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John S. Craiger (#021731) 

jcraiger@polsinelli.com 

POLSINELLI PC 

One East Washington Street, Suite 1200 

Phoenix, AZ 85004 

Phone: (602) 650-2000 

Fax: (602) 264-7033 

Attorney for Defendant USAA Federal Savings Bank 

THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

WILLIAM R. DONGES and CAROLYN 

R. DONGES, husband and wife, 

Plaintiffs, 

vs. 

USAA FEDERAL SAVINGS BANK, 

Defendant. 

Case No. 4:18-CV-00093-TUC-RM

DEFENDANT’S MOTION FOR 

RECONSIDERATION OF ORDER 

DENYING ATTORNEYS’ FEES 

(DOC. 99) 

Pursuant to LRCiv 7.2(g), USAA Federal Savings Bank (“USAA FSB”), moves for 

reconsideration of the Courts Order denying USAA FSB’s motion for attorney’s fees (the 

“Order”). (Doc. 99). Specifically, USAA FSB reconsideration of the Court’s finding that it 

is not entitled to attorney’s fees subject to the terms of the Deed of Trust between the 

Parties.

1

 Here, reconsideration is appropriate because the Court committed clear error by 

misapplying the terms of the Deed of Trust. 

 

 

1

 Although USAA FSB disagrees with the Court’s decision regarding its right to fees 

under A.R.S. § 12-341.01, in light of the discretion given to the district court in making 

such a determination AmerisourceBergen Corp. v. Dialysist West, Inc., 465 F.3d 946, 955 

(9th Cir. 2006), Defendant does not find the Court’s finding properly subject to a motion for 

reconsideration. USAA FSB does not seek to revisit this holding, and instead respectfully 

reserves its appellate rights. 

Case 4:18-cv-00093-RM Document 100 Filed 11/14/19 Page 1 of 6
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I. LEGAL STANDARD 

Rule 7.2(g) of the Local Rules of Civil Procedure states that motions for 

reconsideration will ordinarily be denied “absent a showing of manifest error or a showing 

of new facts or legal authority that could not have been brought to [the Court’s] attention 

earlier with reasonable diligence.” LRCiv 7.2(g)(1); Colter v. Holmberg, No. 17-CV-487-

TUC-RM, 2017 WL 6886090, at *1 (D. Ariz. Nov. 7, 2017). Rule 7.2(g) further provides: 

Any [motion for reconsideration] shall point out with specificity the 

matters that the movant believes were overlooked or misapprehended by 

the Court, any new matters being brought to the Court’s attention for the 

first time and the reasons they were not presented earlier, and any specific 

modifications being sought in the Court’s Order. No motion for 

reconsideration of an Order may repeat any oral or written argument made 

by the movant in support of or in opposition to the motion that resulted in 

the Order. 

Id. 

 Failure to comply with the requirements of Rule 7.2(g)(1) “may be grounds for 

denial of the motion.” Id.

II. DISCUSSION 

In its Order, the Court rightly noted that under Arizona law, “when a contract has an 

attorney’s fee provision it controls . . .” (Doc. 99 at 2 (citing Am. Power Prods., Inc. v. CSK 

Auto, Inc., 396 P.3d 600, 604 (Ariz. 2017)); see also Rich v. Bank of Am., N.A., 666 F. 

App’x 635, 642 (9th Cir. 2016). Here, the Deed of Trust securing Plaintiffs’ loan, which 

compels recovery of attorney’s fees and costs, is such a contract. In particular, the Deed of 

Trust provides, in relevant part: 

 If Grantor breaches any covenant in this Security Instrument, Grantor 

agrees to pay all expenses Lender incurs in performing such covenants or 

protecting its security interest in the Property. . . . Grantor agrees to pay all 

costs and expenses incurred by Lender in collecting, enforcing, or 

protecting Lender’s rights and remedies under this Security Instrument. 

This amount may include, but is not limited to, attorneys’ fees, court costs, 

and other legal expenses. 

(Doc. 65-3 at 4.) 

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In applying this provision, the Court correctly determined that “[t]here is little doubt 

that Plaintiffs’ failure to pay on their mortgage constituted a breach of a covenant.” (Doc. 

99 at 2.) Plaintiffs appear to have come to the same conclusion, as they did not challenge 

the applicability of the Deed of Trust’s fee-shifting provision. (See Doc. 94.) Indeed, 

Plaintiffs agree that “[t]he terms of the Deed of Trust specifically allow USAA FSB to 

recover attorney fees (sic) incurred in protecting its security interest in the property.” (Id. at 

4.) Given the provision’s applicability to the action at hand, Plaintiffs limited their 

challenge to Defendant’s ability to recover more than $50,000 in fees under the provision. 

(Id. at 4-5.) It is an axiom of contract interpretation, that contractual provisions should be 

determined based on the parties intent. See, e.g., Grosvenor Holdings, L.C. v. Figueroa, 

218 P.3d 1045, 1050 (Ariz. Ct. App. 2009). Here, where the parties have a shared intent 

and understanding of the provision’s meaning, the Court should defer to the parties’ 

interpretation. Id. (“The purpose of contract interpretation is to determine the parties’ intent 

and enforce that intent.”). 

 Despite the Court finding that Plaintiffs had breached a covenant of the Deed of 

Trust, and despite Plaintiffs recognition of the applicability of the fee-shifting provision, the 

Court declined to apply the provision as it plainly reads. According to the Court, the Deed 

of Trust’s fee-shifting provision is inapplicable because “Defendant . . . failed to establish 

that any fees it incurred defending this action were caused by [Plaintiffs’ breach in failing to 

pay on their mortgage.]”

2

 (Doc. 99 at 2) (emphasis original, alterations added). The Court 

further reasoned, “it appears that any fees incurred in this action were proximately caused 

by Defendant’s decision to postpone acting to preserve its security interest in the property . . 

. .” (Id.) 

 The plain text of the deed of trust, however, creates no such temporal limitation. 

See, e.g., Hadley v. Sw. Props., Inc., 570 P.2d 190, 193 (Ariz. 1977) (“Where the language 

 

2

 The Court’s proposition is simply unsupported by the record—Plaintiffs’ lawsuit 

was a direct attack on USAA FSB’s security interest, and had Plaintiffs prevailed in this 

matter, they would have extinguished USAA FSB’s security interest. 

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of the contract is clear and unambiguous, it must be given effect as it is written.”). And, to 

read one into the contract, would be inconsistent with its other provisions. For instance, the 

fee-shifting provision expressly contemplates that “Grantor agrees to pay all costs and 

expenses incurred by Lender in collecting, enforcing, or protecting Lender’s rights and 

remedies under this Security Instrument.” (Doc. 65-3 at 4.) Significantly, the Deed of 

Trust expressly contemplates that under the “Remedies on Default” subsection that “Lender 

may accelerate the Secured Debt and Foreclose this Security Instrument . . . .” (Id.); (see 

also Doc. 83 at 6 (Court recognizing that USAA FSB “could, but was not required to, 

accelerate the principal” under the Deed of Trust).) “A contract must be construed in its 

entirety, rather than from reading one provision in isolation from the rest of the contract.” 

See Cent. Ariz. Water Conservation Dist. v. U.S., 32 F. Supp. 2d 1117, 1128 (D. Ariz. 

1998). “A court should construe a contract in a manner that gives full meaning and effect to 

all its provisions and avoid an interpretation which leaves part of the contract meaningless 

or unreasonable.” Id. 

As such, when Plaintiffs—the Grantor—breached the covenant by failing to pay on 

their mortgage, USAA FSB—Lender became contractually entitled to attorney’s fees 

incurred in protecting its security interest—even if USA FSB elected, in accord with its 

contractual rights, to wait to enforce said rights. See, e.g., Taylor v. State Farm Mut. Auto. 

Ins. Co., 854 P.2d 1134, 1138 (Ariz. 1993) (“[i]n Arizona, a court will attempt to enforce a 

contract according to the parties’ intent”). 

III. CONCLUSION 

USAA FSB respectfully asks the Court to reconsider its order denying attorney’s 

fees, and award USAA FSB attorneys’ fees and litigation expenses totaling $114,928.91

pursuant to the terms of the Deed of Trust. 

RESPECTFULLY SUBMITTED this 14th Day of November, 2019. 

POLSINELLI PC 

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 By: /s/ John Craiger 

John Craiger 

1 E. Washington Street, Suite 1200 

Phoenix, AZ 85004 

 Attorneys for Defendant USAA FSB 

 

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CERTIFICATE OF SERVICE 

I hereby certify that on November 14, 2019, I electronically transmitted the 

foregoing document to the U.S. District Court Clerk’s Office by using the CM/ECF System 

for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF 

registrants: 

William R Donges 

5514 N Crescent Ridge Drive 

Tucson, AZ 85718 

520-529-6227 

Email: bdonges@attglobal.net

Plaintiff 

 /s/John Craiger 

Case 4:18-cv-00093-RM Document 100 Filed 11/14/19 Page 6 of 6