Rotalo v. Sahd, 1 CA-CV 16-0365

Background

Pamela Rotalo sued Robert Sahd for breach of promissory notes, unjust enrichment, and conversion after he conveyed six acres of New Mexico land and made partial cash payments toward debts evidenced by two promissory notes.
The parties had dated and twice engaged; during the relationship Sahd gave Rotalo an engagement ring and travel ring; after a second breakup Rotalo retained the rings and was later found by the jury to have to return the engagement ring (travel ring lost).
Two loans from Rotalo to Sahd (about $166,835 and $100,000) underpinned Rotalo’s claim; the jury awarded Rotalo $332,869.31 on her promissory-note claim.
Sahd prevailed on a conversion claim (that certain personal property, including the engagement ring, should be returned) but the jury awarded him $0 damages on conversion and $2,500 for the lost travel ring.
Post-trial Sahd moved for a new trial and sanctions (arguing Rotalo presented undisclosed/fabricated evidence about a third-party land sale), moved to alter/amend the judgment seeking a set-off based on his conversion award, and sought attorney fees; the trial court denied all motions and awarded Rotalo attorney fees and costs.
On appeal the Arizona Court of Appeals affirmed, reviewing discretionary rulings for abuse of discretion and concluding the trial court’s rulings were supported by the record.

Issues

Issue	Rotalo's Argument	Sahd's Argument	Held
Whether trial court erred in denying a new trial and sanctions for alleged nondisclosure/fabrication of evidence about a third-party sale	Testimony about the $30,000/acre valuation relied on statements Sahd made to Rotalo and was disclosed in pretrial filings and prior declaration; any stricken moments were cured; no prejudice	Rotalo introduced previously undisclosed/fabricated testimony that the Land had been sold to a third party (Irani) for $31,000/acre, warranting new trial and sanctions	Denied — court found Rotalo testified only that Sahd told her about prior sales and that her prior filings disclosed the valuation basis; no abuse of discretion in denying new trial or sanctions
Whether the verdict should be altered to set off Sahd’s conversion award against Rotalo’s note recovery	Rotalo: jury found zero damages on Sahd’s conversion claim so no set-off applies	Sahd: $0 conversion award is inconsistent with favorable verdict; judgment should be reduced by his claimed conversion damages (~$76,000)	Denied — jury rejected awarding damages to Sahd on conversion; set-off not required; trial court’s acceptance of jury credibility determinations was not an abuse of discretion
Whether trial court erred in denying Sahd attorney fees and finding Rotalo prevailing party	Rotalo: she was net winner (recovered on note claims substantially exceeding awards to Sahd) and court may use net-winner or totality approach in its discretion	Sahd: he prevailed on counterclaims and should be treated as prevailing party for fees	Denied — trial court reasonably concluded Rotalo was the successful (net-winning) party and had discretion to award fees under A.R.S. §12-341.01
Whether appellate attorney fees should be awarded to either party	Rotalo: prevailing party on appeal entitled to reasonable appellate fees in the court’s discretion	Sahd: not prevailing on appeal	Appellate fees awarded to Rotalo; no fees for Sahd

Key Cases Cited

First Fin. Bank, N.A. v. Claassen, 238 Ariz. 160 (App. 2015) (standard of review for denial of motion for new trial)
Hunnicutt Const., Inc. v. Steward Title and Tr. of Tucson Tr. No. 3496, 187 Ariz. 301 (App. 1996) (standard for awarding or denying sanctions)
Tryon v. Naegle, 20 Ariz. App. 138 (App. 1973) (trial court discretion in adjusting verdicts and additur/remittitur considerations)
Creamer v. Troiano, 108 Ariz. 573 (Ariz. 1972) (deference to trial court’s ruling on verdict adjustments)
Ocean W. Contractors, Inc. v. Halec Constr. Co., 123 Ariz. 470 (Ariz. 1979) (considerations for determining prevailing party and awarding attorney fees)