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UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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

BEAUCHAMP LAW OFFICE PC, et al., Plaintiffs/CrossDefendant/Appellants,

v.

GUST ROSENFELD PLC, Defendant/Cross-Claimant/Appellee.

No. 1 CA-CV 17-0250

Appeal from the Superior Court in Maricopa County

No. CV2013-009661, CV2013-014712 (Consolidated)

The Honorable Daniel J. Kiley, Judge

AFFIRMED

COUNSEL

Oracle Law Group, Phoenix

By Melanie E. Beauchamp

Counsel for Plaintiffs/Cross-Defendant/Appellants

Gust Rosenfeld P.L.C., Phoenix

By Charles W. Wirken

Counsel for Defendant/Cross-Claimant/Appellee

FILED 4-19-2018
BEAUCHAMP, et al. v. GUST ROSENFELD

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2

MEMORANDUM DECISION

Judge James B. Morse Jr. delivered the decision of the Court, in which 

Presiding Judge Randall M. Howe and Judge Kenton D. Jones joined.

M O R S E, Judge:

¶1 Appellants Melanie Beauchamp ("Beauchamp") and 

Beauchamp Law Office ("BLO") appeal the superior court's judgment 

following a bench trial in favor of Appellees Gust Rosenfeld P.L.C. ("Gust"). 

For the following reasons, we affirm.

FACTS AND PROCEDURAL HISTORY

¶2 This case involves a dispute over attorney fees in connection 

with the settlement of a medical malpractice case. In October 2010, C.B. and 

her husband J.B. (collectively the "Clients") met with Melanie McBride 

("McBride"), an attorney with Gust, regarding complications from C.B.'s 

recent surgeries. The Clients subsequently retained Gust to represent them

and entered into a written contingent-fee agreement. The fee agreement 

provided for a fee of one-third of any recovery after the initiation of 

litigation, or reasonable compensation from recovery in the action based 

upon specified hourly rates if the Clients terminated Gust before resolution 

of the case. Over the next two years, Gust spent significant time developing

the case.

¶3 In December 2012, McBride resigned her position with Gust, 

and the Clients elected to transfer their file to McBride at her new law firm. 

Shortly thereafter, McBride left her new law firm and eventually joined 

BLO. McBride and BLO formally substituted in as co-counsel of record for 

the Clients in March 2013. BLO then entered into a fee agreement with the 

Clients which provided for a fee of one-third of any recovery.

¶4 On July 17, 2013, McBride quit her employment at BLO. The 

Clients chose to keep BLO as their attorney because their case was 

scheduled to go to mediation later that month. Less than a week after 

McBride quit, Gust sent a letter to BLO providing notice of its lien of 

approximately $145,000 in fees and expenses previously incurred in the 

case. BLO, Beauchamp, and a BLO employee who is not a party to this 
BEAUCHAMP, et al. v. GUST ROSENFELD

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appeal officially substituted in as counsel for the Clients and ultimately 

obtained a settlement of $500,000 which was confirmed in late August 2013.

¶5 BLO distributed $185,225.83 of the settlement proceeds to the 

Clients, paid itself $169,774.17, and held the remaining $145,000 in trust in 

recognition of Gust's lien. That same day, BLO sent a letter to Gust, alleging 

Gust told her there would be no liens asserted by Gust on the Clients' case 

and claiming Gust had been negligent in the representation of the Clients 

and performed little work. Gust responded the following day, disputing 

BLO's letter in every respect and reinforcing its claim to a portion of the 

proceeds of the Clients' settlement. BLO demanded an itemized list of 

charges, and Gust provided a copy of its internal Prebill Summary. 

Approximately two weeks later, Gust sent BLO a revised invoice. Two time 

entries regarding drafts for potential closing agreements appeared on the 

Prebill Summary but did not appear on the invoice.

¶6 In October 2013, BLO initiated a lawsuit for declaratory relief 

against Gust, the Clients, and McBride. Various counterclaims and crossclaims were subsequently asserted. At a hearing on July 21, 2014, the 

superior court noted that all parties had agreed that the total amount of 

attorneys' fees owed by the Clients should not exceed one-third of the total 

settlement, and ordered BLO to distribute $15,558.77 of the $145,000 that it 

had retained in its trust account to Gust for payment of costs incurred while 

representing the Clients, and to distribute the balance of the account to the 

Clients. The superior court also determined Gust had a lien against the onethird contingent fee that BLO had received from the settlement proceeds in 

the underlying case. After this ruling, BLO and Gust dismissed their 

respective claims against the Clients.

¶7 A bench trial was held in December 2016. Gust was treated 

as the plaintiff at trial because, as a result of various rulings over the course 

of the litigation, the only claims left for the trial court to resolve were Gust's 

claims against BLO for unjust enrichment and declaratory relief. Gust 

presented expert witness testimony in support of the importance of the

work they performed on the underlying case. The expert witness offered 

the court two approaches for apportioning the fees between Gust and BLO. 

The first method would be to total the billings of each firm, determine the 

percentage that each firm's billings bear to the total, and then apply the 

percentage applicable to each firm to the amount of the fee award. The 

second approach would be to award each firm a percentage share of the 

one-third of the total settlement proceeds the parties had agreed was the 

total amount of attorneys' fees owed by the Clients. Those percentages 
BEAUCHAMP, et al. v. GUST ROSENFELD

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would be based upon the respective values the court believed each of the 

parties added toward the obtaining of the settlement.

¶8 After considering the evidence, the superior court entered 

judgment in favor of Gust, finding it had a valid charging lien on the funds

recovered in the underlying lawsuit. The superior court found that under 

the doctrine of unjust enrichment, BLO was unjustifiably enriched by Gust's 

work on the underlying suit, and therefore owed Gust restitution. The 

court was not persuaded by BLO's arguments that Gust's only remedy 

could be against the Clients, that Gust added no value to the case, and that 

Gust acted improperly.

¶9 The superior court awarded a quantum meruit measure of 

damages to Gust. After conducting a thorough review of Gust's invoices, 

the court calculated Gust's portion of the contingency fee to be $125,532.50.

As this amount was close to 75% of the total contingency fee, the court 

accepted Gust's expert's testimony as to the proportion of the contributions 

and awarded Gust 75% of the contingency fee in the underlying case and 

BLO 25%.

¶10 Before trial, BLO filed a motion for sanctions relating to a 

document that Gust drafted in January 2013. Gust's Prebill Summary 

provided that one of Gust's attorneys spent .5 hours drafting a "[c]losing 

letter to client, discussing share of proceeds for fees and costs incurred by 

Gust." Gust did not produce this draft letter until approximately one week 

before trial. The Prebill Summary also discussed drafting a "letter to clients 

regarding change of counsel firms," as well as a "potential agreement with 

Melanie [McBride] and clients for sharing of fees and reimbursement of 

expenses." Gust never produced this draft and asserted that it was lost 

when an employee's computer crashed.

¶11 In its Findings of Fact and Conclusions of Law, the superior 

court addressed the motion for sanctions, finding that the documents in 

question were irrelevant because they were never approved by Gust or 

circulated outside of Gust. In addition, the court found that the evidence 

did not suggest Gust intentionally "destroyed" the draft document. The 

court denied BLO's motion for sanctions.

¶12 BLO timely appealed. We have jurisdiction pursuant to 

Article 6, Section 9, of the Arizona Constitution and Arizona Revised 

Statutes ("A.R.S.") sections 12-120.21(A)(1) and -2101(A)(1).

DISCUSSION
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¶13 BLO argues the superior court erred by (1) finding unjust 

enrichment absent impoverishment, improper conduct, and privity of 

contract; (2) applying quantum meruit as the measure of damages; (3) 

allowing the claim against BLO to go forward; and (4) failing to sanction 

Gust for discovery violations.

¶14 We review questions of law de novo. We will accept the 

superior court's factual findings, "unless they are clearly erroneous." Calisi 

v. Unified Fin. Servs., LLC, 232 Ariz. 103, 106, ¶ 13 (App. 2013). "To be clearly 

erroneous, a finding must be unsupported by any reasonable evidence." In 

re Van Dox, 214 Ariz. 300, 304, ¶ 15 (2007). We view the evidence in the light 

most favorable to sustaining the superior court's judgment and will uphold 

it if it is correct for any reason. Great W. Bank v. LJC Dev., LLC, 238 Ariz. 470, 

473 n.1 (App. 2015); Citibank (Ariz.) v. Van Velzer, 194 Ariz. 358, 359, ¶ 5 

(App. 1998). We do not reweigh conflicting evidence on appeal. Great W. 

Bank, 238 Ariz. at 478, ¶ 22.

I. Unjust Enrichment

¶15 The superior court found BLO was unjustly enriched by 

Gust's work on the Clients' case. "Unjust enrichment occurs when one party 

has and retains money or benefits that in justice and equity belong to 

another." Trustmark Ins. Co. v. Bank One, Ariz., NA, 202 Ariz. 535, 541, ¶ 31 

(App. 2002). As the trial court correctly stated, the party asserting a claim 

of unjust enrichment bears the burden of showing: "(1) an enrichment, (2) 

an impoverishment, (3) a connection between the two, (4) the absence of 

justification for the enrichment and impoverishment, and (5) the absence of 

any remedy at law." Mousa v. Saba, 222 Ariz. 581, 588, ¶ 29 (App. 2009).

¶16 BLO first argues the superior court erred in finding a 

connection between Gust's impoverishment and BLO's gain because Gust's 

expenditure of funds and time was for the Clients' benefit, not BLO's. The 

superior court's detailed factual findings, however, establish that the two 

years of work Gust performed led to BLO's successful settlement. Though 

BLO argues that Gust did little to nothing of value in the underlying case, 

she does not argue that the trial court's factual findings are erroneous. See 

Ariz. R. Civ. P. 52(a) ("Findings of fact . . . must not be set aside unless clearly 

erroneous."). Recognizing the connection between the enrichment and the 

impoverishment, the superior court did not err when it concluded that 

"Gust was impoverished by devoting hours of professional time to the 

Clients' case without compensation, while BLO was correspondingly 

enriched because it benefited from Gust's work product."
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¶17 Next, relying upon Wang Elec., Inc. v. Smoke Tree Resort, LLC, 

230 Ariz. 314 (App. 2012), BLO argues that Arizona law precludes liability 

under unjust enrichment because she did not engage in improper conduct 

nor have privity with Gust. This argument fails for two reasons. First, the 

law in this situation is contrary to BLO's argument. Rather than unjust 

enrichment requiring the existence of a contractual arrangement, i.e., 

requiring privity, the doctrine of unjust enrichment cannot be applied

where there is a specific contract which governs the relationship of the 

parties. Brooks v. Valley Nat'l Bank, 113 Ariz. 169, 174 (1976) (“[W]here there 

is a specific contract which governs the relationship of the parties, the 

doctrine of unjust enrichment has no application.”).

¶18 Second, unjust enrichment does not necessarily require a 

finding of improper conduct. BLO contends that Wang Electric added an 

"improper conduct" element to all analyses of unjust enrichment. This is 

incorrect. Wang Electric articulated a limitation upon the reach of unjust 

enrichment claims in situations involving subcontractors, tenants, and 

property owners. 230 Ariz. at 320, ¶ 17. The court found that claims of 

unjust enrichment do not stretch so far as to make property owners 

"unwitting guarantors of their tenants' contracts for improvements." Id. at 

¶ 16. Accordingly, Wang Electric held that "a contractor hired by a tenant to 

make improvements to leasehold premises, or subcontractors retained by 

that contractor, can recover unpaid monies for making tenant 

improvements from the property owner only when that owner has engaged 

in improper conduct." Id. at ¶ 17. Because this case does not involve such 

a situation, the holding in Wang Electric regarding improper conduct does 

not apply.

¶19 Here, the superior court correctly noted that although a claim 

of unjust enrichment requires a showing of enrichment "without 

justification," the term "without justification" is not synonymous with

"wrongfully" or "maliciously." See, e.g., Loiselle v. Cosas Mgmt. Grp., LLC, 224 

Ariz. 207, 210, ¶ 10 (App. 2010) (fact that defendant "committed no tortious 

or wrongful act" and "had no knowledge" of third party's wrongful acts did 

not "preclude [plaintiffs] from recovering on their unjust enrichment 

claim"). Ultimately, Gust was not required to demonstrate privity or that 

BLO engaged in wrongful conduct to prevail on its unjust enrichment 

claim.

¶20 BLO contends that limitations and equitable defenses apply 

because Gust failed to follow the industry standards for lien noticing and 

deprived BLO of the opportunity to refuse the work for which Gust's fees 

claim existed. Like the superior court, we find no authority for the 
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proposition that Gust's failure to assert a lien sooner should result in the

waiver of its subsequent but well-supported claims. A charging lien 

becomes binding upon a third party when the party has notice of the lien. 

See Millsap v. Sparks, 21 Ariz. 317, 322 (1920) (charging lien is not perfected 

until notice has been given to obligor). When Gust filed its claim for fees,

the Clients, and presumably their by-then current counsel, obtained notice

of Gust's claim.

¶21 Additionally, BLO knew that Gust previously represented the 

Clients through its employee McBride, and thus knew that Gust could 

potentially assert a lien against the ultimate settlement. At trial, both Gust 

and BLO presented evidence that the lien was discussed shortly after BLO

agreed to take the Clients' case1 and that is repeated within BLO's Opening 

Brief. BLO's knowledge of Gust's potential charging lien negates her 

argument that she did not have timely notice of it.

¶22 On appeal, BLO asserts defenses of accord and satisfaction, 

waiver, estoppel, fraud, and failure of consideration. However, because 

BLO did not assert these defenses below, and, on appeal, fails to cite 

authorities or state with particularity why or how the determination of the 

trial court might be deemed error, these arguments are waived. Ritchie v. 

Krasner, 221 Ariz. 288, 305, ¶ 62 (App. 2009); Modular Sys., Inc. v. Naisbitt, 

114 Ariz. 582, 587 (App. 1977); ARCAP 13(a)(7)(A).

II. Quantum Meruit

¶23 BLO argues the superior court misapplied quantum meruit as 

the measure of damages because it is only available in quasi-contractual 

circumstances. Not so. Quantum meruit is the correct measure of damages 

imposed when a party prevails on the equitable claim of unjust enrichment. 

W. Corr. Grp., Inc. v. Tierney, 208 Ariz. 583, 590, ¶ 27 (App. 2004).

¶24 BLO further argues that the superior court erred in its 

application of quantum meruit because such claims are measured by the loss 

to the plaintiff, not gain to the defendant. However, it is well settled that 

"[r]ecovery under quantum meruit is based on the value of services

rendered." Landi v. Arkules, 172 Ariz. 126, 135 (App. 1992). Here, the 

superior court properly found that the value of the services rendered is the 

value of the benefit conferred to BLO. The superior court performed a 

 

1 At trial, BLO asserted that this discussion included an agreement by Gust 

not to assert a charging lien. The superior court found that BLO's claims

were not credible.
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detailed analysis of the invoices submitted by Gust, declined fees that were 

frivolous or not advantageous to the litigation, and arrived at a conferred 

value of 75% of the contingency fee.

¶25 "Fashioning an equitable remedy is within the trial court's 

discretion, and it will not be disturbed on appeal absent an abuse thereof." 

Loiselle, 224 Ariz. at 210, ¶ 8. The superior court did not abuse its discretion 

in its careful analysis calculating the proper measure of damages.

III. Action Against Successor Law Firm

¶26 BLO argues Gust's only avenue for recompense is through the 

Clients. Per BLO, there is no legal support for Gust's claim that an attorney 

may use a charging lien to satisfy pre-judgment fees, nor is there precedent 

to support the claim that Gust may recover attorneys' fees from another law 

firm. We disagree.

¶27 "[A]n attorney under a contingency fee contract who is 

discharged prior to fulfillment of the contract is entitled to reimbursement 

for the reasonable value of his services." Garrett v. Garrett, 140 Ariz. 564, 567 

(App. 1983). A charging lien allows a lawyer to recover fees and costs from

the fund or property ultimately recovered on behalf of the client; charging 

liens are not limited to clients. See Linder v. Lewis, Roca, Scoville & Beauchamp, 

85 Ariz. 118, 123 (1958) (lien effective against assignee of client's judgment); 

see also Holly v. State, 199 Ariz. 358, 360, ¶ 10 (App. 2001) (lien took priority 

over State's right to statutory setoffs for inmate costs). The charging lien is 

binding upon a third party when the party has notice of the lien. See Millsap, 

21 Ariz. at 322 (noting that a charging lien is perfected when "notice has 

been given to the obligor against whom it is asserted," or when "such person 

has knowledge of the claim, or has notice of facts sufficient to put a prudent 

person upon inquiry"). Here, Gust represented the Clients under a 

contingent fee agreement and remained entitled to the reasonable value of 

the services rendered to the Clients after their representation ended. Its 

charging lien properly attached to the settlement monies when it provided 

BLO written notice of the lien.

¶28 BLO also argues Gust must be the attorney who obtained the 

judgment for its charging lien to apply. There is no rule or case authority 

supporting BLO's position. Charging liens attach to the funds created or 

obtained by the attorney's efforts. Nat'l Sales & Serv. Co. v. Superior Court, 

136 Ariz. 544, 545 (1983). Though Gust did not represent the Clients by the 

time the judgment was obtained, the superior court found that their efforts 
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were instrumental in generating the settlement. Thus, Gust was properly 

entitled to the portion of the funds obtained that it helped generate.

IV. Sanctions

¶29 BLO argues the superior court erred when it declined to 

sanction Gust for "destroying seminal documents." The document in 

question is a draft fee agreement between Gust and the Clients referenced 

in Gust's Prebill Statement. BLO contends this court must remand the issue 

to the trial court for specific findings as to Gust's intent in drafting the 

agreement and then "losing" it. Despite the superior court's nearly threepage discussion of the lost document, BLO claims the court did not make 

any findings on the issue.

¶30 "A trial court has broad discretion in ruling on disclosure and 

discovery matters, and this court will not disturb that ruling absent an 

abuse of discretion." Marquez v. Ortega, 231 Ariz. 437, 441, ¶ 14 (App. 2013). 

We defer to the trial judge with respect to factual findings and will affirm 

them so long as they are supported by reasonable evidence. Twin City Fire 

Ins. Co. v. Burke, 204 Ariz. 251, 254, ¶ 10 (2003).

¶31 The superior court found that there was no evidence that Gust 

destroyed the draft fee agreement. Moreover, the court found the 

document irrelevant because it would not have been binding as it was never 

approved by Gust's management, nor was it sent to the Clients. BLO has 

not shown that the loss of the draft agreement caused any harm. Therefore, 

it has not shown that sanctions would be appropriate. Thus, there was no 

abuse of discretion in denying BLO's motion for sanctions.
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CONCLUSION

¶32 For the foregoing reasons, we affirm. Gust requests its taxable 

costs on appeal. We award Gust taxable costs on appeal in compliance with 

ARCAP 21.

¶33 Additionally, Gust requests we impose sanctions against BLO

pursuant to ARCAP 25 for filing a frivolous appeal. "[A] frivolous appeal 

is one brought for an improper purpose or based on issues which are 

unsupported by any reasonable legal theory." Johnson v. Brimlow, 164 Ariz. 

218, 222 (App. 1990). Gust requests BLO's share of the contingency fee, 

approximately $20,000, as a sanction penalty. We impose ARCAP 25 

sanctions with "great reservation." Ariz. Tax Research Ass'n v. Dep't of 

Revenue, 163 Ariz. 255, 258 (1989). Under this standard, and in our 

discretion, we decline to impose the requested sanction against BLO.