City of Tucson v. Royal Orchid Corp.

• Decision Date: 19 May 2023
• Docket Number: 2 CA-CV 2022-0037
• Parties: City of Tucson, a municipal corporation, Plaintiff/Appellee, v. Royal Orchid Corporation, an Arizona corporation, Defendant/Appellant.
• Court: Arizona Court of Appeals

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City of Tucson, a municipal corporation, Plaintiff/Appellee, v. Royal Orchid Corporation, an Arizona corporation, Defendant/Appellant.

No. 2 CA-CV 2022-0037

Court of Appeals of Arizona, Second Division

May 19, 2023

Not for Publication - Rule 111(c), Rules of the Arizona Supreme Court

Appeal from the Superior Court in Pima County No. C20201362 The Honorable Michael Butler, Judge

Nossaman LLP, Tucson By Christopher W. Kramer, Jordan T Leavitt, and Ashley M. Mahoney Plaintiff/Appellee

Stubbs &Schubart P.C., Tucson By Thomas M. Parsons Defendant/Appellant

Judge O'Neil authored the decision of the Court, in which Presiding Judge Staring and Judge Sklar concurred.

MEMORANDUM DECISION

O'NEIL, JUDGE

¶1 In this eminent domain case, Royal Orchid appeals from a final judgment awarding $1,569,720 as just compensation for real property condemned by the City of Tucson, arguing the trial court erred by denying leave to amend its answer finding public use and necessity for the taking of its property, and ruling improperly on several motions in limine. For the reasons outlined below, we affirm.

BACKGROUND

¶2 In November 2015, the city passed a resolution to "negotiate for and acquire certain rights of way and easements which are necessary for the Grant Road-Palo Verde Avenue to Venice Place Improvement Project." The resolution identified an expanded right of way for Grant Road that would encroach into Royal Orchid's property and eliminate a significant portion of its parking lot. In March 2020, the city filed an eminent domain complaint and an application for immediate possession of the entire Royal Orchid property to accommodate the expanded right of way. The parties stipulated "that the property . . . is being taken for a public use; that the taking is necessary for such use; and that the City may be let into immediate possession" upon posting a cash bond of $1,353,000. On that basis, the trial court entered an order for immediate possession pursuant to A.R.S. § 121116. The city posted the bond, and the parties stipulated to release the bond to Royal Orchid.

¶3 Royal Orchid then filed an answer to the complaint. Consistent with the earlier stipulation, it admitted allegations that the city's acquisition of the property was "necessary" and for "a public use authorized by law." It further asked that the court determine the value of the condemned property and enter judgment "for just compensation."

¶4 After the close of discovery, the city filed several motions in limine, including motions to exclude certain evidence of "comparable sales" and to bar reference to anything other than fair market value in determining just compensation for the property, specifically including "use value" or "condemnation blight." The trial court granted several of these motions, limiting Royal Orchid from advancing certain legal theories on the issue of valuation. A pretrial status conference was set for December 3, 2021, and trial was set for December 7.

¶5 On November 29, Royal Orchid filed an amended answer, without leave of court or consent from the city, denying the allegations of necessity and public use it had previously admitted. It also filed a motion to dismiss the complaint, for the first time urging the trial court to make "independent findings" on public use and necessity and arguing dismissal was required, relying on a purported lack of disclosure and Rule 37(d), Ariz. R. Civ. P., as the sole legal basis for dismissal. At the conference on December 3, the court reset the trial date to January 4, 2022, due to a scheduling conflict. On December 29, after the court had denied the motion to dismiss and granted the city's motion to strike the amended answer based on Royal Orchid's failure to comply with Rule 15, Ariz. R. Civ. P., Royal Orchid filed a motion for leave to amend or supplement its answer to dispute the city's right to take possession of the property. The court denied the motion.

¶6 After a jury trial on the sole issue of the property's value, Royal Orchid was awarded $1,569,720 as just compensation. This appeal followed. We have jurisdiction pursuant to A.R.S. §§ 12-120.21(A)(1) and 12-2101(A)(1).

DISCUSSION

¶7 Royal Orchid identifies several issues for review on appeal. First, Royal Orchid contends the trial court improperly denied its motion to amend its answer and relied upon its stipulation for immediate possession in determining that the taking was necessary for an authorized public use. Second Royal Orchid asserts that the court improperly granted dispositive relief through its rulings on the city's motions in limine. Third, Royal Orchid argues the court improperly precluded its theory of just compensation based on "use value." Though the remaining issues are less clearly identified, Royal Orchid also challenges other rulings on pretrial motions in limine.

¶8 The opening brief does not contain, "[f]or each contention, references to the record on appeal where the particular issue was raised and ruled on, and the applicable standard of appellate review with citation to supporting legal authority." Ariz. R. Civ. App. P. 13(a)(7)(B). Royal Orchid adopts a species of the "'kitchen sink' approach to appellate advocacy" that our supreme court has discouraged. State v. Huerstel, 206 Ariz. 93, n.1 (2003) (quoting State v. Bolton, 182 Ariz. 290, 299 (1995)). Under each heading, the opening brief raises a variety of disconnected arguments, sometimes without identifying any specific issue that was raised and ruled on by the trial court. Other issues are mentioned in passing, without development or citation to authority. See Ariz. R. Civ. App. P. 13(a)(7)(A) (requiring arguments be supported with "citations of legal authorities and appropriate references" to the record). This failure to comply with our rules justifies our deeming noncompliant arguments waived altogether. See Ritchie v. Krasner, 221 Ariz. 288, ¶ 62 (App. 2009) (arguments not developed on appeal deemed waived). However, to the extent that the opening brief fairly presents issues in a fashion that has afforded the city a meaningful opportunity to respond, we exercise our discretion to address the arguments Royal Orchid identifies and adequately supports. See Adams v. Valley Nat'l Bank of Ariz., 139 Ariz. 340, 342 (App. 1984) (appellate court prefers to resolve issues on merits).

The City's Power to Take the Property

¶9 Relying on article II, § 17 of the Arizona Constitution and A.R.S. § 12-1112, Royal Orchid generally contends the trial court erred by finding that the taking was necessary for an authorized public use. The opening brief is ambiguous concerning the particular ruling challenged on appeal and fails to identify the applicable standard of appellate review. But the court meaningfully addressed this issue when it denied Royal Orchid's motion for leave to amend its answer, and we therefore address it in that context.^[1]

¶10 Royal Orchid asserts the trial court improperly relied upon the stipulation and order for immediate possession in denying leave to amend its answer. While motions to amend pleadings are liberally granted, Ariz. R. Civ. P. 15(a)(2) "denial of a motion to amend is left to the trial court's sound discretion and will not be disturbed absent a showing of an abuse of such discretion," Haynes v. Syntek Fin. Corp., 184 Ariz. 332, 336 (App. 1995). Royal Orchid initially filed its amended answer without leave of court and without otherwise complying with the requirements of Rule 15(a). Thus, the court could properly have granted the city's motion to strike the amended complaint based solely on Royal Orchid's failure to comply with the rule. See Carranza v. Madrigal, 237 Ariz. 512, ¶ 12 (2015).

¶11 Ultimately, though, Royal Orchid complied with Rule 15(a) by filing a motion for leave to amend or supplement its answer. A trial court may deny an amendment when there is "'undue' delay, bad faith, dilatory motive, repeated failure to cure deficiencies by previous amendments[,] or undue prejudice to the opposing party." Haynes, 184 Ariz. at 336 (alteration in Haynes) (quoting Owen v. Superior Court, 133 Ariz. 75, 79 (1982)). An amendment causes prejudice when it "raises new issues or inserts new parties into the litigation," id. (quoting Owen, 133 Ariz. at 79), and the court may deny leave to amend "when the amendment comes late and raises new issues requiring preparation for factual discovery which would not otherwise have been necessitated nor expected, thus requiring delay in the decision of the case," id. (quoting Owen, 133 Ariz. at 81).

¶12 Royal Orchid has shown no abuse of discretion here. Nineteen months after Royal Orchid filed its answer, the proposed amendment would have altered the entire substance of the trial no more than six days before it began, inserting new issues requiring otherwise unnecessary discovery and preparation after the discovery deadlines were closed. See Owen, 133 Ariz. at 79-81 (affirming denial of amendment that came late and raised new issues requiring factual discovery, not merely a new legal theory); see also Contractor & Mining Serv. &Supply, Inc. v. H &M Tractor &Bearing Corp., 4 Ariz.App. 29, 33 (1966) (affirming denial of amendment after the pretrial order was issued and discovery closed); Gulf Homes, Inc. v. Goubeaux, 136 Ariz. 33, 38 (1983) (affirming denial of amendment argued three days before the matter was set for trial).

¶13 Royal Orchid, however, asserts that it could not reasonably have amended or supplemented its answer earlier because it did not learn the basis for amendment until weeks before trial. As it did in various related pleadings before the trial court, Royal Orchid argues that its late motion to amend or supplement was warranted by the following circumstances: 1) that the...