Opinion
No. 1 CA-CV 11-0533
08-07-2012
KENNETH BRIDGES and LINDA BRIDGES, husband and wife, Plaintiffs/Appellants, v. SAFEWAY, INC., a corporation doing business in Arizona; KASHMAN'S L.L.C., an Arizona limited liability company; MEI'S INCORPORATION, an Arizona corporation doing business as JADE PALACE; SONORAN HOSPITALITY GROUP, INC., sued herein as JALAPENO'S INFERNO BISTRO MEXICANO, an entity of unknown origin, Defendants/Appellees.
Law Office of Lyndon B. Steimel By Lyndon B. Steimel Attorney for Plaintiffs/Appellants Thomas, Thomas & Markson, P.C. By Benjamin C. Thomas Brad M. Thies Attorneys for Defendant/Appellee Safeway Skypeck & Sorenson By Steven M. Chaet Attorneys for Defendant/Appellee Kashman's Lewis Brisbois Bisgaard & Smith LLP By Shawn M. Petri Attorneys for Defendant/Appellee Mei's Incorporation/Jade Palace Burrell & Seletos By Richard H. Rea Attorneys for Defendant/Appellee Sonoran Hospitality Group
NOTICE: THIS DECISION DOES NOT CREATE LEGAL PRECEDENT AND MAY NOT BE CITED
EXCEPT AS AUTHORIZED BY APPLICABLE RULES.
See Ariz. R. Supreme Court 111(c); ARCAP 28(c);
Ariz. R. Crim. P. 31.24
MEMORANDUM DECISION
(Not for Publication -
Rule 28, Arizona Rules of
Civil Appellate Procedure)
Appeal from the Superior Court in Maricopa County
Cause No. CV2009-052898
The Honorable Brian R. Hauser, Judge (Ret.)
AFFIRMED
Law Office of Lyndon B. Steimel
By Lyndon B. Steimel
Attorney for Plaintiffs/Appellants
Scottsdale Thomas, Thomas & Markson, P.C.
By Benjamin C. Thomas
Brad M. Thies
Attorneys for Defendant/Appellee Safeway
Phoenix Skypeck & Sorenson
By Steven M. Chaet
Attorneys for Defendant/Appellee Kashman's
Phoenix Lewis Brisbois Bisgaard & Smith LLP
By Shawn M. Petri
Attorneys for Defendant/Appellee Mei's Incorporation/Jade Palace
Phoenix Burrell & Seletos
By Richard H. Rea
Attorneys for Defendant/Appellee Sonoran Hospitality Group
Phoenix SWANN , Judge ¶1 In July 2009, Kenneth and Linda Bridges ("Appellants") sued several defendants for negligence in connection with a flood that damaged Appellants' store in December 2004. The trial court found that Appellants, within the two years following the flood, could have and should have investigated whether the defendants were potentially liable. Concluding that the two-year statute of limitations had not been tolled under the discovery rule, the court granted summary judgment in favor of the defendants. We affirm.
FACTS AND PROCEDURAL BACKGROUND
¶2 In September 2000, Appellants began operating a dry-cleaning business in a Scottsdale shopping center. They operated the business profitably until December 26, 2004, when a sewer clogged and flooded their store. The flood of raw sewage ruined the business's equipment as well as the clothing deposited in the store for cleaning. ¶3 Initially, the City of Scottsdale ("the City") took steps to deal with the clog and "remediate" the damage to Appellants' store. But as the City explained to Appellants in a letter dated June 13, 2005, it investigated further and learned that "the clog occurred in a private sewer pipe." The letter identified the owner of the private sewer pipe as Scottsdale Pinnacle Shopping Center, LP ("Scottsdale Pinnacle"). The letter stated that the City would be seeking its expenses for the remediation from Scottsdale Pinnacle. ¶4 On December 26, 2006, Appellants filed a complaint against Scottsdale Pinnacle, alleging breach of contract and negligence. In its initial disclosure statement, served July 30, 2007, Scottsdale Pinnacle named several non-parties at fault "who may have been responsible for not properly maintaining their private sewage lines and thus causing the sewage blockage." Those non-parties included three of the parties to this appeal: Safeway, Jade Palace, and Jalapeño's. Appellants stipulated to the dismissal with prejudice of their case against Scottsdale Pinnacle on June 22, 2009. ¶5 On July 29, 2009, Appellants filed the complaint underlying this appeal. Their complaint alleged that Safeway and other shopping-center tenants who were food-service providers had negligently maintained their grease traps and were liable for the sewer backup that had damaged Appellants' store. One of the defendants moved for judgment on the pleadings, arguing that, because the store had flooded in December 2004, Appellants' negligence action was barred by the two-year limitation in A.R.S. § 12-542. In response, Appellants argued that dismissal under § 12-542 would be inappropriate because they had learned that food-service tenants might be at fault only upon receiving Scottsdale Pinnacle's July 30, 2007 initial disclosure. The motion for judgment on the pleadings was withdrawn, but the limitations issue was raised again in a motion for summary judgment, which the court denied on August 20, 2010. ¶6 Safeway filed a renewed motion for summary judgment on February 10, 2011. It argued that the negligence action was barred under § 12-542 because there was evidence obtained during discovery that Appellants "were aware of their potential negligence claim against Safeway within a few days of the incident." To support its motion, Safeway provided the affidavit of Michael Mason, a claims manager for the City. ¶7 In his affidavit, Mason stated that on December 28, 2004, two days after the accident, he went to the shopping center with an outside adjuster for the City, Lee Damner, to investigate any potential claims against the City. At the shopping center, Mason and Damner met with Mark Lina, an employee in the City's water department. Lina told Mason and Damner that he had inspected the sewer lines both on and near the shopping center and that, as a result, he believed that the flooding had been caused by a clog somewhere in the shopping center's sewer line. He identified the clog's location as being "in an area behind Safeway" and said that the clog probably resulted from the grease produced by businesses in the shopping center that used grease traps. And according to Mason's affidavit, on the same day that Lina shared these opinions with Mason and Damner, Mason and Damner met with Appellants and told them about Lina's investigation and his opinions. ¶8 Along with the Mason affidavit, Safeway also included a transcript of a bankruptcy hearing held on January 17, 2006. In that hearing, the court asked Appellants' counsel about their lease situation (Scottsdale Pinnacle was unwilling to renew it) and why relief from an automatic stay should not be granted. Appellants' counsel responded that if the stay were lifted, then "[t]he only thing [Appellants] would have left, if they don't have a lease or somewhere to operate this business, is a lawsuit against the owner, whoever owned the sewer pipe that blew up and flooded their business, either the property owner, maybe a Safeway store that neighbors it . . . ." Appellants were present at that hearing. ¶9 Appellants responded to Safeway's renewed motion for summary judgment on March 23, 2011. Concerning the December 28, 2004 conversation described in the Mason affidavit, Appellants stated that "the only thing [they] learned" from it was "where the clog may have occurred." That information, they said, "led only to their believing the landlord [i.e., Scottsdale Pinnacle] might be responsible." They learned about the potential liability of food-service tenants -- such as Safeway -- only after they had diligently sued Scottsdale Pinnacle. Appellants argued that under the discovery rule, the two-year limitation in § 12-542 should be tolled to the date of disclosure of non-parties at fault in the Scottsdale Pinnacle case, given their timely suit of Scottsdale Pinnacle and their status as "mere lay persons and shop owners" unacquainted with the workings of grease traps. ¶10 The court granted Safeway's motion for summary judgment. It found that within the two years following the flood damage to Appellants' store, Appellants "possessed more than enough information to investigate whether their co-tenants of the property might have been responsible for the damage." The court determined that Appellants failed to fulfill their "duty to conduct a reasonable investigation of the facts." Because of that failure to investigate, the court held that the discovery rule did not toll the statute of limitations for Appellants, and it granted summary judgment in favor of Safeway and the other food-service tenants. ¶11 Appellants timely appeal from that judgment. The primary issue Appellants raise is whether the court erred in its ruling that the discovery rule did not toll the statute of limitations, given that the negligence claim against Safeway and the other food-service tenants arose from facts -- such as those concerning the "maintenance of grease traps" -- purportedly unknown to Appellants until after they had sued Scottsdale Pinnacle. ¶12 We have jurisdiction under A.R.S. § 12-2101(A)(1).
STANDARD OF REVIEW
¶13 The trial court may grant summary judgment when "there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Ariz. R. Civ. P. 56(c)(1). We review the grant of summary judgment de novo, "viewing the facts and reasonable inferences therefrom in the light most favorable to the nonmoving party." Hourani v. Benson Hosp. , 211 Ariz. 427, 432, ¶ 13, 122 P.3d 6, 11 (App. 2005).
DISCUSSION
¶14 Appellants brought their complaint against Safeway and the other defendants as a negligence action. When an action "sounds in negligence or tort," the applicable statute of limitations is A.R.S. § 12-542. Sato v. Van Denburgh, 123 Ariz. 225, 227, 599 P.2d 181, 183 (1979); Hall v. Romero, 141 Ariz. 120, 123, 685 P.2d 757, 760 (App. 1984). Under A.R.S. § 12-542, negligence actions must be "commenced and prosecuted within two years after the cause of action accrues, and not afterward." ¶15 Originally, for statutes of limitation like § 12-542, a legal action "accrue[d]" just as soon as the facts sustaining it began to exist. Gust, Rosenfeld & Henderson v. Prudential Ins. Co. of Am., 182 Ariz. 586, 588, 898 P.2d 964, 966 (1995). That strict construction applied even in cases where plaintiffs were unaware of the facts that gave rise to their claims. Id. But eventually, recognizing that it was unfair to deprive plaintiffs of legal actions before they had "a reasonable basis for believing that a claim exist[ed]," Arizona courts developed the discovery rule. Id. at 589, 898 P.2d at 967. Under that rule, "a cause of action does not accrue until the plaintiff knows or with reasonable diligence should know the facts underlying the cause." Doe v. Roe, 191 Ariz. 313, 322, ¶ 29, 955 P.2d 951, 960 (1998). ¶16 Because the discovery rule mitigates the harshness of statutory limitations by equitably considering a case's facts, the question of when a plaintiff discovered or should have discovered facts giving rise to a claim is "usually and necessarily" left to the jury. Id. at 323, ¶ 32, 955 P.2d at 961. Nonetheless, there are cases involving the discovery rule in which summary judgment is appropriate. See id. at ¶¶ 32-33; Thompson v. Pima Cnty. , 226 Ariz. 42, 46-47, ¶¶ 14-15, 243 P.3d 1024, 1028-29 (App. 2010) (concluding that summary judgment was proper because plaintiffs had reasonable notice to investigate the injury's cause). ¶17 To win summary judgment, the movant must show that there is no genuine dispute about two elements of a plaintiff's knowledge of the injury -- elements our supreme court has labeled the "what" and the "who." Walk v. Ring, 202 Ariz. 310, 316, ¶ 22, 44 P.3d 990, 996 (2002). Before summary judgment can be granted, there must be no genuine dispute that within the limitation period, the plaintiff was aware of "what" happened, i.e., that the plaintiff "possess[ed] a minimum requisite of knowledge sufficient to identify that a wrong occurred and caused injury." Doe, 191 Ariz. at 323, ¶ 32, 955 P.2d at 961. It must also be undisputed that the plaintiff had a "reason to connect the 'what' to a particular 'who' in such a way that a reasonable person would be on notice to investigate whether the injury might result from fault." Walk, 202 Ariz. at 316, ¶ 22, 44 P.3d at 996. ¶18 On appeal, Appellants concede that they knew "what" happened when their store flooded on December 26, 2004. They argue, though, that they had no reason to think that Safeway or any other food-service tenant was a potentially liable "who" until after they were named by Scottsdale Pinnacle as non-parties at fault. ¶19 The undisputed facts of this case do not support that argument. Soon after their store filled with sewage, Appellants were aware that what happened could be attributed to a particular "who." The City, though, quickly showed that it was not in fact that particular "who." The Mason affidavit provided evidence that within days of the accident the City was investigating the flood, determining that the clog occurred on Scottsdale Pinnacle's property, and pointing out that the clog happened near one of the food-service providers (which happened to be Safeway). More importantly, the Mason affidavit provides evidence that at least some of what the City had investigated and concluded was communicated to Appellants in a conversation. ¶20 Appellants claim that the Mason affidavit's reference to that conversation raises questions of fact, making their case one appropriate for the jury and not for summary judgment. But they admit on appeal that they do "recall somewhat such a conversation," even though they insist that it "was only a discussion about whether the clog was on public or private property" and did not include any "detail" about grease traps. Whether grease traps were mentioned at that conversation is immaterial. What is material, however, is that the conversation Mason described put Appellants on notice that the party responsible for their store's damage was an unsettled question, that they would need to look elsewhere to assign liability and that the place to look was somewhere on the shopping center's property. ¶21 But even apart from that conversation, the City's June 13, 2005 letter by itself would have put Appellants on notice that they needed to look into the question of who had caused the clog. As the trial court pointed out in its ruling, the letter alerted Appellants "that the City was not the cause of the sewage flood." At that point, Appellants should have been aware that they needed to investigate who else might be the cause. In other words, the letter alone was enough to trigger Appellants' duty to exert "reasonable diligence" to "know the facts underlying the cause." Doe, 191 Ariz. at 322, ¶ 29, 955 P.2d at 960. ¶22 Appellants attempt to argue around that "reasonable diligence" requirement by emphasizing their unfamiliarity with the workings of sewers and the fact that Safeway's (or some other tenant's) possible liability for the clog was not immediately evident. As they put it in their opening brief: they had "no inkling whatsoever that Safeway might have something to do with the clog, only that the clog may have occurred close to its store." They argue that they "acted within reasonable limits as laypersons, and not as sewer experts" in first suing Scottsdale Pinnacle, especially because "they had been told by [the City] that the clog occurred on [Scottsdale Pinnacle's] property." First, we note as a matter of fact that Appellants did seem to have an inkling that Safeway in particular might have caused the clog: during the January 2006 bankruptcy hearing, Appellants' counsel named Safeway as a potential defendant. Second, as a matter of law, Appellants are correct insofar as they argue that the discovery rule did not require them to personally exercise the reasonable diligence of a plumber. See Walk, 202 Ariz. at 316, ¶ 22, 44 P.3d at 996 (expressing the discovery rule in terms of what "a reasonable person" would be aware of). ¶23 The law, though, recognizes that in certain situations it is necessary for a plaintiff to enlist an expert's help in pursuing a claim. For example, in professional negligence claims the law does not require that a plaintiff procure an expert to testify to questions "within the realm of common knowledge." Hunter Contracting Co. v. Superior Court (Grandinetti), 190 Ariz. 318, 320, 947 P.2d 892, 894 (App. 1997) (citation omitted). But for the same kind of claim, the plaintiff is required to seek out an expert to answer questions that demand "special and technical knowledge." Id. (citation omitted). The distinction is reasonable: some claims are readily comprehensible by almost anyone; others are beyond the competence of the average layman, and the plaintiff is therefore required to obtain an expert's help. ¶24 Applying that same distinction here, we hold that, even though the discovery rule did not require Appellants themselves to understand how the sewer worked, it did require them to find someone who had that understanding and who could help them investigate any potential claims against their shopping-center cotenants. See ELM Ret. Ctr., LP v. Callaway, 226 Ariz. 287, 290, ¶ 12, 246 P.3d 938, 941 (App. 2010) (stating that the discovery rule "does not permit a party to hide behind its ignorance when reasonable investigation would have alerted it to the claim"). This holding accords with the principle that the discovery rule does not favor plaintiffs who "have slept on their rights" -- it favors plaintiffs who remain unaware of a cause of action despite their best efforts. Gust, 182 Ariz. at 590, 898 P.2d at 968; Doe, 191 Ariz. at 322, ¶ 29, 955 P.2d at 960. Here, as the trial court noted, Appellants relied upon the efforts of others -- first the City, then Scottsdale Pinnacle -- rather than their own efforts "to uncover the facts of the incident."
CONCLUSION
¶25 Because there was no genuine issue of material fact as to whether Appellants could have conducted a reasonable investigation into the cause of the flooding within the two-year limitation period, the trial court properly concluded that the statute of limitations bars Appellants' July 2009 negligence claim against Safeway and the other food-service tenants. We therefore affirm the judgment.
__________________
PETER B. SWANN, Judge
CONCURRING: __________________
JOHN C. GEMMILL, Presiding Judge
__________________
ANDREW W. GOULD, Judge