and as
7 Equally unavailing is Del Webb’s reliance upon Cummings v. Budget Tank
Removal & Environmental Services, L.L.C., 260 P.3d 220 (Wash. Ct. App. 2011).
In Cummings, the interim award was not in the record. Id. at 228, ¶¶ 32, 36.
As a result, and under Washington law, the trial court abused its discretion
by awarding interest on the interim award. Id. at ¶ 36. Given the fact that
Arizona allows interest on liquidated amounts and the interim award is in
the record, we find no error.
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requested by the homeowners, they were entitled to interest on the interim
award from the date it was entered until the date modified and then until
the date of the final award. Accordingly, the court, did not err by awarding
interest on the interim award.
¶28 Del Webb next contends that the claim was not liquidated
until the filing of the final award because the interim award did not include
fees and costs. We also disagree with this argument.
¶29 As noted, the interim award was the panel’s resolution of the
damages for the breach of implied warranty claims. The only issues that
remained were attorneys’ fees and costs because the arbitrators noted that
those were “[t]o be determined in the Final Award.” The parties then
addressed attorneys’ fees, expert fees and related costs, and those were
resolved in the final award. Although both parties made a claim for
attorneys’ fees, and the arbitrators had to resolve that issue, along with the
expert witness fee issue and costs, the damages in the interim award did
not change. Because there were no additions to the interim award after it
was modified on November 21, 2011, the homeowners were entitled to
interest on the interim award when it was issued and modified. See Alta
Vista, 186 Ariz. at 83, 919 P.2d at 178 (holding that the plaintiffs are entitled
to prejudgment interest on damages from the date of first accrual, even if
defendants dispute the claim or succeed in reducing the amount).
Similarly, because the final award combined the damages claim and added
attorneys’ fees, expert fees, and costs, the homeowners were then entitled
to interest on the combined final award from the date of that award.
¶30 Del Webb also complains that the court granted interest on
the final award from February 7, 2012, until the confirmation judgment,
instead of the date the final award was entered by the American Arbitration
Association. We disagree.
¶31 When the homeowners originally requested interest on the
final award, they requested interest beginning on February 14, 2012, the
date the final award was filed with the American Arbitration Association,
but later amended the request to February 7, 2012, the date the panel signed
the final award. Although the final award of February 7 was not filed with
the American Arbitration Association until February 14, interest was due
on the final award from February 7 because the sum was then liquidated.
Consequently, the superior court did not err by awarding interest
beginning on the date was final award was signed.
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VI. Attorneys’ Fees on Appeal
¶32 Both parties request attorneys’ fees and costs on appeal
pursuant to the sales agreement and ARCAP 21. Because the homeowners’
have prevailed, we grant them their reasonable attorneys’ fees on appeal
pursuant to the sales agreement, as well as their costs on appeal upon
compliance with ARCAP 21.
CONCLUSION
¶33 We affirm the superior court’s judgment confirming the
arbitrators’ award and adding interest.
:ama
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