Best v. Villarreal ( 2021 )

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.
IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE
GREGORY BEST, Plaintiff/Appellant,
v.
STEVE VILLARREAL, et al., Defendants/Appellees.
No. 1 CA-CV 19-0785
FILED 2-2-2021
Appeal from the Superior Court in Maricopa County
No. CV2018-015480
The Honorable Connie Contes, Judge
AFFIRMED
COUNSEL
Gregory Best, Phoenix
Plaintiff/Appellant
Law Offices of Kyle A. Kinney PLLC, Scottsdale
By Kyle A. Kinney
Counsel for Defendants/Appellees
BEST v. VILLARREAL, et al.
Decision of the Court
MEMORANDUM DECISION
Chief Judge Peter B. Swann delivered the decision of the Court, in which
Presiding Judge Jennifer B. Campbell and Judge Lawrence F. Winthrop
joined.
S W A N N, Chief Judge:
¶1 Gregory Best appeals the superior court’s judgment resolving
a property dispute in favor of Steve Villarreal; Steve Villarreal, P.C.;
Foresight Land Investments, LLC; 12th Street Property Trust; Paris Weant;
Special Property Investments Corporation; Land Holdings, LLC; Kyle
Kinney; and the Law Offices of Kyle A. Kinney, PLLC (collectively, the
“Villarreal Defendants”). Best asserted claims for fraud, fraudulent
transfers, and tortious interference, among other causes of action. Finding
no error in the superior court’s resolution of these claims, we affirm and
award the Villarreal Defendants reasonable attorney’s fees under ARCAP
25 as a sanction for Best’s frivolous appeal.
FACTS AND PROCEDURAL HISTORY
¶2 The underlying dispute in this case is identical to that of 1 CA-
CV 19-0199, or the “First Best Case.” Best v. Villarreal, 1 CA-CV 19-0199,
2020 WL 2499776 (Ariz. App. May 14, 2020) (mem. decision). In both cases,
Best alleges that Foresight Investment Group, LLC (“Foresight”) and its
“co-conspirators” used a fraudulent “shell game” to interfere with Best’s
planned development project in South Phoenix, involving multiple pieces
of real property (the “12th Street Property”). Id. at *1, ¶¶ 1–3. Best alleges
that Foresight interfered with his planned project by inducing multiple
property owners to transfer their ownership interests to Foresight despite
Best’s option contracts on the properties. See id. at ¶¶ 2–3. Best secured a
default judgment against Foresight, which was never satisfied. Id.
Meanwhile, the 12th Street Property Trust (the “Trust”) purchased the 12th
Street Property at a trustee’s sale. 1 Id. at *1–*2, *6, ¶¶ 1, 8, 31. Best alleges
1 In a related case, we affirmed a forcible entry and detainer judgment
against Best and his girlfriend, Linda Lynaugh, when they refused to
surrender possession of the 12th Street Property after the Trust obtained the
deed. 12th Street Prop. Trust v. Lynaugh (Lynaugh I), 1 CA-CV 17-0183, 2019
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BEST v. VILLARREAL, et al.
Decision of the Court
that Foresight arranged this purchase and transfer “with the intent to
defraud [Best], its judgment creditor.”
¶3 In the first Best case, filed in January 2017, the superior court
held in pertinent part: (1) Best presented no evidence of a sale contract with
the actual owner of the 12th Street Property; (2) Best’s preliminary approval
from the Phoenix Planning Commission for subdivision plans including the
12th Street Property did not confer title to Best; (3) any ownership interest
that Best may have had was extinguished by the valid trustee’s sale of the
12th Street Property; and (4) Best lacked standing to pursue claims to the
12th Street Property. Id. at ¶¶ 3, 8. Moreover, no evidence indicated that
Foresight ever owned the 12th Street Property. Id. at *6, ¶ 35. We affirmed.
Id. at *9, ¶ 44. We also affirmed the superior court’s refusal to impose
sanctions against the Trust’s attorney Kyle Kinney and denial of Best’s
motion to amend his complaint. Id. at *5–*7, ¶¶ 28, 31, 35.
¶4 Best filed this case almost two years later.2 In his complaint,
he named about thirty defendants and alleged “Civil Torts, Attorney Fraud,
Abuse of Process, In-Concert Acts, Aiding and Abetting Fraudulent
Transfers, Tortious Interference, Breach of Contract and others” stemming
from the same allegedly fraudulent Foresight asset transfer from the first
Best case. About a month after filing, Best sought a temporary restraining
order (“TRO”) and an immediate injunction. The superior court denied
Best’s TRO and injunction request because Best failed to comply with Rule
65 of the Arizona Rules of Civil Procedure and because he failed to establish
that Foresight owned the 12th Street Property. The Villarreal Defendants
WL 1076220, at *1, *3, ¶¶ 1–3, 15 (Ariz. App. March 7, 2019) (mem. decision).
In a separate action, Lynaugh sued the Trust to void the trustee’s sale, but
we affirmed the superior court’s entry of summary judgment in favor of the
Trust because, in part, the default judgment against Foresight had “no
preclusive effect or precedential value” on the trustee’s sale. Lynaugh v. 12th
Street Prop. Trust (Lynaugh II), 1 CA-CV 18-0375, 2019 WL 1929962, at *1–*2,
¶¶ 1, 6, 11 (Ariz. App. April 30, 2019) (mem. decision).
2 In the interim, Best and Lynaugh filed and appealed many other
suits. E.g., Best v. Hull Holliday & Holliday PLC, 1 CA-CV 19-0594, 2020 WL
5523202 (Ariz. App. Sept. 15, 2020) (mem. decision); Lynaugh v. Vincent, CV-
19-04643-PHX-DJH, 2020 WL 673483 (D. Ariz. Feb. 11, 2020); Lynaugh II, 1
CA-CV 18-0375; Lynaugh I, 1 CA-CV 17-0183; Lynaugh v. BMO Harris Bank
NA, 1 CA-CV 18-0013, 2019 WL 386354 (Ariz. App. Jan. 31, 2019) (mem.
decision).
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Decision of the Court
filed motions to dismiss and joined other parties’ motions to dismiss.
Extensive motion practice followed.
¶5 Best filed three motions to disqualify four attorneys for
alleged conflicts. After oral argument, the superior court: (1) denied all
motions against the attorneys; (2) granted the Villarreal Defendants’
motions to dismiss; and (3) denied Best leave to amend his complaint.
¶6 Meanwhile, in November 2019, the superior court declared
Best a vexatious litigant.3 Thereafter, the superior court entered a signed
judgment in favor of the Villarreal Defendants and granted attorney’s fees
and costs totaling $26,653.24. Best timely appealed regarding only the
Villarreal Defendants. We have jurisdiction under A.R.S. § 12-2101(A)(1).
DISCUSSION
I. Dismissal of Claims.
¶7 Best argues the superior court erred by dismissing his claims
against the Villarreal Defendants. We review a Rule 12(b)(6) dismissal for
failure to state a claim de novo. Coleman v. City of Mesa, 230 Ariz. 352, 355,
¶ 7 (2012). Arizona’s notice pleading standard requires that a complaint set
forth “a short and plain statement of the claim showing that the pleader is
entitled to relief.” Ariz. R. Civ. P. 8(a)(2). This standard ensures that the
defendant receives “fair notice of the nature and basis of the claim.” Cullen
v. Auto-Owners Ins. Co., 218 Ariz. 417, 419, ¶ 6 (2008).
¶8 “The doctrine of res judicata will preclude a claim when a
former judgment on the merits was rendered by a court of competent
jurisdiction and the matter now in issue between the same parties or their
privities was, or might have been, determined in the former action.” Hall
v. Lalli, 194 Ariz. 54, 57, ¶ 7 (1999). Under this doctrine, a judgment on the
merits in a prior suit involving the same parties bars a second suit based on
the same cause of action. Chaney Bldg. Co. v. City of Tucson, 148 Ariz. 571,
573 (1986). A cause of action is the same if “no additional evidence is
needed to prevail in the second action than that needed in the first.” Phx.
Newspapers, Inc. v. Dep’t of Corr., 188 Ariz. 237, 240 (App. 1997).
¶9 The lion’s share of Best’s claims are precluded by res judicata.
Best’s claims regarding fraudulent transfer, tortious interference, and
3 See Maricopa Cnty. Super. Ct. Admin. Order No. 2019-146,
http://www.superiorcourt.maricopa.gov/SuperiorCourt/Administrative
Orders/AdminOrders/AO%202019-146.pdf.
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“[b]ogus TDUS” (trustee deed upon sale) have been litigated extensively
and to finality in this court and the superior court. See First Best Case, 1 CA-
CV 19-0199, at *1–*2, *7, ¶¶ 1, 3, 7–8, 34–37, 44 (affirming summary
judgment for Villarreal and others on Best’s claims of fraudulent transfer
and tortious interference with a business expectancy); Lynaugh II, 1 CA-CV
18-0375, at *1, *3, ¶¶ 1, 3, 16 (affirming summary judgment in a suit to void
the trustee’s sale); BMO Harris Bank NA, 1 CA-CV 18-0013, at *1, *2, *5, ¶¶
1, 8–9, 22 (same). And as we held in Best’s previous case, A.R.S. § 33-811(C)
bars Best’s attack on the trustee’s sale. See Lynaugh II, 1 CA-CV 18-0375, at
*2, ¶¶ 9, 10.
¶10 With respect to the other claims—breach of contract and
abuse of process—Best’s complaint failed to meet the requisite notice
pleading standard. Best alleges that the Villarreal Defendants are liable for
breach of contract but fails to allege any facts about the contract; Best’s
complaint does not specify when the contract was formed, the obligations
of the parties, the parties to the contract, or any details about a breach. See
Goodman v. Physical Res. Eng’g, Inc., 229 Ariz. 25, 28, ¶ 7 (App. 2011)
(explaining that to prevail on a breach of contract claim, a claimant must
prove a contract existed between the parties, the other party breached that
contract, and the claimant suffered damages as a result).
¶11 Further, Best does not explain, let alone demonstrate, how the
Villarreal Defendants are liable for abuse of process. “The elements of an
abuse-of-process claim are (1) a willful act in the use of judicial process; (2)
for an ulterior purpose not proper in the regular conduct of the
proceedings.” Crackel v. Allstate Ins. Co., 208 Ariz. 252, 257, ¶ 11 (App. 2004)
(citation and quotation omitted). To establish an ulterior purpose, a
claimant “must present more than mere speculation to support the
assertion that the defendant has used court processes with an improper
intent.” Id. at 259, ¶ 18. Moreover, the claimant must show the defendant’s
actions “could not logically be explained without reference to the
defendant’s improper motives.” Id. at ¶ 19. In his complaint, Best advances
only conclusory allegations that the Villarreal Defendants “participated in
defrauding the Court” and “advanced legal cases with falsehoods and
material misrepresentations” by using “fake and[/]or forged documents.”
Best’s complaint never moves beyond conclusory speculation to define
improper intent or motives that could form the basis for a cognizable claim.
See id. at ¶¶ 18, 19.
¶12 Because Best’s claims for abuse of process, breach of contract,
fraudulent transfer, tortious interference, and “bogus TDUS” are precluded
or otherwise fail to state a claim, the superior court did not err in granting
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BEST v. VILLARREAL, et al.
Decision of the Court
the Villarreal Defendants’ motions to dismiss. Best argues that his response
adequately “debunked” each of the Villarreal Defendants’ arguments for
dismissal, and if not, he should have had the right to amend his complaint.
But here, an amended complaint would also be futile because the court
already resolved these claims against Best as a matter of law. See First-
Citizens Bank & Trust Co. v. Morari, 242 Ariz. 562, 567, ¶ 12 (App. 2017) (“A
court does not abuse its discretion by denying a request to amend if the
amendment would be futile.”); see also Lynaugh II, 1 CA-CV 18-0375, at *3,
¶ 13. Finally, because Best has no ownership interest in the 12th Street
Property, the Villarreal Defendants would be entitled to dismissal even if
Best was allowed to file an amended complaint. First Best Case, 1 CA-CV
19-0199, at *7, ¶ 35.
¶13 Best also argues that he was entitled to a TRO under Rule 65.
See Ariz. R. Civ. P. 65. But because we find the superior court did not err in
granting the Villarreal Defendants’ motions to dismiss and motion for
summary adjudication, his argument is moot and we need not address it.
II. Alleged Attorney Misconduct.
¶14 Best argues the superior court should have disqualified
attorney Kyle Kinney under the advocate-witness rule.4 We review a
superior court’s ruling on a motion to disqualify counsel for an abuse of
discretion. Burch & Cracchiolo, P.A. v. Myers, 237 Ariz. 369, 374, ¶ 14 (App.
2015). An attorney cannot serve as an advocate at a trial where he or she is
likely to be a necessary witness unless the testimony relates to an
uncontested issue, the testimony involves legal services rendered in the
case, or disqualification of the lawyer would create a substantial hardship
for the client. Ariz. R. Sup. Ct. 42, ER 3.7. Application of this rule involves
balancing a litigant’s right to choose his or her counsel against the prejudice
that may be caused by opposing counsel serving as both an advocate and
witness. Sec. Gen. Life Ins. Co. v. Superior Court, 149 Ariz. 332, 335 (1986). To
strike this balance, an advocate-witness disqualification motion must show:
(1) “the attorney will give evidence material to the determination of the
4 See First Best Case, 1 CA-CV 19-0199, at *5, ¶¶ 22–27 (explaining why,
in an identical argument made by Best, the advocate-witness rule did not
disqualify a Lucas Land attorney from representation). Best has a
repetitious history of alleging so-called “attorney torts,” designed to
expand the litigation. See Maricopa Cnty. Super. Ct. Admin. Order No.
2019-146 at 2,
http://www.superiorcourt.maricopa.gov/SuperiorCourt/Administrative
Orders/AdminOrders/AO%202019-146.pdf.
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issues being litigated,” and (2) the evidence is “unobtainable elsewhere.”
Id. (quoting Cottonwood Estates v. Paradise Builders, 128 Ariz. 99, 105 (1981)).
Because disqualification motions are subject to tactical abuse, the party
seeking disqualification carries the burden and such motions should be
granted only in extreme circumstances. Simms v. Rayes, 234 Ariz. 47, 50, ¶
8 (App. 2014).
¶15 Here, the superior court did not err in determining that Best
failed to meet the burden of proof for attorney disqualification. First, Best
does not allege that Kinney had any material evidence relevant to the issues
at hand. Best points to Kinney’s pleadings and motions as proof of Kinney’s
“personal involvement which includes conspiring with the Defendants he
is trying to plead for.” Best does not allege anything that differentiates
“conspiring” from “representing.” Best also fails to show that Kinney’s
testimony is unobtainable elsewhere; he only expounds that “Kinney will
have to answer to why he claimed Foresight lost all its properties” and other
allegations. Best’s unsupported allegations fail to satisfy the burden of
proof necessary for attorney disqualification.
III. Attorney’s Fees.
¶16 This court has previously sanctioned Best for bringing
frivolous lawsuits or rewarded attorney’s fees to an opposing party under
both ARCAP 25 and A.R.S. § 12-349. See, e.g., Best v. Nieblas, 1 CA-CV 19-
0312, 2020 WL 6065961, at *5, ¶ 26 (Ariz. App. Oct. 15, 2020) (mem.
decision); First Best Case, 1 CA-CV 19-0199, at *9, ¶ 44; Best v. Driggs Title
Agency, Inc., 1 CA-CV 19-0037, 2019 WL 7182582, at *4, ¶ 18 (Ariz. App. Dec.
24, 2019) (mem. decision); Best v. Hillard, 2 CA-CV 2014-0154, 2015 WL
530138, at *4, ¶ 13 (Ariz. App. Feb. 10, 2015) (mem. decision); Best v. Warrick,
1 CA-CV 12-0043, 2013 WL 1653586, at *3–*4, ¶¶ 15–19 (Ariz. App. Apr. 16,
2013) (mem. decision). We have previously stated: “[t]he record
demonstrates that Best is engaging in a practice of litigation that is intended
to harass, is groundless, and is not made in good faith.” See Best v. Carson
Messinger Elliott Laughlin & Ragan, P.L.L.C., 1 CA-CV 08-0702, 2009 WL
3115835, at *7, ¶¶ 33–35 (Ariz. App. Sept. 29, 2009) (mem. decision). Yet
“[n]otwithstanding this history of sanctions, Best has continued misusing
the judicial process.” Nieblas, 1 CA-CV 19-0312, at *5, ¶ 26.
¶17 Here, Best’s arguments are frivolous and unsupported by any
reasonable legal theories. See ARCAP 13(a)(6)–(7). We therefore exercise
our discretion to grant the Villarreal Defendants reasonable attorney’s fees
upon compliance with ARCAP 21. Matter of Levine, 174 Ariz. 146, 152–53
(1993) (finding an appeal frivolous because it was unsupported by any
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reasonable legal theory and presented no colorable argument); see also
ARCAP 13(a)(6)–(7). Because Best does not prevail and is appearing pro
per, we deny his request for fees. See ARCAP 21; see also Simon v. Maricopa
Med. Ctr., 225 Ariz. 55, 64, ¶ 40 (App. 2010).
CONCLUSION
¶18 For the foregoing reasons, we affirm the superior court’s
judgment.
AMY M. WOOD • Clerk of the Court
FILED: AA
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