McBride v. Kieckhefer Assocs., Inc.

• Decision Date: 03 November 2011
• Docket Number: No. 1 CA–CV 09–0299.,1 CA–CV 09–0299.
• Parties: Gerald L. McBRIDE, Plaintiff/Counterdefendant/Appellant,andBillie T. McBride, Counterdefendant/Appellant, v. KIECKHEFER ASSOCIATES, INC., an Arizona corporation; Eugene P. Polk and Barbara J. Polk, husband and wife; and John I. Kieckhefer and Lynda B. Kieckhefer, husband and wife, Defendants/Counterclaimants/Appellees.
• Court: Arizona Court of Appeals

228 Ariz. 262

265 P.3d 1061

620 Ariz. Adv. Rep. 11

Gerald L. McBRIDE, Plaintiff/Counterdefendant/Appellant,andBillie T. McBride, Counterdefendant/Appellant,

v.KIECKHEFER ASSOCIATES, INC., an Arizona corporation; Eugene P. Polk and Barbara J. Polk, husband and wife; and John I. Kieckhefer and Lynda B. Kieckhefer, husband and wife, Defendants/Counterclaimants/Appellees.

No. 1 CA–CV 09–0299.

Court of Appeals of Arizona, Division 1,

Nov. 3, 2011.

Bonnett, Fairbourn, Friedman, & Balint, P.C., By William G. Fairbourn, Patrick T. Stanley, Phoenix, and Martin & Bonnett, PLLC, By Daniel L. Bonnett, Mark A. Bracken, Phoenix, Attorneys for Apellants.

Meyer Hendricks, PLLC By Ed Hendricks, Sr., Brendan Murphy, Scott Mihalik, Phoenix, Attorneys for Appellees.

AMENDED OPINION

GEMMILL, Judge.

¶ 1 In this appeal we address the different roles of a trial judge when ruling on motions for judgment as a matter of law (“JMOL”) compared to motions for new trial. We also address the different standards of appellate review applied to such rulings.

¶ 2 Appellants Gerald L. McBride and Billie T. McBride filed an action for damages against Appellees Kieckhefer Associates, Inc., Eugene P. Polk, Barbara J. Polk, John I. Kieckhefer, and Lynda B. Kieckhefer.¹ KAI asserted a statute of limitations defense. McBride alleged the existence of an oral tolling agreement and that equitable estoppel should apply to prevent KAI from asserting the statute of limitations defense. An initial jury trial was conducted to determine if the parties had agreed to toll the statute of limitations and if equitable estoppel would be applicable. The jury found in favor of McBride, concluding that a tolling agreement existed and also making advisory findings in support of KAI being equitably estopped from asserting the statute of limitations. The trial court rejected the advisory findings and made its own findings, concluding that KAI was not prevented from asserting the statute of limitations. The trial court thereafter granted KAI's renewed motion for JMOL regarding the existence of a tolling agreement and also conditionally granted KAI a new trial on that issue. See Ariz. R. Civ. P. 50(b), (c).

¶ 3 McBride contends the trial court erred in granting KAI's renewed motion for JMOL. We agree and therefore reverse the JMOL. McBride further contends that the trial court erred in conditionally granting a new trial on the tolling issue. Because we conclude that granting a new trial was within the trial court's broad discretion, we affirm that ruling. We also affirm the trial court's decision in favor of KAI on McBride's equitable estoppel claim. Accordingly, we remand for a new trial and further proceedings consistent with this opinion.

BACKGROUND

¶ 4 McBride was employed by KAI as its treasurer and tax manager until early March 1998. McBride filed a complaint in late May 1999, alleging that KAI wrongfully terminated him. KAI answered and asserted counterclaims against McBride. KAI subsequently moved for judgment on the pleadings and summary judgment, arguing McBride's claims were barred by the one-year statute of limitations, Arizona Revised Statutes (“A.R.S.”) section 12–541 (2003). In opposition to KAI's motions, McBride argued that the parties' attorneys—Daniel Bonnett representing McBride and Richard Walker representing KAI—orally agreed before litigation commenced that the statute of limitations would be tolled while the parties attempted to negotiate a settlement. McBride also argued KAI should be equitably estopped from asserting a statute of limitations defense. The trial court granted KAI summary judgment, McBride appealed, and we reversed. See McBride v. Kieckheffer Assoc., Inc., 1 CA–CV 02–0020 (Ariz.App. Oct. 10, 2002).

¶ 5 Upon remand, the trial court ordered a bifurcated jury trial. The first trial would determine the viability of KAI's statute of limitations defense. The jury had two functions in the initial trial: first, to resolve whether the parties had agreed to toll the statute of limitations; and second, to serve in an advisory capacity by answering interrogatories that would assist the court in ruling whether KAI was equitably estopped from asserting the statute of limitations defense. Depending on the outcome of the statute of limitations trial, a second trial would presumably address the merits of the underlying claims and counterclaims.

¶ 6 At the initial trial, the parties presented conflicting evidence regarding the existence of a tolling agreement.² At the close of evidence, KAI moved for judgment as a matter of law arguing the evidence showed the parties did not intend to enter into a tolling agreement because the agreement's terms were indefinite. KAI also argued there was no evidence of McBride's duress, which was a necessary element of the equitable estoppel claim. The trial judge denied the motion, explaining that he thought there was “evidence that reasonable people could disagree upon” and that the issues needed to go to the jury.

¶ 7 The jury returned a verdict in McBride's favor on the tolling agreement claim. The jury also found, by its answers to the interrogatories, that McBride had satisfied the elements necessary to support his equitable estoppel claim. The court subsequently rejected the jury's advisory findings and found in favor of KAI on the equitable estoppel claim.

¶ 8 KAI filed a renewed motion for judgment as a matter of law and, in the alternative, motion for new trial (“Renewed JMOL Motion”) in accordance with Arizona Rule of Civil Procedure (“Rule”) 50(b). In addition to reiterating the argument that the evidence of the purported tolling agreement was insufficient to send the issue to the jury, KAI argued in the alternative that it was entitled to a new trial because the jury verdict was the result of passion or prejudice based on McBride's trial counsel's misconduct during closing arguments and the paucity of trial evidence showing a tolling agreement existed. See Ariz. R. Civ. P. 59(a)(2), (7), (8).

¶ 9 After argument, the court granted KAI's Renewed JMOL Motion but stayed its order pending the resolution of an unrelated issue. The court lifted the stay in March 2009 and ordered McBride's claims dismissed with prejudice. The court alternatively granted KAI a new trial on the tolling agreement claim in the event its entry of JMOL is reversed on appeal. McBride timely appeals.

ANALYSIS

Judgment as a Matter of Law

¶ 10 We review de novo whether the trial court should have granted KAI's Renewed JMOL Motion. See Aegis of Ariz., LLC. v. Town of Marana, 206 Ariz. 557, 566, ¶ 34, 81 P.3d 1016, 1025 (App.2003); Trustmark Ins. Co. v. Bank One, 202 Ariz. 535, 541, ¶ 30, 48 P.3d 485, 491 (App.2002). A trial court properly grants JMOL “only if the facts presented in support of a claim have so little probative value that reasonable people could not find for the claimant.” Shoen v. Shoen, 191 Ariz. 64, 65, 952 P.2d 302, 303 (App.1997). In making this determination, we view the evidence in a light most favorable to upholding the jury verdict. Trustmark, 202 Ariz. at 541, ¶ 30, 48 P.3d at 491. Our supreme court has recently reiterated these principles in the analogous context of a criminal case. State v. West, 226 Ariz. 559, 562, ¶ 15, 250 P.3d 1188, 1191 (2011) (explaining that the “question of sufficiency of the evidence is one of law, subject to de novo review on appeal” and that we view “the evidence in a light most favorable to sustaining the verdict”).

¶ 11 When considering motions for directed verdict or JMOL, a trial court may not weigh the credibility of witnesses or resolve conflicts of evidence and reasonable inferences drawn therefrom. See Estate of Reinen v. Northern Arizona Orthopedics, Ltd., 198 Ariz. 283, 287–88, ¶¶ 12, 15, 9 P.3d 314, 318–19 (2000); Thompson v. Better–Bilt Aluminum Products Co., Inc., 171 Ariz. 550, 558, 832 P.2d 203, 211 (1992). See also West, 226 Ariz. at 563, ¶ 18, 250 P.3d at 1192 (“in ruling on a Rule 20 motion, unlike a motion for a new trial under Arizona Rule of Criminal Procedure 24.1(c)(1), a trial court may not re-weigh the facts or disregard inferences that might reasonably be drawn from the evidence”). A trial judge must give “full credence to the right of the jury to determine credibility, weigh the evidence, and draw justifiable conclusions therefrom.” State v. Clifton, 134 Ariz. 345, 348, 656 P.2d 634, 637 (App.1982). See also State v. Tubbs, 155 Ariz. 533, 535, 747 P.2d 1232, 1234 (App.1987).

¶ 12 Here, Bonnett testified at trial that he and Walker agreed that the one-year statute of limitations would be tolled as long as settlement negotiations proceeded. Shortly after making this agreement, Bonnett told McBride about it. McBride also testified that Bonnett told him about the tolling agreement before litigation commenced. When settlement negotiations stalled in May 1999, Bonnett informed Walker that McBride believed KAI was no longer negotiating in good faith, and therefore he would commence litigation. The complaint was filed seven days later. Bonnett further testified that, because he and Walker agreed “that there wouldn't be a statute of limitations issue raised[,]” he was “shocked and disappointed” upon learning that KAI was asserting a statute of limitations defense. Bonnett thereafter telephoned Walker, and Bonnett testified that Walker did not deny that they had agreed to toll the statute of limitations.

¶ 13 Walker, on the other hand, testified that he was “highly confident” he had not made such an agreement. Walker also testified that at the time of the negotiations that preceded the filing of the complaint, he did not know the applicable statute of limitations. He also testified, moreover, that he continued to negotiate settlement terms with Bonnett after the statute of limitations had expired.

¶ 14 Based on the record, reasonable persons could conclude that a tolling agreement existed so as to render McBride's complaint timely filed. Although KAI...