*1 Bible, challenge verdict. See 175 Ariz. 858 relief on State Smith’s court’s (1993); Gaines, P.2d 1152 State v. post-conviction denial of relief on the claim of contrast, (App.1997). 937 P.2d 701 ineffective assistance of counsel. This issue fundamental error undermines the founda- is moot. case, right

tion of the takes an essential defendant, deprives the defendant of a PELANDER, CONCURRING: JOHN Valenzuela, fair trial. See State v. FLÓREZ, Presiding Judge, and M. JAN (June 18, 1999); Rep. Adv. Bible. “To be Judge. fundamental, clear, egre- the error ‘must be gious, and curable via a new trial.’”

Bible, 175 Ariz. at Gendron,

quoting State v. case, 21 In this fun error was requires damental and a new trial. Hen where, here, ley, eight-member jury Joseph Jacqueline guilty found the defendant of two counts of LOMBARDO Lombardo, Wife, aggravated involving assault two Husband and victims and Plaintiffs-Appellants, prison he was sentenced to concurrent sen tences, supreme despite our object eight- the defendant’s failure to Albu, Elaine ALBU John Doe Hus person jury, his convictions had to be re Wife; Mercurio, Phillip band and Jr. versed. Mercurio, and Jane Doe Husband and [T]he error is fundamental because it vio- Wife; Century 21 Alliance and Invest provision. lates a state constitutional Be- Group, Corporation, an Arizona say beyond cause we cannot a reasonable Defendants-Appellees. significantly doubt that the error did not conviction, contribute to the defendant’s No. 1 98-0113. CA-CV pre- the error is also harmful. We cannot Arizona, Appeals Court of dict, four whether additional 1, Department Division E.

jurors Henley would found defendant guilty beyond a reasonable doubt. July (citation 141 Ariz. at at 1224 May Review Granted omitted). Luque, See also State (trial 1244, 1246 (App.1992) twelve, jurors eight, rather than say harmless error “because we cannot be

yond improper reasonable doubt

eight-person jury significantly did not con burglary tribute the defendant’s convic tion”). reasons, For the same we hold that eight-person jury,

Smith’s trial before an twelve-person jury, rather than a constituted fundamental, reversible error. We thus find

that the trial court abused its discretion

denying post-conviction relief. See State v. Soto-Perez,

¶22 Accordingly, grant we review and grant by reversing relief Smith’s convictions remanding

and sentences and the case for a remand, deny new trial. Because of our *2 Anderson,

O’Connor, Cavanagh, Killings- Beshears, P.A, George Mitch- H. worth & ell, Griggs, Christopher Rob- Kerry M. Phoenix, bins, defendants-appellees.

OPINION

LANKFORD, Judge. Jacqueline Appellants Joseph Lombardo, sellers a residential summary judg- appeal from the Albu, agent favor Elaine buyers. We affirm. offer, making 2 After the Lombardos an anticipated they told Albu difficulty obtaining financing. Albu did

some buyers’ financial situation not disclose The to close the Lombardos. failed escrow, and the home was sold Lombardos’ sale after failed to make trustee’s The Albu payments. loan Lombardos sued buyers’ finan- failure to for her disclose the They raised claims cial difficulties. agent and against their own real estate mortgage company that had fore- closed on the house.

¶3 summary judgment. Albu moved for that, argued buyers’ agent, she as the She information to owed no disclose the granted The trial court the mo- the sellers. tion, appealed. We have Lombardos jurisdiction pursuant Revised to Arizona (“A.R.S.”) 12- Annotated section Statutes (1994). 2101(B) summary judgment is de 4 Our review party is novo. We decide anew whether a judgment of law. See entitled to as a matter Donahue, Floyd v. (App.1996). We affirm because

Albu, buyers’ agent, owed the sellers duty to disclose her financial situa- clients’ tion. argue that Albu Lombardos statutoiy common law

had either or a is a Whether existed to disclose. question of law for the court to decide. See Bd., Ariz. v. Arizona Parks Markowitz Smith, Phoenix, plaintiffs- ultimately policy decision. Francis P. determination State, Cady v. appellants. R4-28-1101(B)(2). (App.1981); Contempo Constr. form. See A.A.C. How- ever,

Co. v. Mountain States Tel. & Tel. regu- the existence of an administrative necessarily lation does not mean that a breached, gives exists rise to reject 6 We the contention that such a in tort. The at issue are similar pertinent portion existed. The *3 regulat- to the Rules of Professional Conduct by Lombardos, upon statute relied A.R.S. ing attorneys, designed which were “not 32-2153(A)(3) (Supp.1998), provides section liability,” “provide be a basis for civil but to may that the real estate commissioner sus- guidance lawyers provide and to a struc- revoke, pend, deny or a license the licensee regulating through ture for disciplin- conduct applicant “[d]isregard[s] or or ... violate[s] Preamble, ary agencies.” Ariz.R.Sup.Ct. 42. any adopted by rules the commissioner.” Lombardos, regulation by cited Ari- support 9 The cases this conclusion. (“A.A.C.”) zona Administrative Code R4-28- Co., For v. National Inv. Alaface 1101(A)provides: 586, 593-94, 1375, 1382-83 181 Ariz. P.2d 892 fiduciary duty A licensee owes to his (App.1994), right held of action protect promote client and shall damages for existed virtue of the subdivi interests of the client. The licensee shall Instead, reporting pur sion statutes. also deal with all other to a remedy chaser was limited to the rescission provided in those statutes. Id. In Melancon R4-28-110KB) states, A.A.C. in relevant v. USAA Ins. Cos. part: 1374, 1377-78 we held that an support B. Each insurance did not participating licensee in a real a cause of action and instead created an estate transaction shall disclose all remedy. provisions any administrative “The to the transaction operational, the Act information much like the ethical pos- which the licensee governing materially considerations of at adversely sesses which conduct torneys professional.” 347, and other Id. at paid by affects the consideration to be 1377; any Long party including, see also Lewis v. & Estate, Inc., 754, to, Md.App. Foster Real following but not limited 85 584 mat- (1991) 1325, (comparing A.2d real ters: physicians, attorneys, brokers to accoun or tants, determining regulat that statutes Any information that or guidelines real estate field minimum “set is, be, lessee or per- unable to conduct”). professional for Much like the insolvency form due to or otherwise. lawyers, Rules of Professional for Conduct itself, 7 The statute A.R.S. section agent regulations provide 32-2153, creates no Nor disclose. monitoring regulating basis pro Legislature is it clear that intended to fession, necessarily legal but do not create a authorize the real estate commissioner to Miller, duty. 76, Lopata Md.App. See duty. apparent create that The statute’s (1998) (determining 712 A.2d that real purpose was not to create tort licensing had no based on provisions, violations of its but to authorize Code); provisions Maryland and ethical regulate the real estate commissioner to Hand, Realty, Ga.App. Johnson Inc. v. agents’ conduct. Arizona & Dis Cf. Life (1988) (stating 377 S.E.2d Inc., ability Honeywell, Ins. Guar. Fund v. promulgated by Georgia that standards 84, 87, (1997) 945 bearing Real Estate Commission have no (We interpret the statute in a manner con liability, “solely regulato civil but are Legislature’s apparent pur sistent ry purpose licensing”); Shapiro see also pose.). McNeill, 92 N.Y.2d 677 N.Y.S.2d (1998) (concluding 8 The do indicate that the N.E.2d that an not, may require attorney’s estate commissioner an ethical violation “will and of itself, buyer’s inability per- gives disclose create a to a rise cause action”). David, Herzberg Ariz.App; text Professional rules from purposes substantially such these serve overruled South liability. from of civil different those See western Paint Varnish Co. v. Arizona Liloia, Baxt v. 155 N.J. 714 A.2d Dep’t Quality, Env. (1998) (concluding the Rules of Pro- Red Carpet-Bar duty giving fessional Conduct do not create a ry, 635 P.2d at 1226. rise to a cause of action adver- ¶ Moreover, Herzberg merely attorney sary’s purposes because serve rehearing rule valid administrative was “substantially of civil different” “adopted pursuant because it had been liability). statutory authority. Under these circum- ¶ 10 The Lombardos contend stances, the rule had the same force *4 regulations statute and should define the 420, effect Ariz.App. of law.” 27 at 555 P.2d argument standard of care. This confuses Accordingly, permitted at rule 679. the the the duty existence of a with the standard of real estate commissioner to conduct rehear- Duty care. of standard care are distinct ings, inapplicable and rendered the rule in a Markowitz, and not to confused. See 146 prior statutory authority case “absent 355, (explaining Ariz. at 706 at 367 P.2d that grant rehearing, quasi-judicial a a tribunal concept the of should not confused revoke, power modify has no annul or a conduct). specific with the details of short, Carpeh- decision.” Id. we read Red compare 11 The case, Lombardos this case to Barry as a not as a which contract case Alaface, in which we noted that a of states that violations the of administrative disclosure exists the under subdivision re- regulations give liability. rise to tort porting statutes. 181 Dep’t 14 Nor does Brown v. Arizona however, at Alaface, 1386. In we did no hold Estate, Real agents. that the created a statutes on (App.1995), imply the in existence only We held that could the statutes Brown, pursu this case. decided that employed agent’s to define the standard of R4-28-1101(A), ant to A.A.C. a real estate duty. conduct under common law buyers duty broker owed non-client of fair 593-597, See id. at 892 P.2d at 1382-86. We 328-29, ness. Id. at P.2d at 890 623-24. We expressly stated common law interpreted “require[ ] the existed. Id. at P.2d at 892 parties a licensee deal with all to a ¶ 12 The dissent reads too much into Red with a licensee’s Associates, Carpet-Barry & Apex Inc. v. As agreed clients.” Id. We cases with California sociates, 635 (App. P.2d 1224 honesty imposing on brokers a 1981). listing We held that parties fairness to all in real estate transac agreement expiration which contained no tions, asserting that “Arizona hold should date void. was See id. at P.2d at 635 open brokers to similar standards of disclo 1226. No tort claim was involved. More sure.” Id. over, holding principally the court’s relied ¶ However, Neale, Brown and the California Olson v. P.2d very (App.1977), cases it cited are different from the case which in turn rested on deter cases, at hand. In those mination contract and law. See Olson, engaged double-dealing in 116 Ariz. at 524-25 & n. broker unrevealed at Carpetr acting agent n. 2. both an in principal The statement is Red Barry disclosing that real estate “have the the dual transactions without the Brown, force effect of is law” taken out of con- role.1 In the broker failed to reveal Taggart, property plaintiff buyers higher price. In Ward 51 Cal.2d at a (1959), broker, Scott, Nguyen the defendant like The defendant broker in Brown, princi- Cal.App.3d Cal.Rptr. the broker acted as an indirect pal plaintiff buyers principal sub- acted in the transaction. as an indirect transaction broker, Ward, Taggart, mitted offer to the at the defen- an defendant issue. Like defendant the Nguyen purchased who then turned dant the around broker in received offer from property plaintiff convey Taggart buyers, allegedly sellers. then sold the then failed to principal____”). primary respon- property financial and interest That is his own sibility agent: principal. of an to serve her transaction. Id. No in this ease evidence (explaining agent id. that an “has suggests principal Albu was a as well as specific duty effect[ing] of ... a sale to the in the advantage principal----”). best however, importantly, Brown More Recognizing to other duties and not a tort case. was agent’s principal’s transaction undercuts the Depart reviewed whether the Arizona We principal to her to the extent that the authority Estate to revoke ment Real had principal’s those of the interests differ from regulations. Brown’s license under Recogniz- other the transaction. Thus, merely violated we held parties potential- agent’s to third regulation, not that he was liable tort. ly places the in a conflict between RKP holding 17 Our recent in Aranki v. party. principal to third Inc., Investments, 20 There would be conflict contrary. also not to the We if owed the same her the sellers’ real is, party. That failing not liable their financial condition to disclose in a defects house. See id. sellers, it would not conflict with their case, allegation in this at 537. As was *5 agent to require interest to also their do so. agents that the sellers’ had made affir- made rejected However, expressly this has Court buyers. misrepresentations to id. mative See buyers spe- and have the notion sellers “important the We also noted distinctions” in cial duties to one another real estate trans- against own between claims one’s and involving actions sale of a home. See against party’s agent, claims other and Oldenburger v. E. Webb Dev. Del buyers against could pursue held that claims agent. their own See id. at fiduciary Oldenburger, we decided that no buyer and a seller. duties exist between ¶ 18 Our decision is thus consistent with “any compared buying We a home with con- holding recognize in Aranki in We recog- sumer Id. We further transaction.” dictum, agents Aranki stated that the sellers’ buyers nized “have adverse and sellers buyers. dealing had a fair to the See highest seller to obtain the interests —the opinion P.2d at id. at pay the possible price and the to low- speculated that the sellers’ would seller-buyer possible price” est “this have been had known of defects liable party in relationship is not one which either buyers. and failed to disclose them We voluntarily responsibilities special assumes by persuaded neither bound nor care or toward the other.” Id. dicta. Oldenburger that the interests demonstrates buyers and sellers are conflict- ¶ 19 The reason that courts do not Thus, ing. recognizing agent’s liability every impose tort instance party loyalties her between the other divides an administrative which someone violates other principal party her and the implicated policies is this: The considering tort can when differ ¶ 21 a conflict deciding regulatory policy. That The existence of between in this law to the third true case. Both the common inquiry. not regulations require performance party does end our faithful nevertheless sufficiently might compelling rea principal. to her Albu owed There fiduciary loyalty impose even it to under to her son to duties of own clients. McCormick, ability principal. agent’s cut the to serve the Realty Arnold Co. See Vivian For information critical Ariz.App. (1973) to the third (stating that a owes transaction but not accessible “real subject Hill good loyalty party might to disclosure. of utmost faith Cf. client, seller, purchased property instead himself.

the offer to his but Jones, 1115, 1119 purchaser); of disclosure to see also Haas, (App.1986) (stating Buffington seller must disclose (1979) damage termite (holding “known the seller but that bro- reasonably being capable known to the ker had no seller that she However, buyer”). present did security proper- does not not retain interest her compelling ty involve such reasons.2 or to inform her contents of escrow instructions was no where there rela- ¶ 22 simple The sellers could have taken tionship). holding precludes Although our protect They measures to themselves. could recovery buyers’ against agent, it have asked the for a financial state- against course does not bar claim the sell- They ment. could have obtained a credit fact, agent. it ers’ own is clear that an report. They approved could faith, principals good owes duties of its financing prequalification for a loan as a loyalty, diligence, reasonable care promise condition of their sell. We see no Haldiman, disclosure. See impose need to on or their 748 P.2d at 1212. If the breach of such a agents to financial disclose adverse informa- loss, they may caused the Lombardos request tion when no is made for them to do agent. recover Ar- their own so. anki, P.2d at 536. hand, 23 On the recog- the costs of appellees Because the nizing duty of disclosure could be substan- buyers’ information, disclose the financial tial. A negative to reveal financial in- properly summary granted judg- arguably formation would not be limited to appellees. Accordingly, af-we complete insolvency. Any information that firm. adversely buyer’s ability reflected perform regarded could be as material and *6 subject THOMPSON, Presiding Judge, many potential to disclosure. Yet history concurring. have some of financial difficul- ty. liability, buyers To be safe from and NOYES, Judge, Dissenting. agents

their would be to disclose detailed financial information without even ¶ Appellees that claim “real estate being single asked to do so. While in a agents only parties owe to those in a duties transaction obligation might this not seem they transaction with whom have established overly burdensome, the total cost to the mar- relationship” a valid principal-agent (empha- ketplace multiplied by when all transactions original). sis in that claim is over- Because great would be It indeed. is far more effi- broad, summary judgment on that claim is cient parties to allow the to decide what respectfully erroneous. I dissent from the exchanged. information must be If the seller majority’s holding Appellees that had no requests the buyer information and the minimum, duty Appellants. Appel- At a seller, legal liability misleads the then duty fairly Appellants. a lees had to deal with misrepresentation protects for the seller. agents duty 27 Arizona real estate have a ¶ 24 duty fairly parties We hold that Albu had to deal no with all other principals’ they duty sellers to disclose her finan and have information, cial A generally including any condition. certain material duty no buyer has disclosure non-clients. See information that is or Corp., perform insolvency Haldiman v. Dev. Gosnell unable to due to or other- R4-28-1101(A) (App. (quoted 748 P.2d 1213-14 wise. See A.A.C. 1987) (determining supra). that seller’s owed opinion markedly agents subject liability 2. Our thus differs are from the to tort breach of position general appellees that the “to dissent attributes and unbridled deal with do not then attacks. We hold that real estate all other to the transaction.” Such a concept duty greatly expands agents' have no duties whatever to non-clients. broad position places Our in a also differs from dissent in them conflict between respect. another notable We do not hold that to others. public, they there- Department v. Arizona Brown Estate, R4 the stan- impose court concluded that fore and articulate Real this 28-1101(A) upon a licen imposed care. dard of with all other see to deal fairness court, Appellees In the came 320, 328- parties to a transaction. 181 Ariz. they admitting close to that (App.1995). Brown Appellants: disclose certain information action, agreed with disciplinary was a but it “upheld a in a articulated THE Does a who COURT: broker a real purchaser’s of action cause purporting is person knows that a who in the absence of an estate broker buyer absolutely way of obtain- has relationship.” Id. at P.2d at 624 financing [the tell sell- have (referring Taggart, 51 Cal.2d Ward way people are these ers] there’s (1959)). court also Brown financing? going to obtain Scott, 206 Nguyen Cal.App.3d cited those COUNSEL]: On [APPELLEES’ Cal.Rptr. proposition facts, Honor, likely your I would most imposes that “California similar agree basically knows who honesty in real fairness to all they’re presenting willing Brown, transactions.” the other on the shouldn’t fool with side regard 890 P.2d at 624. to Ward stated, agree Nguyen, the Brown “We Arizona should

with California standard. really Appellees arguing here is What open hold to similar standards of brokers Appellants facts that are much have at 624. disclosure.” Id. question, than in the court’s weaker Carpet-Barry As in Red facts not have been disclosed. explained and those need Associates, Apex strength rele- Appellants’ Associates v. facts is But the issue; the real estate only to it not rele- vant the breach department’s disciplinary regulations estab- issue, issue before vant to as well applies lish a civil actions us at this time.

inas actions: ¶32 Appellees If had no to deal rules and license Appellants, had a fairness department effect of force and very pur- *7 unfairly them. The to deal with 32-2122(A) § that it provides law. A.R.S. regulations pose licensing of the statutes and any person to act as a shall unlawful just regulate opposite; it is securing a real estate broker without first public activities conduct of so complying license otherwise protected dealing unfair provisions chapter 32. The Arizona malpractices. provisions. courts have enforced these regulate purpose The statutes is judgment Appellees Summary real estate activities so conduct of duty issue be reversed. should public may protected. (emphasis in P.2d at 1226

Id. omitted). original, internal citations ¶30 In Investment v. National Alaface (App.1994), this court considered subdivision that, be- and concluded

disclosure statutes were enacted for cause those statutes public, they imposed the standard of care. articulated depart- same is true here. question enacted