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UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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

STRATTON RESTORATION LLC, et al., Third-Party Plaintiffs/Appellees,

v.

BRIG BURTON, et al., Third-Party Defendants/Appellants.

No. 1 CA-CV 20-0455

Appeal from the Superior Court in Maricopa County

No. CV2015-051357

CV2015-051698

The Honorable Andrew J. Russell, Judge

VACATED AND REMANDED

COUNSEL

Manolio & Firestone PLC, Scottsdale

By Veronica L. Manolio

Counsel for Third-Party Plaintiffs/Appellees

Mark Deatherage Law Office, Phoenix

By Mark Deatherage

Counsel for Third-Party Defendants/Appellants

FILED 4-28-2022
STRATTON, et al. v. BURTON, et al.

Decision of the Court

2

MEMORANDUM DECISION

Presiding Judge D. Steven Williams delivered the decision of the Court, in 

which Judge Jennifer B. Campbell and Judge James B. Morse Jr. joined.

W I L L I A M S, Judge:

¶1 Brig and Carly Burton (the “Burtons”) appeal the superior 

court’s award of attorney’s fees and costs against them. For reasons that 

follow, we vacate the award and remand.

FACTUAL AND PROCEDURAL BACKGROUND

¶2 In 2014, two of Brig Burton’s companies, 363, LLC, d/b/a The 

363 Group, and 363 Business Alliances, LLC (collectively the “363 Entities”) 

entered into contracts to purchase Stratton Restoration, LLC. When the 

purchase did not materialize, the 363 Entities and Stratton Restoration, 

LLC, including its principals, TK and Michelle Stratton (collectively the 

“Strattons”), filed claims against each other in the superior court. The 

Strattons also filed a third-party claim against the Burtons personally. 

Meanwhile, the Burtons petitioned for Chapter 13 Bankruptcy protection in 

the U.S. Bankruptcy Court. Following notice of the Burtons’ bankruptcy 

filing, the superior court placed this case on its dismissal calendar. 

¶3 In 2018, while the bankruptcy was pending, the 363 Entities, 

the Strattons, the Burtons, and Kevin Erdmann (who was involved in 

unrelated litigation against the Burtons) entered into a global settlement 

agreement (the “Agreement”). The Burtons personally owed non-party 

Erdmann $35,000.00, which the Strattons agreed to pay in exchange for an 

end to all pending or future claims between the signatories. The Burtons 

signed the Agreement for themselves, and Brig Burton signed for the 363 

Entities. The Strattons timely paid off the Burtons’ debt to Erdmann in 

accordance with the terms of the Agreement. 

¶4 No one informed the superior court of the Agreement, and in 

March 2019, the court dismissed the case for failure to prosecute. Several 

months later, the 363 Entities moved for relief from the court’s dismissal 

claiming the excusable neglect of legal staff caused missed deadlines that 

could have taken the case off of the dismissal calendar. See Ariz. R. Civ. P. 

60(b)(1). The motion did not mention the Agreement and asserted that the 
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3

Strattons would not be prejudiced by reinstatement. Over the Strattons’

objection, the court vacated its dismissal order and reinstated the case. 

¶5 The Strattons then moved to enforce the Agreement, dismiss 

the matter, and requested their attorney’s fees and costs under the terms of 

the Agreement and A.R.S. §§ 12-341, -341.01, and -349. After briefing, the 

court entered judgment in favor of the Strattons. The 363 Entities did not 

contest the amount of fees or costs sought and did not object to entry of an 

award under the Agreement or A.R.S. § 12-341.01. The 363 Entities did, 

however, object to any fee award under A.R.S. § 12-349. The court awarded 

the Strattons $11,472.63 in fees under both A.R.S. § 12-341.01 and under the 

terms of the Agreement, as well as $50.63 in costs. 

¶6 The Strattons lodged a proposed form of judgment obligating 

not just the 363 Entities for the attorney’s fees and costs, but also the Burtons 

personally. Once the court endorsed the judgment, the Burtons appealed to 

this court. We have jurisdiction under Article 6, Section 9, of the Arizona 

Constitution and A.R.S. § 12-120.21.

DISCUSSION 

¶7 The Burtons argue the superior court erred by awarding fees 

and costs against them because they were: (1) not parties to the underlying 

business dispute, (2) not named in the fee application, and (3) not named in 

the minute entry ruling granting the fee award. First, the record makes clear 

the Burtons became a party when the Strattons sued them personally in 

their counterclaim. Second, though the fee application requested that fees 

“be imposed against both Plaintiffs” (meaning both 363 Entities) and their 

counsel, the Strattons’ original request for fees and costs also named “the 

Burtons and counsel.” Third, while the court’s minute entry does not 

specify the Burtons were obligated personally for the fee and cost award, 

the judgment clearly does. 

¶8 We review an award of attorney’s fees and costs for an abuse 

of discretion. Maleki v. Desert Palms Prof’l Props., L.L.C., 222 Ariz. 327, 

333-34, ¶ 32 (App. 2009). “However, we review questions of law, including 

the superior court’s authority to award attorney’s fees and contract 

interpretation, de novo.” Bennett Blum, M.D., Inc. v. Cowan, 235 Ariz. 204, 

205, ¶ 5 (App. 2014). 

¶9 The 363 Entities breached the Agreement when they moved 

to reinstate the superior court matter with “no credible evidence that the 

Strattons ha[d] failed to fully comply with the . . . Agreement.” As a result, 

the Strattons incurred attorney’s fees. Section 12-341.01 authorized the court 
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Decision of the Court

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to award the Strattons their reasonable attorney’s fees incurred enforcing 

the Agreement, and the express terms of the Agreement required it. But the 

compulsory attorney’s fee award was only authorized against “the 

non-prevailing party or parties.” The non-prevailing parties were the 363 

Entities.

¶10 Although Brig Burton is a principal of both 363 Entities, the 

Burtons, in their capacity as third-party defendants, did not file any 

pleadings in the superior court causing the Strattons to incur additional 

attorney’s fees and costs to enforce the Agreement. Our task, therefore, is 

to determine whether the superior court erred in obligating the Burtons 

personally for the Strattons’ fee and cost award.

¶11 Generally, a member of an LLC is “not personally liable, 

directly or indirectly, . . . for a debt, obligation or other liability of the 

company . . . solely by reason of being or acting as a member or manager.” 

A.R.S. § 29-3304(A). Accordingly, “the personal assets of a corporate officer 

may not normally be reached to satisfy corporate liabilities.” Loiselle v. Cosas 

Mgmt. Grp., LLC, 224 Ariz. 207, 214, ¶ 30 (App. 2010). However, courts will 

disregard the corporate entity and pierce the corporate veil “if there is 

sufficient evidence that 1) the corporation is the ‘alter ego or business 

conduit of a person,’ and 2) disregarding the corporation’s separate legal 

status is ‘necessary to prevent injustice or fraud.’” Id. (first quoting Dietel v. 

Day, 16 Ariz. App. 206, 208 (1972); and then quoting State v. Angelo, 166 

Ariz. 24, 27 (App. 1990)). 

¶12 The record does not reflect that the superior court weighed 

evidence as required by Loiselle. Neither the superior court’s minute entry, 

nor its judgment, address whether the court contemplated or intended to 

pierce the corporate veil. Because we cannot discern from the record 

whether the court intended to do so, we vacate the award of attorney’s fees

and costs – only so far as it obligated the Burtons personally – and remand 

for the superior court to make that determination. 

¶13 Both the Burtons and the Strattons seek attorney’s fees on 

appeal under A.R.S. § 12-341.01 and the terms of the Agreement. We decline 

to award either party its fees, but instead reserve that decision for the 

superior court on remand. Baseline Fin. Servs. v. Madison, 229 Ariz. 543, 546, 

¶ 17 (App. 2012).
STRATTON, et al. v. BURTON, et al.

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CONCLUSION

¶14 We vacate the court’s award of attorney’s fees and costs 

against the Burtons and remand for further proceedings consistent with this 

decision.