Stefanovich v. Anderson
1 CA-CV 15-0567
| Ariz. Ct. App. | Oct 6, 2016Background
- Paul and Janet Stefanovich (landlords) sued Mikel and Robin Anderson (tenants) over a lease dispute; Andersons counterclaimed with torts and claims under landlord-tenant statutes including "abuse of access."
- The case went from justice court to superior court after the Andersons sought more than $10,000; an arbitrator previously awarded each side limited relief and fees; the Andersons appealed to superior court.
- After a three-day jury trial, jury awarded the Stefanoviches $3,632 and the Andersons $5,480.90 on negligent misrepresentation and A.R.S. § 33-1343 (abuse of access); net judgment favored the Andersons by $1,848.90.
- The superior court then awarded the Andersons attorneys’ fees and costs totaling over $112,000 under the lease’s prevailing-party fee clause and A.R.S. § 12-341.01.
- The Stefanoviches appealed, arguing (1) the jury instruction requiring at least one month’s rent for abuse of access misstated the statute, and (2) the Andersons were not entitled to contractual/statutory attorneys’ fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Jury instruction on abuse of access | Stefanoviches: instruction misstated A.R.S. § 33-1376(B) because statute conditions the minimum one-month rent on termination or injunctive relief | Andersons: instruction consistent with statutory minimum award for unlawful/unreasonable entry as applied here | Waived for appeal — no timely, particularized objection in trial record; thus instruction review forfeited |
| Whether claims arose out of contract for fee entitlement | Stefanoviches: prevailing claims were non-contractual; statute/contract fees not applicable | Andersons: dispute was a landlord-tenant matter arising from lease; contract’s broad fee clause covers claims relating to the agreement | Court: claims related to lease; contractual fee clause applies; no error in treating claims as arising from contract |
| Who is prevailing party for fee award | Stefanoviches: court should use percentage-of-success/totality, not net-judgment rule; they prevailed on some claims | Andersons: net verdict approach appropriate in mixed claim/counterclaim cases; Andersons obtained net recovery | Court: reasonable to use net-judgment approach here; Andersons were prevailing party and entitled to fees |
Key Cases Cited
- Duran v. Safeway Stores, Inc., 151 Ariz. 233 (App. 1986) (failure to object to jury instruction waives error on appeal)
- Bradshaw v. State Farm Mut. Auto. Ins. Co., 157 Ariz. 411 (1988) (same principle on waiver of instruction challenges)
- Baker v. Baker, 183 Ariz. 70 (App. 1995) (appellant bears duty to provide record on appeal, including transcripts)
- Ocean West Contractors, Inc. v. Halec Constr. Co., 123 Ariz. 470 (1979) (discusses when net-judgment rule applies to claims and counterclaims)
- Vortex Corp. v. Denkewicz, 235 Ariz. 551 (App. 2014) (articulates net-judgment approach for determining prevailing party)
- Chase Bank of Ariz. v. Acosta, 179 Ariz. 563 (App. 1994) (contractual fee provisions enforced according to their terms)
- Grubb & Ellis Mgmt. Servs., Inc. v. 407417 B.C., L.L.C., 213 Ariz. 83 (App. 2006) (contractual fee clause can control fee entitlement to exclusion of statute)
- Great W. Bank v. LJC Dev., LLC, 238 Ariz. 470 (App. 2015) (standards for de novo review of statute and contract interpretation)