Betts v. Carr

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UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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

SHANE T. BETTS,
Defendant/Appellant,

v.

SAMUEL E. CARR, D.C., P.C., et al.
Defendants/Appellees.

No. 1 CA-CV 21-0008
FILED 11-30-2021

Appeal from the Superior Court in Maricopa County
No. CV2019-000419
The Honorable Joseph P. Mikitish, Judge

AFFIRMED

COUNSEL

Shane T. Betts, Phoenix
Defendant/Appellant

Jeffrey L. Bradford, PLLC, Phoenix
By Jeffrey L. Bradford
Counsel for Defendant/Appellee Samuel E. Carr, D.C., P.C.

Law Office of Lawrence K. Lynde, Phoenix
By Lawrence K. Lynde
Counsel for Defendant/Appellee Joseph A. Silence
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Decision of the Court

MEMORANDUM DECISION

Judge David D. Weinzweig delivered the decision of the Court, in which
Presiding Judge Peter B. Swann and Judge Paul J. McMurdie joined.

W E I N Z W E I G, Judge:

¶1 Shane Betts appeals the superior court’s judgment in favor of
Dr. Samuel Carr and Joseph Silence on their claims of breach of contract
and unjust enrichment. We affirm.

FACTS AND PROCEDURAL BACKGROUND1

¶2 This appeal arises from two contracts for professional
services—legal services and chiropractic services—entered by Betts after he
was injured in a car accident in December 2015. Betts retained Silence to
pursue his personal injury claim against the other driver. Betts and Silence
entered a contingent fee agreement, which promised that Silence would
receive either 30% or 33% “of any settlement offers or gross recovery,”
depending on whether a lawsuit was filed. For seven months, Silence
performed legal services for Betts, culminating in a settlement demand
letter to the other driver’s insurance carrier for $42,500. The insurer
counteroffered $30,000. Just three days later, Betts fired Silence and he
represented himself moving forward. Silence later asserted a charging lien
for $9,000 in attorney fees, representing 30% of the insurer’s counteroffer.

¶3 Betts also entered a contract with Dr. Carr to receive
chiropractic treatment, which acknowledged that Betts was personally
responsible for payment and Dr. Carr would defer payment until
settlement of the negligence claim. After making 54 visits to Dr. Carr over
four months, and accruing $8,574 in medical bills, Betts asked Dr. Carr to
bill his insurance carrier. Dr. Carr declined, explaining that any insurance
claims needed to be submitted within 90 days of treatment. Betts refused
to pay. Dr. Carr asserted a medical lien.

1 We view the facts in the light most favorable to affirming the
superior court’s judgment after a bench trial. Vanessa H. v. Ariz. Dep’t of
Econ. Sec., 215 Ariz. 252, 256, ¶ 20 (App. 2007).

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¶4 Around two years after he fired Silence, Betts settled his
negligence claim with the insurance company for $34,244.10. The
settlement agreement addressed the charging and medical liens. Betts
promised to satisfy all liens “by payment from the settlement funds,” and
he agreed the liens “are [his] sole responsibility.” The agreement also
required the settlement proceeds to remain in trust until the liens were
resolved.

¶5 Betts later demanded all settlement proceeds from the
insurer. The insurer paid $16,670.10 to Betts, representing the undisputed
portion of the settlement, but filed an interpleader action in the superior
court to allocate the remainder. The insurer deposited the funds with the
court and was dismissed from the action. Silence and Dr. Carr asserted
crossclaims against Betts for breach of contract. Silence also requested the
reasonable value of his services under quantum meruit. Betts moved to
dismiss the crossclaims, which the superior court denied.

¶6 The lawsuit went to mandatory arbitration. An arbitrator
ruled against Betts, who appealed to the superior court, and the case went
to trial. The bench trial lasted two days and the court received over 50
exhibits. Five witnesses testified, including Betts, Silence and Dr. Carr.
Betts was given one-half of the trial time, while Silence and Dr. Carr shared
the remainder. The court also extended the trial to a second day to allow
for closing arguments. After the trial, the court entered judgment for
Silence and Dr. Carr. Betts moved for a new trial and for relief from
judgment, which the court denied. The court awarded Silence and Carr
attorney fees and entered final judgment. We have jurisdiction over Betts’s
timely appeal. See A.R.S. § 12-2101(A)(1), (A)(2), and (A)(5)(a).

DISCUSSION

¶7 We uphold findings of fact unless “clearly erroneous or
unsupported by any credible evidence,” Federoff v. Pioneer Title & Tr. Co. of
Ariz., 166 Ariz. 383, 388 (1990), but review de novo all questions of law,
Enter. Leasing Co. of Phoenix v. Ehmke, 197 Ariz. 144, 148, ¶ 11 (App. 1999).
We review the denial of a motion for new trial or motion for relief from
judgment for abuse of discretion. Spring v. Bradford, 243 Ariz. 167, 170, ¶ 11
(2017); Norwest Bank (Minnesota), N.A. v. Symington, 197 Ariz. 181, 184, ¶ 11
(App. 2000).

I. Professional Liens

¶8 Betts first contends the professional liens were invalid and
offered no basis for the judgment. But the court’s judgment was not based

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on the liens. Rather, the court awarded damages to Carr for breach of
contract, and awarded Silence the reasonable value of his legal services. We
affirm because the record has ample supporting evidence that (1) Betts
entered and breached a contract with Carr, and (2) Betts was unjustly
enriched by failing to pay Silence for the reasonable value of his legal
services.

II. Health Insurance

¶9 Betts next argues the judgment was error because Betts had
health insurance through UnitedHealthcare, Dr. Carr had a contract with
UnitedHealthcare, and that contract prohibited Dr. Carr from billing Betts
directly. This argument is meritless. Betts promised to pay Carr for
treatment under the contract “REGARDLESS OF MY INSURANCE
STATUS.” Betts did not even provide his health insurance information to
Carr when entering the contract, and Betts only raised the health insurance
issue after Carr completed the chiropractic services. Nor did Carr ever bill
or receive payment from UnitedHealthcare for these services.2

III. Quantum Meruit Award

¶10 Betts next contends the judgment was error because Silence’s
contingency fee agreement was unethical and invalid. He argues Silence
was only entitled to damages under quantum meruit. But the superior
court awarded Silence the reasonable value of his legal services under
quantum meruit, not for breach of contract. A quantum meruit award is
permissible under Arizona law unless the parties agreed that services
would be provided for free, or it would not be unfair to receive the benefit
of services without payment. Dey v. Quinin, 21 Ariz. 265, 266 (1920) (“It is
well settled that when one is employed in the services of another for any
period of time the law implies a promise to pay what such services are
reasonably worth, unless it is understood that the services were to be
rendered gratuitously, or unless they were rendered under circumstances
which repel the presumption.”); see also Blue Ridge Sewer Imp. Dist. v. Lowry
& Assocs., Inc., 149 Ariz. 373, 376 (App. 1986). Betts does not make these
arguments, and we find no evidence in the record that Silence agreed to
perform his services for free or that it would be unfair for Betts to pay
Silence.

2 Betts also argues that Dr. Carr’s contract claim was preempted under
the Employee Retirement Income Services Act (“ERISA”), but he never
develops the argument or provides supporting authority.

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IV. Interpleader and Assignment

¶11 Betts argues the judgment was error because Arizona
prohibits an assignment of personal injury claims, and this court should
“extrapolate[] that to fictional charging lien claims.” We are unpersuaded.
Betts never assigned his personal injury claim.3 The insurance company
settled his claim, paid him the uncontested amount and filed an
interpleader action for Betts, Silence and Carr to litigate their rights to the
remaining settlement proceeds. See Ariz. R. Civ. P. 22. Silence and Carr
answered and filed crossclaims against Betts for breach of contract. These
claims were appropriate. Ariz. R. Civ. P. 13(f).

V. Fundamental Error

¶12 Betts contends the superior court committed fundamental
errors so “numerous I cannot list [them] all.” His argument fails.
Fundamental error is “error going to the foundation of the case . . . of such
magnitude that the defendant could not possibly have received a fair trial.”
State v. Hunter, 142 Ariz. 88, 90 (1984); see also Maxwell v. Aetna Life Ins. Co.,
143 Ariz. 205, 212 (App. 1984). Betts received a full and fair trial. He was
given one-half of the trial time; Silence and Carr shared the rest. The court
often reminded Betts of his time limitations, encouraged him to focus his
questions, gave him more time and extended the trial to a second day for
closing arguments.

VI. Attorney Fees

¶13 Last, Betts challenges the superior court’s award of attorney
fees to Silence and Carr. The superior court awarded fees under A.R.S. §
12-341.01 because Silence’s and Carr’s claims arose out of contracts for

3 An assignment is a “transfer of rights or property” from one party to
another. Assignment, Black’s Law Dictionary (11th ed. 2019). An
assignment occurs in personal injury cases when an injured party gives
away his right to sue and recover to a third party. See Karp v. Speizer, 132
Ariz. 599, 600-01 (App. 1982) (assignment of personal injury claim and
proceeds from recovery both unenforceable). These assignments are
prohibited because of “the dangers of maintenance and champerty,” where
“unscrupulous people would purchase causes of action and thereby traffic
in lawsuits for pain and suffering.” Id. (citation omitted). A lien, by
contrast, is a “legal right or interest that a creditor has in another’s property,
lasting [] until a debt or duty that it secures is satisfied.” Lien, Black’s Law
Dictionary (11th ed. 2019).

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services and Betts refused to provide payment. We review the superior
court’s decision to award attorney fees under A.R.S. § 12–341.01 for abuse
of discretion. Associated Indem. Corp. v. Warner, 143 Ariz. 567, 570–71 (1985).
Betts entered two contracts for professional services, refused payment and
litigated the claims from arbitration to the superior court to the court of
appeals. Because the court did not abuse its discretion, we affirm the
attorney fee award.

CONCLUSION

¶14 We affirm the judgment in favor of Dr. Carr and Silence. We
award Dr. Carr and Silence their attorney fees and costs incurred on appeal
under A.R.S. § 12-341.01, contingent on compliance with ARCAP 21.

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

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