Villa v. Villa ( 2016 )

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UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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
LORI SUE VILLA, Petitioner/Appellee,
v.
DAVID DANIEL VILLA, Respondent/Appellee.
______________________________________________________
BROOKS GIBSON, in his capacity as Parenting Coordinator,
Appellant.
No. 1 CA-CV 15-0099 FC
FILED 10-20-2016
Appeal from the Superior Court in Maricopa County
No. FC2007-005355
The Honorable Gerald Porter, Judge (Retired)
AFFIRMED
COUNSEL
Joseph W. Charles, Glendale
Counsel for Appellant
Law Office of Judith E. Abramsohn, Phoenix
By Judith E. Abramsohn
Counsel for Appellee David Villa
Pearson Law Group, LLC, Phoenix
By Catherine M. Pearson
Counsel for Appellee Lori Villa
VILLA v. VILLA et al.
Decision of the Court
MEMORANDUM DECISION
Judge Samuel A. Thumma delivered the decision of the Court, in which
Presiding Judge Patricia K. Norris and Judge Margaret H. Downie joined.
T H U M M A, Judge:
¶1 Parenting coordinator Brooks Gibson appeals from an order
refusing to vacate a previous order requiring him to disgorge fees parents
paid to him. Because the superior court had jurisdiction to order
disgorgement, and did not err in doing so, the order is affirmed.
FACTS AND PROCEDURAL HISTORY
¶2 Lori Sue Villa nka Sutorka (Mother) and David Daniel Villa
(Father) divorced in 2007. Later, they agreed that Gibson would serve as the
parenting coordinator for issues involving their two sons. See Ariz. R. Fam.
Law P. 74 (2014); see also Ariz. Rev. Stat. (A.R.S.) §§ 25-405, -410 (2016).1 In
January 2013, the court issued a lengthy order appointing Gibson parenting
coordinator. Among other things, that order specified Gibson would serve
for 12 months, subject to court removal, ordered that Gibson “shall keep
accurate records of services rendered” and addressed fees for Gibson’s
services.
¶3 Father later learned that Gibson’s counseling license had been
surrendered effective November 2012 pursuant to a consent agreement
with the state regulatory agency.2 As a result, Father moved to discharge
Gibson for cause and for reimbursement of the fees Mother and Father had
paid Gibson. Although Mother and Father disagreed about Gibson’s
1Absent material revisions after the relevant dates, statutes and rules cited
refer to the current version unless otherwise indicated. Because Ariz. R.
Fam. Law P. 74 was amended effective January 1, 2016, the prior version of
Rule 74 (in place during the relevant events here) is cited throughout.
2 Although Gibson disputes the reason for the surrender, he does not
dispute that his license was surrendered effective November 2012. The
consent agreement specified that Gibson’s surrender of his license would
be treated as a revocation.
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Decision of the Court
qualifications, they agreed that his fees were unreasonable and his billing
was inadequate.
¶4 In a February 2014 minute entry sent to Gibson and the
parties, the court set a March 2014 return hearing on Father’s motion. At the
March 2014 hearing, the court discharged Gibson from any further duties
and set an evidentiary hearing on Father’s motion to be held on April 21,
2014, with a copy of the resulting minute entry sent to Gibson and the
parties. At the April 21, 2014 hearing, Mother and Father testified and
provided exhibits received by the court, Gibson testified (including about
exhibits marked for identification) and the court took the matter under
advisement. During that hearing, the court repeatedly told Gibson that, if
he was not discharged for cause, he would be required to provide the court
and the parties a detailed billing statement so the court could determine the
reasonableness of his fees.
¶5 The court, in a May 1, 2014, minute entry sent to Gibson and
the parties, did not discharge Gibson for cause but directed that “Gibson
shall within thirty days provide a detailed billing to the Court and the
parties outlining by date and time in chronological order the services that
were provided and the amounts charged to each party.” The record
indicates Gibson never complied with this order.3
¶6 In early July 2014, Mother and Father filed a joint motion
(showing service on Gibson) for an order that Gibson disgorge all fees he
had been paid or, alternatively, that Gibson submit the detailed billing
information to the court and the parties within 10 days. On July 24, 2014,
Gibson filed a response, asking for 30 more days to submit billing
information.4 By September 2014, however, Gibson had not provided such
information. On September 2, 2014, the court granted the joint motion for
disgorgement and on October 22, 2014, entered a judgment directing
Gibson to disgorge $11,495 in fees paid by Mother and Father. Gibson did
not timely appeal from that judgment.
3Gibson apparently attempted to send the Court (but not Mother and
Father) a May 2014 letter, which was stricken by the court later that month
and is not part of the record on appeal.
4It appears, from the record, that the court did not act on Gibson’s request
for 30 additional days to submit the billing information. But, given that the
court did not grant the motion for disgorgement until September 2, 2014,
Gibson had sufficient time to submit such information but did not do so.
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Decision of the Court
¶7 On November 13, 2014, Gibson filed a motion to set aside the
judgment “pursuant to Rules 55(c) and 59, 60(c)(1) and (6),” apparently
referencing the Arizona Rules of Civil Procedure. The motion argued
Gibson’s failure to comply with the various orders was due to excusable
neglect, claimed (without supporting authority) that he had a meritorious
defense and claimed that “equity demands” the judgment be set aside. The
superior court denied the motion and this appeal followed. This court has
jurisdiction over Gibson’s timely appeal of the denial of his motion to set
aside. See A.R.S. § 12-2101(A)(1).
DISCUSSION
I. The Superior Court Had Personal Jurisdiction Over Gibson.
¶8 Gibson argues that the superior court lacked personal
jurisdiction over him, an issue this court reviews de novo. State v. Donahoe,
220 Ariz. 126, 127 n.1 (App. 2009). Any services Gibson provided, however,
were pursuant to the superior court’s order, to which Gibson did not object,
and which governed his involvement in the case. Even more significantly,
Gibson personally appeared, litigated disgorgement, made filings and
testified and, by doing so, waived any objection he may have had to
personal jurisdiction. See Tarr v. Superior Court (Jensen), 142 Ariz. 349, 351
(1984) (citations omitted).
¶9 Gibson argues that “[a] trial court is precluded from asserting
jurisdiction over a party when there had been no service of process to a non-
party in the underlying action or a full opportunity to contest the
allegations against it.” In making this argument, Gibson relies exclusively
on MCA Financial Group, Ltd. v. Enterprise Bank & Trust, 236 Ariz. 490 (App.
2014). MCA, however, is distinguishable.
¶10 In MCA, an individual, who was employed by an entity, was
appointed receiver. Id. at 492 ¶ 3. After the individual performed services
as receiver, and was paid receiver fees, a party sought disgorgement of
those fees, which had been paid to the entity. Id. at 493 ¶ 5. The objecting
party, however, did not join the entity as a party, the entity was not the
receiver and the entity made a special appearance for the limited purpose
of challenging the allegations in the disgorgement motion and argued that
the motion was procedurally improper. Id. On appeal, the court reversed
an order requiring the entity to disgorge payments, finding the entity was
not a party, was not the receiver and was not named in the underlying
lawsuit, “the receivership proceedings, or the disgorgement motion as a
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party against whom relief was sought,” meaning the superior court lacked
personal jurisdiction over the entity. Id. at 495 ¶ 12.
¶11 Unlike the entity in MCA, Gibson was the parenting
coordinator serving pursuant to the superior court’s order and, in doing so,
submitted to the court’s jurisdiction. Gibson was named in the
disgorgement motion, was served with that motion, had knowledge of the
proceedings on that motion and, in fact, generally appeared and
participated in those proceedings. Given these differences, MCA does not
stand for the proposition that the superior court lacked personal
jurisdiction over Gibson. For these reasons, the superior court properly
exercised personal jurisdiction over Gibson in considering the
disgorgement motion.
II. Gibson’s Due Process Rights Were Not Violated.
¶12 Gibson argues he “has not been afforded the due process
rights of a plenary hearing.” Gibson, however, failed to raise this argument
with the superior court and cannot do so for the first time on appeal. See
Trantor v. Fredrickson, 179 Ariz. 299, 300 (1994). Moreover, Gibson has not
shown that he was denied any due process right to which he was entitled.
See Emmett McLoughlin Realty, Inc. v. Pima County, 212 Ariz. 351, 355 ¶ 17
(App. 2006) (noting, as applicable here, that due process requires “adequate
notice and . . . the opportunity to be heard at a meaningful time and in a
meaningful manner”).
¶13 Gibson asserts that he was not given “the opportunity to
refute the allegations made against him.” The record, however, is to the
contrary. The record shows that Gibson received advance notice of the
evidentiary hearing, appeared at that hearing, testified and indicated that
he understood what was required of him. After that evidentiary hearing,
Gibson was given several chances to support the fees he was claiming. But,
as noted above, he failed to do so.
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Decision of the Court
¶14 During oral argument before this court, Gibson’s counsel
intimated that Gibson offered billing records to the superior court at the
April 21, 2014 hearing but that offer was refused. The transcript from the
April 21, 2014 hearing, however, reveals the following exchange:
MR. GIBSON: I’ve already submitted all of -- all
of our -- my sessions are recorded with the
parties, I’ve already submitted all those
recordings to the court. I’ve already submitted
my work product --
THE COURT: And I’m going to hand that back
MR. GIBSON: notes --
THE COURT: -- to you, just so you know.
MR. GIBSON: -- 55 pages.
The superior court then specifically told Gibson that he did not want those
records but wanted itemized billing statements so that he could “look at the
reasonableness of [his] fees.” The court was clear that the documents Mr.
Gibson offered did not constitute the itemized billing statements that the
court would require him to submit.
¶15 Gibson contends that he did not know how to comply with
the court’s order and had no notice of the May 1, 2014 ruling summarizing
the April 21, 2014 hearing. At the April 21, 2014 hearing, however, the court
explained what Gibson was required to do and Gibson told the court that
he understood what was required of him. Moreover, the May 1, 2014 ruling
simply commits to writing the court’s express directives at the April 21,
2014 hearing. Finally, Gibson’s assertion that he had never prepared a
court-ordered itemized billing statement is irrelevant. Gibson had notice of
the allegations against him and he had a reasonable opportunity to be heard
and to comply with the requirement that he provide itemized billing
statements. On this record, Gibson has not shown that his due process
rights were violated.
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Decision of the Court
III. The Disgorgement Order Did Not Result In Unjust Enrichment.
¶16 Although conceding an award of expert fees is reviewed for
an abuse of discretion, Gibson argues the disgorgement ruling unjustly
enriches Mother and Father. Again, it does not appear that Gibson raised
this argument with the superior court and, accordingly, it may be deemed
waived. See Trantor, 179 Ariz. at 300. Moreover, classically, disgorgement
focuses on the conduct of the party required to return the money, not on
the benefit to the party receiving the disgorged funds. Cf. Hirsch v. Ariz.
Corp. Comm’n, 237 Ariz. 456, 466 ¶ 41 (App. 2015) (noting “‘[d]isgorgement
does not aim to compensate the [recipients of the disgorged funds], as
restitution does’”) (citation omitted). Under this analysis, Gibson’s focus on
any benefit to the parties is misplaced.
¶17 Claiming he was entitled to payment for his services in
quantum meruit, Gibson cites Schwartz v. Schwerin, 85 Ariz. 242 (1959). As
noted in Schwartz, quantum meruit focuses on “the reasonable value of
services rendered” where no contractual payment term applies. Id. at 245.
This is, in essence, what the superior court was targeting in directing
Gibson to provide detailed billing records. Gibson, however, failed to do so
after repeated opportunities. In this respect, even if Gibson’s quantum
meruit claim was timely asserted and legally supported, as in Schwartz,
Gibson “failed or refused at that time to give any approximation on the time
element [for his services] and was very evasive as to any question submitted
to him on this point.” Id. at 247. Moreover, despite several opportunities,
Gibson failed to give the superior court or the parties the opportunity to
review his fees and determine reasonableness with supporting proof.
Accordingly, Gibson has not shown an entitlement to fees on a quantum
meruit basis or that the disgorgement results in an improper unjust
enrichment.
IV. The Superior Court Had Authority To Order Disgorgement.
¶18 Gibson argues the superior court lacked authority to order
disgorgement because Rule 74 “does not discuss or mention disgorgement
as a remedy.” Gibson, however, did not raise this argument in his opening
brief and this court typically does not address issues raised for the first time
in a reply brief on appeal. See Dawson v. Withycombe, 216 Ariz. 84, 111 ¶ 91
(App. 2007).
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Decision of the Court
¶19 Essentially, Gibson argues that parties were required to pay,
and the superior court was required to approve, his services regardless of
whether they were reasonable or supported by appropriate billing, with no
recourse other than removing him as a parenting coordinator. This is not
the law. The superior court properly may construe and enforce applicable
rules and orders “in a manner to secure the just, prompt and inexpensive
determination of every action and proceeding.” Ariz. R. Fam. Law P. 1; see
also A.R.S. § 25-410(B) (requiring fees charged be “reasonable” and cited in
the parenting coordinator order issued in this case). And “a superior court
judge has inherent authority to conduct such proceedings and issue such
orders as are necessary to the complete administration of justice.” Arpaio v.
Baca, 217 Ariz. 570, 576 ¶ 19 (App. 2008) (citations omitted).
¶20 Gibson cites State ex rel. Horne v. AutoZone, Inc., 229 Ariz. 358
(2012) for the proposition that disgorgement was not a proper remedy here.
AutoZone, however, dealt with the availability of “statutory, not equitable,
remedies.” Id. at 362 ¶ 19. Because the applicable statute expressly
authorized restitution, AutoZone found that disgorgement was not
authorized. Id. Here, by contrast, A.R.S. § 25-410(B) mandates that fees
charged be reasonable and Rule 74 does not mention express remedies for
a parent coordinator’s inability to justify fees charged. Accordingly, the
proposition relied upon in AutoZone — “‘where a statute expressly provides
a particular remedy or remedies, a court must be chary of reading others
into it’” — has no application here. Id. (citation omitted).
¶21 The court’s order appointing Gibson required that he keep
accurate records of services rendered and A.R.S. § 25-410(B)—one of the
statutory bases for the order—required that the fees be reasonable. These
provisions vested the superior court with the power to determine whether
the fees Gibson charged were reasonable, a power that logically includes
the remedy of disgorgement. When those services and fees were
questioned, the superior court directed Gibson more than once to disclose
supporting documentation. And when he failed to do so after numerous
opportunities, the court determined that he had not shown his fees were
reasonable. The court then ordered disgorgement. On this record, Gibson
has not shown the disgorgement order was beyond the authority of the
superior court.
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Decision of the Court
V. Attorneys’ Fees And Costs.
¶22 Gibson requests an award of attorneys’ fees and costs
incurred before the superior court and on appeal pursuant to A.R.S. § 12-
341.01(A) and Arizona Rule of Civil Appellate Procedure (ARCAP) 21.
Mother and Father seek attorneys’ fees and costs on appeal pursuant to
A.R.S. §§ 12-349 and 12-341.01. Because Gibson is not the successful party,
his request is denied. Although Mother and Father are the successful parties
on appeal, they have not shown that an award of attorneys’ fees under
A.R.S. § 12-349 is justified here and have not shown entitlement to an award
of attorneys’ fees under A.R.S. § 12-341.01. Accordingly, their request for
attorneys’ fees is denied, but their request for taxable costs on appeal is
granted, contingent upon their compliance with ARCAP 21.
CONCLUSION
¶23 The superior court’s denial of Gibson’s motion to set aside
judgment is affirmed.
AMY M. WOOD • Clerk of the Court
FILED: AA
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