Rock Country v. 7b Building

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UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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

ROCK COUNTRY BUILDERS, INC., an Arizona corporation,
Plaintiff/Appellee,

v.

7B BUILDING & DEVELOPMENT, LLC, a foreign limited liability
company; ENDURANCE ASSURANCE CORPORATION, a foreign
corporation, Defendants/Appellants.

No. 1 CA-CV 19-0749
FILED 10-1-2020

Appeal from the Superior Court in Apache County
No. S0100CV201800066
The Honorable Steve Williams, Judge Pro Tempore

AFFIRMED

COUNSEL

Nick D. Patton, Attorney at Law, PLLC, Show Low
By Nicholas D. Patton
Counsel for Plaintiff/Appellee

Murphy Cordier PLC, Phoenix
By Richard B. Murphy & Chase E. Halsey
Counsel for Defendant/Appellant 7B Building & Development, LLC
 ROCK COUNTRY v. 7B BUILDING, et al.
Decision of the Court

MEMORANDUM DECISION

Judge Paul J. McMurdie delivered the Court’s decision, in which Presiding
Judge James B. Morse Jr. and Judge Maria Elena Cruz joined.

M c M U R D I E, Judge:

¶1 7B Building & Development, LLC (“7B Building”) appeals
from the superior court’s order entitling Rock Country Builders, Inc. (“Rock
Country”) to relief for breach of contract.1

FACTS AND PROCEDURAL BACKGROUND

¶2 In May 2017, Rock Country contracted with 7B Building to
install a septic system in Concho and be paid in phases with the first phase
payable by: “[$]4,000 upon invoice for Design Engineering and
[percolation] testing complete.” Within one month, Rock Country emailed,
phoned, and submitted an invoice to 7B Building indicating it had
completed the engineering work and a percolation test. But 7B Building
refused to pay Rock Country because it never furnished the design
drawings or proof of the percolation test. Rock Country performed no
additional work, and 7B Building found a different contractor to complete
the remaining work.

¶3 In April 2018, Rock Country sued 7B Building alleging the
contract’s breach and requesting attorney’s fees. The court held a bench trial
in July 2019, after which it found in 7B Building’s favor. However, the court
also stated, “[n]otwithstanding the Court’s order finding in favor of
Defendant, should Plaintiff provide Defendant the results of the percolation
test and design engineering photos/report, Plaintiff would be entitled to
receive payment of $4,000.00 from Defendant per the terms of the contract.”
The court gave 7B Building leave to request attorney’s fees if Rock Country
failed to produce its results within 30 days, stating the order would become
final only if “nothing further [was] filed by either party within 35 days.”

1 On the court’s motion, the caption in this matter has been amended
to correct an error. The amended caption shall be used on any future filings.

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 ROCK COUNTRY v. 7B BUILDING, et al.
Decision of the Court

¶4 7B Building moved for reconsideration of the court’s order,
arguing the court erroneously reopened the case to hear additional
evidence not disclosed or produced at trial, causing prejudice, when it held
Rock Country would be entitled to payment upon furnishing proof that the
contracted work had been completed. The court agreed with 7B Building
that “by allowing the Plaintiff the opportunity to disclose the results of the
percolation test, this Court reopened the matter ‘under circumstances
which are prejudicial to [7B Building].’” But the court reversed its prior
ruling, changing its original interpretation of the contract and ordering
7B Building to pay Rock Country $4000 per the contract’s terms. After
noting that two witnesses testified at trial that the percolation test and
engineering design had been completed, the court stated:

The relevant language of the contract required that Plaintiff
provide an “invoice” for work that was “complete” relative to
the “Design Engineering and [percolation] test.” There is no
language in the contract itself that requires either proof of
completion or the actual results of the percolation test before
Plaintiff was entitled to the first $4,000.00 payment.

Certainly, the parties could have agreed that the results of the
percolation test were to be provided with the invoice if that
was their desire. However, no such requirement was written
into the contract. For the Court to interpret the contract to
require disclosure of the “results of the percolation test” at the
time of invoice would require the Court to read into the
contract language that is not there. While it may have
otherwise been a reasonable request by the Defendant to see
the results of the percolation test, because the parties did not
bind themselves to that requirement, the Court will not
rewrite the contract to require the same. The parties are bound
by the language they agreed to.

¶5 7B Building appealed, and we have jurisdiction under
Arizona Revised Statutes (“A.R.S.”) sections 12-120.21(A)(1)
and -2101(A)(1).

DISCUSSION

¶6 7B Building argues the superior court erred by (1) reversing
its original ruling, which interpreted the contract in 7B Building’s favor,
absent new evidence or a request to reconsider the interpretation; and
(2) interpreting the contract in Rock Country’s favor in its final judgment.

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 ROCK COUNTRY v. 7B BUILDING, et al.
Decision of the Court

A. The Superior Court Did Not Err by Reversing Its Original Ruling.

¶7 We review de novo the superior court’s application of court
rules. Haroutunian v. Valueoptions, Inc., 218 Ariz. 541, 549, ¶ 22 (App. 2008).
The superior court has “inherent power” to modify its judgment before it
becomes final. Preston v. Denkins, 94 Ariz. 214, 219 (1963); see also Ariz. R.
Civ. P. 54(b) (if there is no language of finality recited in the judgment, “any
decision [adjudicating] fewer than all the claims . . . does not end the action
as to any of the claims . . . and may be revised at any time before the entry
of a judgment adjudicating all the claims”). Here, the court’s original order
gave 7B Building leave to request attorney’s fees if Rock Country failed to
produce its results within 30 days, stating the order would become final
only if “nothing further [was] filed by either party within 35 days.” The
court could revise its decision regarding the contract dispute before it
entered a final judgment, regardless of whether the parties presented
additional evidence or a request to reconsider the contract interpretation. It
did not err by doing so.

B. The Superior Court Did Not Erroneously Interpret the Contract.

¶8 We review de novo the superior court’s interpretation of a
contract. Andrews v. Blake, 205 Ariz. 236, 240, ¶ 12 (2003). “We consider the
plain meaning of the words in the context of the contract as a whole.” Dunn
v. FastMed Urgent Care PC, 245 Ariz. 35, 38, ¶ 10 (App. 2018). If
unambiguous, the terms are conclusive. Goodman v. Newzona Inv. Co., 101
Ariz. 470, 472 (1966).

¶9 The language of the contract is clear—7B Building had to pay
Rock Country “[$]4,000 upon invoice for Design Engineering and
[percolation] testing complete.” Rock Country submitted an invoice to
7B Building for the engineering and testing and produced testimony from
two witnesses at trial that said Rock County completed the engineering and
testing. By ruling in Rock Country’s favor, the court implicitly found the
witnesses’ testimony credible. See State v. Organ, 225 Ariz. 43, 49, ¶ 26 (App.
2010) (holding the court implicitly found an officer’s testimony credible by
ruling in the State’s favor). Therefore, the court did not err by ruling in Rock
Country’s favor and finding 7B Building owed Rock Country $4000 under
the contract.

ATTORNEY’S FEES AND COSTS

¶10 Rock Country and 7B Building each request an award of
attorney’s fees under A.R.S. § 12-341.01. Because Rock Country is the

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 ROCK COUNTRY v. 7B BUILDING, et al.
Decision of the Court

prevailing party, we grant attorney’s fees and costs upon compliance with
Arizona Rule of Civil Appellate Procedure 21.

CONCLUSION

¶11 We affirm the superior court’s judgment.

AMY M. WOOD • Clerk of the Court
FILED: AA

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