Lehman v. Washburn

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UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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

In the Matter of:

JEFFERY LYNN WASHBURN, Deceased.
_________________________________

LACEY LYNN LEHMAN, et al., Petitioners/Appellees,

v.

REGINA WASHBURN, Respondent/Appellant.

No. 1 CA-CV 21-0409
FILED 3-22-2022

Appeal from the Superior Court in Maricopa County
No. PB2020-070372
The Honorable J. Justin McGuire, Judge Pro Tempore

AFFIRMED IN PART; REVERSED IN PART

COUNSEL

Windtberg & Zdancewicz, PLC, Phoenix
By Michael J. Zdancewicz
Counsel for Petitioners/Appellees

Schutt Law Firm PLC, Scottsdale
By Kenneth W. Schutt, Jr., Erika M. Weiler
Counsel for Respondent/Appellant

LEHMAN, et al. v. WASHBURN
Decision of the Court

MEMORANDUM DECISION

Judge James B. Morse Jr. delivered the decision of the Court, in which
Presiding Judge Jennifer B. Campbell and Judge Randall M. Howe joined.

M O R S E, Judge:

¶1 Regina Washburn ("Washburn") appeals from the probate
court's grant of summary judgment and the award of attorney fees to the
Estate of Jeffery Lynn Washburn ("the Estate") on Washburn's petition for
allowance of a claim. For the following reasons, we affirm the disallowance
of Washburn's claim, but reverse the attorney fee award to the Estate.

FACTS AND PROCEDURAL BACKGROUND

¶2 A 1992 dissolution decree required Jeffery Washburn ("the
decedent") to carry a $100,000 life-insurance policy designating Washburn
as the non-revocable beneficiary and to provide her with annual
verification of coverage.

¶3 After entry of the dissolution decree, the decedent did not
regularly provide Washburn annual verification, and she never sought to
enforce the decree's life-insurance provision. The record suggests that the
decedent last provided Washburn annual verification of coverage several
years before 2003, when the parties litigated child custody in another state.
The decedent died in 2019 without an active life-insurance policy.

¶4 Lacey Lynn Lehman, the personal representative of the
decedent's Estate, applied for informal probate to administer the Estate's
assets. Washburn filed a $100,000 notice of claim with the Estate based on
the decedent's failure to comply with the decree's life-insurance provision,
which the Estate disallowed. Washburn petitioned the probate court to
allow the claim, and the parties filed competing motions for summary
judgment.

¶5 The probate court denied Washburn's motion for summary
judgment and granted summary judgment to the Estate. The court found
that decedent breached his contractual obligation to obtain an insurance
policy and provide annual coverage verification, each annual failure
constituted a new material breach, and the statute of limitations did not bar
Washburn's claim. However, the court found that the doctrine of laches

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LEHMAN, et al. v. WASHBURN
Decision of the Court

barred her claim because Washburn's more than two-decade delay in
pursuing her claim was unreasonable and would prejudice the Estate.

¶6 After the probate court entered final judgment, Washburn
moved for a new trial, and the Estate moved for attorney fees. The court
denied Washburn's motion for new trial and awarded attorney fees to the
Estate.

¶7 We have jurisdiction over Washburn's timely appeal under
A.R.S. § 12-2101(A)(1).

DISCUSSION

I. Summary Judgment.

¶8 Washburn argues the probate court erred by relying on the
doctrine of laches to grant summary judgment to the Estate.1

¶9 We review the grant of summary judgment de novo, viewing
the facts "in the light most favorable" to Washburn, against whom summary
judgment was granted. Andrews v. Blake, 205 Ariz. 236, 240, ¶ 12 (2003).
When there is no genuine issue of material fact and the moving party is
entitled to judgment as a matter of law, we will affirm summary judgment.
Ariz. R. Civ. P. 56(a); Thompson v. Pima County, 226 Ariz. 42, 44, ¶ 5 (App.
2010). We review de novo the court's interpretation of an existing
dissolution decree. Cohen v. Frey, 215 Ariz. 62, 66, ¶ 10 (App. 2007). We
review the court's application of laches for abuse of discretion. McLaughlin
v. Bennett, 225 Ariz. 351, 353, ¶ 5 (2010).

¶10 On appeal, Washburn argues the probate court erred by
applying the doctrine of laches to her claim for money damages for breach
of contract. The Estate argues that Washburn's claim is to enforce the
dissolution decree, not for breach of contract, and enforcement of the decree
is an equitable matter, to which the doctrine of laches applies.

¶11 As an initial matter, the Estate asserted to the probate court
that contract law governs and laches can apply to an action in contract. We
reject Washburn's position that the Estate waived its equitable argument
via its position below. The Estate consistently urged laches and it is the

1 Because our decision affirming the grant of summary judgment to
the Estate resolves this appeal, we do not address the denial of Washburn's
motion for summary judgment.

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court that determines which law applies to the facts, not the parties. Word
v. Motorola, Inc., 135 Ariz. 517, 520 (1983).

¶12 Despite Washburn's insistence that the parties entered into an
agreement that was incorporated by reference into the decree, our review
shows no reference to a separate written agreement referenced in the
decree. The decree states that the matter arose before the family court for
hearing, that neither party appeared, and that the parties agreed the matter
may be heard as a default. The family court ordered the decedent to
maintain a life-insurance policy and "supply wife with annual verification
of coverage." Both parties signed the decree, approving it as to form and
content. The probate court determined the decedent had breached his
contractual obligations in the decree, impliedly finding that the decree was
a contract.

¶13 To the extent the probate court treated the decree as a
contract, it erred. A consent decree, like any judgment, is "an independent
resolution by the court of the issues before it and rightfully is regarded in
that context and not according to the negotiated intent of the parties." In re
Marriage of Zale, 193 Ariz. 246, 249, ¶ 11 (1999). Enforcement of dissolution
decrees is based on the equitable power of the family court. See Cole v. Cole, 101 Ariz. 382, 384 (1966) (dissolution of marriage is an equitable action).
"The superior court has inherent power to enforce its own judgments by
subsequent orders when asked to do so." Daley v. Earven, 166 Ariz. 461, 463
(App. 1990). And because laches is an equitable doctrine, the probate court
properly considered its application to the decree's life-insurance
requirement. See Sotomayor v. Burns, 199 Ariz. 81, 82-83, ¶ 6 (2000) (noting
laches is "an equitable counterpart to the statute of limitations, designed to
discourage dilatory conduct"). Because we find that the decree is a
judgment, not a contract, we do not address the parties' dispute about
whether laches can apply to a breach of contract claim.

¶14 Laches generally bars a claim when the delay is unreasonable
and would prejudice the opposing party. Id. at 83, ¶ 6. We determine
whether a delay is unreasonable by examining "the justification for delay,
including the extent of plaintiff's advance knowledge of the basis for
challenge." Harris v. Purcell, 193 Ariz. 409, 412, ¶ 16 (1998).

¶15 The record supports the probate court's exercise of its
discretion. Because the decedent failed to provide annual proof of coverage
under an insurance policy, Washburn knew every year that the decedent
failed to comply with that provision of the decree. Washburn did not seek
enforcement of the life-insurance provision in the decree in Arizona family

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LEHMAN, et al. v. WASHBURN
Decision of the Court

court and the record shows she last raised the issue in any court in 2003.
We agree that Washburn's nearly two-decade delay in pursuing her rights
under the decree is unreasonable.

¶16 Further, the prejudice to the Estate is clear. A claim against
the Estate "includes liabilities of the decedent." A.R.S. § 14-1201(8). A
liability is a legal obligation. See Liability, Black's Law Dictionary (11th ed.
2019) (defining liability as "[t]he quality, state, or condition of being legally
obligated or accountable; legal responsibility to another or to society,
enforceable by civil remedy or criminal punishment"). The decedent's legal
obligation under the dissolution decree was not to provide $100,000 to
Washburn, but to maintain a life-insurance policy for that value and
provide annual proof of coverage. It is undisputed that there is no life-
insurance policy and no concomitant $100,000 in proceeds for the Estate to
distribute. Thus, Washburn has no claim for $100,000. Even though causes
of action against the decedent survive death and may be asserted against
his personal representative, A.R.S. § 14-3110, Washburn's cause of action is
for enforcement of her rights under the decree to be named as a beneficiary
under a life-insurance policy. By waiting until the decedent had died,
Washburn's failure to seek enforcement results in impossibility of
compliance. The Estate cannot now procure a life-insurance policy for the
decedent, and it would be prejudicial to force the Estate to distribute other
assets to satisfy the decedent's obligation to maintain a life-insurance
policy. The court did not abuse its discretion in applying laches.

II. Attorney Fees.

¶17 Washburn argues the probate court erred in awarding the
Estate attorney fees because it untimely filed its motion for fees more than
15 days after entry of final judgment in violation of Arizona Rule of Civil
Procedure 54(h)(2)(C).

¶18 Although the Estate properly asserted a claim for attorney
fees in its response to Washburn's petition, the probate court entered final
judgment without having considered attorney fees. When a court enters
final judgment without first receiving a motion for judgment or proposed
form of judgment, as is the case here, a prevailing party seeking fees must
file a motion to alter or amend the judgment within 15 days. Ariz. R. Civ.
P. 54(h)(2)(C), 59(d). It is undisputed that the Estate did not file its motion
within 15 days after entry of judgment. Despite this failure, the court
awarded the Estate fees.

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LEHMAN, et al. v. WASHBURN
Decision of the Court

¶19 The probate court lacks jurisdiction to rule on an untimely
post-judgment motion. Einboden v. Martin, 70 Ariz. 245, 249 (1950); see also
Preston v. Denkins, 94 Ariz. 214, 219 (1963); Egan-Ryan Mech. Co. v. Cardon
Meadows Dev. Corp., 169 Ariz. 161, 166 (App. 1990). The fact that
Washburn's motion for new trial was pending does not extend the Estate's
deadline to file its own motion to alter or amend judgment for attorney fees.
Ariz. R. Civ. P. 6(b) (prohibiting a court from extending the time to file a
motion to alter or amend a judgment except under certain conditions absent
in this case).

¶20 The Estate argues Washburn failed to object to its motion for
attorney fees and therefore waives any objection to the fee award. But
Washburn filed a notice of lodging proposed form of order that would deny
the attorney fee motion as untimely. And even if the proposed order was
insufficient, a party cannot waive subject-matter jurisdiction. Swichtenberg
v. Brimer, 171 Ariz. 77, 82 (App. 1991). Thus, the probate court lacked
jurisdiction to award the Estate attorney fees.

CONCLUSION

¶21 For the foregoing reasons, we affirm the probate court's ruling
disallowing Washburn's claim but reverse the attorney fee award. In our
discretion, we decline to award either party attorney fees. We award costs
on appeal to Washburn upon compliance with ARCAP 21.

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

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