Arik Co. v. RGO LLC
| Decision Date | 04 March 2021 |
| Docket Number | No. 1 CA-CV 20-0280,No. 1 CA-CV 20-0284 (Consolidated),1 CA-CV 20-0280,1 CA-CV 20-0284 (Consolidated) |
| Parties | ARIK COMPANY LLC, Plaintiff/Appellee, v. RGO LLC, Defendant/Appellant. |
| Court | Arizona Court of Appeals |
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 UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.
Appeal from the Superior Court in Maricopa County
APPEAL DISMISSED IN PART, VACATED IN PART, AFFIRMED IN PART, REMANDED
Burch & Cracchiolo PA, Phoenix
By Jake D. Curtis, Daryl Manhart
Rutila Seibt & Nash PLLC, Scottsdale
By Gregory W. Seibt, Alexandra Mijares Nash
Counsel for Defendant/Appellant
MEMORANDUM DECISIONPresiding Judge Paul J. McMurdie delivered the Court's decision, in which Judge Cynthia J. Bailey and Judge Lawrence F. Winthrop joined.
McMURDIE, Judge:
¶1 Appellant RGO LLC ("RGO") challenges the superior court's grant of partial summary judgment on a rent disgorgement claim brought by Appellee Arik Company LLC ("Arik") based on a clarified ruling from an earlier case between the same parties. For the reasons discussed below, we dismiss the appeal from the judgment in Maricopa County cause number CV2013-010442. In Maricopa County cause number CV2018-014076, we vacate the judgment and remand for further proceedings because the clarified order is not entitled to preclusive effect.
¶2 Arik and RGO entered a commercial lease in August 2007 to operate a bar and restaurant (the "Lease"). Arik paid $1890 in monthly rent from September 2007 through March 2012 and began paying $2000 in monthly rent on April 1, 2012.
¶3 In October 2010, a significant hailstorm damaged the premises' roof, causing water leaks within Arik's restaurant. The storm also destroyed an illuminated sign on the premises that advertised Arik's restaurant.
¶4 Arik sued RGO in 2013 ("2013 Case"), alleging RGO had failed to make the necessary repairs to the premises and failed to replace or repair the sign. The Lease provided Arik with the following remedies in the event of partial damage to the premises:
RGO counterclaimed for forcible entry and detainer, trespass, and breach of the Lease.
¶5 In the 2013 Case, the superior court, Judge Patricia A. Starr presiding, granted partial summary judgment to Arik, finding RGO materially breached the Lease "by refusing to repair the hail-damaged sign" and rejecting RGO's contention that Arik did not properly exercise its option to renew the Lease in 2012. The case proceeded to a bench trial at which Arik claimed, among other damages, $62,181 in "Abatement of Rent" based on an alleged "70% loss of use due to failure to make required repairs." However, Judge Starr ruled that Arik "failed to prove that it suffered any damages as a result" of RGO's breach and, thus, that it was not entitled to recover damages. She also ruled that RGO failed to prove damages stemming from its counterclaims. Deeming Arik to be the successful party, the court awarded it attorney's fees according to Paragraph 31 of the Lease and costs under A.R.S. § 12-341.
¶6 RGO appealed to this court. We stayed the appeal to allow the superior court to certify the judgment as final under Arizona Rule of Civil Procedure ("Rule") 54(c). Following entry of an amended final judgment, we concluded that Paragraph 9.2 of the Lease obligated RGO to make repairs for insured losses, including the hail-damaged sign:
[I]f at any time during the term of this Lease there is damage which is an Insured Loss . . . , then Lessor shall, at Lessor's sole cost, repair such damage, but not Lessee's fixtures, equipment or tenant improvements, as soon as reasonably possible and this Lease shall continue in full force and effect.
Arik Co., LLC v. RGO, LLC ("Arik I"), 1 CA-CV 15-0653, 2017 WL 822122, at *7, ¶¶ 28-29 (Ariz. App. March 2, 2017) (mem. decision). We also affirmed the court's conclusion that "RGO materially breached the lease by failing torepair the hail-damaged sign" and affirmed the attorney's fees and costs award to Arik. Id. at *7-10, ¶¶ 29, 39-41.
¶7 Arik moved for entry of the judgment after we issued our mandate in Arik I, and the superior court did so in December 2017. In June 2018, RGO moved to determine whether the judgments against it had been satisfied. Specifically, it sought "a credit towards the Judgments" because Arik had stopped paying monthly rent in June 2017 and "ha[d] not paid its share of the water bill since December 2017." Arik opposed the motion. Stating that the sign "was not rebuilt and is not rebuilt as of the filing of this motion," Arik argued RGO was not entitled to any offsets because its "material breach of the lease excuses Arik's performance . . . , including paying rent, until the material breach is cured." The superior court, Judge Daniel Martin presiding, denied RGO's motion in September 2018, finding that "the material breach previously found by the Court"—the failure to repair the sign—"remains uncured" and that Arik "is excused from performance pending that cure."
¶8 Arik filed a notice of satisfaction of the judgment on October 26, 2018, and Judge Martin entered a dismissal with prejudice on November 15, 2018. Two days before the court dismissed the 2013 Case, Arik filed a new complaint against RGO ("2018 Case"). Alleging that RGO still had not repaired the roof or the sign, Arik sought disgorgement of all rent it had paid between November 1, 2010, and June 1, 2017. RGO counterclaimed, asserting that it had repaired the sign on or about January 11, 2019, and that once the repairs were made, all of Arik's unpaid rent was past due.
¶9 The parties filed cross-motions for summary judgment, and the superior court, Judge Christopher Coury presiding, ruled as follows:
As to the last item, Judge Coury offered two possible constructions of Judge Martin's ruling:
Judge Coury asked if either party objected to him speaking with Judge Martin to determine which construction he had intended. RGO objected, and Judge Coury granted the parties leave to seek clarification from Judge Martin.
¶10 Both parties did so. Judge Martin issued an order stating that he "intended . . . to hold that Plaintiff would never owe any rent at all for months when [RGO]'s breach was existing" and returned the matter to Judge Coury. On that basis, Judge Coury entered summary judgment for Arik for $92,000, representing the $2000 in monthly rent it paid between August 1, 2013, and May 31, 2017. Judge Coury also awarded Arik attorney's fees and costs and certified the judgment under Rule 54(b).
¶11 RGO filed notices of appeal in both the 2013 Case and the 2018 Case. The cases were consolidated, and we have jurisdiction under A.R.S. § 12-2101(A)(2).
¶12 In reviewing a grant of partial summary judgment, we review de novo whether any genuine issues of material fact exist and whether the superior court correctly applied the law. Sign Here Petitions LLC v. Chavez, 243 Ariz. 99, 104, ¶ 13 (App. 2017). We view the facts and reasonable inferences in the light most favorable to RGO as the non-prevailing party. Rasor v. Nw. Hosp., LLC, 243 Ariz. 160, 163, ¶ 11 (2017). Summary judgment should be granted only "if the facts produced in support of [a] claim . . . have so little probative value, given the quantum of evidence required, thatreasonable people could not agree with the conclusion advanced by the proponent of the claim." Orme Sch. v. Reeves, 166 Ariz. 301, 309 (1990).
¶13 This court has an independent obligation to determine whether it has appellate jurisdiction. Dabrowski v. Bartlett, 246 Ariz. 504, 511, ¶ 13 (App. 2019). If appellate jurisdiction is lacking, an appeal cannot proceed, and "any decision in such an appeal would be void." Jessicah C. v. DCS, 248 Ariz. 203, 205, ¶ 8 (App. 2020); see Legacy Found. Action Fund v. Citizens Clean...
To continue reading
Request your trial