Nikolous v. Superior Court In and For Maricopa County

• Decision Date: 21 June 1988
• Docket Number: No. CV-87-0095-PR,CV-87-0095-PR
• Citation: 157 Ariz. 256,756 P.2d 925
• Parties: Gordon L. NIKOLOUS and Helen Nikolous, husband and wife, and Tanner Southwest, Inc., an Arizona corporation, Petitioners, v. SUPERIOR COURT of the State of Arizona, In and For the COUNTY OF MARICOPA, Honorable Marilyn Riddel, a Judge thereof, Respondent Judge, Clarence R. LUDEKE, a single man, and the City of Phoenix, Real Parties in Interest.
• Court: Arizona Supreme Court

Page 925

756 P.2d 925

157 Ariz. 256

Gordon L. NIKOLOUS and Helen Nikolous, husband and wife, and Tanner Southwest, Inc., an Arizona corporation, Petitioners, v. SUPERIOR COURT of the State of Arizona, In and For the COUNTY OF MARICOPA, Honorable Marilyn Riddel, a Judge thereof, Respondent Judge, Clarence R. LUDEKE, a single man, and the City of Phoenix, Real Parties in Interest.

No. CV-87-0095-PR.

Supreme Court of Arizona, In Banc.

June 21, 1988.

Robbins & Green, P.A. by Robert H. Green, Robert L. Baumann, Phoenix, for petitioners.

Law Office of Dennis P. Levine by Dennis P. Levine, Phoenix, for real party in interest Clarence R. Ludeke.

Jones, Skelton & Hochuli by William R. Jones, Jr., Najia M. Kerrin, Phoenix, for real party in interest City of Phoenix.

Gallagher & Kennedy by W. Charles Thomson III, Thomas A. Maraz, Phoenix, for amicus curiae Phoenix Ass'n of Defense Counsel.

Molloy, Jones & Donahue, P.C. by Michael J. Meehan, Tucson, and Latham &amp FELDMAN, Vice Chief Justice.

[157 Ariz. 257] Watkins (of counsel) by Ernest J. Getto, Linda M. Inscoe, Los Angeles, Cal., for amicus curiae Hughes Aircraft Co.

Defendants ask us to reverse the trial court's dismissal of their third-party complaint. The question before us is whether a tort defendant can implead a third party who eventually may become liable to the defendant for contribution under the Uniform Contribution Among Tortfeasors Act, A.R.S. § 12-2501 et seq. We granted review to resolve this issue of first impression. Rule 23, Ariz.R.Civ.App.P., 17B A.R.S.; Rule 8(b), Ariz.R.P.Spec.Act., 17B A.R.S. We have jurisdiction under Ariz. Const. art. 6, § 5(3) and A.R.S. § 12-120.24.

FACTUAL AND PROCEDURAL SUMMARY

The essential facts are undisputed. On January 14, 1984, while driving a Tanner Southwest, Inc. company truck, Gordon Nikolous collided with plaintiff Clarence Ludeke's car. Ludeke suffered personal injuries and sued Nikolous and Tanner (defendants) for negligence in Maricopa County Superior Court. In May 1986, defendants filed an administrative claim with and against the City of Phoenix (City), pursuant to A.R.S. § 12-821(A), alleging a right of contribution because a City fire truck had negligently caused the January accident by a turn which created a "sudden emergency situation." When the City did not act on the claim within sixty days, defendants filed a third-party claim against the City on September 3, 1986. See A.R.S. § 12-821(C).

In their third-party complaint, defendants sought indemnity and contribution from the City in the event they were held liable to plaintiff in the primary action. Defendants based their contribution claim on the Uniform Contribution Among Tortfeasors Act (UCATA), A.R.S. §§ 12-2501 et seq. The City answered and moved for summary judgment on the grounds that the applicable statutes of limitations barred the complaint, there was no right of indemnity under the facts of the case and claims for contribution had not yet accrued under Kriz v. Buckeye Petroleum Co., 145 Ariz. 374, 701 P.2d 1182 (1985). The trial court granted the City's motion for summary judgment on the indemnity count and dismissed defendants' contribution claim without prejudice because it was "premature." The court then set the case for trial.

Defendants brought a special action before the court of appeals seeking review of the dismissal of their contribution claim. That court accepted jurisdiction. Acknowledging that there were strong arguments in defendants' favor, the court nevertheless believed it was "precluded" from granting relief by the holding in Kriz. The court of appeals stayed the trial to allow defendants time to seek review. We granted defendants' subsequent petition for review.

THE ISSUE

Although the parties formulate the issue in different ways, the fundamental question in this case is whether, under UCATA, defendants may file a third-party action for contribution before the contribution claim actually accrues.

DISCUSSION

A. The Right of Contribution

In Arizona, contribution is statutory. See Holmes v. Hoemako Hospital, 117 Ariz. 403, 405, 573 P.2d 477, 479 (1977). The legislature created a new, separate and distinct right of contribution when it enacted the UCATA in 1984. As we held in Kriz, the cause of action for contribution does not actually accrue until one of several joint tortfeasors pays more than its prorata share of the common liability. 145 Ariz. at 380, 701 P.2d at 1188; A.R.S. § 12-2501(B).

B. The Impact of Rule 14(a)

According to the City, because the cause of action for contribution does not really exist before a tortfeasor pays more than its prorata share, and defendants have not yet paid any share, defendants have no contribution rights to assert in a third-party action. The UCATA does not, in fact, specifically provide that a tortfeasor may implead potential contributors before he or she has paid anything to the alleged victim. Conversely, the statute contains no explicit prohibition on such a procedure.

On the other hand, Rule 14(a), Ariz.R.Civ.P., 16 A.R.S., specifically allows a defendant to bring a claim against third parties based solely on "contingent" liability. In pertinent part, Rule 14(a) provides:

At any time after commencement of the action a defendant, as a third-party plaintiff, may cause a summons and complaint to be served upon a person not a party to the action who is or may be liable to the third-party plaintiff for all or part of the plaintiff's claim against the third-party plaintiff.

(Emphasis added.)

Rule 14(a) was undoubtedly primarily intended to cover indemnity claims. However, the rule is not limited to indemnity. See, e.g., Jobe v. King, 129 Ariz. 195, 197, 629 P.2d 1031, 1033 (App.1981). The circumstances under which a defendant may assert a third-party claim under Rule 14(a) are very broad. See, e.g., 3 J. MOORE, MOORE'S FEDERAL PRACTICE p 14.11 (1984). The third-party plaintiff need only allege some basis indicating the third-party defendant may become liable for some part of the relief which plaintiff may obtain from the defendant/third-party plaintiff. Chirco Construction Co. v. Stewart Title & Trust of Tucson, 129 Ariz. 187, 189, 629 P.2d 1023, 1025 (App.1981). Of course, Rule 14(a) does not itself create any right of indemnity, reimbursement or contribution, "but where there is a substantive basis for such right, the rule expedites the presentation and in some instances, accelerates the accrual of such right." Ewing v. Goettl's Metal Products Co., 116 Ariz. 484, 487, 569 P.2d 1382, 1384 (App.1977). The fact that the right of contribution might not exist or become enforceable by direct action until payment of more than the pro rata share of liability does not conflict with the language or intent of Rule 14(a).

By enacting UCATA, the legislature gave defendants a substantive right to seek contribution if they were forced to pay more than their prorata share of the common liability of all tortfeasors. Kriz, 145 Ariz. at 380, 701 P.2d at 1188. Once the legislature created the substantive right, the judiciary was responsible to establish and supervise the procedures for vindicating that right. Ariz. Const. art. 6, § 5(5); State ex rel. Collins v. Seidel, 142 Ariz. 587, 591, 691 P.2d 678, 682 (1984).

We believe that Rule 14(a) allows a defendant to implead all alleged joint tortfeasors, even though the defendant's claim against them does not accrue until after the time of impleading. Rule 14(a) was designed to promote the interests of judicial economy and efficiency by permitting the procedural assertion of just such contingent or inchoate claims. It is precisely this type of consolidated proceeding which is "the most orderly and logical method" to establish the common liability which is the substantive basis of the right of contribution. Markey v. Skog, 129 N.J.Super. 192, 200, 322 A.2d 513, 517 (Law Div.1974) (defendant allowed to implead third-party defendant under New Jersey's UCATA). The same is true, of course, for establishing the share of damages to be paid by each of the joint tortfeasors. Thus, although UCATA does not provide for impleading, we conclude that Rule 14(a) governs and permits its procedural implementation. Ariz. Const. art. 6, § 5(5).

We note that the overwhelming weight of authority in other jurisdictions supports the use of Rule 14(a) third-party practice to settle contribution shares in the same action determining plaintiff's claim. See generally Annotation, Right of defendant in action for personal injury or death to bring in joint tortfeasor for purpose of asserting right of contribution, 11 A.L.R.2d 228 (1950); Annotation, Uniform Contribution Among Tortfeasors Act, 34 A.L.R.2d 1107, at § 5 (1954). See also 6 C. WRIGHT & A. MILLER, FEDERAL PRACTICE AND PROCEDURE § 1448 (1971).

C. Public Policy

Despite the clear language of Rule 14(a), the City argues that public policy should impel us to construe the rule and the statute to prohibit defendants from joining third parties who eventually may be found liable to make contribution under UCATA. According to the City, a plaintiff must have the unfettered right to maintain a lawsuit as he or she sees fit, without the confusion, complications, delays, costs and litigation burdens inherent in the proposed use of Rule 14(a). On the other hand, defendants assert that impleading third parties who are potentially liable for contribution will eliminate duplication of evidence, save time, reduce judicial effort and lower costs, thereby promoting the efficient and just resolution of the entire tort action. Defendants argue that whatever additional burdens this might impose on the plaintiff will be more than offset by the efficiency of determining liability and percentages of fault in a single action.

We share the City's concern that Rule 14(a) could be...