Arizona Case Law Update

Author: Alice Segal

Guest Editor: Jeremy Freedman

June 3, 2019 10:00am

Normandin v. Encanto Adventures, LLC.[1]

Factual and Procedural History

Marcie Normandin sued Encanto Adventures, LLC. and the City of Phoenix for a broken ankle and injured arm, which she received when she stepped into sprinkler head divot.  Encanto Adventures, LLC had a licensing agreement with the City of Phoenix through which Encanto Adventures was permitted to build and maintain children’s rides and an amusement park in an area within the larger Encanto Park, known as Picnic Island.  The amusement park, known as Enchanted Island, was a fenced-in and contained area within Picnic Island.  In addition to Enchanted Island, the agreement with the City also permitted Encanto Adventures to use an unfenced part of Picnic Island next to Enchanted Island, which was known as the “piñata area.”  Encanto Adventures maintained the piñata area by “patrolling, maintaining, inspecting, preparing, and grooming the grounds.”  However, the area was kept open for the public to use.

A Historical View of Arbitration Agreements and their Rise in Employment Agreements

Author: Rachel Donnelly

Guest Editor: Jeremy Freedman

June 3, 2019 10:00am

In the 1920’s, businesses throughout the United States faced a legal dilemma. The federal courts they heavily relied on to resolve various disputes and enforce contracts were painfully overcrowded and difficult to navigate. As a result, businesses turned their reliance to arbitration agreements in which they agreed to submit their disputes for binding resolution to a third party who was generally an expert in their industry. However, the courts thwarted arbitration as they refused to enforce arbitration agreements.

Arizona Case Law Updates

Author: Emily Berman

Guest Editor: Kris Darrough

May 6, 2019 12:48pm

Duff v. Lee[1]

In October 2017, the Arizona Supreme Court adopted a pilot program in the Pima County Superior Court called the Fast Trial and Alternative Resolution Program (“FASTAR”) by administrative order. This program effectively eliminated compulsory arbitration under A.R.S. section 12-133 by lowering the monetary limit to the threshold of the superior court’s original jurisdiction in the local court’s rules, and plaintiffs with claims valued between that threshold and $50,000 could instead choose between a fast trial or binding alternative dispute resolution without right of appeal or de novo trial (which would remain available to the defendant).  Consistent with the pilot program, the Pima County Superior Court’s presiding judge filed a petition for a local rule change in October, 2017 to conform Pima County’s local rules to the Administrative Order.  The Supreme Court granted the petition.

Proposal for Revisions to White Collar Exemptions

Author: Rachel Donnelly

Guest Editor: Kris Darrough

May 6, 2019 12:46pm

On March 7, 2019, the U.S. Department of Labor (“DOL”) published a proposal for revisions to the “white collar” or executive, administrative and professional (EAP”) exemptions from the overtime provisions of the Fair Labor Standards Act (“FLSA”). The notice of proposed rulemaking sets two new salary thresholds: an EAP threshold and a highly compensated employee (“HCE”) exemption. This article will focus on the proposed increase in the HCE salary threshold from $100,000 to $147,414. This threshold is approximately the 90th percentile of the earnings distribution of full-time, non-hourly workers in the entire U.S.

Arizona Case Law Update

Author: Terra Davenport

Guest Editor: Christopher Schon

April 1, 2019 12:22pm

Dormant Commerce Clause of the United States Constitution – Anti-diversion provision of the Arizona Constitution

Saban Rent-a-Car LLC v. Arizona Department of Revenue, No. CV-18-0080-PR (February 2019)

The legislature created the Arizona Tourism and Sports Authority (the “AzSTA”) in 2000 to build and operate a sports stadium, build Major League Baseball spring training facilities, build youth and amateur sports and recreation facilities, and promote tourism. See A.R.S. §§ 5-801(4), -802(A), -807 to -809, -815. AzSTA’s authority is restricted to counties with populations greater than two million people, meaning it has only ever operated in Maricopa County. See § 5-802(A). AzSTA’s construction projects are funded solely by taxes and surcharges approved by Maricopa County voters. See § 5-802(C). One such voter-approved surcharge is at issue here.

Verified Complaints in Arizona

Author: Katie Greenbaum

Guest Editor: Christopher Schon

April 1, 2019 12:20pm

In most jurisdictions, verified complaints are only filed in rare occasions or where required by statute as they can raise additional obstacles for plaintiffs. In Arizona, unless a rule or statute specifically states otherwise, complaints need not be verified. (16. A.R.S. Rules of Civil Procedure, Rule 8(h)) However, where a verified complaint is required, the complaint “must be accompanied by an affidavit by the party–or a person acting on the party’s behalf who is acquainted with the facts—attesting under oath, to the best of the party’s or person’s knowledge, the facts set forth in the pleading are true and accurate.” (Id.)

Arizona’s Dram Shop Laws and General Negligence Laws “Cut-Off” a Bar or Restaurant’s Immunity to Civil Liability for Continuing to Serve Alcohol to Intoxicated Patrons

Author: Ben Davis

March 4, 2019 9:00am

Have you experienced being at a bar or restaurant and noticed an obviously physically impaired patron continue to be served alcohol?  In this situation, have you wondered how the bar or restaurant could continue to serve the impaired patron alcohol?  Well you should know there are dram shop laws and liability pursuant to a common law negligence standard to ensure bars and restaurants serve alcohol in a responsible manner.

Arizona Case Law Update

Author: Danielle Vukovich

Guest Editor: Raymond K. Wilson Jr.

February 4, 2019 11:54am

Arizona Supreme Court Determines That Assignment of Rights to Workers’ Compensation Benefits Depends on the Law of the State Paying Those Benefits

The Arizona Supreme Court addressed a workers’ compensation related issue involving whether a one year statute of limitations pursuant to Arizona Revised Statute section 23-1023 is applicable in actions involving workers’ compensation benefits paid under the laws of another state.

A Look at Arizona’s Wrongful Death Statute and Recoverable Damages

Author: Katie Greenbaum

Guest Editor: Raymond K. Wilson Jr.

February 4, 2019 11:00am

Who Can Recover?

A survival claim is brought by the estate of the deceased and a wrongful death claim is brought by the deceased’s surviving family members. These two claims are not mutually exclusive and can be brought simultaneously. Liability arises from a death in Arizona when but for a wrongful act or negligence the decedent would not have died and been entitled to pursue a personal injury action. (A.R.S. § 12-611.)  Pursuant to A.R.S. § 12 -612, standing to bring a survivorship or wrongful death action is limited to the following: the decedent’s estate, the surviving spouse; child; parent or guardian; and/or legal representative of the decedent. Unlike other jurisdictions, Arizona excludes recovery for siblings or other relatives; same-sex partners; and common law spouses.

Water, Water Everywhere: Bad Faith Litigation and Motions for Summary Judgement in Arizona

Author: Jenny Silverstein

January 7, 2019 9:00am

Most of us, hopefully, have some form of insurance for our home, whether it be a single family home we own or an apartment we rent. We pay monthly premiums in the hope that, heaven forbid, an earthquake, flood, tornado, fire, or other catastrophic event occurs, the insurance company to whom we have been sending our monthly checks will make us whole again. It may be a long road, but it is our hope that we will be paid fairly for the property lost or damaged, we will have a place to stay temporarily, and there will be a friendly ear on the other side when the road seems too long and daunting.

Arizona’s Governor Signs Insurance Bill Resolving Issues with Enforceability of Translated Insurance Policies

Author: Eric L. Cook

December 3, 2018 9:00am

With a stroke of his pen to House Bill 2083, Governor Doug Ducey clarifies the enforceability of an insurance contract translated into a foreign language. Arizona Revised Statutes (“A.R.S.”) section 20-1119 mandates the English-language version of an insurance policy that was translated into a language other than English will control in any disputes as to the construction and contents of an insurance policy so long as the cover page of the policy contains a specified disclaimer indicating same.

The “Reasonably Susceptible” Interpretation Considerations of Parole Evidence in Arizona

Author: Sitar Bhatt

Guest Editor: Tiffany LeMelle

November 5, 2018 9:00am

Recently, the Arizona Court of Appeals, Division Two, revisited the “reasonably susceptible” analysis in determining whether to consider parol evidence to interpret a contract. In Donsen v. Farmers Insurance, No. 2 CA-CV 2017-0174 (October 3, 2018), plaintiff Samuel Donsen (“Donsen”) filed a complaint against Farmers Insurance (“Farmers”) claiming breach of contract, declaratory relief, insurance bad faith, and interference with contract. Donsen filed the lawsuit after suffering injuries in an automobile accident in which he incurred approximately $22,000 in medical expenses. A portion of his medical expenses were paid by workers’ compensation benefits. Donsen also recovered $15,000 from the third-party tortfeasor and, pursuant to A.R.S. § 23-1203(D), was required to reimburse his workers’ compensation insurer in the amount of $8,750.

Is Mediation the New Trial?

Author: Kristin Mathis

November 5, 2018 9:00am

99.9 percent of all cases filed in Arizona never make it to the jury. While many cases can resolve informally between the attorneys; the most successful strategy for resolution tends to be private mediation. As such, attorneys should prepare for mediation as thoroughly as they would prepare for trial.

Substantively Differing Laws Mean No Class for You

Author: Sitar Bhatt

Guest Editor: Catie R. Johnson

October 1, 2018 10:00am

Ferrara v. 21st Century North America Insurance Company Background

In Ferrara v. 21st Century North America Insurance Company, No. 2 CA-CV 2017-0195 (September 10, 2018), the Arizona Court of Appeals Division Two reviewed whether plaintiff Cynthia Ferrara’s (“Ferrara”) motion for class certification complied with the requirements of Rule 23, Ariz. R. Civ. P.

Arizona Case Law Update

Author: Jenny Silverstein

September 5, 2018 12:42pm

A Recorded Affidavit Alleging CC&R Violations Does Not Mean An Encumbrance On a Person’s Real Property Is Created Unless The Affidavit Explicitly States Otherwise

Thomas M. Baumgartner and Julie B. Baumgartner, et al. v. Edward A. Tmmins, Jr., et al. (August 30, 2018, 2018 WL 4177840)

Dogs, Strict Liability and Summary Judgment

Author: Sitar Bhatt

September 5, 2018 9:00am

Recently, the Arizona Court of Appeals affirmed a trial court’s decision, which granted defendants’ summary judgment motion finding the strict liability and negligence claims failed based on the lack evidence to support such claims.

When Multiple Negligent Acts are considered a “Single Occurrence” under Arizona Law

Author: Kristin Mathis

Guest Editor: Natasha K. Zaslove

August 6, 2018 9:00am

According to an Arizona Court of Appeals holding, a single event caused by several independent acts is a single occurrence under an insurance policy, when the policy defines “occurrence” as an “accident.” Cincinnati Indemnity Company v. Southwestern Line Constructors Joint Apprenticeship and Training Program, et al., No. 1 CA-CV 17-0238 (May 31, 2018).

Stipulated Dismissal Does Not Trigger Issue Preclusion

Author: Sitar Bhatt

Guest Editor: Natasha K. Zaslove

August 6, 2018 9:00am

Thomas Kopp, et al., v. Physician Group of Ariz., Inc., et al., No. CV-17-0222-PR (July 9, 2018) – Opinion

In a recent opinion, the Arizona Supreme Court ruled a dismissal with prejudice does not, on its own, trigger issue preclusion. Thomas Kopp v. Physician Group of Arizona, et. al. No. CV-17-0222-PR (July 9, 2018) – Opinion. In doing so, the Court overturned a 73 year old ruling in DeGraff v. Smith, 62 Ariz. 261, 269-70 (1945) that a dismissal with prejudice is a judgment on the merits that carries preclusive effect.

Arizona Court of Appeals Allowing Assignments of Post-Loss Benefits

Author: Sitar Bhatt

July 9, 2018 9:00am

When an insured assigns its rights to post-loss benefits to a third-party, under the insurance policies, can the third-party bring a breach of contract claim against the insurer? According to an Arizona Court of Appeals holding, post-loss assignments of benefits under insurance policies are valid despite anti-assignment provisions. Farmers v. Hon. Udall and EcoDry, No. 1 CA-SA 18-0081 (June 12, 2018).

The Importance of Contractual Signifiers in Anti-Stacking Provisions Under A.R.S. § 20-259.01

Author: Mark Bolin

Guest Editor: Issa Mikel

July 9, 2018 9:00am

Introduction

In Hanfelder v. GEICO Indem. Co., 1 CA-CV 17-0362, 2018 WL 2315949, at *1 (App. May 22, 2018), the Arizona Court of Appeals reversed a summary judgment order in favor of GEICO Indemnity Company (“GEICO Indemnity”) in a case involving the interpretation of the insurer’s underinsured motorist coverage amendment.  Based on that amendment’s use of the word “us,” the court held GEICO Indemnity’s Policy did not effectively limit its UIM coverage was limited to one policy.

Tiered Case Systems on the Horizon in Arizona Civil Court

Author: Sitar Bhatt

Guest Editor: Conner Holdsworth

May 31, 2018 9:22am

At the end of 2015, the Committee on Civil Justice Reform was established as part of the Arizona Supreme Court’s strategic agenda to promote access to justice and improve the court process to better serve the public. Recently, the Arizona Supreme Court approved the procedural reforms proposed by the Committee. These rule changes go into place July 1, 2018, and are important to note for purposes of preparing to successfully defend civil litigation claims.

Reliance on Existing Record Enough to Set Aside a Default Judgement

Author: Sitar Bhatt

Guest Editor: Raymond K. Wilson Jr.

April 27, 2018 10:48am

The Arizona Supreme Court recently considered whether a defendant must submit additional evidence outside the existing record to establish a “meritorious defense” in a motion to set aside a default judgment under Arizona Rules of Civil Procedure 60(b).[1] The Supreme Court held in Gonzalez v. Nguyen, No. CV-17-0017-PR (April 12, 2018), a defendant may rely on the existing record and a trial court has broad discretion to determine whether a matter should be decided on the merits.

Update to Arizona Legislative Actions 2018

Author: Sitar Bhatt

Guest Editor: Tiffany LeMelle

April 3, 2018 1:39pm

Note: This article is an update to the article which appeared in the March newsletter regarding Arizona Legislative Actions 2018.

The 53rd Arizona Legislature began its Second Regular Session on January 8, 2017, and within the first two weeks, saw an introduction of more than 700 bills. This has been a busy legislative session. March 23, 2018, is the deadline for bills passing the House to be heard in a Senate standing committee and bills passing the Senate to be heard in a House standing committee. The proposed bills cover a wide variety of subjects with potential impact on insurance defense litigation.

You Get What You Pay For: An Update on Bad Faith Litigation in Arizona

Author: Jenny Silverstein

Guest Editor: Tiffany LeMelle

April 3, 2018 1:35pm

Even as a lawyer, I find insurance law to be a complicated subject. Insurance policies are complex contracts which can make even the most educated person’s head spin. However, if you ask the “Average Joe” what an insurance policy is, he or she will answer the policy is to provide peace of mind. Whether it be for a car or motorcycle, home, business, earthquake, malpractice or general umbrella coverage, the average person thinks when they pay their premiums, and a horrible event occurs, the insurance policy is supposed to provide coverage to eliminate worry about paying out of pocket for damages. When I speak to my clients and they wonder what they are going to do, this is when I gently remind them this is why they pay their premiums.

Update to Arizona Legislative Actions 2018

Author: Sitar Bhatt

Guest Editor: Jeremy Freedman

March 5, 2018 12:14pm

Note: This article is an update to the article which appeared in the February newsletter regarding Arizona Legislative Actions 2018.

The 53rd Arizona Legislature began its Second Regular Session on January 8, 2017, and within the first two weeks saw an introduction of more than 700 bills. This has been a busy legislative session. Indeed, as of February 9, 2018, more than 900 bills had yet to clear their first committee. The proposed bills covered subjects ranging from, in relevant part, vehicle liability insurance, obtaining medical records, judgment renewal, construction contracts, and confidentiality agreements involving sexual assault and harassment claims.

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