Court Opinion

ID: 9390789
Source: CourtListenerOpinion
Date Created: 2023-04-28 17:02:34.052711+00
Date Added: 2024-06-11T17:18:36.804262
License: Public Domain

IN THE

    SUPREME COURT OF THE STATE OF ARIZONA

                            JACOB LAURENCE,
                            Plaintiff/Appellant,

                                     v.

 SALT RIVER PROJECT AGRICULTURAL IMPROVEMENT & POWER DISTRICT,
                        Defendant/Appellee.

                           No. CV-21-0292-PR
                           Filed April 28, 2023

          Appeal from the Superior Court in Maricopa County
                The Honorable David J. Palmer, Judge
                         No. CV2018-093037

                    REVERSED AND REMANDED

            Memorandum Decision of the Court of Appeals,
                          Division One
                      No. 1 CA-CV 21-0100
                     Filed November 9, 2021

                               VACATED

COUNSEL:

David L. Abney (argued), Ahwatukee Legal Office, P.C., Phoenix, and
Maren Tobler Hanson, Nathan Tobler, Tobler Law, P.C., Mesa, Attorneys
for Jacob Laurence

Eric D. Gere (argued), Alexander J. Egbert, Jennings, Strouss & Salmon,
P.L.C., Phoenix, Attorneys for Salt River Project Agricultural Improvement
& Power District
                           LAURENCE V. SRP
                           Opinion of the Court

Daniel Rubinov, Rafat H. Abdeljaber, RAJ Law PLLC, Phoenix, Attorneys
for Amicus Curiae Arizona Association for Justice/Arizona Trial Lawyers
Association

Nancy L. Davidson, General Counsel, League of Arizona Cities and Towns,
Phoenix, Attorneys for Amicus Curiae League of Arizona Cities and Towns,
and Nicholas D. Acedo, Struck Love Bojanowski & Acedo, PLC, Chandler,
Attorneys for Amicus Curiae Arizona Counties Insurance Pool, Arizona
Municipal Risk Retention Pool and Arizona School Risk Retention Trust,
Inc.

VICE CHIEF JUSTICE TIMMER authored the Opinion of the Court, in
which CHIEF JUSTICE BRUTINEL, JUSTICES MONTGOMERY and
PELANDER (Ret.) * joined.   JUSTICE MONTGOMERY authored a
concurring Opinion. JUSTICE LOPEZ authored a dissenting Opinion, in
which JUSTICES BEENE and KING joined.

VICE CHIEF JUSTICE TIMMER, Opinion of the Court:

¶1            After the superior court dismisses with prejudice a tort claim
against an employee, must the court also dismiss a claim filed against the
employer under the respondeat superior doctrine? It depends. If the
claim against the employee was dismissed for lacking merit, the court must
also dismiss the respondeat superior claim. But if the claim against the
employee was dismissed for reasons unrelated to its merits, the respondeat
superior claim remains viable. In arriving at this answer, we overrule in
substantial part DeGraff v. Smith, 62 Ariz. 261 (1945). 1

*
 Justice Bolick is recused from this matter. Pursuant to article 6, section 3
of the Arizona Constitution, Justice John Pelander (Ret.) of the Arizona
Supreme Court was designated to sit in this matter.
1
  The caption in this case spells the defendant’s name “De Graff” while the
text uses “DeGraff.” For continuity’s sake, we refer to the case as
“DeGraff.”
                                     2
                            LAURENCE V. SRP
                            Opinion of the Court

                              BACKGROUND

¶2           On January 4, 2017, Jacob Laurence and his minor son were
injured when a truck owned by Salt River Project Agricultural
Improvement & Power District (“SRP”) and driven by its employee, John
Gabrielson, collided with Laurence’s vehicle.       Laurence alleges that
Gabrielson’s negligent driving caused the accident and that he was driving
the SRP truck during the course and scope of his employment.
Consequently, Laurence claims SRP is vicariously liable for Gabrielson’s
negligence under the respondeat superior doctrine.

¶3              Because SRP is a political subdivision of the State of Arizona,
A.R.S. § 12-821.01 applies. See Hohokam Irrigation & Drainage Dist. v. Ariz.
Pub. Serv. Co., 204 Ariz. 394, 397 ¶ 6 (2003). Under that provision, plaintiffs
intending to sue a public entity or a public employee must first file a claim
with that entity or person within 180 days after the cause of action accrues.
§ 12-821.01(A). Laurence filed a timely claim with SRP, but he was unable
to file a claim with Gabrielson until nearly fifteen months after the accident.

¶4           On January 3, 2018, Laurence filed this action against SRP and
Gabrielson.    Almost immediately, Gabrielson moved for summary
judgment based on Laurence’s failure to timely comply with § 12-821.01(A).
The superior court granted the motion as it pertained to Laurence’s claim
but denied the motion as it pertained to the son’s claim. Because the son
was a minor, he was not required to file a claim until 180 days after turning
eighteen, making his claim timely. See § 12-821.01(D).

¶5            SRP then moved for partial summary judgment against
Laurence on his respondeat superior claim. SRP argued that pursuant to
DeGraff it could not be held vicariously liable for Gabrielson’s negligence
because the court had granted summary judgment for Gabrielson on that
claim. See DeGraff, 62 Ariz. at 270 (“[Servant] having been adjudged as not
guilty of any negligence because of the dismissal with prejudice, we hold
that the master DeGraff cannot be held liable.”). Laurence responded that
because the court had granted summary judgment in favor of Gabrielson
for reasons unrelated to the merits of the negligence claim, SRP could be
found vicariously liable. The superior court agreed with SRP and granted
its motion. After the parties settled the remaining claims, the court
entered a final judgment, dismissing all claims against SRP and Gabrielson
with prejudice. The court of appeals affirmed. Laurence v. Salt River

                                      3
                          LAURENCE V. SRP
                          Opinion of the Court

Project Agric. Improvement & Power Dist., No. 1 CA-CV 21-0100, 2021 WL
5183957, at *2 ¶ 12 (Ariz. App. Nov. 9, 2021) (mem. decision).

¶6             We granted review of Laurence’s petition for review because
it raises recurring issues of statewide importance. We have jurisdiction
under article 6, section 5(3) of the Arizona Constitution.

                             DISCUSSION

                                    I.

¶7           The issue here is whether the superior court’s summary
judgment dismissing with prejudice Laurence’s claim against Gabrielson
required entry of summary judgment for SRP on Laurence’s respondeat
superior claim. We review the summary judgment ruling de novo as a
matter of law. See Dabush v. Seacret Direct LLC, 250 Ariz. 264, 267 ¶ 10
(2021).
                                  II.

                                    A.

¶8             Our resolution of this dispute depends on the ongoing
viability of DeGraff. As here, DeGraff arose from a traffic accident. The
plaintiffs, Virgil and Elizabeth Smith, were injured after driving into the
rear of a commercial truck owned by Mollie DeGraff that was stopped at
night on the side of a highway without lights or emergency flares. DeGraff,
62 Ariz. at 262. The Smiths sued DeGraff and her employee, Lloyd
Mundee, who was driving the truck immediately before the accident
occurred. Id.

¶9            At the close of evidence during the ensuing jury trial, and
without explanation, the Smiths moved to voluntarily dismiss their
complaint against Mundee. Id. at 263. When asked, they agreed the
dismissal should be “with prejudice” because if they lost the case against
DeGraff they could not sue Mundee as a joint tortfeasor, and if they
prevailed they had no desire to sue him. Id. Thereafter, the jury returned
a verdict against DeGraff awarding monetary damages to Elizabeth Smith.
Id. DeGraff then moved for a judgment notwithstanding the verdict
because the only claim against her was based on respondeat superior and
Mundee’s dismissal therefore “operated as a bar to the verdict and is res

                                    4
                            LAURENCE V. SRP
                            Opinion of the Court

judicata” as to the claim against her.     Id.   The court denied the motion.
Id.

¶10            DeGraff appealed to this Court, which was then comprised of
three justices. See id. The determinative issue was whether the dismissal
with prejudice of the claim against Mundee barred recovery against
DeGraff. See id. at 263–64. The two-justice majority first rejected the
Smiths’ contention that DeGraff was independently liable as Mundee’s joint
tortfeasor. See id. at 264. It concluded that DeGraff’s liability was
predicated solely on Mundee’s negligent actions under the doctrine of
respondeat superior. Id. at 268. The distinction was legally significant
because when an employer and employee are sued for injuries caused by
the employee, “a verdict which exonerates the employee from liability for
injuries caused solely by the alleged negligence or misfeasance of the
employee requires also the exoneration of the employer.” Id. (quoting 35
Am. Jur. § 534); accord id. (“[T]he acquittal of the employee of wrongdoing
conclusively negatives liability of the employer.”).

¶11           The majority next addressed the consequence of dismissing
“with prejudice” a complaint against an employee, as occurred there. Id.
at 269. Without elaboration, the majority stated “[a] dismissal with
prejudice is an adjudication on the merits of the case.” Id. (quoting 27
C.J.S. Dismissal and Nonsuit § 73, at 255 n.89). As additional support, the
majority cited Union Indemnity Co. v. Benton County Lumber Co., 18 S.W.2d
327, 330 (Ark. 1929), and Hargis v. Robinson, 79 P. 119, 121 (Kan. 1905), each
of which concluded that an order dismissing a case against a defendant
with prejudice constituted a final disposition of the dispute and barred
future action against that defendant. See DeGraff, 62 Ariz. at 269.

¶12           The majority then quoted Dare v. Boss, 224 P. 646 (Or. 1924), at
some length. DeGraff, 62 Ariz. at 269–70. The plaintiff in Dare sued to
recover damages for injuries incurred after a car, owned by Boss
Automobile Company and driven by a prospective buyer with an
employee-passenger’s permission, collided with plaintiff’s car. Dare,
224 P. at 646. The jury returned a verdict against Boss Automobile
Company’s partners and the employee-passenger, but jurors erased the
prospective buyer’s name from the pre-printed verdict form. Id. at 647. As
quoted in DeGraff, the Oregon Supreme Court reversed, reasoning:

       But there is one proposition that makes it necessary to reverse
       this case, and that is the fact that the jury, in effect, has found

                                       5
                            LAURENCE V. SRP
                            Opinion of the Court

      [the prospective buyer], who was driving the car by
      permission of [the employee], not guilty of negligence in
      crashing into plaintiff’s car, or at least has failed to find on
      that subject. There could be no negligence except that
      imputed from the relationship of the parties, and, unless [the
      prospective buyer] was negligent, no negligence could, under
      any circumstances, be imputed to the defendant company.
      That is to say, if the collision was without negligence on the
      part of the driver of the car, it could not be negligence on the
      part of any one else. To say that [the prospective buyer] was
      not negligent is to say that nobody in charge of the car was
      negligent, because it was his hand steering the car, and
      whatever injury occurred, if any, for which anybody was
      liable, must have been through his agency, and this is
      sustained by all of the authorities. Childress v. Lake Erie, etc., R.
      Co., 182 Ind. 251, 105 N.E. 467; Webster v. Chicago, St. P. M. &
      O. Ry. Co., 119 Minn. 72, 137 N.W. 168; Rathjen v. Chicago, B. &
      Q. R. Co., 85 Neb. 808, 124 N.W. 473; Loveman v. Bayless, 128
      Tenn. 307, 160 S.W. 841, Ann. Cas. 1915C, 187; Emmons v.
      Southern Pacific Co., 97 Or. 263, 298, 191 P. 333.

DeGraff, 62 Ariz. at 269–70 (quoting Dare, 224 P. at 648). As in Dare, the
employee’s liability in each case cited in the above quote was adjudicated
on the merits by a jury.

¶13           Even though (1) Union Indemnity Co. and Hargis concluded
that a dismissal with prejudice precludes future actions against the
dismissed defendants and did not address the impact on claims against
other defendants, and (2) Dare and the cases it relied on involved the
exoneration of an employee on the merits of a claim, the DeGraff majority
relied on these authorities as meaning the dismissal with prejudice in that
case was a merits adjudication that adjudicated Mundee “not guilty of any
negligence.” Id. at 269–70. Consequently, it held DeGraff could not be
adjudicated vicariously liable. Id. at 270.

¶14           The dissenting justice disagreed, faulting the majority’s
“premise that the dismissal of Mundee amounted to an adjudication that he
was not guilty of any negligence.” Id. at 270–71 (Morgan, J., dissenting).
He cited the dismissal rule then in effect, now codified as Arizona Rule of
Civil Procedure 41(a), which permitted a plaintiff to voluntarily dismiss a
claim only by court order and with any conditions the court deemed proper.
                                       6
                            LAURENCE V. SRP
                            Opinion of the Court

Id. at 271. According to the dissent, the trial judge clearly conditioned the
dismissal on permitting the Smiths to proceed against DeGraff and prove
Mundee’s negligence.      Id.   Otherwise, the judge would have also
dismissed the case against DeGraff, and he would not have instructed the
jury that DeGraff could only be liable if Mundee acted negligently. Id
at 271–72.

¶15             In sum, the DeGraff majority concluded that dismissing a
claim against an employee with prejudice for any reason serves to exonerate
that employee from negligence and thus simultaneously adjudicates a
respondeat superior claim against the employer. Notably, this conclusion
rested on neither claim preclusion (res judicata) nor issue preclusion
(collateral estoppel). Those doctrines apply only after entry of a final
judgment on the merits of all claims, and DeGraff addressed the effect of a
dismissal with prejudice on a respondeat superior claim pending in the
same lawsuit. See Banner Univ. Med. Ctr. Tucson Campus, LLC v. Gordon,
252 Ariz. 264, 266–67 ¶¶ 10–11 (2022); Chaney Bldg. Co. v. City of Tucson,
148 Ariz. 571, 573 (1986). Issue preclusion also could not apply because
whether Mundee was negligent was not litigated. See Chaney Bldg. Co.,
148 Ariz. at 573 (“Collateral estoppel or issue preclusion is applicable when
the issue or fact to be litigated was actually litigated in a previous suit, a
final judgment was entered, and the party against whom the doctrine is to
be invoked had a full opportunity to litigate the matter and actually did
litigate it, provided such issue or fact was essential to the prior judgment.”).
Instead, DeGraff created a new doctrine, unique to respondeat superior
claims.
                                        B.

¶16           If we follow DeGraff, we must conclude the superior court
correctly entered summary judgment for SRP on Laurence’s respondeat
superior claim because the court dismissed his claim against Gabrielson
with prejudice. See DeGraff, 62 Ariz. at 270. Laurence, however, asks that
we overrule that case and instead decide that dismissal of a claim against
an employee for reasons unrelated to a claim’s merits does not foreclose a
respondeat superior claim against the employer. SRP urges us to continue
to recognize and apply DeGraff because courts have done so repeatedly
since 1945, the reasons underlying its rationale still exist, and stare decisis
militates against overruling it.

                                       7
                              LAURENCE V. SRP
                              Opinion of the Court

                                         1.

¶17            We begin with stare decisis because it provides the
framework for deciding the parties’ arguments. The stare decisis doctrine
cautions courts against overruling a prior opinion unless the reasons
underlying it no longer exist or the opinion was “clearly erroneous or
manifestly wrong.” State v. Agueda, 253 Ariz. 388, 391–92 ¶ 20 (2022)
(quoting Lowing v. Allstate Ins., 176 Ariz. 101, 107 (1993)). The doctrine is
rooted in the public policy that people should be able to rely on judicial
precedent to know their rights and order their conduct accordingly. See
Derendal v. Griffith, 209 Ariz. 416, 424 ¶ 33 (2005); see also Knick v. Twp. of
Scott, Pa., 139 S. Ct. 2162, 2177 (2019) (“The doctrine of stare decisis reflects
a judgment that in most matters it is more important that the applicable rule
of law be settled than that it be settled right.” (cleaned up) (quoting Agostini
v. Felton, 521 U.S. 203, 235 (1997))); State ex rel. Brnovich v. Ariz. Bd. of Regents,
250 Ariz. 127, 132 ¶ 17 (2020) (“The doctrine of stare decisis is based upon
the value to the rule of consistency, continuity, and predictability.”);
Galloway v. Vanderpool, 205 Ariz. 252, 256 ¶ 16 (2003) (stating stare decisis
“seeks to promote reliability so that parties can plan activities knowing
what the law is”).

¶18           We have recognized that stare decisis “should not require
[unbending] adherence to authority.” Derendal, 209 Ariz. at 424 ¶ 33
(quoting Goldman v. Kautz, 111 Ariz. 431, 432 (1975)); see also State v.
Hickman, 205 Ariz. 192, 200 ¶ 37 (2003) (“Stare decisis is a doctrine of
persuasion, not a rigid requirement . . . .” (emphasis omitted)); White v.
Bateman, 89 Ariz. 110, 113 (1961) (to same effect).           Regardless, any
departure from stare decisis “demands special justification.” Hickman,
205 Ariz. at 200 ¶ 37 (quoting Arizona v. Rumsey, 467 U.S. 203, 212 (1984));
see also Young v. Beck, 227 Ariz. 1, 6 ¶ 22 (2011) (stating the Court will not
overturn prior case law for “mere disagreement” but “will overturn long-
standing precedent only for a compelling reason” (quoting State v. McGill,
213 Ariz. 147, 159 ¶ 52 (2006))).

¶19             The strength with which courts apply stare decisis varies by
case type. Courts most strongly defer to precedent that construed an
existing statute because the legislature had the opportunity to change that
statute if it disagreed with the judicial interpretation. See Brnovich,
250 Ariz. at 132 ¶ 17; Hickman, 205 Ariz. at 201 ¶ 38. Similarly, stare
decisis is “at its zenith” when the precedent established “important settled
expectations—especially those relating to property and contract rights.”

                                          8
                            LAURENCE V. SRP
                            Opinion of the Court

Bryan A. Garner et al., The Law of Judicial Precedent 370 (2016) [hereinafter
Garner]. Conversely, courts are less likely to invoke stare decisis to
preserve precedent concerning court-created procedural rules.               See
Hickman, 205 Ariz. at 201 ¶ 38; Garner at 370. This is so because people
expect court rules “to change with the times” and are unlikely to rely on
court procedures in ordering their personal affairs. See Hickman, 205 Ariz.
at 201 ¶ 38; see also Garner at 370 (“After all, procedural rules don’t usually
dictate the parties’ real-world actions or upset their expectations.”).

                                      2.

¶20          Several compelling reasons persuade us to overrule DeGraff
and its progeny to the extent these cases conclude that dismissing a claim
against an employee for reasons that did not exonerate the employee from
wrongdoing requires the court to also dismiss a claim against the employer
under the doctrine of respondeat superior.

                                      (a)

¶21            First, DeGraff is “clearly erroneous or manifestly wrong.”
See Agueda, 253 Ariz. at 391–92 ¶ 20 (quoting Lowing, 176 Ariz. at 107). The
trial court in DeGraff dismissed the Smiths’ (plaintiffs) claim against
Mundee (employee) pursuant to what is now Rule 41(a), which permitted
the court to place conditions on the dismissal. By immediately submitting
the respondeat superior claim to the jury, instructing it must find Mundee
negligent to enter a verdict against DeGraff (employer), and denying
DeGraff’s motion for judgment notwithstanding the verdict, the court
clearly conditioned Mundee’s dismissal on the Smiths’ continuing
adjudication of their claim against DeGraff. See DeGraff, 62 Ariz. at 263; id.
at 271 (Morgan, J., dissenting).

¶22           More significantly, DeGraff’s legal reasoning is both
conclusory and faulty—a circumstance our dissenting colleagues do not
even attempt to defend. The DeGraff majority correctly treated employee
Mundee’s dismissal “with prejudice” as “an adjudication on the merits” of
the claim against Mundee. See DeGraff, 62 Ariz. at 269. But it failed to
explain why that circumstance meant he had “been adjudged as not guilty
of any negligence” so as to preclude pursuit of the separate respondeat
superior claim against DeGraff. See id. at 270.

                                      9
                           LAURENCE V. SRP
                           Opinion of the Court

¶23           The authorities relied on by the DeGraff majority did not
support its conclusion. The C.J.S. section characterized a dismissal “with
prejudice” as concluding the rights of parties to the dismissed claim “as
though suit had been prosecuted to a final prosecution adverse to the
complainant.” See 27 C.J.S. Dismissal and Nonsuit § 73, at 474 n.89 (1959). 2
It did not address the effect on a separate respondeat superior claim, which
involves different parties. See id. Similarly, Union Indemnity Co., 18
S.W.2d at 330, and Hargis, 79 P. at 121, did not involve respondeat superior
claims. Those cases concluded that an order dismissing a case against a
defendant with prejudice constitutes a final disposition of the dispute and
bars future action against that defendant (claim preclusion). See Union
Indemnity Co., 18 S.W.2d at 330; Hargis, 79 P. at 121. Dare and the cases it
cited precluded respondeat superior claims against employers based on
dismissals with prejudice of claims against employees. See Dare, 224 P.
at 646. But the dismissals in those cases occurred because the underlying
negligence claims against the employees lacked merit, making the cases
distinguishable from DeGraff. See id. at 648.

¶24           Contrary to DeGraff’s reasoning, dismissing a claim “with
prejudice” against an employee for reasons unrelated to the merits of that
claim does not preclude adjudication of a separate respondeat superior
claim against the employer. Although DeGraff involved a voluntary
dismissal, because the dismissal was “with prejudice” and therefore
operated as “an adjudication on the merits,” the dismissal’s import is
grounded in Rule 41(b), which applies to involuntary dismissals.
Rule 41(b), which was codified as 21-916, A.C.A. (1939) when DeGraff was
decided but was not cited by the majority, provides that “[u]nless the
dismissal order states otherwise, a dismissal under this Rule 41(b) and any
dismissal not under this rule—except one for lack of jurisdiction, improper
venue, or failure to join a party under Rule 19—operates as an adjudication
on the merits.” Interpreting the federal version of Rule 41(b), which is
identical to Arizona’s version, the United States Supreme Court concluded
that an “adjudication upon the merits” is simply the opposite of a
“dismissal without prejudice” under Rule 41(a).        Semtek Int’l Inc. v.
Lockheed Martin Corp., 531 U.S. 497, 505 (2001). The Court noted that the

2 The C.J.S. version cited by the DeGraff majority is no longer accessible.
See DeGraff, 62 Ariz. at 268. Because the 1959 version reflects that DeGraff
cited the same provision and footnote, it follows that the substance of this
provision had not changed since DeGraff. See 27 C.J.S. Dismissal and
Nonsuit § 73, at 474 n.89 (1959).
                                     10
                            LAURENCE V. SRP
                            Opinion of the Court

term “with prejudice” is shorthand for “an adjudication upon the merits.”
Id. (quoting 9 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper,
Federal Practice and Procedure § 2373, at 396 n.4 (1981)). Because a dismissal
“without prejudice” permits the plaintiff to refile the same claim, the Court
concluded that a dismissal “with prejudice” merely “bar[s] refiling of the
same claim in the [same court].” Id. at 506; see also Magellan Health, Inc. v.
Duncan ex rel. Maricopa, 252 Ariz. 400, 403 ¶ 11, 404 ¶ 14 (App. 2021) (citing
Semtek to conclude that the district court’s dismissal of a claim “with
prejudice” for lack of standing and jurisdiction did not preclude plaintiff’s
state-court action based on the same claims).

¶25            Following our general inclination to interpret Arizona’s
procedural rules consistently with their federal counterparts, Flynn v.
Campbell, 243 Ariz. 76, 80 ¶ 9 (2017), we agree with Semtek that a dismissal
“with prejudice” does no more than bar refiling the same claim in the same
court. Both the C.J.S. provision cited by DeGraff and our cases before
DeGraff align with this view. See 27 C.J.S. Dismissal and Nonsuit § 73, at 474
n.89 (1959) (“[A] dismissal with prejudice has a well-recognized legal
import; it is converse of [the] term ‘without prejudice.’”); Tootle-Campbell
Dry Goods Co. v. Knott, 43 Ariz. 210, 213 (1934) (concluding that a dismissal
with prejudice of a case against defendants in their individual capacity
barred a future suit on that theory but did not bar suit against them in their
representative capacity); Berman v. Thomas, 41 Ariz. 457, 464 (1933)
(acknowledging that a dismissal “with prejudice” served “as a bar to
another action between the same parties over the same subject-matter”);
Roden v. Roden, 29 Ariz. 549, 553 (1926) (“A judgment of dismissal ‘with
prejudice’ is the same as a judgment for defendant upon the merits, and, of
course, is res judicata as to every matter litigated.” (citation omitted)).

¶26           Contrary to SRP’s argument, with which our dissenting
colleagues agree, see infra ¶¶ 60–61, following Semtek’s interpretation of
Rule 41(b) is not inconsistent with this Court’s decision in Anguiano v.
Transcontinental Bus System, Inc., 76 Ariz. 246 (1953). In Anguiano, the
superior court dismissed a personal injury lawsuit because the plaintiff had
failed to comply with an order requiring him to post security for costs. Id.
at 246. The plaintiff filed a new but identical lawsuit, and the court
entered summary judgment because dismissal of the first lawsuit operated
as an adjudication on the merits under Rule 41(b). Id. at 246–47.

                                     11
                           LAURENCE V. SRP
                           Opinion of the Court

¶27            This Court affirmed, rejecting the plaintiff’s argument that
Rule 41(b) applies only to involuntary dismissals based on a claim’s merits.
Id. at 247. The Court reasoned in part that examining the reasons for
involuntarily dismissing a case to determine Rule 41(b)’s application would
“conjure up a hydra-headed monster in the field of procedure.” Id. at 250.
Anguiano is consistent with our view that a dismissal “with prejudice”
merely bars refiling the same claim in the same court, no matter the basis
for the dismissal.      See Semtek, 531 U.S. at 506; Magellan Health, Inc.,
252 Ariz. at 403 ¶ 11, 404 ¶ 14. It did not expand the dismissal’s impact to
bar a separate claim against another party. Consequently, our decision
today does not conjure up Anguiano’s mythological monster because, like
that Court, we do not examine the reasons for a dismissal with prejudice to
bar refiling the same claim in the same court.

¶28            The dissent also incorrectly argues we should assign a
different meaning to our version of Rule 41(b) because Semtek’s
interpretation did not involve respondeat superior and was “informed by
uniquely federal concerns.” See infra ¶ 62. But nothing in Rule 41(b)’s
language suggests its meaning changes depending on the type of claim at
issue. And although the Supreme Court discussed the ramifications of a
contrary interpretation on the relationship between federal and state courts,
its interpretive analysis did not turn on any uniquely federal concern. See
Semtek, 531 U.S. at 505.       Instead, the Court viewed Rule 41(b) in
juxtaposition to Rule 41(a) and relied on a California Supreme Court
decision and secondary authorities in reaching its conclusion. See id.

¶29            For these reasons, DeGraff was clearly wrong in concluding
that dismissing a tort claim against an employee with prejudice for reasons
unrelated to the merits and that did not exonerate the employee from
wrongdoing required the court to dismiss the respondeat superior claim
against the employer.
                                     (b)

¶30           Second, this Court has already abrogated DeGraff in part for
reasons severely undercutting the efficacy of the remainder. Plaintiffs in
Kopp v. Physician Group of Arizona, Inc., 244 Ariz. 439 (2018), filed medical
malpractice claims against an agent-doctor and a principal-hospital. Id.
at 440 ¶ 2. Plaintiffs settled with the doctor, resulting in a dismissal with
prejudice of claims against him and Plaintiffs’ agreement not to pursue
claims against the hospital based on a theory of respondeat superior or
vicarious liability. Id. ¶ 3. Plaintiffs’ independent claims against the

                                     12
                            LAURENCE V. SRP
                            Opinion of the Court

hospital for negligent credentialing, hiring, and supervision were
unaffected by the settlement. See id. at 442 ¶ 12.

¶31            To prevail on their remaining claims against the hospital,
Plaintiffs were required to prove the doctor was negligent. See id. ¶ 13.
The issue before this Court was whether issue preclusion applied to prevent
Plaintiffs from doing so in light of DeGraff’s pronouncement that “[a]
dismissal with prejudice is an adjudication on the merits.” Id. (alteration
in original) (quoting DeGraff, 62 Ariz. at 269). Ultimately, we concluded
that applying DeGraff to preclude Plaintiffs from proving the doctor’s
negligence would conflict with our jurisprudence applying issue preclusion
only when an issue “was actually litigated,” which did not occur there or
in DeGraff. Id. at 442–43 ¶ 15. We noted that our decision in Chaney
Building Co. abrogated DeGraff and its progeny “to the extent those cases
suggest that a stipulated dismissal with prejudice is a judgment on the
merits for purposes of issue preclusion.” Id. at 442 ¶ 14. Thus, we
“disavow[ed] our holding in DeGraff insofar as that case and its progeny
conclude that a stipulated dismissal with prejudice operates as an
adjudication that the dismissed party was not negligent in the treatment of
the plaintiff.” Id. at 440 ¶ 1 (cleaned up).

¶32            Our dissenting colleagues nevertheless view Kopp as
implicitly endorsing what remained of DeGraff because Kopp acknowledged
that “a judgment can be ‘on the merits’ for purposes of claim preclusion
even if it results from the parties’ stipulation or certain pre-trial rulings by
the court.” See id. at 442 ¶ 14 (quoting 4501 Northpoint LP v. Maricopa
Cnty., 212 Ariz. 98, 102 ¶ 26 (2006)); infra ¶ 64. But this acknowledgment,
with which we agree, merely states that a dismissal with prejudice, for any
reason, precludes refiling a subsequent lawsuit asserting the same claim
against the same party in the same court. See Chaney Bldg. Co., 148 Ariz.
at 573. That was not the circumstance in DeGraff and is not the situation
here. And nothing in Kopp endorses DeGraff’s conclusion that a dismissal
with prejudice of an employee-claim for reasons different from the claim’s
merits exonerates the employee from wrongdoing and therefore requires
dismissal of a respondeat superior claim.

¶33          Continuing to apply DeGraff to respondeat superior claims
while carving out a different meaning for issue preclusion purposes would
be confusing and unnecessary. Specifically, an “adjudication on the
merits” would mean a tort claim was actually adjudicated to exonerate an
employee from wrongdoing for purposes of vicarious liability (the DeGraff
                                      13
                             LAURENCE V. SRP
                             Opinion of the Court

circumstance) but the seminal issue underlying that tort claim—whether the
employee engaged in wrongdoing—was not for purposes of issue
preclusion (the Kopp circumstance). Overruling DeGraff in substantial part
avoids that peculiarity.
                                     (c)

¶34            Third, DeGraff conflicts with our cases and an Arizona statute
recognizing that under the doctrine of respondeat superior, an employer is
vicariously liable for its employee’s tortious acts, not the employee’s
adjudicated liability. See Kopp, 244 Ariz. at 441 ¶ 9 (“Under the doctrine of
respondeat superior, an employer is vicariously liable for ‘the negligent
work-related actions of its employees.’” (quoting Engler v. Gulf Eng’g, Inc.,
230 Ariz. 55, 57 ¶ 9 (2012))); Tarron v. Bowen Mach. & Fabricating, Inc.,
225 Ariz. 147, 150 ¶ 9 (2010) (same); A.R.S. § 12-2506(D)(2) (“[A] party is
responsible for the fault of another person . . . if . . . [t]he other person was
acting as an agent or servant of the party.”); § 12-2506(F)(2) (defining “fault”
as “an actionable breach of legal duty, act or omission” that causes injury
or damages); see also Fields v. Synthetic Ropes, Inc., 215 A.2d. 427, 432–33 (Del.
1965) (recognizing that “the imputation of negligence rests squarely upon,
and is justified by, the culpability of the employee, not upon the
circumstance of whether or not the employee may, himself, be held liable
for his act”); Restatement (Second) of Agency § 219(1) (Am. L. Inst. 1958)
(“A master is subject to liability for the torts of his servants committed while
acting in the scope of their employment.”).

¶35            Indeed, a plaintiff is not required to sue the employee to
pursue a respondeat superior claim against the employer. See Wiggs v.
City of Phx., 198 Ariz. 367, 371 ¶¶ 14–16 (2000); see also § 12-821.01(A)
(recognizing that claims against public employers and their employees are
distinct by requiring service of separate notices of claim on each). And this
Court has held that a plaintiff could pursue a respondeat superior claim
against a principal even after a claim against its agent was dismissed
without prejudice, but the applicable statute of limitations precluded
refiling the claim. See Hovatter v. Shell Oil Co., 111 Ariz. 325, 326 (1974).

¶36           By requiring dismissal of a respondeat superior claim when
the employee-claim is dismissed for reasons unrelated to the claim’s merits,
DeGraff incorrectly hitches the respondeat superior doctrine to the
employee’s liability rather than the employee’s tortious acts. Overruling
DeGraff in substantial part eliminates this misstep.

                                       14
                             LAURENCE V. SRP
                             Opinion of the Court

¶37            The dissent asserts that two Restatement provisions
undermine our conclusion that DeGraff conflicts with our respondeat
superior jurisprudence. See infra ¶ 65. Not so. Restatement (Second) of
Agency § 217B cmt. c, cited in Kopp, 244 Ariz. at 441 ¶ 9, provides that “in
an action against two persons, judgment [cannot] properly be rendered
against one and for the other, if the liability of the one [cannot] exist without
the liability of the other.” Viewed in context, this comment does not
suggest that a judgment must be entered against an agent-employee
individually before the principal-employer can be found vicariously liable,
as the dissent suggests. This comment supplements § 217B(2), which
forbids “judgments on the merits for the agent and against the principal,” a
rule with which we agree. DeGraff’s conflict arises from its treatment of a
judgment for the agent not on the merits, making the comment inapplicable.

¶38            Restatement (Third) of Torts: Apportionment of Liability § 13
cmt. e (Am. L. Inst. 2000), which has never been adopted or even cited by
an Arizona court, likewise does not affect our analysis. That comment
observes that “[t]he vicariously liable party is liable only for the share of
plaintiff’s damages for which the tortious actor is held liable pursuant to
this Section.” Section 13 provides that the vicariously liable defendant can
only be “liable for the entire share of comparative responsibility assigned
to [the agent-employee].” Nothing in § 13 or the comment suggests that
an agent-employee is only “held liable” if named as a defendant and
adjudicated personally liable. Indeed, comment c recognizes that the
basis for a vicariously liable party’s liability is “legal imputation of
responsibility for another’s tortious acts,” not responsibility for a judgment
against the agent personally. And any different view of § 13 comment e
would conflict with this Court’s view that an agent-employee does not have
to be sued or even capable of being sued for a plaintiff to pursue a
respondeat superior claim. See Wiggs, 198 Ariz. at 371 ¶¶ 14–16; Hovatter,
111 Ariz. at 326.
                                        (d)

¶39          Fourth, DeGraff is in tension with our courts’ recognition that
employers sued under respondeat superior cannot assert defenses personal
to their employees. See Brumbaugh v. Pet Inc., 129 Ariz. 12, 13 (App. 1981)
(adopting Restatement (Second) of Agency § 217(B) to conclude that an
employer cannot avoid vicarious liability for its employee’s tortious actions
merely because the employee has interspousal-immunity from liability); see
also Clem v. Pinal Cnty., 251 Ariz. 349, 354–55 (App. 2021) (adopting
Restatement (Second) of Judgments § 51(1)(b) to bar application of claim

                                       15
                            LAURENCE V. SRP
                            Opinion of the Court

preclusion in favor of a principal sued under respondeat superior when the
earlier judgment in favor of the agent was based on a defense personal to
that agent). In other words, and contrary to SRP and the dissent’s
position, a respondeat superior claim is freestanding, and an employee and
employer therefore do not always occupy the “same shoes.” See infra ¶ 67.
When a plaintiff violates an employee’s procedural rights it raises a defense
personal to the employee. Applying DeGraff to dismiss a respondeat
superior claim because the court dismissed an employee-claim for
procedural reasons—as occurred here because Laurence did not timely
comply with § 12-821.01—would effectively permit the employer to assert
a defense personal to the employee. Overruling DeGraff in substantial part
prevents this conflicting result.
                                      (e)

¶40           Fifth, public policy does not support upholding DeGraff.
Whether to dismiss a vicarious liability claim after dismissal of an
employee-claim with prejudice is a matter of court procedure. See State v.
Reed, 248 Ariz. 72, 76 ¶ 13 (2020) (describing procedural law as pertaining
to and prescribing “the practice, method, procedure or legal machinery by
which the substantive law is enforced or made effective” (quoting State v.
Birmingham, 96 Ariz. 109, 110 (1964))). We recognize that several cases
have favorably cited DeGraff when employee-claims were dismissed for
reasons unrelated to the claims’ merits. See, e.g., Law v. Verde Valley Med.
Ctr., 217 Ariz. 92, 96 ¶ 12 (App. 2007); Torres v. Kennecott Copper Corp.,
15 Ariz. App. 272, 274 (1971), abrogated in part as described in Kopp, 244 Ariz.
at 442 ¶ 14. But because persons and entities do not rely on procedural
rules to know their substantive rights and order their affairs accordingly,
overruling DeGraff and its progeny will not disrupt any ongoing or future
private or governmental affairs. Thus, we are inclined to take that path
rather than continuing to rigidly follow a deeply flawed case. See
Derendal, 209 Ariz. at 424 ¶ 33; Hickman, 205 Ariz. at 201 ¶ 38; Garner at 370.

¶41            SRP argues that DeGraff “advances fundamental principles of
fairness” because it would be unfair to permit a respondeat superior claim
against the employer when the employee who committed the tort is
relieved of liability. We are unconvinced that this result would be unjust
when the employee-claim is dismissed for reasons unrelated to the claim’s
merits. As previously explained, the doctrine of respondeat superior
imputes the employee’s tortious acts to the employer, not the employee’s
liability. Thus, unless and until the court or a jury finds that the employee
did not commit a tort, or possibly that the plaintiff released the employee

                                      16
                            LAURENCE V. SRP
                            Opinion of the Court

from liability, which did not occur in DeGraff or here, 3 it is fair to permit
the respondeat superior claim to continue. See Wiper v. Downtown Dev.
Corp. of Tucson, 152 Ariz. 309, 311 (1987) (stating it would be unjust to
exonerate an employee from paying punitive damages while imposing
punitive damages on the employer under respondeat superior).

¶42           We are also unpersuaded by SRP’s two-pronged argument
that DeGraff “is necessary to meaningfully vindicate agent-defendants’
violated rights.” SRP initially asserts that unless the respondeat superior
claim is dismissed when the employee-claim is dismissed for procedural
reasons, plaintiffs would not be deterred from violating an employee’s
procedural rights. The consequence of dismissal itself, however, deters
plaintiffs from violating procedural rights. SRP then contends that
dismissing an employee-claim would be meaningless if an employer could
be found vicariously liable and then seek indemnity from the employee.
But this could happen if the employee was never a party to the lawsuit that
resulted in the vicarious liability judgment. See Wiggs, 198 Ariz. at 371
¶¶ 14–16 (explaining both that the agent does not have to be sued to impose
vicarious liability on the principal and that the principal can sue the agent
for indemnity). SRP does not suggest why an employee should be
relieved from indemnifying the employer for a vicarious-liability judgment
stemming solely from the employee’s tortious acts simply because the
injured plaintiff could not pursue a claim against the employee for
procedural reasons. The employee’s procedural rights are sufficiently
vindicated by dismissal of the employee-claim.

                                      (f)

¶43           For these reasons, we overrule DeGraff and its progeny to the
extent these cases suggest that dismissing a claim with prejudice against an
employee for reasons unrelated to the merits of that claim requires the court
to also dismiss a respondeat superior claim against the employer.
Although courts in other jurisdictions are split on this issue, for the reasons
explained, we agree with the courts that decided that when tort claims
against an employee are not actually adjudicated, dismissal of the
employee-claim does not summarily require dismissal of the respondeat

3When a plaintiff executes a covenant not to sue an employee-agent, the
employer-principal is not released from liability. See Hovatter, 111 Ariz.
at 327. But we have not yet addressed whether a release of the employee-
agent releases the employer-principal, and we need not do so here.
                                      17
                            LAURENCE V. SRP
                            Opinion of the Court

superior claim. See, e.g., Cameron v. Osler, 930 N.W.2d 661, 664–67 ¶¶ 7–18
(S.D. 2019) (collecting cases).

¶44            To be clear, to the extent DeGraff states that exonerating or
acquitting an employee of tortious acts must exonerate or acquit the
employer from vicarious liability, we agree. Dismissing a tort claim
against an employee because the claim lacks merit requires the court to also
dismiss a claim against an employer under the doctrine of respondeat
superior. See Hovatter, 111 Ariz. at 327 (“Where the master’s liability rests
solely on respondeat superior, if the servant is exonerated by trial on the
merits, then, of course, the master cannot be held liable . . . .” (quoting
Holcomb v. Flaving, 210 N.E.2d 565, 567 (Ill. App. (1965))); Kennecott Copper
Corp. v. McDowell, 100 Ariz. 276, 281–82 (1966) (recognizing that a directed
verdict in favor of an agent who purportedly committed a tort “necessarily
releases the principal”); Restatement (Second) of Torts § 883 (Am. L. Inst.
1979) (“If two defendants are joined in an action for the same harm,
judgment can properly be entered against one and in favor of the other,
except when the judgment is entered after trial on the merits and the
liability of one cannot exist without the liability of the other.”).

¶45           Requiring courts to determine whether a dismissal of a claim
against an employee was on the merits, thereby exonerating that employee
from wrongdoing and, in turn, precluding a respondeat superior claim,
does not conjure up a “monster,” as the dissent imagines. See infra ¶¶ 68–
69. This is not an onerous task. As in this case, claims against employees
and employers are frequently brought simultaneously, and the judge
knows precisely why the employee-claim was dismissed. In successive
lawsuits, a judge can examine both the reasons given by the moving party
for dismissing the employee-claim in the prior case and any reasoning
provided in the court’s dismissal order. Judges routinely examine prior
judgments to identify their underlying bases. For example, they do so to
decide whether an issue was actually litigated for purposes of issue
preclusion. See In re Gen. Adjudication of All Rts. to Use Water in Gila River
Sys. & Source, 212 Ariz. 64, 70 ¶ 14 n.8 (2006) (stating that issue preclusion
“attaches only when an issue of fact or law is actually litigated and
determined by a valid and final judgment, and the determination is
essential to the judgment” and noting that in “a judgment entered by
confession, consent, or default, none of the issues is actually litigated”
(quoting Arizona v. California, 530 U.S. 392, 414 (2000))). We are confident
judges are up to the task.

                                     18
                            LAURENCE V. SRP
                            Opinion of the Court

¶46            We do not overrule DeGraff lightly, as the dissent suggests
with notable bluster. See infra ¶ 56. Nor are we dispensing with a case
that has flawlessly guided courts for nearly eighty years, as our colleagues
also imply. See id. DeGraff was incorrectly decided from the outset,
forcing courts to wrestle with its illogic for decades and prompting this
Court to chip away parts. See Kopp, 244 Ariz. at 440 ¶ 1; Chaney Building
Co., 148 Ariz. at 573.

¶47           DeGraff has also injected confusion into our jurisprudence.
In Cochise Hotels, Inc. v. Douglas Hotel Operating Co., 83 Ariz. 40 (1957), for
example, this Court cited DeGraff for the principle that a dismissal with
prejudice is a “final determination” that “has the same effect as an
adjudication on the merits of the case.” Id. at 47–48. But in the same
paragraph, the Court stated that a dismissal “with prejudice” is not a “final
determination” if based “upon some ground which does not go to the merits,”
a conclusion squarely at odds with DeGraff. Id. (emphasis added); see also
Knick, 139 S. Ct. at 2178 (stating that a prior case’s “consistency with other
related decisions” is a factor in deciding whether to overrule that case
(citation omitted)).

¶48            Also, federal courts considering the same issue as the one here
have applied Arizona law to arrive at decisions both at odds with DeGraff
and consistent with it. Compare Crick v. City of Globe, 606 F. Supp. 3d 912,
918–19 (D. Ariz. 2022) (“Although a dismissal due to a failure to comply
with the notice of claim statute is a dismissal ‘with prejudice,’ dismissal on
this ground is not an adjudication on the merits.”), and Strickler v. Arpaio,
No. CV-12-00344-PHX-GMS, 2012 WL 6200612, at *3 (D. Ariz. Dec. 12, 2012)
(stating that a dismissal based on the notice of claim statute “is not a
determination on the merits for purposes of respondeat superior”), with
Ferreira v. Arpaio, No. CV-15-01845-PHX-JAT, 2016 WL 3970224, at *10 (D.
Ariz. July 25, 2016) (reaching the opposite conclusion).

¶49          After carefully applying stare decisis, we eliminate all
confusion by shaking free of DeGraff’s incorrect reasoning.

                                      C.

¶50          Turning to this case, we conclude the superior court
incorrectly entered summary judgment in favor of SRP. The court
dismissed the claim with prejudice against Gabrielson solely because
Laurence had failed to timely comply with § 12-821.01(A), which is

                                      19
                           LAURENCE V. SRP
                           Opinion of the Court

analogous to a statute of limitations. See Pritchard v. State, 163 Ariz. 427,
430–31 (1990) (addressing the predecessor to § 12-821.01(A)). It did not
exonerate Gabrielson from the claim that he had negligently operated the
SRP truck. Thus, Laurence’s claim that SRP is vicariously liable to him
remains viable.
                             CONCLUSION

¶51          We vacate the court of appeals’ decision, reverse the partial
summary judgment entered in favor of SRP and against Laurence, and
remand to the superior court for further proceedings.

                                     20
                             LAURENCE V. SRP
                     JUSTICE MONTGOMERY, Concurring

MONTGOMERY, J., Concurring:

¶52           I write separately to note that this is a case of first impression
for this Court regarding the application of DeGraff v. Smith, 62 Ariz. 261
(1945), in the context of a public employer and a public employee and to
highlight the effect of DeGraff’s holding.

¶53            What SRP seeks to do in dismissing the plaintiff’s claim is to
essentially use the notice of claim requirement under A.R.S. § 12-821.01 as
both a sword and shield. A sword to deny Laurence the ability to bring
his claim and a shield against liability for one of its employees. SRP is not
unjustified in this effort because a public employer’s liability is governed
by Arizona law, which includes our statutes and the holding of DeGraff.
See 1984 Ariz. Sess. Laws ch. 285, § 1 (2d Reg. Sess.) (providing that “it is
hereby declared to be the public policy of this state that public entities are
liable for acts and omissions of employees in accordance with the statutes
and common law of this state”). Yet, the plaintiff in this case properly
served the public employer and § 12-821.01 does not require a plaintiff to
serve a notice of claim on an employee in order to file a claim against a
public employer. Additionally, there has been no determination on the
merits regarding the employee’s liability.

¶54           The upshot of DeGraff then is that it results in a de facto
requirement that a plaintiff must properly serve a public employee in order
to maintain a claim against a public employer under circumstances as we
have in this case. Yet, that is not required by the plain text of § 12-821.01.
See James v. City of Peoria, 253 Ariz. 301, 305 ¶ 21 (2022) (“We will not
construe the notice of claim statute, under which the claimant satisfies the
relevant requirements but adds a condition of no legal consequence, in a
way that defeats the clear text of the statute.”).

¶55            Therefore, for this additional reason, I concur fully in my
colleagues’ analysis and conclusion regarding the need to overturn DeGraff,
as well as the interpretation of Rule 41(b).

                                      21
                            LAURENCE V. SRP
       JUSTICE LOPEZ, joined by JUSTICES BEENE and KING, Dissenting

LOPEZ, J., joined by BEENE, J. and KING, J. Dissenting:

¶56        The majority dispenses with stare decisis to upend nearly eighty
years of respondeat superior jurisprudence—and potentially unsettle the
law on Arizona Rule of Civil Procedure 41 and claim preclusion—on the
ground that DeGraff v. Smith, 62 Ariz. 261 (1945), is clearly erroneous or
manifestly wrong. The majority embarks upon this precarious road
despite the debatable nature of the issue—a reason upon which we recently
declined to overrule precedent interpreting a constitutional provision in
Arizona Free Enterprise Club v. Hobbs, 253 Ariz. 478, 484 ¶ 17 (2022). The
DeGraff dissent does not undercut the case’s legal reasoning and the
majority here (1) erroneously relies on an interpretation and application of
Rule 41’s ambiguous text by importing federal courts’ interpretation of the
corresponding federal rule, which is based, in part, on uniquely federal
concerns, and is contrary to eighty years of Arizona jurisprudence; (2)
overstates DeGraff’s conflict with our jurisprudence; and (3) creates more
confusion in the procedural realm than it purports to clarify. For these
reasons, we respectfully dissent.

                                     I.

¶57           “Generally, the doctrine of stare decisis cautions us against
overruling former decisions.” State v. Agueda, 253 Ariz. 388, 391 ¶ 20
(2022) (quoting E.H. v. Slayton, 249 Ariz. 248, 254 ¶ 13 (2020)). “[S]tare
decisis commands that ‘precedents of the court should not lightly be
overruled,’ and mere disagreement with those who preceded us is not
enough.” Young v. Beck, 227 Ariz. 1, 6 ¶ 22 (2011) (quoting State v. Salazar,
173 Ariz. 399, 416 (1992)). We must have a compelling reason to overturn
long-standing precedent. Id. The majority asserts that DeGraff is clearly
erroneous or manifestly wrong. Supra ¶ 21. We disagree.

¶58           The majority concedes that “courts in other jurisdictions are
split on [the issue before us],” supra ¶ 43, and that Arizona courts have
“favorably cited DeGraff when employee-claims were dismissed for reasons
unrelated to the claims’ merits,” supra ¶¶ 40, 48. Although a split in other
jurisdictions on an issue and adherence by our own courts do not
necessarily foreclose a conclusion that a case is clearly erroneous or
manifestly wrong, it strongly suggests that the issue is debatable and
militates against overturning precedent.        In fact, we have recently
employed precisely this reticence in electing to follow stare decisis. See
                                     22
                            LAURENCE V. SRP
       JUSTICE LOPEZ, joined by JUSTICES BEENE and KING, Dissenting

Hobbs, 253 Ariz. at 484 ¶ 17 (following stare decisis in concluding that
Garvey is not clearly erroneous because it was “debatable whether Warner
or Garvey offer[ed] the best interpretation” of a constitutional provision).
This principle is particularly applicable where, as here, the majority’s
decision to override stare decisis relies on mere “agreement” with other
jurisdictions’ conclusions contrary to our jurisprudence, supra ¶ 43, rather
than the absence of any supporting legal authority or reasoning. See
Young, 227 Ariz. at 6.
                                     II.

¶59            The presence of a dissent in DeGraff does not undermine its
legal reasoning. The DeGraff dissent implicitly adopted the majority’s
premise that even a voluntary dismissal with prejudice against the
employee forecloses a respondeat superior claim against the employer.
DeGraff, 62 Ariz. at 271 (Morgan, J., dissenting). The DeGraff dissent
instead contended that the majority erroneously affirmed the trial court’s
dismissal of the action against the employee with prejudice—with its
attendant legal consequence for the respondeat superior claim—because
the dismissal with prejudice was inconsistent with the plaintiff and trial
court’s intent to enter a conditional dismissal that permitted the case to
proceed against the employer. Id. at 270–71 (“I cannot agree with the
majority members of the court. Their decision is based on the premise that
the dismissal of [the employee] amounted to an adjudication that he was
not guilty of any negligence. A reading of the record discloses that the
dismissal was conditional. There appears to have been no intent upon the
part of the attorneys for the plaintiff to dismiss with prejudice.”). In fact,
the dissent merely urged the majority “to limit the effect of the dismissal in
accordance with the intention of the plaintiff and the court.” Id. at 272.
Thus, the DeGraff dissent’s criticism of the majority’s opinion centered on
its interpretation of the record rather than on its legal reasoning concerning
the preclusive effect of the precursor to Rule 41(a) on the respondeat
superior claim. Consequently, it offers no support for the majority’s
assertion here that DeGraff was clearly erroneous or manifestly wrong.

                                      III.

¶60          The majority relies on our oft-repeated “general inclination to
interpret Arizona’s procedural rules consistently with their federal
counterparts” to justify following the interpretation of Federal Rule of Civil
Procedure 41 as set forth in Semtek International Inc. v. Lockheed Martin Corp.,
531 U.S. 497 (2001). Supra ¶ 25. The majority, citing Semtek, contends

                                      23
                            LAURENCE V. SRP
       JUSTICE LOPEZ, joined by JUSTICES BEENE and KING, Dissenting

that “adjudication on the merits” is “simply the opposite of a ‘dismissal
without prejudice’ under Rule 41(a)” and, thus, “the term ‘with prejudice’
is shorthand for ‘an adjudication upon the merits.’” Supra ¶ 24. This
interpretation, although reasonable, is not unassailable because it is
incomplete. To confine the meaning of “adjudication upon the merits” to
“with prejudice” artificially limits its scope and ignores the rule’s inherent
distinction embodied in its use of the two phrases. Compare Rule 41(a)
(stating that voluntary dismissals, unless the notice or order states
otherwise, are “without prejudice”), with Rule 41(b) (stating that “[u]nless
the dismissal states otherwise, a dismissal under Rule 41(b) and any
dismissal not under this rule,” except for three specified exceptions,
“operates as an adjudication on the merits”).

¶61           Rule 41(b)’s text certainly signals a preclusive purpose, but it
is arguably ambiguous because it is silent on the scope of the preclusive
effect of “an adjudication on the merits” ruling. This ambiguity invites
and supports different interpretations of the phrase’s meaning and, thus,
does not foreclose a broader preclusive effect consistent with DeGraff. We
should adhere to our own long-standing interpretation of the rule. See
Anguiano v. Transcon. Bus Sys., 76 Ariz. 246, 250 (1953) (“Rule 41(b) used
plain, clear, simple, unequivocal language, and says an involuntary
dismissal other than for lack of jurisdiction or for improper venue operates
as an adjudication upon the merits unless the court otherwise directs.”).

¶62           Putting aside the interpretative merits of Semtek, more
compelling reasons militate against the majority’s reliance on Semtek to
guide interpretation of our Rule 41. First, Semtek did not involve the claim
preclusive effect of a Rule 41(b) dismissal in the respondeat superior
context; instead, Semtek examined a complex diversity jurisdiction issue
concerning whether a federal court’s dismissal of a plaintiff’s claim on state-
statute-of-limitations grounds precluded the plaintiff’s suit in another state.
531 U.S. at 499–500. It offers little insight into the question before us—one
purely of state law and concern involving respondeat superior in the
context of a state tort claim arising from a vehicle accident. Second,
Semtek’s interpretation of the federal rule was informed by uniquely federal
concerns, absent here, such as “the jurisdictional limitation of the Rules
Enabling Act” and federalism principles. Id. at 503–04; see also id. at 503
(“[I]t would be peculiar to find a rule governing the effect that must be
accorded federal judgments by other [state] courts ensconced in rules
governing the internal procedures of the rendering court . . . .”). Plainly,

                                      24
                            LAURENCE V. SRP
       JUSTICE LOPEZ, joined by JUSTICES BEENE and KING, Dissenting

the effect of the rule rather than its text compelled Semtek’s interpretation of
the federal rule. Id.

¶63            We dispense with the “general inclination to interpret
Arizona’s procedural rules consistently with their federal counterparts,”
supra ¶ 25, if the federal interpretation is in tension with Arizona policy,
practice, or case law. Ritchie v. Grand Canyon Scenic Rides, 165 Ariz. 460,
464 (1990) (“[B]lind devotion to federal interpretation is not required; we
need not follow the federal cases if we believe Arizona policy, practice, or
case law requires a different result.”); see also Orme School v. Reeves, 166 Ariz.
301, 304 (1990). This is precisely the circumstance here. Conformity with
the federal rule does not merely generate tension with our policy, practice,
and case law, it requires discarding nearly eighty years of jurisprudence
concerning state procedural rules involving state tort claims. We should,
as we have done before, reject the federal interpretation of its analog rule as
wholly inconsistent with our law. See, e.g., State v. Ariz. Bd. of Regents,
253 Ariz. 6, 14 ¶¶ 33–34 (2022) (“Although we recognize the persuasive
value of federal courts’ interpretation of a federal procedural rule, it is ‘not
binding in the construction of our rule.’” (quoting Flynn v. Campbell, 243
Ariz. 76, 80 ¶ 9 (2017))); Ritchie, 165 Ariz. at 467 (rejecting the U.S. Supreme
Court’s interpretation of the federal analog of Arizona Rule of
Procedure 15(c), in part, because “[i]t conflict[ed] with established Arizona
law”).
                                        IV.

¶64            The majority’s opinion also overstates DeGraff’s conflict with
our law. First, the assertion that this Court’s partial abrogation of DeGraff
“severely [undercuts] the efficacy of the remainder” is incorrect. See supra
¶ 30. In Kopp v. Physician Group of Arizona, Inc., 244 Ariz. 439 (2018), we
merely abrogated DeGraff and its progeny “to the extent those cases suggest
that a stipulated dismissal with prejudice is a judgment on the merits for
purposes of issue preclusion.” Id. at 442 ¶ 14. Although DeGraff’s
continued vitality was not squarely before us, we expressly acknowledged
that “a judgment can be ‘on the merits’ for purposes of claim preclusion
even if it results from the parties’ stipulation or certain pre-trial rulings by
the court.” Id. (quoting Northpoint LP v. Maricopa County, 212 Ariz. 98,
102 (2006)). Contrary to the majority’s assertion, Kopp endorsed DeGraff,
albeit implicitly, rather than undercut it. Id.

¶65           Second, the majority, citing Kopp, also claims that DeGraff
conflicts with our cases recognizing that “under the doctrine of respondeat
                                       25
                            LAURENCE V. SRP
       JUSTICE LOPEZ, joined by JUSTICES BEENE and KING, Dissenting

superior, an employer is vicariously liable for its employee’s tortious acts,
not the employee’s adjudicated liability.” Supra ¶ 34. The majority
overstates this purported conflict. For example, in Kopp we cited the
Restatement (Second) of Agency § 217B cmt. c (Am. Law Inst. 1958), for the
proposition that “the liability of the [principal] cannot exist without the
liability of the [agent].” 244 Ariz. at 441 ¶ 9; see also Restatement (Third)
of Torts: Apportionment of Liability § 13 cmt. e (Am. Law Inst. 2000) (“The
vicariously liable party is liable only for the share of plaintiff’s damages for
which the tortious actor is held liable . . . .”). Of course, imputation of
liability requires imputation of tortious acts, but the extent of DeGraff’s
conflict with our cases on this point is debatable. See, e.g., Dominguez v.
City of Scottsdale, 587 F. Supp. 3d 914, 937 (D. Ariz. 2022) (“Put simply,
because the agent has been adjudicated not liable, as a matter of law, the
principal is not [vicariously] liable.” (alteration in original) (quoting
Jamerson v. Quintero, 233 Ariz. 389, 392 ¶ 14 (App. 2013))); see also Howard v.
Wash. Elementary Sch. Dist. 6, No. 1 CA-CV 20-0390, 2022 WL 363766, at *4
¶ 16 (Ariz. App. Feb 8, 2022) (mem. decision) (upholding dismissal of
vicarious liability claim against public employer based on dismissal of
claim against employee for failure to timely serve notice of claim); Angulo
v. City of Phoenix, No. 1 CA-CV 12-0603, 2013 WL 3828778, at *2 ¶¶ 7–8 (Ariz.
App. July 16, 2013) (mem. decision) (same). The majority’s contention that
Restatement (Second) of Agency § 217B cmt. c “does not suggest that a
judgment must be entered against an agent-employee individually before
the principal-employer can be found vicariously liable” because it
supplements Restatement § 217B(2), which forbids “judgments on the
merits for the agent and against the principal,” supra ¶ 37, merely begs the
question before us—what is an “adjudication on the merits?”

                                      V.

¶66           The majority asserts that DeGraff generates a “peculiarity”
because “‘an adjudication on the merits’ would mean a tort claim was
actually adjudicated to exonerate an employee from wrongdoing for
purposes of vicarious liability (the DeGraff circumstance) but the seminal
issue underlying that tort claim—whether the employee engaged in
wrongdoing—was not for purposes of issue preclusion (the Kopp
circumstance),” and purports to end confusion concerning the preclusive
effect of judgments involving respondeat superior and issue preclusion.
Supra ¶ 33. This premise reflects a fundamental misunderstanding of how
DeGraff and issue preclusion relate. This preclusive distinction is not a
peculiarity, but rather a reflection of the principal difference between
                                      26
                            LAURENCE V. SRP
       JUSTICE LOPEZ, joined by JUSTICES BEENE and KING, Dissenting

derivative or vicarious claims and independent ones. See Kopp, 244 Ariz.
at 442 ¶ 14. The majority’s reasoning, typified by its claim that we have
“chip[ped] away parts” of DeGraff, supra ¶ 46, seems to question the very
distinction between respondeat superior (and claim preclusion) and issue
preclusion. What the majority characterizes as “chipping away” at
DeGraff was simply clarification of the circumstances in which it applied.
Errors arose not from DeGraff but rather from the courts that misapplied it.
The majority further injects uncertainty as it raises the question whether it
concludes that Kopp also was wrongly decided.

¶67            Although respondeat superior is independent from
Rule 41(b) and common law claim preclusion, DeGraff is not an island. It
shares an inherent logic and reasoning with this rule and doctrine. As SRP
explains: “The law follows a simple logic: vicarious liability claims put
employers in their employees’ shoes to vicariously bear the employees’
liability; when the employees’ liability is extinguished (i.e., dismissed with
prejudice for any reason), there no longer exists any liability for the
employer to vicariously bear.” Thus, a plaintiff cannot establish a prima
facie respondeat superior claim because a vicarious action against an
employer for its dismissed employee’s negligent conduct is, in effect, the
same claim. See Restatement (Third) of Torts: Apportionment of Liability
§ 7 cmt. j (Am. Law Inst. 2000) (“When a party is liable solely on the basis
of another person’s tortious conduct, there is no direct responsibility to
assign to the party to whom liability is imputed. In that situation, the
party who committed the tortious acts or omissions and the party to whom
liability is imputed are treated as a single unit for the assignment of
responsibility. For example, an employer who is vicariously liable for the
negligence of an employee and the employee are treated as a single
entity.”).

¶68           DeGraff, Rule 41(b), and common law claim preclusion also
often coincide. For example, an involuntary dismissal of an employee in
a vicarious liability claim against the employer implicates DeGraff and
aligns with Rule 41(b), because the employee’s dismissal is “an adjudication
on the merits.” See Anguiano, 76 Ariz. at 250 (observing that “classifying
dismissals according to the time and reasons for which they were granted”
would “conjure up a hydra-headed monster in the field of procedure”).
Similarly, DeGraff corresponds with claim preclusion when an employee is
dismissed with prejudice in an action separate from the vicarious liability
claim against the employer. See, e.g., Chaney Bldg. Co. v. City of Tucson,
148 Ariz. 571, 573 (1986).
                                     27
                            LAURENCE V. SRP
       JUSTICE LOPEZ, joined by JUSTICES BEENE and KING, Dissenting

¶69          The majority contends that overruling DeGraff will end
courts’ “wrestl[ing] with its illogic for decades.” Supra ¶ 46. However,
far from adding clarity to the law, the majority creates a legal distinction
between two “types” of an identical phrase: “adjudication on the merits.”
Prospectively, courts must differentiate between an “adjudication on the
merits” under Rule 41(b) and an “adjudication on the merits” that, in the
majority’s words, “go[es] to the merits.” See id.         What the latter
“adjudication on the merits” embodies in the wide spectrum of case
dismissals—from jury verdicts to court judgments to party settlements—is
anyone’s guess. The majority leaves our courts to wrestle with this
“hydra-headed monster” in ensuing decades. See Anguiano, 76 Ariz.
at 250.
                                      VI.

¶70            The majority asserts that we “do not even attempt to defend”
DeGraff’s “conclusory and faulty” legal reasoning. Supra ¶ 22. This
characterization ignores the entire thrust of our dissent. DeGraff, and its
shared logic and frequent intersection with Rule 41(b) and common law
claim preclusion, dictate that Laurence’s failure to prove the employee’s
liability forecloses a derivative action against SRP. See Falcon ex rel.
Sandoval v. Maricopa County, 213 Ariz. 525, 527 ¶ 10 (2006) (“If a notice of
claim is not properly filed within the statutory time limit, a plaintiff’s claim
is barred by statute. Actual notice and substantial compliance do not
excuse failure to comply with the statutory requirements of ARS § 12-
821.01(A).” (internal citation omitted)). If we were writing on a blank
slate, perhaps we may agree with the majority, but that is not the posture
in which we consider the issue. As the majority acknowledges in citing
Knick v. Township of Scott, Pennsylvania, 139 S. Ct. 2162, 2177 (2019), supra
¶ 17, “[t]he doctrine of stare decisis reflects a judgment that in most matters
it is more important that the applicable rule of law be settled than it be
settled right,” id. (cleaned up) (quoting Agostini v. Felton, 521 U.S. 203, 235
(1997)). This is precisely our point. DeGraff has been the law in Arizona
for nearly eighty years and it should remain so because the majority has
shown only its “mere disagreement” with the case and that its holding is
debatable, not that it is clearly erroneous or manifestly wrong. See Young,
227 Ariz. at 6 ¶ 22.

                                      28