American Asphalt v. Cmx llc/cmx Group Inc

SUPREME COURT OF ARIZONA
En Banc

AMERICAN ASPHALT & GRADING ) Arizona Supreme Court
COMPANY, an Arizona corporation, ) No. CV-10-0324-PR
)
Plaintiff/Appellant, ) Court of Appeals
) Division One
v. ) No. 1 CA-CV 09-0634
)
CMX, L.L.C., an Arizona limited ) Maricopa County
liability company; CMX GROUP, ) Superior Court
INC., an Arizona corporation, ) No. CV2008-009602
)
Defendants/Appellees. )
)
) O P I N I O N
__________________________________)

Appeal from the Superior Court in Maricopa County
The Honorable John A. Buttrick, Judge

VACATED AND REMANDED
________________________________________________________________

Memorandum Decision of the Court of Appeals Division One
Filed Jul. 22, 2010

VACATED
________________________________________________________________

LANG BAKER & KLAIN PLC Scottsdale
By Kent A. Lang
William G. Klain
Michael Walter Thal

And

PAUL G. ULRICH P.C. Phoenix
By Paul G. Ulrich
Attorneys for American Asphalt & Grading Company

FOLK & ASSOCIATES P.C. Phoenix
By P. Douglas Folk
Benjamin L. Hodgson
Christopher D.C. Hossack
Attorneys for CMX LLC and CMX Group Inc.
And

COMMITTEE ON SUPERIOR COURT
BY Hon. James Soto, Chair
Amicus Curiae Committee on Superior Court
_______________________________________________________________

B R U T I N E L, Justice

¶1 Arizona Rule of Civil Procedure 38.1(e) requires the

superior court to “promptly notify counsel in writing of the

placing of cases on the Inactive Calendar.” We hold that a

notice issued several months prior to placing the case on the

Inactive Calendar does not comply with this rule.

I.

¶2 In April 2008, American Asphalt and Grading Company

(“American Asphalt”) sued CMX, L.L.C., for professional

negligence and breach of implied warranty. On October 1, 2008,

the Maricopa County Superior Court issued an order (“150-Day

Order”) informing American Asphalt that if it did not file a

Motion to Set and Certificate of Readiness as required by Rule

38.1(a), the case would be placed on the Inactive Calendar after

January 20, 2009, and dismissed without further notice on or

after March 23, 2009.

¶3 American Asphalt did not file a Motion to Set and the

case was dismissed without further notice on April 29, 2009.

American Asphalt then promptly moved under Arizona Rules of

Civil Procedure 60(c)(1) and (6) to set aside the dismissal.

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American Asphalt contended that its failure to comply with Rule

38.1(a) was excusable because it had substituted counsel around

the time of the Rule 38.1(d) filing deadline. The superior

court denied the motion. The court of appeals affirmed, finding

no excusable neglect partly because “the 150-Day Order provided

the notice required in Rule 38.1(e).” American Asphalt &

Grading Co. v. CMX, L.L.C., 1CA-CV 09-0634, 2010 WL 2889471, at

*3 ¶¶ 13-15 (Ariz. App. July 22, 2010) (mem. decision).

¶4 We granted review to clarify the requirements of Rule

38.1(e). We have jurisdiction under Article 6, Section 5(3) of

the Arizona Constitution and A.R.S. § 12-120.24 (2003).

II.

¶5 Arizona Rule of Civil Procedure 38.1(d) requires that

“every case in which a Motion to Set and Certificate of

Readiness has not been served within nine months after the

commencement thereof” shall be placed on the “Inactive

Calendar.” Under that rule, cases remaining on the Inactive

Calendar for two months without either the filing of a Motion to

Set or a court order allowing continuance on that Calendar

“shall be dismissed without prejudice for lack of prosecution.”

Rule 38.1(e) states:

The clerk of the court or court administrator,
whoever is designated by the presiding judge, shall
promptly notify counsel in writing of the placing
of cases on the Inactive Calendar, and no further
notice shall be required prior to dismissal.

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¶6 American Asphalt argues that the 150-Day Order did not

satisfy Rule 38.1(e) because the order did not issue when the

case was placed on the Inactive Calendar. We use rules of

statutory construction to interpret court rules. See Preston v.

Kindred Hosps. W., L.L.C., 226 Ariz. 391, 393 ¶ 8, 249 P.3d 771,

773 (2011). And we do not look beyond a rule’s language if it

is clear and unambiguous. Id.

¶7 Read in isolation, the phrase “of the placing of cases

on the Inactive Calendar,” rather than “when a case is placed on

the Inactive Calendar,” could be read to mean that Rule 38.1(e)

is satisfied if attorneys are notified at any time that cases

will be placed on the Inactive Calendar on some specified future

date. Under that interpretation, Maricopa County’s 150-Day

Order would comply with the rule.

¶8 Based on the rule’s directive that the court shall

“promptly” notify counsel of the placement of cases on the

Inactive Calendar, however, we conclude that Rule 38.1(e)

requires contemporaneous (or nearly contemporaneous) notice when

a case is placed on the Inactive Calendar. As noted above, Rule

38.1(d) directs the court to “place on the Inactive Calendar

every case in which a Motion to Set and Certificate of

Readiness” are not served within nine months. Rule 38.1(e), by

requiring the court to “promptly notify counsel in writing of

the placing of cases on the inactive calendar,” is most

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plausibly read to refer to notice when the action identified in

Rule 38.1(d) occurs– that is, when the case is actually placed

on the Inactive Calendar. Any other interpretation would imply

that the court’s placing a case on the Inactive Calendar under

Rule 38(d)(1) means something different than the “placing of

cases on the Inactive Calendar” in Rule 38.1(e).

¶9 Construed most reasonably and in context, Rule 38.1(e)

requires notification when a case is placed on the Inactive

Calendar. Because the 150-Day Order did not notify American

Asphalt when the case was placed on the Inactive Calendar, but

rather gave notice only of the court’s intention to do so in the

future, the order did not comply with Rule 38.1(e).

¶10 In so holding, we do not disapprove of Maricopa

County’s 150-Day Order, which provides useful advance notice to

counsel. But local practices must comport with and cannot

supplant the rules of civil procedure. See State ex. rel.

Romley v. Ballinger, 209 Ariz. 1, 2 ¶ 6, 97 P.3d 101, 102 (2004)

(emphasizing that superior courts have no authority to abridge

rules of civil procedure).

¶11 Having found that the notice provided did not comply

with Rule 38.1(e), we next consider the consequences. We reject

American Asphalt’s argument that the superior court’s judgment

was void ab initio. See Cockerham v. Zikratch, 127 Ariz. 230,

234, 619 P.2d 739, 743 (1980) (explaining that void judgments

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are those rendered by a court lacking jurisdiction over subject

matter or parties whereas erroneous judgments are those issued

by courts with jurisdiction, but subject to reversal on appeal).

Rather, we adopt the approach taken in Copeland v. Arizona

Veterans Memorial Coliseum & Exposition Center, 176 Ariz. 86,

859 P.2d 196 (App. 1993). There, the court of appeals applied

our decision in Jepson v. New, 164 Ariz. 265, 792 P.2d 728

(1990), to conclude that lack of notice is one factor, among

many, that a court should consider in ruling on a Rule 60(c)

motion. See Copeland, 176 Ariz. at 89-90, 859 P.2d at 199-200.

¶12 Here, unlike Copeland, American Asphalt did receive

notice, albeit not the notice required under Rule 38.1(e), of

the consequences of failing to file a Motion to Set. Express

notice was set forth in the 150-Day Order (printed on a pink

sheet of paper) as well as in Rule 38.1(d). Nonetheless, in an

excess of caution, we vacate the court of appeals’ decision and

remand the case to the superior court because the record does

not make clear whether that court considered the 150-Day Order

dispositive. On remand, the superior court should follow the

analysis in Copeland and determine what effect, if any, the

absence of Rule 38.1(e)-compliant notice had on the conduct of

counsel.

_____________________________________
Robert M. Brutinel, Justice

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CONCURRING:

_____________________________________
Rebecca White Berch, Chief Justice

_____________________________________
Andrew D. Hurwitz, Vice Chief Justice

_____________________________________
W. Scott Bales, Justice

_____________________________________
A. John Pelander, Justice

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