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UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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

In re the Marriage of:

URSULA M. JOHNSTON, Petitioner/Appellant,

v.

JOHN D. JOHNSTON, Respondent/Appellee.

No. 1 CA-CV 14-0451 FC

Appeal from the Superior Court in Maricopa County

No. FN2013-090099

The Honorable Paul J. McMurdie, Judge

AFFIRMED IN PART; VACATED AND REMANDED IN PART

COUNSEL

Richard G. Neuheisel, P.L.L.C., Tempe

By Richard G. Neuheisel

Counsel for Petitioner/Appellant

The Murray Law Offices, P.C., Scottsdale

By Stanley David Murray

Counsel for Respondent/Appellee
JOHNSTON v. JOHNSTON

Decision of the Court

2

MEMORANDUM DECISION

Judge Peter B. Swann delivered the decision of the court, in which Presiding Judge 

Kent E. Cattani and Judge Lawrence F. Winthrop joined.

S W A N N, Judge:

¶1 Ursula Johnston (“Wife”) appeals the trial court’s order denying her 

motion to set aside the parties’ Decree of Dissolution of Marriage. Wife argued

that John Johnston (“Husband”) committed fraud when he failed to disclose 

certain financial information to her, thereby voiding the parties’ Rule 69 agreement

and the Decree of Dissolution that resulted. Because we find that there was 

sufficient evidence in the record to support the trial court’s decision, we affirm the 

trial court’s order but remand for recalculation of attorney’s fees. 

FACTS AND PROCEDURAL HISTORY

¶2 Husband and Wife engaged in mediation of their dissolution 

proceeding and settled all issues relating to the division of their assets in an

agreement under ARFLP 69. 

¶3 Shortly thereafter, under the terms of the Rule 69 agreement, 

Husband drafted a Decree of Dissolution of Marriage and Property Settlement 

Agreement. Wife refused to sign the proposed agreement and Husband then

requested that the court adopt the proposed agreement as its formal order. Wife 

objected, asserting that the division of property was unfair and inequitable. She 

argued that during the mediation, Husband presented a revised calculation of his 

business accounts to the mediator without her knowledge, and that she would not 

have entered the Rule 69 agreement had she seen the calculation. 

¶4 Meanwhile, Wife also filed a motion to set aside the Rule 69 

agreement under ARFLP 85(C)(1)(a) and (c), in which she asserted that Husband 

had incorrectly stated the amount of funds in his business bank account as 

$126,630 when the true balance of the account was $209,661.10. In the motion, Wife 

stated that she first noticed the discrepancy when she reviewed the account 

statement after the mediation concluded, and contended that the mediator

acknowledged that he knew of the discrepancy but chose not to inform her during 

the mediation. Wife argued that her own failure to confirm the account balance 

during mediation constituted mistake or excusable neglect under ARFLP 
JOHNSTON v. JOHNSTON

Decision of the Court

3

85(C)(1)(a) and that the settlement agreement was not fair because she did not 

have full knowledge of the property involved. 

¶5 Husband moved to dismiss Wife’s motion to set aside. He argued 

that Wife’s failure to review the account statements that Husband had disclosed 

to her did not constitute mistake or excusable neglect within the meaning of 

ARFLP 85(C)(1)(a). Husband also argued that sound reason existed for the slightly 

uneven division of this asset because there was an unequal division of other assets 

in Wife’s favor, most notably more than $30,000 in liquid assets to which Husband 

had waived any claim. 

¶6 The trial court signed Husband’s proposed Decree of Dissolution of 

Marriage, which included the Property Settlement Agreement that resulted from 

the Rule 69 agreement, and invited Husband to apply for attorney’s fees relating

to the various post-decree motions. 

¶7 Wife then filed a motion to set aside the Dissolution Decree and the 

order inviting Husband to apply for attorney’s fees and costs. Wife asserted that 

“[f]raud and concealment existed throughout this divorce proceeding,” that 

Husband failed to disclose accurate financial information to Wife, that there was 

no valuation or determination for Husband’s consulting company and a bank 

account connected to that company, and that Husband had used a fake birth 

certificate and driver’s license to create an alias used in conducting business 

activity and had concealed this information from Wife.1

¶8 Husband filed another motion to dismiss, arguing that Wife had 

ample opportunity to engage in formal discovery and failed to do so. Husband 

argued that even assuming Wife’s allegations were true, she could not show fraud 

because she had all of Husband’s financial information available to her. 

¶9 The trial court denied Wife’s motion and awarded attorney’s fees 

and costs to Husband. 

DISCUSSION

¶10 “We will not disturb the trial court’s decision on a motion to set aside 

a judgment absent an abuse of discretion.” Tovrea v. Nolan, 178 Ariz. 485, 490-91 

 

1 Husband asserts that Wife was aware that these documents were for a fake 

ID Husband used when he was 19 years old to date an older woman and that the 

photo on the driver’s license was clearly of Husband when he was 19. 
JOHNSTON v. JOHNSTON

Decision of the Court

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(App. 1993).

2 “The court abuses its discretion when it makes an error of law in 

reaching a discretionary conclusion or ‘when the record, viewed in the light most 

favorable to upholding the trial court’s decision, is devoid of competent evidence 

to support the decision.’” Michaelson v. Garr, 234 Ariz. 542, 544, ¶ 5 (App. 2014)

(citation omitted).

¶11 Wife argues on appeal that the trial court abused its discretion when 

it denied her motion to set aside the decree, drafted pursuant to the Rule 69 

agreement, because the agreement arose from Husband’s fraud. We disagree. 

¶12 The parties voluntarily proceeded to private mediation, and reached 

a binding agreement. Wife has not demonstrated that the Rule 69 agreement or 

the resulting decree was procured by fraud. Indeed, she acknowledges that she 

received from Husband the information concerning the bank account, but 

contends that she received it late because Husband “mismailed” it. She also 

acknowledges that Husband provided accurate information to the mediator.

¶13 The failure to conduct adequate discovery or to ensure that 

disclosure is complete before voluntary resolution of a case constitutes neither 

excusable neglect nor fraud by an adversary. 

¶14 Overall, trial courts enjoy broad discretion when deciding whether 

to set aside a judgment for fraud or misrepresentation. Woodbridge Structured 

Funding, LLC v. Ariz. Lottery, 235 Ariz. 25, 29, ¶ 21 (App. 2014). Here, there was 

evidence in the record that Husband provided Wife with all required financial 

documents through informal disclosure and that Wife simply failed to review 

them. There was also evidence that Husband could not have disclosed many of 

the documents Wife references in her motion to set aside because they were not in 

existence at the time the parties executed their Rule 69 agreement. The trial court 

did not abuse its discretion when it denied Wife’s motion to set aside the Decree 

of Dissolution. 

 

2 Wife argues that “[i]f a trier of fact can find in favor of wife, husband’s 

motion must fail.” Her reference to the standard governing motions to dismiss 

highlights the impropriety of such motions in this context. But Husband has not 

effectively changed the standard of review on appeal by filing a motion to dismiss 

instead of a response to Wife’s motion to set aside. The trial court did not grant 

Husband’s motions to dismiss -- it correctly denied Wife’s motions. 
JOHNSTON v. JOHNSTON

Decision of the Court

5

ATTORNEY’S FEES

¶15 The trial court awarded attorney’s fees in connection with the postdecree briefing of Wife’s motions, concluding that she had taken unreasonable 

positions. We vacate this award.

¶16 Husband was entitled to respond to Wife’s motions. But he chose 

instead to move to “dismiss” them. We disapprove of this type of motion practice. 

The tactic was calculated to expand the number of filings beyond those 

contemplated by ARFLP 35(A), and in fact did so. By filing replies in support of 

his motions to dismiss, Husband effectively filed sur-replies that the rules do not 

allow. The court would have been justified had it rejected the motions to dismiss 

on that ground.

¶17 We do not quarrel with the trial court’s finding that Wife took 

unreasonable positions in this litigation. But Husband’s counsel’s disregard of 

ARFLP 35 unreasonably expanded the very work for which he was awarded fees, 

and Wife should not bear the burden of Husband’s counsel’s abuse of the rules. 

¶18 We hold that Husband is not entitled to attorney’s fees resulting 

from his improper post-decree briefing. Accordingly, we remand for a 

recalculation of Husband’s fee award. 

¶19 Husband also requests an award of attorney’s fees on appeal. In our 

discretion, we deny his request. 

CONCLUSION

¶20 For the foregoing reasons, we affirm the denial of Wife’s motion to 

set aside, but vacate the award of attorney’s fees and remand for recalculation of 

the award.