FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

JACOB BENSON, an individual; 

JOSEPH BENSON; DEBORAH BENSON, 

husband and wife; K. B., a minor, by 

and through Jacob Benson, guardian 

ad litem,

Plaintiffs-Appellants,

v.

CASA DE CAPRI ENTERPRISES, LLC, 

an Arizona limited liability 

company; UNKNOWN PARTIES, 

named as John Does 1–20; ABC

CORPORATIONS I–X; XYZ

PARTNERSHIPS I–X,

Defendants-Appellees,

CONTINUING CARE RISK RETENTION 

GROUP, INC., Garnishee,

Real-Party-In-Interest-Appellee.

No. 19-16686

D.C. No.

2:18-cv-00006-

DWL

ORDER 

CERTIFYING 

QUESTIONS 

TO ARIZONA 

SUPREME 

COURT

Appeal from the United States District Court

for the District of Arizona

Dominic Lanza, District Judge, Presiding

Argued and Submitted October 5, 2020

Pasadena, California

Filed November 23, 2020
2 BENSON V. CASA DE CAPRI ENTERPRISES

Before: Andrew J. Kleinfeld, Andrew D. Hurwitz, and

Daniel A. Bress, Circuit Judges.

Order

SUMMARY*

Certification to Arizona Supreme Court

The panel certified to the Arizona Supreme Court the 

following questions:

1. In a garnishment action by a judgment 

creditor against the judgment debtor’s 

insurer claiming that coverage is owed 

under an insurance policy, where the 

judgment creditor is not proceeding on an 

assignment of rights, can the insurer 

invoke the doctrine of direct benefits 

estoppel to bind the judgment creditor to 

the terms of the insurance contract?

2. If yes, does direct benefits estoppel also 

bind the judgment creditor to the 

arbitration clause contained in the 

insurance policy? 

* This summary constitutes no part of the opinion of the court. 

It has been prepared by court staff for the convenience of the reader.
BENSON V. CASA DE CAPRI ENTERPRISES 3

ORDER

This case involves the potential application of Arizona’s 

doctrine of direct benefits estoppel in a garnishment action 

brought by a judgment creditor against a judgment debtor’s 

insurer. The issues of Arizona law presented in this appeal 

are important and appear unresolved. Pursuant to Arizona 

Revised Statutes (“A.R.S.”) § 12-1861 and Arizona 

Supreme Court Rule 27, we respectfully certify two 

questions of law to the Arizona Supreme Court, as set forth 

in Part III below. The answers to these questions “may be 

determinative of” this appeal, and it appears there is “no 

controlling precedent” in the decisions of the Arizona 

Supreme Court or the Arizona Court of Appeals. A.R.S. 

§ 12-1861.

I

Appellee Continuing Care Risk Retention Group 

(“CCRRG”) provides liability insurance to skilled nursing 

facilities. From January 2012 to August 2013, CCRRG 

insured Casa De Capri Enterprises (“Capri”), a skilled 

nursing facility, under a “Claims Paid” insurance policy that 

provided up to $1,000,000 in liability coverage. The policy 

had an arbitration provision, which states:

Any dispute or controversy arising under, out 

of, in connection with or in relation to this 

Policy shall be submitted to, and determined 

and settled by, arbitration in Sonoma County, 

California[.] . . . Any demand for arbitration 

by a CCRRG Member under this Policy must 

be made within twelve (12) months of any 

dispute arising out of this “Policy”, 

including, but not limited to any denial by 

CCRRG of defense or reimbursement, 
4 BENSON V. CASA DE CAPRI ENTERPRISES

whether in whole or in part, of any “Claim” 

dispute or controversy that arises. . . . The 

parties agree that any such award shall also 

be final and binding in a direct action against 

CCRRG by any judgment creditor of a 

CCRRG Member.1

On December 10, 2012, Appellants Jacob Benson and 

his family (“the Bensons”) sued Capri in Maricopa County 

Superior Court, alleging negligence and abuse of Jacob. 

Jacob, a “vulnerable adult,” see A.R.S. § 46-451(A)(10), 

was a resident at Casa De Capri. Capri tendered the 

Bensons’ claim to CCRRG, which provided a defense. In 

August 2013, Capri filed a Chapter 11 bankruptcy petition, 

triggering an automatic stay of all litigation against it. Capri 

then cancelled its insurance policy with CCRRG, effective 

August 1, 2013. Citing the policy’s terms, CCRRG then 

withdrew from its defense of the Bensons’ claims and 

disclaimed any further coverage in the action.

Three years later, the Bensons obtained an order partially 

lifting the bankruptcy stay so that their action against Capri 

could proceed. As part of this order, the Bensons also 

obtained an assignment of Capri’s potential bad faith 

insurance claim against CCRRG. On December 1, 2017, the 

state court entered an approximately $1.5 million 

uncontested judgment in favor of the Bensons and against 

Capri.

1 Capri and CCRRG also signed a Subscription Agreement 

containing a substantially similar arbitration provision. 
BENSON V. CASA DE CAPRI ENTERPRISES 5

After judgment entered, the Bensons filed a writ of 

garnishment against CCRRG, seeking to obtain from 

CCRRG the $1.5 million owed under the Bensons’ judgment 

against Capri, plus interest. CCRRG removed the 

garnishment action to federal court based on diversity of 

citizenship, and then moved to compel arbitration under the 

insurance policy’s arbitration clause. In response, the 

Bensons maintained that they could not be required to 

arbitrate because their garnishment action was not premised 

on an assignment of Capri’s coverage claims under the 

CCRRG policy, and the Bensons themselves were not 

signatories to that policy. CCRRG maintained that the 

Bensons sought to avail themselves of the benefits of the 

CCRRG policy, and so should be bound by its terms—

including the arbitration clause. CCRRG also disputes that 

it would owe any coverage to Capri because Capri cancelled 

its policy.

Applying Arizona law, the district court granted 

CCRRG’s motion to compel arbitration and dismissed the 

action, holding that the Bensons, though non-signatories to 

the policy, were bound to its arbitration clause under 

Arizona’s doctrine of direct benefits estoppel. The Bensons 

appealed.

II

The Federal Arbitration Act (“FAA”), 9 U.S.C. § 1, et 

seq., governs the arbitration clause. The FAA makes 

“written arbitration agreements ‘valid, irrevocable, and 

enforceable, save upon such grounds as exist at law or in 

equity for the revocation of a contract.’” Arthur Andersen 

LLP v. Carlisle, 556 U.S. 624, 629–30 (2009) (quoting 

9 U.S.C. § 2). Generally, “as a matter of federal law, any 

doubts concerning the scope of arbitrable issues should be 

resolved in favor of arbitration.” Moses H. Cone Mem’l 
6 BENSON V. CASA DE CAPRI ENTERPRISES

Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24–25 (1983). 

Here, there is no apparent dispute that the arbitration clause, 

if applicable, covers the Bensons’ claims. Instead, the 

threshold question is “whether a particular party,” the 

Bensons, are “bound by the arbitration agreement.” 

Rajagopalan v. NoteWorld, LLC, 718 F.3d 844, 847 (9th Cir. 

2013). To answer that question, we turn to “[t]raditional 

principles of state law,” in this case, Arizona’s. Id.

(quotations omitted).

Under Arizona law, “whether a nonparty is bound by a 

contract term is properly resolved by the Court as a matter 

of law.” JTF Aviation Holdings Inc. v. CliftonLarsonAllen 

LLP, 472 P.3d 526, 529 (Ariz. 2020) (quoting Duenas v. Life 

Care Ctrs. of Am., Inc., 336 P.3d 763, 771 (Ariz. Ct. App. 

2014) (alterations omitted)). The Arizona Supreme Court 

recently explained that “theories available to bind nonsignatories to the terms of a contract” include “incorporation 

by reference, assumption, agency, veil-piercing or alter ego, 

equitable estoppel, and third-party beneficiary.” Id. at 529–

30 (citing, inter alia, Duenas, 336 P.3d at 772).

Relevant here is a variant of equitable estoppel, 

sometimes called “direct benefits estoppel,” which the 

district court applied to bind the Bensons to the policy’s 

arbitration clause. Under Arizona’s doctrine of direct 

benefits estoppel, a non-signatory may be bound to the terms 

of a contract when the non-signatory “(1) knowingly exploits 

the benefits of an agreement . . . , or (2) seeks to enforce 

terms of that agreement or asserts claims that must be 

determined by reference to the agreement.” Austin v. Austin, 

348 P.3d 897, 906 (Ariz. Ct. App. 2015).

In attempting to collect a judgment against the insured, 

Arizona law permits a non-signatory judgment creditor to 

use garnishment to litigate an insurer’s obligations to the 
BENSON V. CASA DE CAPRI ENTERPRISES 7

judgment debtor under an insurance policy. See Sandoval v. 

Chenoweth, 428 P.2d 98, 102 (Ariz. 1967) (“[A]fter 

recovering a judgment against an insured under a liability 

policy, the injured third person may collect such judgment 

by instituting garnishment proceedings against the liability 

insurer.”); see also Holt v. Utica Mut. Ins. Co., 759 P.2d 623, 

626 (Ariz. 1988); Kepner v. W. Fire Ins. Co., 509 P.2d 222, 

225 (Ariz. 1973) (“Such a testing of the insurer’s liability 

may take the form of . . . proceedings on garnishment 

following the trial of the third party’s action . . . .”).

If Capri sought to litigate whether CCRRG was required 

to cover its losses under the insurance policy, it seems quite 

clear the arbitration clause would apply. The same would be 

true if the Bensons were assigned Capri’s contractual rights 

under the policy. See Farmers Ins. Exch. v. Udall, 424 P.3d 

420, 425 (Ariz. Ct. App. 2018) (rejecting argument that the 

assignee of an insured’s post-loss policy claim is “allow[ed] 

. . . to pursue its claims unhampered by the policy’s 

obligations”). But the Bensons maintain that Arizona’s

garnishment action is of a “special and limited nature,” and 

emphasize that they are not proceeding under an assignment 

of Capri’s rights to coverage under the insurance contract. 

Neither we nor the parties have located any Arizona cases 

applying direct benefits estoppel in a garnishment action 

brought by a judgment creditor against the judgment 

debtor’s insurer, seeking to obtain amounts under the policy 

in satisfaction of the judgment.

In support of their position, the Bensons cite Able 

Distributing Co. v. James Lampe, General Contractor, 773 

P.2d 504 (Ariz. Ct. App. 1989). In that case, the plaintiff, 

Able, obtained a default judgment against a subcontractor, 

Master Mechanical. Id. at 506. Able then served a writ of 

garnishment against the general contractor, Lampe, based on 
8 BENSON V. CASA DE CAPRI ENTERPRISES

a debt that Lampe owed to Master Mechanical under a 

contract to which Able was not a signatory. Id. The trial 

court determined that Lampe was indebted to Master 

Mechanical and entered judgment in favor of Able as 

judgment creditor. Id. at 507. On appeal, Lampe argued that 

its contract with Master Mechanical required all disputes to 

be settled through arbitration, and thus its liability to Master 

Mechanical could not be determined in a garnishment 

proceeding. Id. at 515.

The Able court rejected this argument, stating that 

“[p]arties to a contract which includes an arbitration clause 

cannot control the rights of a non-party garnishing creditor 

such as Able.” Id. Although Able also relied on the fact that 

Lampe had unreasonably delayed pursuing arbitration, id., 

the Bensons maintain that in a garnishment action, Able

forecloses any attempt to bind a non-signatory judgment 

creditor to the terms of the judgment debtor’s contract, at 

least absent a formal assignment of rights under the contract.

For its part, CCRRG contends that Able did not purport 

to announce a special rule for garnishment actions, but 

instead only a “general rule” that a contract normally does 

not bind non-signatories. That rule, CCRRG notes, is 

subject to recognized exceptions. This argument finds 

support in Duenas, where the court cited Able for the 

proposition that a party “is not bound to arbitrate disputes it 

has not specifically agreed to arbitrate,” before noting that 

“[t]here are some exceptions to the general rule,” such as 

equitable estoppel or third-party beneficiary theories. 

336 P.3d at 772. In CCRRG’s view, the form of the 

garnishment proceeding does not change the substance of 

this action—a dispute over insurance coverage under a 

contract—and thus the ordinary exceptions for binding nonsignatories to the terms of a contract apply.
BENSON V. CASA DE CAPRI ENTERPRISES 9

According to CCRRG, the district court correctly 

applied the doctrine of direct benefits estoppel, as articulated 

in Austin, 348 P.3d at 906, because the Bensons seek to

exploit the benefits of the CCRRG policy by collecting its 

proceeds, and their claimed entitlement to those benefits 

must be determined by reference to the policy’s terms, which 

set the conditions of coverage.

We are unsure whether to read Able as announcing a 

general rule, which is subject to the exceptions identified in 

Duenas, 336 P.3d at 772, or a special rule for garnishment 

actions, exempting judgment creditors from the Duenas 

exceptions. See also Crawford Prof’l Drugs, Inc. v. CVS 

Caremark Corp., 748 F.3d 249, 260 (5th Cir. 2014) (noting 

a general “dearth of Arizona precedent” involving 

“arbitration-by-estoppel” theories); United States v. Harkin 

Builders, Inc., 45 F.3d 830, 835 (4th Cir. 1995) (describing 

Able as “holding that [a] judgment creditor seeking under 

Arizona law to attach a contract interest by way of 

garnishment is not bound by [the] contract’s arbitration 

clause”).

In the absence of any apparent controlling precedent, and 

out of respect for Arizona courts and their preeminent role 

in interpreting Arizona law, we believe it “most suitable” to 

certify this issue to “the highest court of the state whose law 

is in question.” Fast Trak Inv. Co., LLC v. Sax, 962 F.3d 

455, 468 (9th Cir. 2020).

III

We therefore certify the following questions to the 

Arizona Supreme Court:

1) In a garnishment action by a judgment 

creditor against the judgment debtor’s 
10 BENSON V. CASA DE CAPRI ENTERPRISES

insurer claiming that coverage is owed 

under an insurance policy, where the 

judgment creditor is not proceeding on an 

assignment of rights, can the insurer 

invoke the doctrine of direct benefits 

estoppel to bind the judgment creditor to 

the terms of the insurance contract?

2) If yes, does direct benefits estoppel also 

bind the judgment creditor to the 

arbitration clause contained in the 

insurance policy?

We respectfully ask the Arizona Supreme Court to 

exercise its discretionary authority to accept certification 

under Ariz. Rev. Stat. § 12-1861. “Our phrasing of the 

questions should not restrict the Court’s consideration of the 

issues involved. We acknowledge that the Court may 

reformulate the relevant state law questions as it perceives 

them to be, in light of the contentions of the parties.” Raynor 

v. United of Omaha Life Ins. Co., 858 F.3d 1268, 1273 (9th 

Cir. 2017) (quotations and alterations omitted). If the 

Arizona Supreme Court decides not to accept certification, 

we will resolve these questions based on our best 

understanding of Arizona law.

The Clerk will file a certified copy of this order with the 

Arizona Supreme Court under Arizona Supreme Court Rule 

27. This appeal is withdrawn from submission and will be 

resubmitted following the conclusion of any proceedings in 

the Arizona Supreme Court. The Clerk is directed to 

administratively close this docket, pending further order. 

We retain jurisdiction over any further proceedings in this 

Court. The parties will notify the Clerk within one week 

after the Arizona Supreme Court accepts or rejects 
BENSON V. CASA DE CAPRI ENTERPRISES 11

certification and again within one week after an opinion is 

rendered.

IV

Counsel for Appellants, the Bensons:

H. Michael Wright

David R. Schwartz

Udall Shumway, PLC

1138 North Alma School Road, Suite 101

Mesa, AZ 85201

(480) 461-5300

Steven S. Guy

The Guy Law Firm, PLLC

10105 E. Via Linda, Suite 103

Scottsdale, AZ 85258

(480) 767-3175

Counsel for Appellee CCRRG:

Steven G. Mesaros

Brian E. Cieniawski

Renaud Cook Drury Mesaros, PA

One North Central Avenue, Suite 900

Phoenix, AZ 85004

(602) 307-9900

Terri A. Sutton

Shauna Martin Ehlert

Cozen O’Connor

999 Third Avenue, Suite 1900

Seattle, WA 98104

(206) 340-1000
12 BENSON V. CASA DE CAPRI ENTERPRISES

IT IS SO ORDERED.

/s/ Andrew D. Hurwitz 

Andrew D. Hurwitz,

United States Circuit Judge, Presiding