Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_10-cv-02774/USCOURTS-azd-2_10-cv-02774-2/pdf.json

Nature of Suit Code: 220
Nature of Suit: Foreclosure
Cause of Action: 28:1444 Petition for Removal- Foreclosure

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Amy Y. Mundinger, Aaron Mundinger,

Plaintiffs, 

vs.

Wells Fargo Bank, et al., 

Defendants. 

)

)

)

)

)

)

)

)

)

)

)

)

No. CV-10-2774-PHX-FJM

ORDER

The court has before it defendants’ motion for attorney’s fees (doc. 24) and

memorandum in support (doc. 30), plaintiffs’ response (doc. 33), and defendants’ reply (doc.

34). 

On April 25, 2011, we granted defendants’ motion to dismiss and dismissed the first

amended complaint with prejudice. Defendants’ now seek an award of attorney’s fees in the

amount of $18,411.40, pursuant to A.R.S. § 12-341.01(A), which authorizes a court to award

reasonable attorney’s fees to the “successful party” in a contested action arising out of

contract. 

We agree with defendants that this action “arose out of a contract,” and therefore falls

within A.R.S. § 12-341.01. An action need not involve a breach of contract claim in order

to be eligible for fees under § 12-341.01. Instead, a prevailing party is eligible for fees if the

action involves the “rights, obligations, validity, enforceability and priority of rights arising

Case 2:10-cv-02774-FJM Document 35 Filed 08/11/11 Page 1 of 3
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 2 -

out of contract.” Deutsche Credit Corp. v. Case Power & Equip. Co., 179 Ariz. 155, 164,

876 P.2d 1190, 1199 (Ct. App. 1994). Plaintiffs filed claims based upon their belief that the

promissory note was modified, and challenging defendants’ authority under the deed of trust

to notice and conduct a trustee’s sale. Underlying each of these claims are the rights and

obligations of the parties under the promissory note and the deed of trust. As such, these

claims have “arisen out of contract” for purposes of § 12-341.01.

A court has wide discretion is deciding whether to award fees under § 12-341.01. The

award of fees “should be made to mitigate the burden of the expense of litigation to establish

a just claim or a just defense.” Id. § 12-341.01(B). “It need not equal or relate to the

attorney fees actually paid or contracted.” Id. In deciding whether to award fees we consider

factors such as (1) whether the unsuccessful party's claims were meritorious; (2) whether the

litigation could have been avoided or settled; (3) whether assessing fees would cause extreme

hardship; (4) whether the successful party prevailed with respect to all relief sought; (5)

whether the legal question was novel; and (6) whether an award would discourage other

parties with tenable claims from litigating them. Associated Indem. Corp. v. Warner, 143

Ariz. 567, 570, 694 P.2d 1181, 1184 (1985). 

After considering each of the Warner factors, we conclude that an award of fees in this

case is appropriate. Plaintiffs’ claims, though perhaps colorable, were not entirely

meritorious. Given the parties’ diverse positions, settlement was not possible. The legal

questions presented, involving Arizona’s deed of trust statute, and issues of unjust

enrichment and promissory estoppel, were not novel. Defendants prevailed on every claim

and an award of fees would not discourage other parties from filing meritorious actions.

Given that plaintiffs defaulted on their mortgage loan, it is reasonable to presume that a

hardship is likely. This factor alone weighs in plaintiffs’ favor.

Defendants request $18,411.40 in fees, in this simple matter that was resolved on a

motion to dismiss. Defendants employed two lawyers, with hourly rates ranging from $400

to $225 an hour—with those fees in the higher range exceeding prevailing Phoenix rates for

this type of case. They expended 17.5 hours on their second motion to dismiss and 23.5

Case 2:10-cv-02774-FJM Document 35 Filed 08/11/11 Page 2 of 3
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 3 -

hours on their reply, and a total of more than 59 hours defending against claims that they

themselves described as “routinely dismissed” by courts in this District and elsewhere (doc.

6 at 1). We think 15 hours at $250.00 per hour would be sufficient to get a non-meritorious

and routine complaint dismissed. We then discount that by plaintiffs’ presumed hardship to

yield $1,500.00 

Therefore, IT IS ORDERED GRANTING defendants’ motion for an award of

attorney’s fees (doc. 24), and awarding defendants $1,500 in fees. 

DATED this 11th day of August, 2011.

Case 2:10-cv-02774-FJM Document 35 Filed 08/11/11 Page 3 of 3