Opinion
No. 1 CA-CV 13-0749
12-23-2014
WICKES FAMILY TRUST DATED 9/28/2000, Plaintiff/Appellant, v. YAVAPAI COUNTY, Defendant/Appellee.
COUNSEL Douglas V. Fant, Anthem By Douglas V. Fant Counsel for Plaintiff/Appellant Jones, Skelton & Hochuli, P.L.C., Phoenix By Georgia A. Staton, Elizabeth A. Gilbert, Jonathan P. Barnes, Jr. Counsel for Defendant/Appellee
NOTICE: NOT FOR PUBLICATION.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. Appeal from the Superior Court in Yavapai County
No. P1300CV201200816
The Honorable Patricia A. Trebesch, Judge
VACATED AND REMANDED
COUNSEL Douglas V. Fant, Anthem
By Douglas V. Fant
Counsel for Plaintiff/Appellant
Jones, Skelton & Hochuli, P.L.C., Phoenix
By Georgia A. Staton, Elizabeth A. Gilbert, Jonathan P. Barnes, Jr.
Counsel for Defendant/Appellee
MEMORANDUM DECISION
Judge Lawrence F. Winthrop delivered the decision of the Court, in which Presiding Judge Patricia K. Norris and Judge John C. Gemmill joined. WINTHROP, Judge:
¶1 Plaintiff/Appellant, the Wickes Family Trust Dated 9/28/2000 ("the Trust"), appeals the trial court's order dismissing the Trust's complaint against Defendant/Appellee, Yavapai County ("the County"), for the Trust's failure to post security for costs. For the following reasons, we vacate the order of dismissal and remand for further proceedings.
FACTS AND PROCEDURAL HISTORY
The County contends the Trust's statement of facts in its opening brief does not comply with Arizona Rule of Civil Appellate Procedure ("ARCAP") 13(a)(4), and asks us to disregard those factual assertions. We agree the Trust's statement of facts is deficient because it lacks appropriate citations to the record; accordingly, we rely on our review of the record for our recitation of the facts. See Sholes v. Fernando, 228 Ariz. 455, 457 n.2, ¶ 2, 268 P.3d 1112, 1114 n.2 (App. 2011); State Farm Mut. Auto. Ins. Co. v. Arrington, 192 Ariz. 255, 257 n.1, 963 P.2d 334, 336 n.1 (App. 1998).
¶2 The Trust owns approximately 1.5 acres of real property, which is used as both a residence and bed and breakfast lodge. Poland Creek flows through the property, which is accessed by a County road, Crown King Road. In the summer of 2011, maintenance was performed on the road, allegedly resulting in large quantities of lignosulfonate, a dust suppressant, being washed off the road and into Poland Creek during subsequent monsoon storms.
¶3 The Trust filed a complaint against the County, asserting claims for nuisance, negligence per se, and trespass. The Trust alleged the County had aided and abetted tortious conduct by the resurfacing of the road, which had polluted Poland Creek and damaged the adjacent real property owned by the Trust.
¶4 In July 2013, the County filed a motion requesting that the trial court order the Trust to post security for costs in the amount of $10,000 pursuant to Arizona Rule of Civil Procedure ("Rule") 67(d). In a minute entry dated August 9 and filed August 14, 2013, the trial court granted the County's motion and ordered the Trust to post security for the County's potential costs in the amount of $10,000 "within 14 days of the entry of this order, or the court may dismiss this action."
Rule 67(d) provides as follows:
At any time before trial of an issue of law or fact, on motion of the defendant, supported by affidavit showing that the plaintiff is not the owner of property within the state out of which the costs could be made by execution sale, the court shall order the plaintiff to give security for the costs of the action. The court shall fix the amount of the security, the time within which it shall be given and it shall be given upon condition that the plaintiff will pay all costs that may be adjudged against the plaintiff, and authorize judgment against the sureties, if a written undertaking. If the plaintiff fails so to do within the time fixed by the court, the court shall order the action dismissed without notice.
¶5 On August 23, 2013, the Trust filed a motion to vacate the order requiring security for costs, asserting it was unable to comply due to insufficient assets. See Ariz. R. Civ. P. 67(e). As proof, the Trust attached the affidavit of Darla Wickes-Boch, the asserted trustee for the Trust, who averred she lacked sufficient personal assets to post a security bond in the amount of $10,000. She did not specifically address in the affidavit whether the Trust's assets were limited, but did assert she was "the plaintiff in the above-titled action."
¶6 On August 28, 2013, the County filed its response to the Trust's motion to vacate the order requiring security for costs, arguing in part that Wickes-Boch was not the named plaintiff and her inability to give security was irrelevant, and even if she was the appropriate person to file the affidavit, an affidavit without corresponding documentation was insufficient to provide the strict proof necessary to prove an inability to give security. Also, on August 27, 2013, the County filed a motion to dismiss the complaint with prejudice, asserting the Trust had "failed to timely make strict proof of inability to give the security ordered by the Court and [] failed to give the security by the deadline ordered by the Court."
In her response to the motion to dismiss, Wickes-Boch asserted she had filed the affidavit on behalf of both the Trust and herself, and any questions regarding the Trust's financial status should be resolved via oral examination by the court. Wickes-Boch did not, however, address the timeliness of her motion to vacate the order requiring security for costs, although she later attempted to address the timeliness issue.
¶7 On November 19, 2013, the trial court denied the Trust's motion to vacate the order requiring security for costs and granted the County's motion to dismiss the case with prejudice for "failure to timely file strict proof of an inability to give security and failure to timely give the $10,000 security as ordered by the Court." We have jurisdiction over the Trust's timely appeal pursuant to Arizona Revised Statutes section 12-2101(A)(1) (Supp. 2014).
ANALYSIS
¶8 The Trust argues the trial court erred in dismissing its complaint. The County maintains (1) the Trust did not timely file its motion to vacate the order requiring security for costs, and (2) even if the motion to vacate was timely, the Trust failed to provide strict proof of its inability to give the security because the affidavit supporting the Trust's motion was insufficient.
¶9 We review de novo issues involving the interpretation of court rules. Xavier R. v. Joseph R., 230 Ariz. 96, 98, ¶ 3, 280 P.3d 640, 642 (App. 2012) (citations omitted); see also Coleman v. City of Mesa, 230 Ariz. 352, 355-56, ¶ 7, 284 P.3d 863, 866-67 (2012) (reviewing de novo a judgment of dismissal).
I. Timeliness
¶10 The Trust argues its motion to vacate the order requiring security for costs was timely. We agree with the Trust.
¶11 Under Rule 67(d), the trial court "shall" order a plaintiff to give security for the costs of an action upon a proper showing by the defendant, and if the plaintiff fails to give the security within the time fixed by the court, "the court shall order the action dismissed without notice." Nevertheless, "[i]f the plaintiff, within five days after the order, makes strict proof of inability to give the security, the order to give security shall be vacated." Ariz. R. Civ. P. 67(e). Consequently, under Rules 67(d) and (e), the Trust had two options after service of the court's order: (1) give the security as ordered by the court on or before the date ordered (in this case, fourteen days after "entry" of the order, or August 28, 2013), or (2) timely make strict proof of its inability to give the security. The Trust chose to pursue the second option.
See Maricopa Cnty. Juv. Action No. JS-8441, 174 Ariz. 341, 342-43, 849 P.2d 1371, 1372-73 (1992) (measuring "entry" of a severance order from the last applicable date, which is generally the date the order is "processed" or filed into the official court records); see also Ariz. Local R. Prac. Super. Ct. (Yavapai) 2(F) ("The Clerk of the Court shall make a copy of every minute entry and order and such copy shall be placed in the individual case file.").
¶12 Although the court signed its order requiring the Trust to post security for costs on Friday, August 9, 2013, the order was not filed until Wednesday, August 14. Consequently, the order could not have been served on counsel for the parties earlier than August 14. See generally JS-8441, 174 Ariz. at 342-43, 849 P.2d at 1372-73 (recognizing that, in Maricopa County, the "processed" date is generally the date of mailing); Ariz. R. Civ. P. 5(c)(2)(C) (providing that service is complete upon mailing), (D) (providing that service by electronic means is completed upon transmission). Under Rule 67(e), the Trust was required to make strict proof of its inability to give the security "within five days after the order." However, pursuant to Rule 6(a), because the period of time specified in Rule 67(e) was less than eleven days, the five-day period did not include August 17 (Saturday) and 18 (Sunday). In other words, the five-day period specified in Rule 67(e) consisted of five business days, not five calendar days, and therefore extended through Wednesday, August 21. The time period was further enlarged by an additional five calendar days under Rule 6(e). Consequently, the Trust was required to make strict proof of its inability to give the security by no later than Monday, August 26, and its motion to vacate the order requiring security for costs, filed on August 23, 2013, was timely.
Yavapai County does not have a local rule providing for its system of mailing. See generally Ariz. Local R. Prac. Super. Ct. (Yavapai) 1-19. Yavapai County utilizes a central clerk's office that mails out orders on the day they are filed or "processed," unless the filing occurs late in the day, in which case the order is mailed the next business day, much the same as Maricopa County.
Rule 6(a) provides as follows:
In computing any period of time specified or allowed by these rules, by any local rules, by order of court, or by any applicable statute, the day of the act, event or default from which the designated period of time begins to run shall not be included. When the period of time specified or allowed, exclusive of any additional time allowed under subdivision (e) of this rule, is less than 11 days, intermediate Saturdays, Sundays and legal holidays shall not be included in the computation. When the period of time is 11 days or more, intermediate Saturdays, Sundays and legal holidays shall be included in the computation. The last day of the period so computed shall be included, unless it is a Saturday, a Sunday or a legal holiday, in which event the period runs until the end of the next day which is not a Saturday, a Sunday or a legal holiday.Ariz. R. Civ. P. 6(a) (emphasis added).
Rule 6(e) provides as follows:
Whenever a party has the right or is required to do some act or take some proceedings within a prescribed period after the service of a notice or other paper upon the party and the notice or paper is served by a method authorized by Rule 5(c)(2)(C) or (D), five calendar days are added after the prescribed period would otherwise expire under Rule 6(a) . This rule has no application to the distribution of notice of entry of judgment required by Rule 58(e).Ariz. R. Civ. P. 6(e) (emphasis added); accord Desmond v. J.W. Hancock Enters., Inc., 123 Ariz. 474, 475-77, 600 P.2d 1106, 1107-09 (1979).
II. Strict Proof of Inability to Give Security
¶13 The parties next argue whether the Trust satisfied the requirements of Rule 67(e) by showing "strict proof of inability to give the security."
¶14 "Rule 67(e) provides that an order to give security shall be vacated if the plaintiff, within five days after the order, makes 'strict proof' of [its] inability to give the security." McCarthy v. Arnold, 150 Ariz. 208, 210, 722 P.2d 376, 378 (App. 1986). Further, the strict proof may be made by affidavit. Id. However, "if objection thereto is made by the defendant, the plaintiff shall submit to the court at a time designated by the court, when the plaintiff shall be examined orally as to the inability to give such security." Ariz. R. Civ. P. 67(e). Thus, any questions regarding the Trust's financial status should be resolved via oral examination by the court regarding the inability to give security. See McCarthy, 150 Ariz, at 210, 722 P.2d at 378.
¶15 The County argues the Trust's proffer of strict proof failed to include evidence relating to the Trust's ability to post the required security because, although the Trust tendered the affidavit of Wickes-Boch, the affiant was not a named plaintiff, contrary to her claim, and she failed to specify whether she was authorized to account for or manage the assets of the Trust. We agree with the County that, in her affidavit, Wickes-Boch incorrectly asserted she is "the plaintiff in the above-titled action." Nevertheless, Wickes-Boch is the trustee for the Trust, and as such, "holds a fiduciary responsibility to manage the trust's corpus assets and income." Black's Law Dictionary 1508 (6th ed. 1990).
¶16 The County next argues that Wickes-Boch averred only that her own assets were limited and failed to address the sufficiency of the Trust's assets to post the required security; consequently, the Trust failed to submit strict proof of its inability to post security under Rule 67(e). However, in its motion for security for costs, the County acknowledged its awareness through discovery that the Trust "has no property in the State of Arizona out of which costs could be obtained by execution sale." That acknowledgement was based on the Trust's previous admission "that a lien for satisfaction of costs in the captioned case, if awarded by the Court to [the County], cannot be exercised against the property held in the trust. Some personal property outside of the trust may be lienable, but that property is of minimum value to [the County] for [the County's] stated purpose." In other words, the Trust had already notified the County that, absent the 1.5 acres of real property previously disclosed, the Trust held extremely limited assets and, if the County wished to collect on an award of litigation costs, it would likely have to seek assets outside the Trust, such as the personal property of Wickes-Boch, in the event litigation costs were awarded to the County. Wickes-Boch's affidavit, although only tangentially relevant given the current makeup of the parties to the lawsuit, averred she, too, lacked sufficient personal assets to post a security bond in the amount of $10,000. Given the prior pleadings by the parties, the affidavit raised at least a question of fact whether Wickes-Boch's personal assets might be relevant and attachable, and the trial court should not have dismissed the Trust's complaint on the basis of a lack of strict proof absent further exploring via oral examination the relationship between the Trust and Wickes-Boch and the Trust's inability to give security. See Ariz. R. Civ. P. 67(e); McCarthy, 150 Ariz. at 210, 722 P.2d at 378.
Although the County argued in its response to the Trust's motion to vacate the order requiring security for costs that, without corresponding documentation, Wickes-Boch's affidavit was insufficient to provide the strict proof necessary to prove an inability to give security, the parties do not address that argument on appeal. We note, however, that although Rule 67(e) certainly does not preclude a party from providing or the court from ordering and considering corresponding documentation, it also does not specifically require such documentation; instead, Rule 67(e) simply requires "strict proof," which "may be made by affidavit," and if the defendant objects, provides for a hearing at which the plaintiff "shall be examined orally as to the inability to give such security."
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CONCLUSION
¶17 The trial court's order dismissing the Trust's complaint is vacated, and the matter is remanded for further proceedings. We note, however, that if on remand the trial court wishes to conduct an oral examination and further consider the Trust's motion to vacate the order requiring security for costs, as well as the County's motion to dismiss with prejudice, it must do so before January 1, 2015. That date is relevant because, on September 2, 2014, the Arizona Supreme Court issued an order repealing Rules 67(d) and (e), effective January 1, 2015. See Ariz. Sup. Ct. Order No. R-13-0044 (Sep. 2, 2014). Consequently, should the trial court fail to address this matter before January 1, 2015, the matter shall be moot, and litigation based on the underlying complaint may proceed. Upon compliance with Rule 21, ARCAP, the Trust is awarded its taxable costs on appeal.