Panto v. Sines

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UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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

DONNA PANTO and STEVEN PANTO, Plaintiffs/Appellants,

v.

GERALD SINES and ROBIN NELSON, Defendants/Appellees.

No. 1 CA-CV 23-0182
FILED 11-21-2023

Appeal from the Superior Court in Mohave County
No. S8015CV202200834
The Honorable Steven C. Moss, Judge

AFFIRMED

COUNSEL

Law Offices of Linda Marie Brown PLLC, Bullhead City
By Linda Marie Brown
Counsel for Plaintiffs/Appellants

Lundberg & Elias PLLC, Bullhead City
By T’shura-Ann Elias
Counsel for Defendants/Appellees
 PANTO, et al. v. SINES, et al.
Decision of the Court

MEMORANDUM DECISION

Judge Cynthia J. Bailey delivered the decision of the Court, in which
Presiding Judge James B. Morse Jr. and Judge Brian Y. Furuya joined.

B A I L E Y, Judge:

¶1 Appellants Donna and Steven Panto (“Landlords”) challenge
the superior court’s denial of their request for attorney’s fees and costs
following a jury trial. We affirm.

FACTS AND PROCEDURAL HISTORY

¶2 Starting in 2014, Appellees Gerald Sines and Robin Nelson
(“Tenants”) rented a Bullhead City house from Landlords. The parties
signed two lease agreements: one in August 2014 and one in February 2016.
Both agreements obligated Tenants to pay $850 in monthly rent.

¶3 Landlords tried to terminate the lease in May 2022. They filed
an eviction complaint in justice court soon after. Tenants counterclaimed,
alleging, among other things, that Landlords had “agreed to sell the . . .
property” to them and later breached that agreement.

¶4 The justice court transferred the case to superior court, and
the matter proceeded to jury trial. At the time of trial, Landlords sought (1)
an eviction order, (2) unpaid rent, (3) compensation for alleged property
damage and repairs, and (4) punitive damages. Tenants asserted five
counterclaims: (1) breach of the alleged purchase agreement, (2) breach of
the implied covenant of good faith and fair dealing, (3) unjust enrichment
stemming from the “failure to complete the sale of the property,” (4) quiet
title, and (5) fraudulent misrepresentation.

¶5 At the close of Landlords’ case-in-chief, Tenants moved for a
directed verdict on several issues and prevailed on two: (1) punitive
damages and (2) “that any hold-over tenancy period will be charged at the
rate of [$]850.00 per month.” At the close of trial, the jury found for
Landlords, awarded them $4,250 in damages, and denied Tenants’
counterclaims.

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Decision of the Court
¶6 The superior court invited both sides to submit requests for
attorneys’ fees and costs. Landlords claimed fees under Arizona Revised
Statutes (“A.R.S.”) § 12-341.01(A) and the lease agreements, which provide:

In any action or proceeding arising out of this agreement, the
prevailing party shall be entitled to reasonable attorney’s fees
and costs.

Tenants claimed fees under A.R.S. § 12-341.01(A), contending they had
prevailed on some of Landlords’ claims and that the $4,250 damages award
was “significantly less than what was sought by [Landlords].”

¶7 The superior court, noting that both sides sought “tens of
thousands of dollars” in damages, found that Landlords were “the
prevailing part[ies], though that is true only in a nominal sense considering
the extent of damages sought.” But the court also stated that “awarding
fees against [Tenants] would cause extreme hardship” and it was “loath to
discourage or chill others in [Tenants’] circumstances from asserting similar
claims.” The court concluded that “neither party is a prevailing party under
the facts and circumstances of this case” and denied both parties’ requests
for attorneys’ fees and costs.

¶8 Landlords timely appealed the denial of their request for
attorney’s fees and costs. We have jurisdiction under A.R.S. § 12-
2101(A)(1).

DISCUSSION

I. The superior court did not abuse its discretion in determining
Landlords were not the prevailing parties.

¶9 Landlords argue that fee awards under contractual provisions
are mandatory and thus the superior court lacked discretion to decline to
award fees. See, e.g., Murphy Farrell Dev., LLLP v. Sourant, 229 Ariz. 124, 133,
¶ 32 (App. 2012). But the lease agreements call for an award of reasonable
attorney’s fees and costs to “the prevailing party.” To recover fees,
Landlords had to first show that they were the prevailing parties.

¶10 Because the lease agreements do not define “prevailing
party,” we look to Arizona cases addressing the definition of “successful
party,” as used in A.R.S. § 12-341.01(A). See Am. Power Prods., Inc. v. CSK
Auto, Inc., 242 Ariz. 364, 368, ¶ 15 (2017). Whether a party is successful for
purposes of A.R.S. § 12-341.01(A) is within the superior court’s sole
discretion. Berry v. 352 E. Virginia, L.L.C., 228 Ariz. 9, 13, ¶ 21 (App. 2011).
As this case involved multiple claims and varied success, the superior court

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Decision of the Court
could apply either a “percentage of success” test or a “totality of the
litigation” test. Id. at 13–14, ¶ 22. It appears the court applied the latter.
We will affirm the court’s prevailing party determination if it has any
reasonable basis. Lee v. ING Inv. Mgmt., LLC, 240 Ariz. 158, 161, ¶ 8 (App.
2016). We do so because the superior court “is better able to evaluate the
parties’ positions during the litigation and to determine which has
prevailed.” Berry, 228 Ariz. at 13, ¶ 22.

¶11 Landlords contend they were the prevailing parties because
the jury “found in favor of a landlord/tenant relationship and did not find
a purchase/sale agreement or unjust enrichment as alleged by the
[Tenants].” While true, the superior court also observed that Landlords’
“claims for property damage and/or waste were meritorious but clearly
exaggerated” and “[t]heir claims for punitive damage were not
meritorious.” As Landlords did not provide trial transcripts, we must
presume the evidence presented at trial supported these findings. J.F. v.
Como in & for Cnty. of Maricopa, 253 Ariz. 400, 406–07, ¶ 31 (App. 2022).

¶12 Landlords also contend they prevailed because the jury
awarded them damages. A money judgment is one important factor for
consideration, but the “party who is awarded a money judgment in a
lawsuit is not always the successful or prevailing party.” Ocean W.
Contractors, Inc. v. Halec Const. Co., 123 Ariz. 470, 473 (1979). The judgment
is not dispositive here because the court found Landlords only prevailed
“in a nominal sense considering the extent of damages sought,” noting that
Landlords’ claims totaled “tens of thousands of dollars.” Landlords do not
show the court abused its discretion by considering the damages amount
they were awarded. See Bank One, Arizona v. Rouse, 181 Ariz. 36, 41 (App.
1994) (holding that the superior court has discretion to deny attorneys’ fees
and costs to both sides when there is no “clear successful party”). We affirm
the denial of Landlords’ attorney’s fees claim. See Hall v. Read Dev., Inc., 229
Ariz. 277, 279, ¶ 7 (App. 2012) (concluding that the superior court has
“broad discretion to determine whether a party was successful in the
litigation”).

II. We need not address Tenants’ settlement offers.

¶13 Landlords also challenge the court’s finding that Tenants
“made what appears to have been a reasonable settlement offer, though that
offer is not . . . apple-to-apple comparable to the matters submitted to the
jury.” If a written settlement offer is rejected and the final judgment is equal
to or more favorable to the offeror, the offeror is deemed the successful
party from the date of the offer. A.R.S. § 12-341.01(A).

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Decision of the Court
¶14 The court did not find that Tenants were successful parties on
this basis, nor did it award them fees. Tenants do not challenge those
rulings, and thus we need not address their settlement offers.

III. Taxable Costs in Superior Court

¶15 The court also has discretion to determine who is the
successful or prevailing party for purposes of awarding costs under A.R.S.
§ 12-341. See Nataros v. Fine Arts Gallery of Scottsdale, Inc., 126 Ariz. 44, 49
(App. 1980) (affirming the superior court’s determination of successful
party “based upon the totality of the litigation presented”). Landlords do
not show that the court abused its discretion in finding they were not
successful parties. We affirm the denial of their taxable costs claim.

IV. Attorneys’ Fees and Taxable Costs on Appeal

¶16 Both sides request attorneys’ fees and taxable costs, citing
Arizona Rule of Civil Appellate Procedure (“ARCAP”) 21. ARCAP 21 is
not a substantive basis for a fee award. Assyia v. State Farm Mut. Auto. Ins.
Co., 229 Ariz. 216, 224, ¶ 34 (App. 2012). “Because neither cites authority to
support the request, neither is entitled to an award of attorney’s fees.” Vera
v. Rogers, 246 Ariz. 30, 36, ¶ 23 (App. 2018). Tenants are successful in this
appeal and may recover their taxable costs upon compliance with ARCAP
21. See A.R.S. § 12-341.

CONCLUSION

¶17 We affirm the superior court’s denial of Landlords’ request
for attorney’s fees and costs.

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

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