Rudinsky v. Harris

• Decision Date: 23 November 2012
• Docket Number: No. 1 CA–CV 11–0663.,1 CA–CV 11–0663.
• Citation: 648 Ariz. Adv. Rep. 50,290 P.3d 1218,231 Ariz. 95
• Parties: Helen RUDINSKY, Plaintiff/Appellant, v. Ryan HARRIS; Adam Sachs and Green Light Real Estate, LLC, a Nevada limited liability company, Defendants/Appellees.
• Court: Arizona Court of Appeals

231 Ariz. 95

290 P.3d 1218

648 Ariz. Adv. Rep. 50

Helen RUDINSKY, Plaintiff/Appellant,

v.Ryan HARRIS; Adam Sachs and Green Light Real Estate, LLC, a Nevada limited liability company, Defendants/Appellees.

No. 1 CA–CV 11–0663.

Court of Appeals of Arizona, Division 1, Department T.

Nov. 23, 2012.

The Nathanson Law Firm By Philip J. Nathanson, Scottsdale, Attorneys for Plaintiff/Appellant.

Hill & Hill, PLC By R. Corey Hill, Ginette M. Hill, Phoenix, and DeCiancio Robbins, PLC By Christopher Robbins, Tempe, Attorneys for Defendants/Appellees.

OPINION

GEMMILL, Judge.

¶ 1 Helen Rudinsky appeals the trial court's partial summary judgment in favor of defendants Ryan Harris, Adam Sachs, and Green Light Real Estate LLC, dismissing Rudinsky's claim for breach of an oral contract. Because we agree with the trial court that the statute of frauds bars her contract claim, we affirm.

FACTS AND PROCEDURAL HISTORY

¶ 2 In reviewing a grant of summary judgment, we view the facts and reasonable inferences from the facts in a light most favorable to the party against whom judgment was entered. Maycock v. Asilomar Dev., Inc., 207 Ariz. 495, 496, ¶ 2, 88 P.3d 565, 566 (App.2004).

¶ 3 In 2004, defendants Ryan Harris and Adam Sachs formed Green Light Real Estate LLC (collectively “Green Light”) as a full service brokerage company. In 2006, Green Light organized a referral program known as the “Investor Ring.” The Investor Ring consisted of real estate agents who earned referral fees by bringing prospective buyers to Green Light's real estate developers. Agents were paid commissions when their buyers closed on property deals with Green Light's developers. The commissions were split 50/50, half going to the agent who brought in the buyer and the other half to Green Light.

¶ 4 Rudinsky was an agent in the Investor Ring and sold real estate investment properties in conjunction with Green Light. From June to December 2006, Rudinsky sold $6,823,945 worth of real estate with Green Light. Rudinsky and Green Light entered into separate referral fee agreements for each of the referrals made by Rudinsky to Green Light's developers. No additional written contracts were created between Rudinsky and Green Light.

¶ 5 Rudinsky claims that, separate from the individual referral agreements, the parties had an oral, implied-in-fact contract concerning their real estate deals. Rudinsky testified that Green Light promised not to go around her to work directly with her buyers and, in exchange, she promised not to cut Green Light out of any transactions between her buyers and Green Light's developers. According to Rudinsky, once she brought a buyer to Green Light, Green Light would never be entitled to deal with that buyer without compensating her. She explained:

Q: And according to your understanding of the implied agreement Green Light would not be entitled to deal directly with those buyers forever basically?

A: Yes.

Q: So if a buyer belonged to you or you brought the buyer in, from that day forward Green Light would never be able to sell property to that person directly; is that correct?

A: Yes.

Q: Without you being involved?

A: Cutting me out.

Q: So that contract could have lasted five years, 10 years, 20 years, however long that buyer was interested in buying property?

A: Yeah. I mean, it was—yeah.

Rudinsky also testified that she declined, in accordance with the agreement, to cut Green Light out of her business with a particular developer.

¶ 6 Rudinsky further testified that the agreement would apply to her buyers even after she left Green Light. She testified she would earn commissions on deals involving the initial buyers she brought to Green Light (“first generation” buyers) and also on deals with “second generation” buyers referred to Green Light through the first generation buyers:

Q: In other words, if you could track through the buyers who brought in buyers who brought in buyers, if you could track through that network, under your understanding of the agreement with Green Light you would have been entitled to commissions down the line?

A: Yes.

Q: And if this had continued on for five years, 10 years, 20 years, whatever it was, you would have continued to have that entitlement in your mind?

A: That was the thinking. And Ryan [Harris] thought that way too.

¶ 7 In early 2007, Rudinsky left the Green Light Investor Ring. Before she left, the parties considered—but did not enter into—a “Confidentiality and Non Compete Agreement.” Green Light thereafter had contact with one of Rudinsky's previous buyers, and she alleges that such contact constituted a breach of the parties' oral contract.

¶ 8 On November 1, 2007, Harris sent an email to the Investor Ring concerning Rudinsky's exit from the organization. The email alleged that Rudinsky was an “imposter,” who had been “kicked out of the organization” for asking developers to cut Green Light out of deals. Rudinsky alleges that this email defamed her.

¶ 9 In July 2008, Rudinsky filed a complaint in superior court alleging breach of an implied-in-fact contract and defamation per se. In September 2010, Green Light filed a motion for partial summary judgment challenging Rudinsky's breach of contract claim on the basis of the statute of frauds. Rudinsky failed to respond to the motion for summary judgment. The trial court granted partial summary judgment after considering Green Light's motion, “the absence of a response,” and the record as a whole. In November 2010, Green Light filed a motion for attorneys' fees incurred in defense of the breach of contract claim. In response to Green Light's application for attorneys' fees, Rudinsky requested an evidentiary hearing regarding financial hardship. The trial court initially scheduled, but subsequently cancelled, the evidentiary hearing; and the court awarded attorneys' fees to Green Light in the amount of $27,197.

¶ 10 In August 2011, the trial court entered a judgment in Green Light's favor on Rudinsky's breach of contract claim, including the award of attorneys' fees. The judgment included a determination in accordance with Arizona Rule of Civil Procedure 54(b) that there was no just reason for delay and directed the entry of judgment. Rudinsky timely appeals to this court. We have jurisdiction pursuant to Arizona Revised Statutes (“A.R.S.”) section 12–2101(A)(1) (Supp. 2012).

ANALYSIS

¶ 11 On appeal Rudinsky argues the trial court erred in granting partial summary judgment to Green Light on the contract claim and in granting attorneys' fees to Green Light.

Application of the Statute of Frauds To the Alleged Oral Contract

¶ 12 Rudinsky claims Green Light violated the oral agreement by failing to compensate her after contracting directly with one of her buyers. Rudinsky also alleges Green Light violated the agreement by failing to compensate her for purchases made by second-generation buyers. Green Light argues that the alleged contract is unenforceable under the statute of frauds because it was not in writing and could not be performed within one year. We agree that Green Light was entitled to summary judgment on the breach of oral contract claim.

¶ 13 We review the granting of “summary judgment de novo to determine whether a genuine issue of material fact exists and whether the trial court correctly applied the law.” Mein ex rel. Mein v. Cook, 219 Ariz. 96, 98, ¶ 9, 193 P.3d 790, 792 (App.2008) (citation omitted). Summary judgment should be granted when the record shows that there is no real dispute as to any material fact and the defendants are entitled to judgment as a matter of law. Ariz. R. Civ. P. 56(c); Nicoletti v. Westcor, Inc., 131 Ariz. 140, 142, 639 P.2d 330, 332 (1982).

¶ 14 Rudinsky initially argues the factual record presented by Green Light failed to establish a prima facie case for summary judgment and the trial court erred in granting judgment in favor of Green Light, even in the absence of a response from her. Rudinskyis correct that the trial court must deny a summary judgment motion if the moving party has not demonstrated entitlement to judgment as a matter of law. Rand v. Porsche Fin. Servs., 216 Ariz. 424, 430, ¶ 20, 167 P.3d 111, 117 (App.2007) (“Absent a showing that the moving party is entitled to summary judgment, the party opposing the motion need not even respond, and the failure to respond cannot in itself entitle the moving party to summary judgment.”); United Bank of Ariz. v. Allyn, 167 Ariz. 191, 196, 805 P.2d 1012, 1017 (App.1990). A party who fails to respond to a motion for summary judgment, however, “does so at his peril because uncontroverted evidence favorable to the movant, and from which only one inference can be drawn, will be presumed to be true.” Tilley v. Delci, 220 Ariz. 233, 237, ¶ 11, 204 P.3d 1082, 1086 (App.2009) (citation omitted).

¶ 15 Green Light's statement of facts in support of its motion for summary judgment presented each party's initial disclosure statements and excerpts from Rudinsky's deposition testimony. Because Rudinsky failed to respond to the motion, she is limited to arguing the legal sufficiency of the facts presented by Green Light and reasonable inferences drawn therefrom.

¶ 16 Green Light's motion for partial summary judgment was based on the following portion of Arizona's statute of frauds:

No action shall be brought in any court in the following cases unless the promise or agreement upon which the action is brought, or some memorandum thereof, is in writing and signed by the party to be charged, or by some person by him thereunto lawfully authorized:

....

(5) Upon an agreement which is not to be performed within one year from the making thereof.

A.R.S. § 44–101(5) (2003).

¶ 17 To determine whether an agreement comes within this section, the proper inquiry is whether the contract is capable of being performed within one year of the agreement. This section has been interpreted as not applying to oral contracts when there is a possibility of performance within one year....