Am. Power Prods., Inc. v. CSK Auto, Inc.

• Decision Date: 05 February 2016
• Docket Number: No. CV–14–0261–PR.,CV–14–0261–PR.
• Citation: 367 P.3d 55
• Parties: AMERICAN POWER PRODUCTS, INC., a California corporation; LFMG/APP, LLC, an Arizona corporation, Plaintiffs/Counterdefendants/Appellants/Cross–Appellees, v. CSK AUTO, INC., an Arizona corporation, Defendant/Counterclaimant/Appellee/Cross–Appellant.
• Court: Arizona Supreme Court

367 P.3d 55

AMERICAN POWER PRODUCTS, INC., a California corporation; LFMG/APP, LLC, an Arizona corporation, Plaintiffs/Counterdefendants/Appellants/Cross–Appellees,

v.CSK AUTO, INC., an Arizona corporation, Defendant/Counterclaimant/Appellee/Cross–Appellant.

No. CV–14–0261–PR.

Supreme Court of Arizona.

Feb. 5, 2016.

Herbert Dodell, Dodell Law Corporation, Woodland Hills, CA; and David B. Goldstein (argued), Hymson Goldstein & Pantiliat, PLLC, Scottsdale, Attorneys for American Power Products Inc. and LFMG/APP LLC.

Leon B. Silver (argued), Andrew S. Jacob, Gordon & Rees LLP, Phoenix, Attorneys for CSK Auto Inc.

Justice BRUTINEL authored the opinion of the Court, in which Chief Justice BALES, Vice Chief Justice PELANDER, and Justices TIMMER and BERCH (retired) joined.

Justice BRUTINEL

, opinion of the Court.

¶ 1 During jury deliberations after a lengthy trial, a juror asked the bailiff how long deliberations usually lasted. Without consulting anyone, the bailiff answered, "an hour or two should be plenty." We hold that the trial court did not err by denying the plaintiff's motion for a new trial based on the bailiff's statement without first holding an evidentiary hearing. Although the statement was plainly improper, it was not objectively prejudicial and there was no significant fact question about what occurred.

I. BACKGROUND

¶ 2 In 2005 American Power Products, Inc. ("American") sued CSK Auto, Inc. ("CSK") for breach of contract, and CSK counterclaimed. The eventual trial lasted twelve trial days and included twenty-four witnesses and 164 exhibits, one of which was more than 4000 pages long.

¶ 3 Closing arguments were heard on a Friday before a three-day weekend. Although American sought more than $5 million in damages, its counsel attempted to simplify the case and focus the jury's attention on a small number of exhibits. For example, at one point he said, "I am not encouraging you to look at every single exhibit, but this is an important one." Later, in rebuttal, he encouraged the jurors to "just look at Exhibit No. 412. Tab two. That's all I want you to look at."

¶ 4 Counsel for CSK argued that the jury should award more than $1.6 million on its counterclaims. In the alternative, however, he suggested that the jury might simply reject all the claims and counterclaims and award American the $10,733 that CSK conceded it owed and that the parties had agreed would be the "starting point" for computing damages. After deliberating for one to two hours, the jurors returned a 6–2 verdict awarding American $10,733.

¶ 5 Subsequently, American hired a private investigator who obtained affidavits from two jurors about their deliberations. The affidavit from juror H.T. described a communication between the bailiff and the jury that qualified as possible "extraneous prejudicial information" under Arizona Rule of Evidence 606(b)(2)

. Juror H.T.'s affidavit stated that "[at] one point the bailiff ... came into the room. Someone asked her how long deliberations typically lasted. She told us an hour or two should be plenty."

¶ 6 Relying on the affidavits, American moved for a new trial. American argued that, "at a minimum [the affidavits] create a ground for further inquiry whether deliberations were improperly curtailed both by improper jury conduct and the bailiff's statement that one or two hours of deliberations were enough." CSK argued that Evidence Rule 606

precluded admission of all statements in the affidavits except juror H.T.'s description of the communication between the bailiff and the jury.¹ CSK did not dispute that the bailiff communication occurred as alleged. Rather, CSK argued that, although improper, the communication was insubstantial and did not raise an inference of actual prejudice.

¶ 7 At oral argument on the motion, the court indicated that it agreed with CSK that only the statement about the bailiff communication would be admissible under Evidence Rule 606

and that the bailiff communication was not prejudicial. The court characterized the communication as a "throwaway question" that was "not directed to this case, not to the substance of this case at all." In addition, when counsel for American contended that the jury's rapid verdict was "so aberrational that it's kind of stunning," the court responded that it "[didn't] think it was stunning at all." The court also implied that the quick verdict might have resulted from the attorneys' failure to heed the court's admonition to simplify the case, which, the court pointed out, featured a confusing combination of detailed contract provisions, numerous acronyms, and technical jargon. The trial court denied the motion for a new trial without holding an evidentiary hearing.

¶ 8 A divided court of appeals reversed and remanded. Am. Power Prods., Inc. v. CSK Auto, Inc., 235 Ariz. 509, 517 ¶ 25, 334 P.3d 199, 207 (App.2014)

. The majority found that the trial court could not determine from the record how the jury might have interpreted the bailiff's comment. This uncertainty meant that prejudice should be presumed, and therefore the trial court erred by denying the new trial motion without holding an evidentiary hearing. The dissent concluded that the trial court acted within its discretion in determining, on the basis of H.T.'s uncontested affidavit alone, that the communication was not prejudicial.

¶ 9 We granted review because this case raises an issue of statewide importance. We have jurisdiction under article 6, section 5(3) of Arizona's Constitution and A.R.S. § 12–120.24

.

II. DISCUSSION

¶ 10 We review the trial court's denials of a motion for a new trial and a requested evidentiary hearing for abuse of discretion. See State v. Miller, 178 Ariz. 555, 556, 875 P.2d 788, 789 (1994)

; Adroit Supply Co. v. Elec. Mut. Liab. Ins. Co., 112 Ariz. 385, 389, 542 P.2d 810, 814 (1975).

¶ 11 Bailiffs are prohibited from communicating ex parte with the jury, other than about mere administrative details. Ariz. R. Civ. P. 39(e), (g)

; see Perez ex rel. Perez v. Cmty. Hosp. of Chandler, Inc., 187 Ariz. 355, 359, 929 P.2d 1303, 1307 (1997) (noting that improper ex parte communications may come from a bailiff or a judge and "there is far more potential for improper advice from a bailiff than from a judge on substantive legal and important procedural matters"). If an ex parte communication prejudices jury deliberations, the verdict must be vacated and a new trial ordered. Perez, 187 Ariz. at 362, 929 P.2d at 1310. But we do not presume prejudice from the mere occurrence of an ex parte communication. Id. at 361, 929 P.2d at 1309. Instead, courts examine ex parte communications on a "case-by-case basis, applying a two-prong inquiry: (1) Was there an improper communication? and (2) Was the communication prejudicial or merely harmless?" Id. at 358, 929 P.2d at 1306. Because we agree with the parties and the court of appeals that the bailiff's statement was improper, we focus on whether it was prejudicial.

A. Lack of Factual Dispute

¶ 12 If there is no significant factual question, the trial court may grant or deny a motion for a new trial without holding an evidentiary hearing. See State v. Spears, 184 Ariz. 277, 289, 908 P.2d 1062, 1074 (1996)

(concluding that the trial court did not abuse its discretion in denying defendant a new trial without first holding an evidentiary hearing when a juror's post-verdict affidavit stated that jurors had considered notes from an alternate juror but did not indicate that the notes contained extraneous information that was damaging or prejudicial). If there is a significant question as to what occurred or whether the affiant is credible and whether the alleged facts, if true, would establish a basis for granting the motion, the court must hold an evidentiary hearing before ruling on a motion for new trial. See, e.g., Perez, 187 Ariz. at 357 n. 3, 929 P.2d at 1305 n. 3 (finding that the trial court erred in limiting evidentiary hearing to one of three alleged improper communications when details of the communications were not fully known); Miller, 178 Ariz. at 557, 875 P.2d at 790 (finding that the trial court erred in denying motion for a new trial without first holding an evidentiary hearing when the only information about the improper communication came second-hand from the prosecutor).

¶ 13 Here the trial court was not required to hold an evidentiary hearing before ruling on the motion for new trial because there was no dispute as to what occurred. Both parties agreed that the bailiff said that "one or two hours should be plenty." In finding that the trial court erred, the court of appeals reasoned that the jury could have understood the bailiff's statement as either (1) an innocuous estimate of the typical duration of jury deliberations or (2) an "indirect comment on the relative complexity of the evidence and the applicable law." CSK, 235 Ariz. at 514 ¶ 15, 334 P.3d at 204

. Because it concluded that the trial court did not have the facts necessary to determine which of the two interpretations the jury adopted, it found an evidentiary hearing necessary to address questions "regarding the context of the communication itself," including the specific content of the communication, "whether the jurors asked follow-up questions in response to the bailiff's response, or the amount of time that elapsed between the communication and the jury's verdict." Id. at 515 ¶ 16, 334 P.3d at 205.

¶ 14 But even if we assume that such questions would have been proper under Evidence Rule 606

, we conclude that the mere existence of potential "context" questions does not compel the trial court to hold an evidentiary hearing. As the dissent recognized, "neither party disputed whether the bailiff made the statement at issue, and the parties did not point to any factual dispute relating to the bailiff's statement that would need to be resolved through an evidentiary hearing." Id. at 517 ¶ 28, 334 P.3d at 207

(Cattani, J., dissenting). Accordingly, the trial court reasonably could...