Raatz et al v. Dealer Trade Incorporated et al

Filing 113

ORDER granting 75 Plaintiff's MOTION for Judgment Default re: 108 Memorandum in the amount of $24,851.50 against Marcos Vidal Lopez and True Credit Auto Wholesale. Signed by Judge David G Campbell on 2/17/17. (DXD)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Pinnacle Nissan, LLC,
Third-Party Plaintiff/Cross
Defendant,

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No. CV16-0170-PHX DGC
ORDER

v.
Manheim Phoenix, dba Manheim
Remarketing, Inc. and Marcos Vidal Lopez,
True Credit Auto.
Third-Party
Defendants/Cross-Defendant.

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The Court previously granted default judgment in favor of Defendant and third-

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party Plaintiff Pinnacle Nissan, LLC, and against third-party Defendants Marcos Vidal

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Lopez and True Credit Auto Wholesale. Doc. 96. The judgment was for common law

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indemnity. Docs. 75, 96. The Court directed Pinnacle to file a memorandum on the

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amount of damages to be awarded, and Pinnacle has done so. Doc. 108. The third-party

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Defendants have not appeared or opposed the memorandum, and Pinnacle has not

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requested oral argument.

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I.

Background.

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Plaintiffs Tom and Marcine Raatz sued Pinnacle, True Credit, and others for

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breach of contract and violations of the Federal Motor Vehicle Information and Cost

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Savings Act, also known as the Federal Odometer Act, 49 U.S.C. § 32701, alleging that

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Tom Raatz purchased a vehicle with an altered odometer reading. Id., ¶ 1. The vehicle at

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issue had the following history: True Credit, through its principal and agent, Lopez

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(Doc. 108 at 3), placed the vehicle in an auction, Pinnacle purchased the vehicle in the

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auction and then returned it (id. at 2), another dealer then purchased the vehicle from the

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auction and sold it to Tom Raatz (id.). Pinnacle asserted third-party claims against Lopez

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and cross-claims against True Credit. Doc. 34.

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II.

Legal Standard.

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The damages Pinnacle seeks to recover from Lopez and True Credit are attorneys’

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fees Pinnacle has incurred in this litigation. “In Arizona, courts generally do not construe

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‘damages’ to include attorneys’ fees.” City Ctr. Exec. Plaza, LLC v. Jantzen, 344 P.3d

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339, 343 (Ariz. Ct. App. 2015). But “[i]t is generally held that where the wrongful act of

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the defendant has involved the plaintiff in litigation with others or placed him in such

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relation with others as makes it necessary to incur expense to protect his interest, such

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costs and expenses, including attorneys’ fees, should be treated as the legal consequences

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of the original wrongful act and may be recovered as damages.” United States Fid. &

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Guar. Co. v. Frohmiller, 227 P.2d 1007, 1009 (Ariz. 1951).

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attorneys’ fees under this principle, the plaintiff must show: (1) that the plaintiff had

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become involved in a legal dispute either because of a breach of contract by the

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defendant or because of the defendant’s tortious conduct; (2) that the dispute was with a

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third party not with the defendant; and (3) that the plaintiff incurred attorneys’ fees

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connected with that dispute.” Spanier v. United States Fid. & Guar. Co., 623 P.2d 19, 29

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(Ariz. Ct. App. 1980).

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III.

“In order to recover

Analysis.

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Pinnacle requests judgment in the amount of $26,544 for the cost of defending

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against the Raatzes’ claim. To recover attorneys’ fees as damages, Pinnacle must show

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that it became involved in this lawsuit because of the conduct of Lopez and True Credit.

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Spanier, 623 P.2d at 29. Pinnacle purchased the vehicle with the altered odometer from

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True Credit and Lopez, was sued by the Raatzes as a predecessor in the chain of title, but

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Lopez and True Credit were the predecessors to Pinnacle. Doc. 96 at 2-3.

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Pinnacle cannot recover attorneys’ fees incurred in litigating against Lopez and

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True Credit. Spanier, 623 P.2d at 29. The Court subtracts from Pinnacle’s requested

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damages $1,692.50 for 6.9 hours Pinnacle spent litigating against Lopez and True Credit.

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Doc. 108-1 at 8-10, 13. The Court concludes that Pinnacle may recover attorneys’ fees

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totaling $24,851.50. Id. at 6-16. See Collins v. First Fin. Servs., Inc., 815 P.2d 411

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(Ariz. Ct. App. 1991) (defendant that incurred attorneys’ fees defending against an action

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permitted to recover the fees from the entity that caused it to be sued).

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IT IS ORDERED that Plaintiff’s motion for default judgment is granted in the
amount of $24,851.50 against Marcos Vidal Lopez and True Credit Auto Wholesale.
Dated this 17th day of February, 2017.

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