Jewels v. Lund ( 2014 )

NOTICE: NOT FOR PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION DOES NOT CREATE
LEGAL PRECEDENT AND MAY NOT BE CITED EXCEPT AS AUTHORIZED.
IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE
JEWELS BY G. DARRELL OLSON, INC., Plaintiff/Appellant,
v.
SHERRY L. LUND AND WILLIAM LUND, Defendants/Appellees,
BRADFORD D. LUND, Intervenor/Appellee.
No. 1 CA-CV 13-0621
FILED 12-04-2014
Appeal from the Superior Court in Maricopa County
No. CV0000-445923
The Honorable Benjamin E. Vatz, Judge Pro Tempore
AFFIRMED
COUNSEL
Broening, Oberg, Woods & Wilson, P.C., Phoenix
By Brian Holohan
Counsel for Plaintiff/Appellant
Gammage & Burnham, P.L.C., Phoenix
By Gregory J. Gnepper
Counsel for Defendants/Appellees
JEWELS v. LUND
Decision of the Court
Shumway Law Offices, PLC, Scottsdale
By Jeff A. Shumway
Counsel for Intervenor/Appellee
MEMORANDUM DECISION
Judge Michael J. Brown delivered the decision of the Court, in which
Presiding Judge Peter B. Swann and Judge Kenton D. Jones joined.
B R O W N, Judge:
¶1 Jewels By G. Darrell Olson, Inc. (“Jewels”) appeals the
superior court’s attorneys’ fee awards entered against Jewels after an
unsuccessful attempt to garnish a bank account. For the reasons that follow,
we affirm.
BACKGROUND
¶2 Jewels obtained a default judgment in 1983 against Sherry
Lund (formerly Sherry Cox). Jewels, having renewed the judgment over
the years, discovered that Sherry had married and therefore resumed its
collection efforts. To that end, Jewels served a writ of garnishment on Wells
Fargo Bank, seeking funds allegedly belonging to Sherry.
¶3 In its answer, Wells Fargo reported holding $4650.49 in non-
exempt funds and identified William Lund, Sherry’s husband, and
Bradford Lund, Sherry’s step-son, as persons who might possess personal
property belonging to Sherry. When Jewels applied for a judgment against
Wells Fargo, Sherry objected to the application and Wells Fargo’s answer.
According to Sherry, (1) the account belonged to Bradford and she had
contributed nothing to it; (2) Jewels had not waited ten days before seeking
judgment against Wells Fargo, as required by Arizona Revised Statutes
(“A.R.S.”) section 12-1580(A); and (3) Jewels had failed to join Bradford and
William as parties pursuant to A.R.S. § 12-1595(C). Eleven days later,
Sherry submitted a prehearing memorandum reiterating these arguments,
disputing William’s community liability for her pre-marital debt, and
requesting attorneys’ fees under A.R.S. § 12-1580(E).
¶4 At its initial hearing, the superior court ordered Jewels to join
Bradford and William as parties and Sherry’s counsel agreed to accept
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Decision of the Court
service on behalf of William. At a subsequent hearing, the court set a
briefing schedule addressing Wells Fargo’s duty in researching and
determining which accounts were subject to garnishment. Bradford’s
counsel then filed a notice of appearance and joined Sherry and William’s
counsel in litigating the issue at the court’s next hearing. The court quashed
the garnishment writ in a minute entry and filed a signed order on May 22,
2013 sustaining the “objections to the writ of garnishment lodged by the
Judgment Debtor and Bradford Lund.” The order did not include Rule
54(b) language nor did it address attorneys’ fees or the dismissal of Wells
Fargo.
¶5 On May 24, 2013, Sherry and William applied for an award of
$8243.64 in attorneys’ fees and costs and on June 11, 2013, Bradford
similarly sought an award of fees and costs in the amount of $8781.17.
Jewels objected to both fee applications, arguing that the May 22, 2013 order
quashing the garnishment was a final judgment and the opposing parties
had forfeited any right to fees when they failed to file a timely Rule 59(l)
motion to amend that judgment. Jewels further contended that Bradford’s
aggregate fee claim was unreasonable but did not contest any of the
component charges.
¶6 The superior court rejected Jewels’ forfeiture argument as
“superseded by Ariz. R. Civ. P. Rule 54(g) and rejected in later case law.”
The court then awarded the applicants most of the claimed fees: $7200 to
Sherry and William, and $7500 to Bradford, along with costs, in an order
which included Rule 54(b) language. This timely appeal followed.
DISCUSSION
A. Timeliness of Attorneys’ Fees Applications
¶7 Jewels contends that Sherry, William, and Bradford
(collectively “the Lunds”) forfeited their right to fees by failing to move
under Rule 59(l) to amend the May 22, 2013 order quashing the
garnishment. According to Jewels, the May 22, 2013 order was a final
judgment that did not include any award of attorneys’ fees and it was
therefore appealable when entered. Jewels asserts that “[o]nce the order
was entered, Rule 54(g) no long[er] applied.” Having failed to move to
amend the May 22, 2013 order within fifteen days under Rule 59(l), Jewels
contends, the Lunds lost their fee claims.
¶8 At oral argument in this court, however, Jewels reframed its
argument to one of waiver. Jewels argued that the Lunds failed to timely
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request attorneys’ fees before the entry of the May 22, 2013 order, and
thereby forfeited any claim to a fees award.
¶9 Contrary to Jewels’ assertion made at oral argument, the
record reflects that Sherry timely requested an award of attorneys’ fees
pursuant to A.R.S. § 12-1580(E) in her prehearing memorandum.
Bradford’s objection, with its attendant fee request, was not formally filed
with the court. It was presented to opposing counsel and expressly
considered by the court, however, and Jewels therefore waived any
challenge on this basis by failing to raise it in response to Bradford’s
application for attorneys’ fees. See Airfreight Express Ltd. v. Evergreen Air
Ctr., Inc., 215 Ariz. 103, 109-10, ¶ 17, 158 P.3d 232, 238-39 (App. 2007) (party
waives argument raised for the first time on appeal when the superior court
had no opportunity to address the issue on its merits).
¶10 Absent a Rule 54(b) determination, a “judgment shall not be
entered until claims for attorneys’ fees have been resolved and are
addressed in the judgment.” Ariz. R. Civ. P. 58(g). Applying Rule 58(g)
here, the May 22, 2013 order was not an appealable judgment because the
Lunds’ requests for attorneys’ fees were pending. Therefore, the Lunds’ fee
applications were timely and fell within the superior court’s jurisdiction.
¶11 Jewels also contends that William was not entitled to fees
because he never specifically objected to the writ. Section 12-1580(A) states
that “[a] party who has an objection to the writ of garnishment, the answer
of the garnishee or the amount held by the garnishee or a party claiming an
exemption from garnishment may, not later than ten days after the receipt
of the answer, file a written objection and a request for hearing.” Further,
“a party requesting a hearing pursuant to this section is required to state
the grounds for his objection in writing, but the objecting party is not
limited to those written objections at the hearing . . . .” A.R.S. § 12-1580(C).
¶12 Jewels fails to explain how William could object in light of
Jewels’ failure to join William as “a party” until after the first hearing. By
that time, Sherry had already filed her objection and her memorandum
seeking fees. Sherry’s counsel agreed to accept service for William and
undertook his representation. A minute entry from the subsequent hearing
indicates that Sherry and William’s counsel appeared and litigated the
objection to Wells Fargo’s answer and motion to quash. Under the
circumstances, William was entitled to rely upon Sherry’s previously filed
objection. Because Jewels has failed to supply us with a transcript of the
hearing on quashing the writ, we also presume the facts support the
superior court’s resolution of this issue. A.R.C.A.P. 11(b)(1); See Johnson v.
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Elson, 192 Ariz. 486, 489, ¶11, 967 P.2d 1022, 1025 (App. 1998). Accordingly,
William was entitled to recover attorneys’ fees under A.R.S. § 12-1580(E).
¶13 Jewels’ related complaint that Sherry will receive attorneys’
fees for fighting someone else’s fight rests upon a misconception. As the
judgment debtor, Sherry was obligated to object to the garnishment and
garnishee Bank’s answer or face liability to Bradford, an innocent party.
The source of payment of Sherry’s attorneys’ fees is similarly irrelevant to
her right to recoup them under A.R.S. § 12-1580(E).1
¶14 Jewels raises several other arguments2 we need not address
because they were not asserted in its objections to the fee applications. See
Lemons v. Showcase Motors, Inc., 207 Ariz. 537, 541 n.1, ¶ 17, 88 P.3d 1149,
1153 n.1 (App. 2004). Additionally, we will not review matters for which
Jewels has supplied no legal authority. See ARCAP 13(a)(6) (an appellate
brief shall contain citations to the authorities on which the party relies);
Polanco v. Indus. Comm’n, 214 Ariz. 489, 491 n.2, ¶ 6, 154 P.3d 391, 393 n.2
(App. 2007) (holding that failure to develop and support an argument
waives an issue on appeal).
B. Reasonableness of Attorneys’ Fees Awards
¶15 Jewels contends the superior court’s fee awards were
unreasonable. We review the court’s award of attorneys’ fees for an abuse
of discretion. Orfaly v. Tucson Symphony Soc’y, 209 Ariz. 260, 265, ¶ 18, 99
P.3d 1030, 1035 (App. 2004). We will affirm if any reasonable basis supports
the award. Radkowsky v. Provident Life & Accident Ins. Co., 196 Ariz. 110, 113,
1 To the extent Jewels also challenges the award of attorneys’ fees to
William because he was not named in Sherry’s prehearing request for
attorneys’ fees, we note Jewels failed to raise this claim in its objection to
the Lunds’ fee applications and it is therefore waived. See Airfreight Express
Ltd., 215 Ariz. at 109-10, ¶ 17, 158 P.3d at 238-39.
2 These arguments include: (1) the superior court could not award fees
because a fee claim must be made in a pleading and an “objection” is not a
pleading under Arizona Rule of Civil Procedure 7(a); (2) it is incongruous
for the Lunds to obtain attorneys’ fees while Sherry does not separately
satisfy the pre-marital judgment in favor of Jewels ; (3) Sherry and William’s
fee claim did not specify which fees Sherry incurred before William became
a party; and (4) certain charges, including those related to Bradford’s
duplicative brief and an exhibit, do not support the fee claims.
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¶ 18, 993 P.2d 1074, 1077 (App. 1999). As to issues of law, our review is de
novo. Geller v. Lesk, 230 Ariz. 624, 627, ¶ 8, 285 P.3d 972, 975 (App. 2012).
¶16 Section 12-1580(E) provides that “[t]he prevailing party may
be awarded costs and attorney fees in a reasonable amount determined by
the court.” Jewels objected that the fee applications were “outrageous” and
“redefine[d] chutzpah.” Jewels failed to dispute, however, the
reasonableness of any of the component charges, an issue it cannot now
raise on appeal. See Airfreight Express Ltd., 215 Ariz. at 109-10, ¶ 17, 158 P.3d
at 238-39. Furthermore, “[t]he fact that the attorney’s fees are in excess of
the amount in dispute does not mean that they are unreasonable.” Wagner
v. Casteel, 136 Ariz. 29, 32, 663 P.2d 1020, 1023 (App. 1983).
¶17 In assessing whether to award attorneys’ fees, the superior
court considered several relevant factors: (1) the applicants prevailed on
their objections; (2) the ownership of funds in the garnished accounts
presented no novel issues; (3) the litigation could have been avoided but for
Jewels’ pursuit of a claim in the face of documents establishing that the
funds belonged to Bradford; (4) Jewels delayed in joining a necessary party;
and (5) Rule 59(g) superseded, and case law has rejected, Jewels’ Rule 59(l)
argument. See Wagonseller v. Scottsdale Mem’l Hospital, 147 Ariz. 370, 394,
710 P.2d 1025, 1049 (1985) (superseded by statute on other grounds).
¶18 A reasonable basis exists for these findings and the resulting
fee awards. Even though Bradford joined the litigation later than Sherry
and William, the record reflects his counsel’s extensive efforts to map the
source of the accounts’ funds for the benefit of Jewels’ counsel. Because
Jewels’ counsel was not persuaded, all the Lunds continued to incur
attorneys’ fees and costs. Jewels’ failure to promptly join William and
Bradford further delayed the case and increased the fees expended. The
superior court exercised its discretion in awarding most, but not all, of the
fees claimed. We perceive no abuse of discretion on this record.
C. Attorneys’ Fees on Appeal
¶19 The Lunds request that they be awarded attorneys’ fees
incurred on appeal under § 12-1580(E). Jewels contends that this statute
authorizes awards of fees incurred in the superior court, but not on appeal.
¶20 Our supreme court considered a similar argument when it
addressed the scope of A.R.S. § 12-341.01(A) in Wenk v. Horizon Moving &
Storage Co., 131 Ariz. 131, 639 P.2d 321 (1982). The supreme court noted that
the statute “neither restricts its application to trials nor expands it to cover
appeals” because the statute merely provides that “the court” may award
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attorneys’ fees. Id. at 133, 639 P.2d at 323. The court then explained that the
identity of the successful party is unknown until the appeal concludes and
that public policies supporting a fee award at trial must also apply to the
ultimately successful party on appeal. Id. Accordingly, the court concluded
that A.R.S. §12-341.01(A) applies to appeals as well as superior court
actions. Id.
¶21 As in Wenk, A.R.S. § 12-1580(E) authorizes “the court” to
award reasonable attorneys’ fees. This statute neither restricts its
application to superior court actions nor extends it to appeals. 131 Ariz. at
133, 639 P.2d at 323. Similarly, the “prevailing party” in an action under
A.R.S. § 12-1580(E) is uncertain until an appeal is resolved. We perceive no
policy requiring us to differentiate between fee awards at the superior court
and appellate levels. Thus, we conclude that A.R.S. § 12-1580(E) authorizes
an award of attorneys’ fees incurred on appeal.
¶22 In our discretion, we award reasonable attorneys’ fees to
William and Sherry, and to Bradford, subject to their respective compliance
with Arizona Rule of Civil Procedure 21.
CONCLUSION
¶23 We affirm the superior court’s orders awarding attorneys’
fees to the Lunds.
:gsh
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