CITIBANK v. DAVIS

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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 IN THE COURT OF APPEALS STATE OF ARIZONA DIVISION ONE CITIBANK SOUTH DAKOTA, N.A., ) ) Plaintiff/Appellant, ) ) v. ) ) GARY D. DAVIS and ROBIN DAVIS, ) ) Defendants/Appellees. ) __________________________________) DIVISION ONE FILED: 08/21/2012 RUTH A. WILLINGHAM, CLERK BY: sls No. 1 CA-CV 11-0216 DEPARTMENT D MEMORANDUM DECISION (Not for Publication Rule 28, Arizona Rules of Civil Appellate Procedure) Appeal from the Superior Court in Yavapai County Cause No. V1300CV201080541 The Honorable Michael R. Bluff, Judge AFFIRMED Seidberg Law Offices PC By Kenneth W. Seidberg and Joseph L. Whipple Attorneys for Plaintiff/Appellant Phoenix Gary D. Davis and Robin Davis Defendants/Appellees In Propria Persona Sedona B R O W N, Judge ¶1 Citibank (South Dakota), N.A. ( Citibank ) appeals the trial court s default judgment entered against Gary and Robin Davis ( Davis ). Citibank s principal argument is that the court erred by awarding zero dollars in damages. For the following reasons, we affirm. BACKGROUND ¶2 Citibank sued Davis to collect on a credit card account. The unverified complaint alleged that Davis owed the sum of $28[,]785.43, as set forth in the attached Exhibits, less all lawful off[.] credits and offsets applied from date of charge- Attached to the complaint was an affidavit signed by a representative of Citibank, which listed a total amount due and repeatedly Exhibit account referenced A. was The the statement affidavit stated $28,785.43, plus transaction that applicable closing date on Exhibit A until paid. the detail balance interest in of the from the However, there was no exhibit attached to the affidavit. ¶3 defend. Davis was properly served, but failed to appear or Citibank moved for default judgment without a hearing, asserting that the amounts stated in the Judgment submitted are due and owing as of the date of this Affidavit after allowing for all just and lawful set offs, payments and credits, and are substantiated by the following . . . documents. Citibank s motion, however, did not include the referenced Judgment or list any specific amount for which it sought judgment; instead, the only document Citibank mentioned was a Statement of Costs and Notice of Taxation of Costs. The trial court denied Citibank s 2 motion and set a default hearing, explaining it was necessary to take evidence on damages because the affidavit Citibank had hearing the attached to the complaint was missing Exhibit A. ¶4 Neither party appeared at court conducted on March 14, 2011. the default The court entered judgment for Citibank and awarded $327.80 in costs, but did not award any damages. On March 21, Citibank filed an expedited motion to set aside the judgment pursuant to Arizona Rule of Civil Procedure 60(c). Citibank asserted as follows: (1) its failure to appear at the hearing was due to a scheduling error; (2) the court erred in setting a default hearing; (3) the court s entry of judgment awarding Citibank zero dollars in damages was erroneous; and (4) the court s award of damages for zero dollars was an improper sanction against Citibank for its failure to appear at the hearing. 1 The court denied Citibank s motion on March 24, stating that the hearing was necessary to establish the credibility of Citibank s damages owed by Davis. complaint and the amount of The court also explained that its award of zero dollars in damages to Citibank was not a sanction. 1 Citibank also disputed the court s prior finding that Citibank improperly attempted to amend the complaint when it substituted Robin Davis in the caption of the motion for default judgment. In ruling on Citibank s Rule 60(c) motion, the court ordered the judgment amended to correctly identify Gary and Robin Davis as the defendants in this case. 3 ¶5 On March 28, Citibank filed a notice of appeal from the March 14 default judgment, but did not appeal the court s denial of the 60(c) motion. order dismissing Citibank s On April 10, 2012, we issued an appeal for lack of jurisdiction. Citibank timely filed a motion for reconsideration of that order and Davis responded. In our discretion, we granted Citibank s motion. JURISDICTION ¶6 We have an independent obligation to ensure we have jurisdiction in every appeal. Soltes v. Jarzynka, 127 Ariz. 427, 429, 621 P.2d 933, 935 (App. 1980). A party generally may not appeal from a default judgment without first moving to set aside the judgment. See id. at 430, 621 P.2d at 936; Byrer v. A. B. Robbs Trust Co., 105 Ariz. 457, 458, 466 P.2d 751, 752 (1970). Instead, a defaulting party seeking to challenge a default judgment typically does so by filing a motion to set aside the judgment, which then triggers the right to appellate review of a court s order denying the motion. See Ariz. Rev. Stat. ( A.R.S. ) § 12-2101(A)(2) (Supp. 2011) ( An appeal may be taken to the court of appeals from the superior court . . . . [f]rom any special order made after final judgment. ); see also Sanders v. Cobble, 154 Ariz. 474, 475, 744 P.2d 1, 2 (1987). ¶7 In Byrer, our supreme court noted the reason for the rule that a defendant may not appeal from a default judgment 4 without first moving to set aside the judgment is to give the trial court exercise a prolonged the opportunity more and opportunity mature further judgment unnecessarily to for reconsider lest reflection litigation expensive[,] the matter as on be well its and to unduly as the merits by presentation of an appropriate motion attacking that portion of the judgment which defendants believe erroneous. 105 Ariz. at 458, v. 466 P.2d at 752. Similarly, in Poleo Grandview Equities, Ltd., 143 Ariz. 130, 692 P.2d 309 (App. 1984), we concluded that where the defaulting party did not file a motion to vacate the judgment, but did file a motion for new trial, the trial court was afforded sufficient opportunity to review the claimed error, thereby bestowing jurisdiction on this court to hear the appeal. ¶8 Id. at 132, 692 P.2d at 311. Here, we are presented with the situation in which a plaintiff has appealed from a default judgment unsuccessfully to set aside the judgment. rule prohibiting an appeal from a defaulting party does not apply. Citibank was prerequisite required to to pursuing judgment, it did so. file an after moving Thus, the general default judgment by a Furthermore, even assuming a Rule appeal of 60(c) the motion trial as a court s Accordingly, we conclude that we have 5 jurisdiction to consider Citibank s appeal of the default judgment. 2 DISCUSSION ¶9 Citibank first argues the trial court erred when it denied its hearing. part: original Citibank motion relies for on default Rule judgment 55(b)(1), without a states in which When the plaintiff s claim against a defendant is for a sum certain . . . the Court upon motion of the plaintiff and upon affidavit of the amount due shall enter judgment for that amount. (Emphasis added.) for a precise sum certain amount of by Citibank argues that because it pled including damages, the an court affidavit was specifying obligated to the enter judgment for that amount. ¶10 We reject Citibank s argument based on Rule 55(b)(2), which states in part: If, in order to enable the court to enter judgment or to carry it into effect, it is necessary to take an account or to determine the amount of damages or to establish the truth of any averment by evidence or to make an investigation of any other matter, the court may conduct such hearings or order 2 Citibank argues the trial court erred in denying its Rule 60(c) motion. However, Citibank failed to file a notice of appeal from the trial court s order denying its Rule 60(c) motion. As Citibank has only appealed the court s March 14, 2011 entry of judgment on default, we lack jurisdiction to consider Citibank s challenge to the denial of its Rule 60(c) motion. Lee v. Lee, 133 Ariz. 118, 124, 649 P.2d 997, 1003 (App. 1982) ( The court of appeals acquires no jurisdiction to review matters not contained in the notice of appeal. ). 6 such references proper. The plain language of as deems rule the it necessary gives the and trial court discretion to determine if a hearing is necessary. broad See Dungan v. Superior Court In & For Pinal County, 20 Ariz. App. 289, 291, 512 P.2d 52, 54 (1973) ( The language of Rule 55(b) evinces an intention to place broad discretion in the hands of the court to conduct such establishing hearings' the truth as of would the be in averments furtherance contained in of the complaint. ); see also Beyerle Sand & Gravel, Inc. v. Martinez, 118 Ariz. 60, 63, 574 P.2d 853, 856 (App. 1977) ( A claim is not for a sum certain merely because it is for a specific amount. ); Gilmore v. Cohen, 95 Ariz. 34, 36, 386 P.2d 81, 82 (1963) (burden is on the plaintiff in action for breach of contract to prove damages with reasonable certainty ). ¶11 In setting the default hearing, the trial court noted that although there was an affidavit attached to the complaint that alleged a sum certain, the affidavit referred several times to Exhibit A as giving a detailed breakdown of the balance due on the Davis account. The exhibit was not attached to the affidavit, leading the court to determine that the affidavit was incomplete and that a hearing was necessary to establish the truth of the averment stated in the Complaint that Defendant 7 owed Plaintiff $28,785.43. 3 The court therefore acted within its broad discretion in deciding to order a hearing. ¶12 Citibank next contends the trial court abused its discretion in awarding zero dollars in damages because the award was unjust and contrary to law. We review the court s determination of a damages award for an abuse of discretion. See Daou (1984). v. Harris, 139 Ariz. 353, 361, 678 P.2d 934, 942 Citibank does not cite any law, nor are we aware of any, supporting the proposition that an award of zero dollars of damages necessarily reflects improper application of the law. Cf. Piper v. Bear Med. Sys., Inc., 180 Ariz. 170, 179, 883 P.2d 407, 416, (App. 1993) (holding that a jury award of zero dollars in compensatory damages does not evidence a finding of no fault by the jury). And, although the default of a defendant is an admission of all well-pled facts in a complaint, this admission does not relieve the plaintiff from demonstrating proof as to the extent of the damages. Reed v. Frey, 10 Ariz. App. 292, 294, 458 P.2d 386, 388 (1969); Dungan, 20 Ariz. App. at 290. ¶13 In Appeals Jennings addressed a v. Rivers, situation the where Tenth the Circuit Court of plaintiff and her counsel failed to appear at a default judgment hearing. F.3d 850 (10th Cir. 2005). The 3 district court 394 entered a Exhibit A was apparently never filed in the superior court, as it is not included in the record on appeal. 8 judgment in favor of the plaintiff but awarded zero dollars in damages for lack of evidence. Id. at 853. On appeal, the court determined there was no error in the district court s finding of zero damages because due to the absence of plaintiff and her counsel, proof of damages was totally lacking. Id. Despite this determination, the court of appeals reversed and remanded the case because the lower court improperly reviewed the plaintiff s post-judgment motion according to Rule 59(c) rather than under Rule 60(b)(1). Id. at 855-56, 858. The district court improperly assumed plaintiffs were appealing under Rule 59(c) because the motion did not cite the rule it was appealing under and it was filed within 10 days of final judgment. 856 ( District courts should evaluate post-judgment Id. at motions filed within ten days of judgment based on the reasons expressed by the movant, not the timing of the motion. ). Notwithstanding this reversal, we find persuasive the court s reasoning as to why it determined that the district court did not err in awarding zero damages. ¶14 As noted, the trial court in this case found the missing exhibit rendered the affidavit incomplete and that a hearing damages. provide was necessary to determine the extent of Citibank s By failing to appear at the hearing, Citibank did not evidence of incomplete affidavit. damages to the court other than the We therefore conclude that the court s 9 award of zero damages was not an abuse of discretion. See Daou, 139 Ariz. at 361, 678 P.2d at 942 ( [I]f a court merely awards a plaintiff what is prayed for in the complaint, that may not attain that level of judicial discretion which will pass appellate muster. ). ¶15 Finally, we reject Citibank s assertion that the court s decision to award zero damages constituted an improper sanction against Citibank for its failure to appear. Citibank does not direct us to any authority or any portion of the record that supports its claim. The trial court stated in its ruling on Citibank s Rule 60(c) motion to set aside the judgment that [t]he Court did failure to appear. not impose any sanction for [Citibank s] As the court further explained, [T]he sum certain Affidavit was incomplete, the Court notified [Citibank] of the need to set a hearing as a result of the missing Exhibit A, no objection was raised by [Citibank] that a hearing was unnecessary or that the missing Exhibit A would be timely filed with the Court. The Court called the case at the appointed time, no party appeared and thus no damages were proven, so the Court awarded no principal damages. On this record, determination that we the find no judgment sanction for failure to appear. 10 error in entered the was trial not court s based on a CONCLUSION ¶16 For the foregoing reasons, we affirm the judgment of the trial court. /s/ _________________________________ MICHAEL J. BROWN, Judge CONCURRING: /s/ ___________________________________ PETER B. SWANN, Presiding Judge T H O M P S O N, Judge, dissenting. ¶17 This is an action on a credit card debt. The principal amount owed on the debt was not unliquidated as was the property damage in Beyerle Sand and Gravel v Martinez, 118 Ariz. 60, 63, 574 P.2d 853, 856 (App. 1978). The action was for an attested sum certain, and thus, as to the principal owed, no hearing was warranted upon Davis s default. The trial court should have entered judgment for the principal amount set forth in Citibank s affidavit. Rule 55(b)(1), Ariz. R. Civ. P. It was proper to deny interest on the debt and attorneys fees as these were not set forth as a sum certain. to the principal. I would reverse as /s/ _________________________________ JON W. THOMPSON, Judge 11

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