Tucson Lot 4, LLC v. Sunquest Information Systems, Inc.

IN THE
ARIZONA COURT OF APPEALS
DIVISION TWO
TUCSON LOT 4, LLC,
AN ARIZONA LIMITED LIABILITY COMPANY,
Plaintiff/Appellant,
v.
SUNQUEST INFORMATION SYSTEMS, INC.,
A PENNSYLVANIA CORPORATION;
MISYS HOSPITAL SYSTEMS, INC.,
A PENNSYLVANIA CORPORATION; AND
MISYS PLC, A UNITED KINGDOM CORPORATION,
Defendants/Appellees.
No. 2 CA-CV 2016-0088
Filed November 22, 2016
Appeal from the Superior Court in Pima County
No. C20160742
The Honorable Jeffrey T. Bergin, Judge
REVERSED AND REMANDED
COUNSEL
Jackson & Oden, PC, Tucson
By Todd Jackson and Lane Oden
Counsel for Plaintiff/Appellant
Farhang & Medcoff, Tucson
By Ali J. Farhang, Elizabeth A. Parsons, and Robert A. Bernheim
Counsel for Defendants/Appellees
TUCSON LOT 4 v. SUNQUEST INFO. SYS.
Opinion of the Court
OPINION
Chief Judge Eckerstrom authored the opinion of the Court, in which
Presiding Judge Vásquez and Judge Miller concurred.
E C K E R S T R O M, Chief Judge:
¶1 Appellant Tucson Lot 4, LLC (TL4) appeals from the
trial court’s order granting a preliminary injunction in favor of
Sunquest Information Systems, Inc. (Sunquest). For the following
reasons, we reverse the judgment of the trial court.
Factual and Procedural Background
¶2 In 2004, Sunquest entered into a commercial lease
agreement with TL4’s predecessor in interest. The lease was set to
run from August 21, 2006 until November 30, 2016. In 2012,
Sunquest asserted to TL4 that there were issues with the calculation
of square footage used as the base for the rental rate and the
management fee charged under the lease. In February 2016, TL4
filed suit against Sunquest, alleging Sunquest had stopped paying
some of the operating expenses, which allegedly constituted breach
of lease. After TL4 filed suit, Sunquest ceased paying all rent.
Sunquest filed numerous counterclaims.1 Sunquest also requested
an injunction to prevent TL4 from initiating eviction proceedings or
otherwise interfering with Sunquest’s use of the premises. TL4 filed
an amended complaint against Sunquest for forcible detainer (FED).
After an evidentiary hearing, the trial court granted Sunquest’s
request for a preliminary injunction. The court’s order also
“den[ied] TL4’s pending request for an eviction order and an award
of associated damages.” This appeal followed.
1TL4 and Sunquest both raised claims against other parties,
but those parties are not participants in this appeal.
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TUCSON LOT 4 v. SUNQUEST INFO. SYS.
Opinion of the Court
Appellate Jurisdiction
¶3 Sunquest acknowledges that this court has appellate
jurisdiction to review the trial court’s preliminary injunction
pursuant to A.R.S. § 12-2101(A)(5)(b). Sunquest challenges this
court’s jurisdiction over the denial of TL4’s FED action, however,
noting that the trial court’s order did not contain language pursuant
to Rule 54(b) or (c), Ariz. R. Civ. P. The Arizona Rules of Procedure
for Eviction Actions (RPEA) generally state that “[t]he Arizona Rules
of Civil Procedure [ARCP] apply only when incorporated by
reference in these rules.” RPEA 1. Rule 54 of the ARCP is not
incorporated into the RPEA. Furthermore, A.R.S. § 12-1182(A)
provides that an appeal may be taken from a forcible detainer action.
Neither Rule 54(b) nor Rule 54(c) applies to an order that is
independently appealable by statute. See Brumett v. MGA Home
Healthcare, L.L.C., 240 Ariz. 421, ¶ 11, 380 P.3d 659 (2016).2
Preliminary Injunction
¶4 TL4 contends the trial court erred in granting the
preliminary injunction based on a failure of evidence. We do not
reach the merits of the injunction because we conclude that, as TL4
argued below, the trial court did not have the authority to grant it as
a matter of law. By doing so, it denied TL4 its statutory right to a
FED proceeding. “Courts of equity are as much bound by the plain
and positive provisions of a statute as are courts of law. When
rights are clearly established and defined by a statute, equity has no
power to change or upset such rights.” Valley Drive-In Theatre Corp.
2Although TL4 stipulated to the joinder of its FED action and
Sunquest’s counterclaims, TL4 has maintained that the trial court
implicitly considered inappropriate defenses to the FED action. See
Olds Bros. Lumber Co. v. Rushing, 64 Ariz. 199, 205, 167 P.2d 394, 397
(1946). Because we do not read the trial court’s denial as a ruling on
the merits, we do not address which defenses or counterclaims
raised by Sunquest would be relevant to the FED action.
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TUCSON LOT 4 v. SUNQUEST INFO. SYS.
Opinion of the Court
v. Superior Court, 79 Ariz. 396, 399, 291 P.2d 213, 214 (1955); cf. A.R.S.
§ 12-1802(1) (prohibiting injunctive relief to stay pending litigation).3
¶5 In Valley Drive-In, the plaintiff was awarded a writ of
replevin for certain property. 79 Ariz. at 398, 291 P.2d at 214. The
defendant filed a petition seeking to enjoin execution of the writ,
arguing substantive reasons the writ should not have issued. Id.
Our supreme court concluded the injunction was improper, noting
that the trial court, acting in equity through its injunctive authority,
had inserted financial hardship into the proceeding in spite of the
implicit legislative directive not to consider it. Id. at 400, 291 P.2d at
215.
¶6 Here, likewise, our legislature has established a
procedure for determining whether a landlord may evict a tenant.
See Curtis v. Morris, 184 Ariz. 393, 398, 909 P.2d 460, 465 (App. 1995)
(purpose of FED action is to provide summary, speedy remedy for
landlord), approved, 186 Ariz. 534, 925 P.2d 259 (1996). That
procedure precludes a court from considering a tenant’s financial
hardship as a factor in determining the right to possession, the only
issue relevant in a FED action. See A.R.S. § 12-1177(A) (“On the trial
of an action of forcible entry or forcible detainer, the only issue shall
be the right of actual possession and the merits of title shall not be
inquired into.”). Thus, just as in Valley Drive-In, Sunquest’s action
seeking injunctive relief is an improper attempt to insert the issue of
hardship where our legislature has stated it does not belong. See 79
Ariz. at 400, 291 P.2d at 215; see also Sult v. O’Brien, 15 Ariz. App.
384, 388, 488 P.2d 1021, 1025 (1971) (“The maxim that equity follows
the law is strictly applicable whenever the rights of the parties are
clearly defined and established by statutory provisions.”). The trial
court therefore erred in granting an injunction preventing TL4 from
proceeding with a FED action.
3 Section 12-1802(1) arguably would independently bar
Sunquest’s request for injunctive relief. But because the parties have
not discussed this statute, and because it is not necessary to the
resolution of this case, we do not address it.
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TUCSON LOT 4 v. SUNQUEST INFO. SYS.
Opinion of the Court
Eviction Order
¶7 The trial court’s ruling did not include a finding
whether Sunquest was guilty of the forcible detainer TL4 alleged in
its amended complaint. It appears that the court denied the eviction
request on the basis that such a proceeding was enjoined rather than
making a determination on the merits. Because we vacate the
injunction, we likewise vacate the trial court’s ruling denying the
eviction order. We do not address the merits of the FED claim or
whether TL4 properly initiated an eviction action.
Bond
¶8 TL4 next contends that the trial court should have
required Sunquest to pay the rental value of the property as bond
during the pendency of the appeal. Because we conclude the trial
court erred in granting the injunction, we need not decide this issue.
Attorney Fees
¶9 TL4 requests its attorney fees “pursuant to Rule 21,
ARCAP, the terms of the Lease, and A.R.S. §§ 12-341 and 12-341.01.”
Under § 12-341.01(A), attorney fees may be awarded to a “successful
party” in a contract action. If a contract provides for attorney fees,
such an award is mandatory. See Bennett v. Appaloosa Horse Club, 201
Ariz. 372, ¶ 26, 35 P.3d 426, 432 (App. 2001).
¶10 However, TL4 has not achieved a final determination
on the merits. A “‘successful party’ . . . may include those who
achieve reversal of an unfavorable interim order if that order is
central to the case and if the appeal process finally determines an
issue of law sufficiently significant that the appeal may be
considered as a separate unit.” Wagenseller v. Scottsdale Mem’l Hosp.,
147 Ariz. 370, 393-94, 710 P.2d 1025, 1048-49 (1985). This appeal does
not meet either of these criteria, and we therefore determine TL4 is
not a successful party for purposes of attorney fees.
¶11 However, because TL4 is the “successful party” in that
it has accomplished its goal in this appeal, we award TL4 its costs on
appeal pursuant to A.R.S. § 12-341, pending compliance with
Rule 21, Ariz. R. Civ. App. P. See Mahurin v. Schmeck, 95 Ariz. 333,
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TUCSON LOT 4 v. SUNQUEST INFO. SYS.
Opinion of the Court
343, 390 P.2d 576, 582 (1964); cf. Henry v. Cook, 189 Ariz. 42, 44, 938
P.2d 91, 93 (App. 1996) (attorney fees on appeal “can be apportioned
between successful and unsuccessful efforts” but costs cannot be
apportioned).
Disposition
¶12 For the foregoing reasons, we reverse the trial court’s
granting of a preliminary injunction. We remand this case for
further proceedings consistent with this opinion.
6