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ensure that the witness signing anagreement with such provisionsunderstands that the obligation totestify truthfully is paramount.State v. Rivera, CR 04-0170-PR,4/05/05.

COURT OF APPEALS CIVIL MATTERSA trial court erred in vacating adefault judgment based uponinsufficient service of processwhere service of process wasproperly made pursuant toARIZ.R.CIV.P. 4.2(c) by certifiedmail that was received andsigned for by a civil defendant’scontracted mail agent (a UPSstore) that had express authorityto accept certified mail on theirbehalf and the served defendantwas unable to rebut the pre-sumption of personal service.Federal due process was notoffended by such service becauseit constituted notice that wasreasonably calculated under thecircumstances to apprise inter-ested parties of the pendency ofthe civil action in issue.However, the plaintiff ’s service bypublication was insufficient pur-suant to ARIZ.R.CIV.P. 4.2(f)because the plaintiff failed to file

an appropriate affidavit specifyingfacts showing due diligence inattempting personal service.Notwithstanding the reversal ofthe lower court’s order vacatingthe default judgment, the courtremanded the case for further find-ings under ARIZ.R.CIV.P. Rule60(c), which had not been decidedbelow. Barlage v. Valentine, 2 CA-CV 2004-0127, 4/27/05 … A1999 amendment to A.R.S. §23-1044(A), allowing employersand workers’ compensationinsurance carriers to reduce tem-porary partial disability benefitsif a person is also receivingretirement or pension benefitsresulting form prior work forthat same employer, violatesArizona Constitution Art. 18, §8, which requires that a percentageor amount of compensation cannotbe reduced except by initiative orreferendum. Naslund v. MaricopaCounty, 1 CA-IC 02-0084,4/21/05 … If a car dealer entersinto an agreement with a carpurchaser to provide service tothe car in accordance with aservice contract that the manu-facturer will issue to the pur-chaser, the dealer has entered

into a service contract with thepurchaser that constitutes a war-ranty under theMangnuson–Moss Warranty Act,15 U.S.C. §§ 2301, et seq.Accordingly, under theMangnuson–Moss Warranty Act,the dealer cannot limit anyimplied warranty of mer-chantability provided under statelaw. Arizona law does not providefor a 15-day or 500 mile impliedwarranty of merchantability, butonly provides that a dealer maylimit the implied warranty to thoseterms. Johnson v. Earnhardt’sGilbert Dodge, Inc., 1 CA-CV 02-0656, 4/7/05*.

COURT OF APPEALS CRIMINAL MATTERSA.R.S. § 13-1207 (the prisonriot statute) does not create twoseparate offenses, but a singleoffense that may be committedin alternate ways: (1) assaultwith intent to incite a prison riotand (2) participation in a prisonriot. The defendant had beenindicted for proscribed conductunder the statute that could beaffected in two different ways, bothof which encompassed his alleged

SUPREME COURT CIVIL MATTERSIn terminating parental rights,the superior court need onlydetermine by a preponderance ofthe evidence, not by clear andconvincing evidence, that itsdecision is in the best interests ofthe child. Kent K. v. Bobby M., CV04-0209-PR, 4/28/05 … Thereis no statute of limitations for aparty to file a motion to set asidean arbitration award pursuant toA.R.S. § 12-1512 unless theprevailing party files a motion toconfirm such an award. In thatcase, the party contesting theaward must file its motion with-in 20 days of the filing of themotion to confirm. Morgan v.Carillon Investments, Inc., CV 04-0222-PR, 4/1/05.

SUPREME COURT CRIMINAL MATTERSA plea agreement containingterms that requires the witnessto testify truthfully but that alsocontains an avowal that priorstatements by the pleadingdefendant were true does notconstitute a consistency agree-ment prohibited by State v. Fisher,176 Ariz. 69, 859 P.2d 179(1993). However, the State should

APPELLATE HIGHLIGHTSby Hon. Donn Kessler, Arizona Court of Appeals, Div. One, and Patrick C. Coppen, Esq., Tucson

Deciding a case of first impression,Division One of the Arizona Courtof Appeals invalidated a law firm’sshareholder agreement, which pro-vided that upon voluntary with-drawal from the firm a shareholderloses all rights to compensation forhis shares. However, the court alsoheld that the withdrawing attorneycould not recoup his equity inter-est in the law firm under theArizona Professional CorporationAct or under a theory of unjustenrichment. Fearnow v. Ridenour,Swenson, Cleere & Evans, P.C., 1CA-CV 03-0650, 4/19/05.

Fearnow became a partner inthe law firm and paid approximate-ly $33,000 for his partnership

interest. In 1991, the partnershipdissolved, and the prior partnersformed a professional corporationin which Fearnow received oneshare of stock. In 1997, the corpo-ration executed the latest versionof its Shareholder Agreement,which included a provision that astockholder who withdrew fromthe firm except for retirement hadto tender his or her share to thecorporation for no compensation.Fearnow later left the firm andwent to practice at another lawfirm, taking some of his priorfirm’s clients with him. He thendemanded his prior firm return his$33,000 as compensation for hisshare of stock. The firm refused,

and Fearnow sued seeking to inval-idate the voluntary withdrawal pro-vision.

The superior court grantedFearnow summary judgment,holding that the voluntary with-drawal provision was a restrictionon a lawyer’s right to practice lawin violation of Ethical Rule 5.6 ofRule 42 of the Arizona SupremeCourt. The court later ruled thatFearnow was a “disqualified per-son” under the ArizonaProfessional Corporation Act anddetermined under that act Fearnowwas entitled to the fair value of theshare—$86,500.

The Court of Appeals affirmedin part and reversed in part. The

CASE OFTHE MONTH

SUPREME COURT PETITIONScompiled by Barbara McCoy BurkeStaff Attorney, Arizona Supreme Court

The Arizona Supreme Court accepted review or jurisdic-tion of the following issues on May 24, 2005*:

State of Arizona v. Melissa Jean Gomez, 1 CA-CR 03-1050 (Opinion) (CR 05-0062-PR) “A. Does the court of appeals’ opinion finding unconstitutional a statute disallowing pro-bation for a class of defendants with prior indictments directly conflict with bindingSupreme Court precedent?“B. Did the court of appeals misapply the Sixth Amendment by holding that suspensionof sentence and imposition of probation can be treated as the statutory maximum?”

In re Sara S., 1 CA-JV 04-0111(Mem. Opinion) (CV 05-0023-PR)“1. Did the court of appeals err when it determined, contrary to a decision reached earlier

by another panel in a case not materially distinguishable from the instant case, that aseven-year-old [child] may be adjudicated incorrigible and placed on probation,although it is undisputed that all absences underlying the alleged ‘habitual truancy’occurred as a result of illness, that the child remained home at the direction of and inthe company of a parent, and there is no evidence that the child was in any way atfault, where the absences were only deemed ‘not excused’ by virtue of failures of themother to comply with a school rule that required parents to notify the school within24 hours after the inception of the absence of the reason therefore?

“2. Did the court of appeals err when it determined that a juvenile court has jurisdictionto not merely adjudicate a seven-year-old ‘dependent,’ but may also adjudicate such achild ‘incorrigible’?

“3. Did the court of appeals err by upholding the juvenile court’s finding that there wereeight unexcused absences?”

State ex rel. Thomas v. Hon. Warren Granville, 1 CA-SA 05-0086 (Order) (CV 05-0155-PR)“1. Did the trial court abuse its discretion by failing to instruct the jury that, under

Arizona law, once the State has proven an aggravating factor the burden is on theDefendant to prove by a preponderance of evidence mitigation sufficiently substantialto warrant leniency?

“2. If Arizona requires the defense to prove that a life sentence is warranted, did the trialcourt abuse its discretion by instructing the jury that if they had a ‘doubt’ aboutwhether the death sentence should be imposed they were to return a life sentence?”

*Unless otherwise noted, the issues are taken verbatim from either the petition for review orthe certified question.

The Arizona Supreme Court and Arizona Court ofAppeals maintain Web sites that are updated continually. Readers may visit the sites for the

Supreme Court (www.supreme.state.az.us/opin),the Court of Appeals, Div. 1

(www.cofad1.state.az.us) and Div. 2(www.apltwo.ct.state.az.us).

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conduct, thus not entitling him to alternativejury instructions. The law enforcement officerswere “victims” under A.R.S. § 13-2508 becausethey were persons against whom force was usedor threatened and this was not a victimlesscrime so the total financial losses of the victimscould be considered in aggravation underA.R.S. § 13-702 (c)(9). State v. Manzanedo, 2CA-CR 2003-0238, 4/29/05 … A defendantwas not entitled to be tried by a 12-personjury where, prior to the time the jury begandeliberations, the superior court had dis-missed all but one of the defendant’s histor-ical convictions so that he could not possiblybe sentenced to 30 or more years incarcera-tion. The key point at which the right to a 12-person jury attaches is when the jury delibera-tions begin. State v. Kuck, 1 CA-CR 03-0987,4/21/05.

COURT OF APPEALS JUVENILE MATTERSThe juvenile court has jurisdiction to con-duct a probation violation hearing andimpose continued probation on a juvenilepreviously determined to be delinquent evenif such hearing is conducted more than oneyear after initial probation was imposed andthe probation has expired, provided the peti-tion to revoke probation was filed prior tothe one-year end of the initial probationperiod. In re Stephanie M., 1 CA-JV 04-0203,4/28/05.

* indicates a dissent

reasonable financial penalties fordeparting lawyers linked to theactual loss suffered by the firmattributable to the lawyer’s depar-ture. The court held it did nothave to determine which standardapplied because the penalty provi-sion in this case was invalid evenunder the more permissive stan-dard.

However, the court reversedthe superior court’s holding thatFearnow was entitled to compen-sation for his share’s fair valueunder the professional corporationact. The court reasoned that underthe act, a professional corporationhad to repurchase shares onlywhen a shareholder died or dis-

solved or when the shareholderbecame a “disqualified person.”Under the act, a disqualified per-son is a person who ceases to be aqualified person, and a qualifiedperson is one who is eligible to beissued shares in the corporation.Because eligibility is based on theindividual being licensed to prac-tice law, the court concluded thatFearnow was not disqualifiedbecause he was still licensed topractice law. The current versionof the Act superseded the ArizonaSupreme Court’s interpretation ofthe predecessor act in Vinall v.Hoffman, 133 Ariz. 322, 651 P.2d850 (1982), which required com-pensation for a resigning or legally

disqualified shareholder. The courtrecognized the result of the instantcase could expose the parties torisks of ethical improprietiesbecause Fearnow in essence stillheld shares in a competing firm.However, any change to thestatute would require legislativeaction.

Finally, the court rejectedFearnow’s claim that he was enti-tled to compensation on a theoryof unjust enrichment. It reasonedthat Fearnow still owned his sharein the firm and could exercise allshareholder rights under the act.Therefore, the firm had notretained anything that belonged toFearnow.

court first held that the voluntarywithdrawal agreement was unen-forceable as to Fearnow because itviolated ER 5.6(a). It reasonedthat the provision acted as arestrictive covenant, which violat-ed the ethical rule prohibiting apartnership or employment agree-ment that restricts the rights of alawyer to practice after termina-tion of the relationship except anagreement concerning benefitsupon retirement. The court wrotethat several jurisdictions had heldthat any financial disincentiveimposed on a departing lawyer isan invalid restriction on the rightto practice law while other courtshad held that firms may impose