Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-4_04-cv-00258/USCOURTS-azd-4_04-cv-00258-1/pdf.json

Nature of Suit Code: 380
Nature of Suit: Other Personal Property Damage
Cause of Action: 28:1332 Diversity-Property Damage

---

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

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

GILES CONSTRUCTION, INC.,

Plaintiff, 

vs.

COMMERCIAL FEDERAL BANK,

Defendants. 

)

)

)

)

)

)

)

)

)

)

No. CIV 04-258-TUC-CKJ

ORDER

On August 3, 2006, Magistrate Judge Jennifer C. Guerin issued a Report and

Recommendation [Doc. # 42] in which she recommended Defendant's Motion for Summary

Judgment [Doc. # 28] be granted on all of Plaintiff's claims and Defendant's request for an

award of attorneys' fees be denied. Defendant Commercial Federal Bank, Inc. ("CFB") has

filed an objection to the Report and Recommendation asserting that it is the prevailing party

in this matter and it is entitled to an award of attorneys' fees for expenses incurred in proving

the absence of a contract and because Plaintiff Giles Construction, Inc. ("Giles")

acknowledged in the Complaint that an award of attorneys' fees to the successful party would

be appropriate. Giles asserts, however, that CFB prevailed on the four tort claims and that

there was never a breach of contract claim alleged by Giles. Neither party has filed any

objections to the remaining issues.

The Court is to make a de novo review of those issues to which objection is made.

28 U.S.C. § 636(b)(1). As to those issues to which no objections are filed, the Court is to

review the findings and recommendations for clear error. McDonnell Douglas Corp. v.

Case 4:04-cv-00258-CKJ Document 45 Filed 09/21/06 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 -

Commodore Bus. Mach., Inc., 656 F.2d 1309, 1313 (9th Cir. 1981). The parties have not

objected to the magistrate judge's determinations of the issues presented in the Motion for

Summary Judgment. The Court has reviewed those issues and finds they were correctly

decided by the magistrate judge.

CFB has objected, however, to the magistrate judge's determinations as to an award

of attorney's fees. The Court will review this issue de novo. "A party is entitled to an award

of its attorney's fees under A.R.S. § 12-341.01 if judgment in its favor is based upon the

absence of the contract sued upon by the adverse party." Lacer v. Navajo County, 141 Ariz.

392, 394, 687 P.2d 400, 402 (App. 1984). Indeed, an award of attorney's fees is not

precluded merely because two legal theories are intertwined "'as long as the cause of action

in tort could not exist but for the breach of the contract.'" In Re Larry's Apartment, L.L.C.,

249 F.3d 839, 836 (9th Cir. 2001), quoting Sparks v. Republic National Life Insurance Co.,

132 Ariz. 529, 543, 647 P.2d 1127, 1141 (1982) (en banc); see also White v. Arizona

Property and Casualty Insurance Guaranty Fund, 190 Ariz. 526, 950 P.2d 1147 (1997). An

award is not appropriate, however, where the contract is "merely somewhere in the factual

background." Larry's Apartment, 249 F.3d at 836. 

In this case, Giles' tort claims were not reliant on a breach of contract. Giles'

allegations against CFB could have existed whether or Giles and the medical facility had

contracted for the construction work. Further, the allegations against CFB do not involve a

contractual relationship between Giles and CFB. Lastly, Giles' own assertion in the

Complaint that the successful party is entitled to an award of attorney's fees does not require

a determination that an award is appropriate. Rather, just as the Court is to determine

whether a complaint states a cause of action or whether there is an absence of a genuine issue

of material fact and that judgment as a matter of law should be granted, it is the Court that

determines whether a party is entitled to an award of attorney's fees. The Court finds the

contractual relationships were peripheral to the claims and an award of attorney's fees is not

appropriate.

After an independent review, IT IS ORDERED:

Case 4:04-cv-00258-CKJ Document 45 Filed 09/21/06 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 -

1. The Report and Recommendation [Doc. # 42] is ADOPTED;

2. Defendant's Motion for Summary Judgment [Doc. # 28] is GRANTED;

3. Summary judgment in favor of Defendant is GRANTED;

4. The request for an award of attorney's fees is DENIED, and;

5. The Clerk of the Court shall enter judgment accordingly and shall then close

its file in this matter.

DATED this 21st day of September, 2006.

Case 4:04-cv-00258-CKJ Document 45 Filed 09/21/06 Page 3 of 3