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 UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL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


        PATRICK DALLABETTA and PAMELA DALLABETTA,
               husband and wife, Plaintiffs/Appellees,

                                        v.

        JERRY D. DEPPEN AND CONNIE K. KRABER-DEPPEN,
               husband and wife, Defendants/Appellants.

                             No. 1 CA-CV 18-0458
                               FILED 10-22-2019


             Appeal from the Superior Court in Yuma County
                        No. S1400CV201600084
                  The Honorable John P. Plante, Judge

                                  AFFIRMED


                                   COUNSEL

Schneider & Onofry, P.C., Yuma
By Charles D. Onofry, Luane Rosen
Counsel for Plaintiff/Appellant

Law Office of Phil Hineman, P.C., Yuma
By Phil Hineman
Counsel for Defendants/Appellants
                  DALLABETTA, et al. v. DEPPEN, et al.
                        Decision of the Court



                      MEMORANDUM DECISION

Presiding Judge Samuel A. Thumma delivered the decision of the Court, in
which Judge Jennifer M. Perkins and Judge Paul J. McMurdie joined.


T H U M M A, Judge:

¶1           Defendants Jerry D. Deppen and Connie K. Kraber-Deppen
(the Deppens) appeal from the denial of their motion to set aside a final
judgment entered against them after they failed to participate in
compulsory arbitration. Because the arbitrator properly found for plaintiffs
Patrick and Pamela Dallabetta on liability and damages, the superior court
correctly denied the motion seeking to set aside that portion of the final
judgment. Because the Deppens have failed to show any error, the
judgment is affirmed.

                FACTS AND PROCEDURAL HISTORY

¶2            In April 2015, the Deppens agreed to purchase the
Dallabettas’ home for $650,000. The parties signed a purchase contract
agreeing that the Deppens would deposit $50,000 in earnest money in an
escrow account, with the remainder to be paid in cash by a May 8, 2015
close of escrow deadline. If the Deppens did not pay the purchase price by
that deadline, the contract provided the $50,000 earnest money deposit was
the liquidated damages amount the Dallabettas would recover.

¶3            After the parties signed the contract, the Deppens’ real estate
agent “represented to the Dallabettas that the Deppens had written a check
for $50,000 and that it would be deposited with the title company.” Later,
after the Dallabettas began preparing to move, the Deppens’ real estate
agent “informed them that the Deppens had not actually paid the $50,000
earnest money, but that they were in the process of getting the money from
the bank and that it would be deposited shortly.” Ultimately, the Deppens
never deposited the $50,000 into an escrow account. The Deppens then
refused to comply with the terms of the contract, escrow did not close by
the May 8, 2015 deadline, and the sale never took place.




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                  DALLABETTA, et al. v. DEPPEN, et al.
                        Decision of the Court

¶4            In February 2016, the Dallabettas sued the Deppens,1 alleging
breach of contract and other theories, claiming (among other things) the
failure to pay the $50,000 in earnest money was a material breach of the
contract. Confirming they sought $50,000, the Dallabettas certified the
amount in controversy did not exceed the $50,000 limit for compulsory
arbitration. Yuma County Local Rule 10(A) (2019);2 see also Ariz. R. Civ. P.
72-77. The Deppens, who represented themselves during the relevant
superior court proceedings, filed a timely answer in February 2016. The
superior court then appointed an arbitrator.

¶5             In late March 2017, the Dallabettas moved to strike the
Deppens’ answer, claiming the Deppens had failed to make any Rule 26.1
disclosures and ignored repeated requests to do so. The court set a May 8,
2017 hearing on the motion. When the Deppens failed to respond to the
motion to strike, the Dallabettas sought summary disposition of the motion
to strike. See Ariz. R. Civ. P. 7.1(b).

¶6            On April 28, 2017, the arbitrator gave the Deppens “30 days
from the date of this order to comply with their Rule 26.1 disclosure
obligations,” adding that if they failed to do so “their Answer will be
stricken.” A week later, the court denied the Dallabettas’ request for
summary disposition. At the May 8, 2017 court hearing on the motion to
strike, the Deppens failed to appear, and, after hearing from counsel for the
Dallabettas, the court vacated the hearing, adding that “if the matter is not
resolved [by the arbitrator], it can be brought back before the Court.”

¶7            When the Deppens failed to provide any disclosure as
ordered by the arbitrator, on June 1, 2017, the Dallabettas filed a renewed
motion to strike the Deppens’ answer and request to enter the arbitration
award. The Deppens never responded to this motion. Later in June 2017,
the arbitrator issued an award noting the Deppens’ answer was stricken,
entering an award in favor of the Dallabettas and against the Deppens for
the principal amount of $50,000, $322 in taxable costs and $7,500 in
attorneys’ fees, plus interest. The Deppens did not appeal the award. In
August 2017, the court granted the Dallabettas’ motion for entry of
judgment on the arbitration award.



1 The Dallabettas also sued the Deppens’ real estate agent and her employer,

later settling with those defendants, who are not parties to this appeal.

2 Absent material revisions after the relevant dates, statutes cited refer to
the current version unless otherwise indicated.


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                  DALLABETTA, et al. v. DEPPEN, et al.
                        Decision of the Court

¶8            When the Deppens did not pay the judgment, in December
2017, the Dallabettas applied for writs of garnishment against the Deppens.
In January 2018, counsel for the Deppens filed a notice of appearance and a
motion to set aside the arbitration award, claiming the June 2017 award was
beyond the arbitrator’s authority. After full briefing and a hearing, the court
denied the motion, concluding it was untimely, there was no timely
challenge to the arbitration award and the judgment was valid. After
additional briefing, the court issued a final judgment denying the motion
to set aside and awarding the Dallabettas an additional $3,364.50 in
attorneys’ fees. This court has jurisdiction over the Deppens’ timely appeal
pursuant to Ariz. Rev. Stat. (A.R.S.) section 12-2101(A)(2)

                               DISCUSSION

¶9              On appeal, the Deppens press three arguments: (1) the
Dallabettas failed to comply with procedural prerequisites to filing the suit
and moving to strike their answer; (2) the arbitrator exceeded his authority
by striking their answer and entering an award against them; and (3) the
superior court failed to hold a hearing before entering the judgment
confirming the arbitration award. The Dallabettas argue with some force
that the Deppens’ appeal from an amended order denying their motion to
set aside the judgment pursuant to Rule 60, but fail to address that Rule 60
order. It is true the Deppens’ arguments on appeal cut straight to the merits
of the arbitration award and the judgment confirming that award. That
said, given the unique procedural history of this case and the issues
involved, this court addresses the merits of the Deppens’ arguments on
appeal.

I.     The Deppens Waived Any Argument That The Dallabettas Failed
       To Comply With The Alternative Dispute Resolution
       Requirement In The Contract And That Their Motion To Strike
       Was Procedurally Improper.

¶10           The parties’ contract contains an alternative dispute
resolution (ADR) provision, in which they agreed to mediate, and if that
did not prove successful, then arbitrate any dispute arising out of the
contract. No such ADR activity occurred. Accordingly, the Deppens argue,
the Dallabettas “should have been estopped from moving forward with
their complaint until they complied with the mediation clause.” Having
failed to timely invoke that ADR process and having failed to press that
argument at any point before entry of judgment in the superior court, the
Deppens have waived such an argument. See, e.g., Continental Lighting &
Contracting, Inc. v. Premier Grading & Utils., LLC, 227 Ariz. 382, 386 ¶ 12



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                   DALLABETTA, et al. v. DEPPEN, et al.
                         Decision of the Court

(App. 2011); In re Estate of Cortez, 226 Ariz. 207, 211 ¶¶ 5-6 (App. 2010);
Schurgin v. Amfac Elec. Distribution Corp., 182 Ariz. 187, 190 (App. 1995).

¶11           The Deppens also assert, for the first time on appeal, the
Dallabettas’ motion to strike, filed in mid-2017, was improper because it did
not attach a “good faith consultation certificate.” Ariz. R. Civ. P. 7.1(h).3 In
pressing this argument, the Deppens do not dispute the statements in that
motion that they had “actively ignored undersigned counsel” for the
Dallabettas. Moreover, by failing to raise this argument in a timely manner,
it is waived on appeal. Continental Lighting, 227 Ariz. at 386 ¶ 12; Schurgin,
182 Ariz. at 190.

II.    The Deppens Have Not Shown The Arbitrator Exceeded His
       Authority By Striking Their Answer And Entering An Award.

¶12           The Deppens argue by striking their answer and entering an
award, the arbitrator granted a motion to dismiss or for summary
judgment, which exceeded the arbitrator’ authority. See Ariz. R. Civ. P.
74(d)(1)(C), (E). Not so. Unless otherwise specified, the arbitrator has the
authority to “make all legal rulings,” including “ruling on discovery
motions.” Ariz. R. Civ. P. 74(d)(1), (3). Because the motion to strike, filed
pursuant to Rule 37, was neither a motion to dismiss nor a motion for
summary judgment, the arbitrator had the authority to rule on that motion.

¶13           The Deppens argue “[t]he Arbitrator improperly ruled on
[Dallabetta]’s motion to strike and request for summary disposition [when
the Deppens failed to respond to the motion to strike] to default and dismiss
the [Deppens’] ability to participate to any extent in the arbitration.” This
argument fails for two reasons: (1) the arbitrator properly ruled on the
motion to strike given the Deppens’ failure to provide any Rule 26.1
disclosures and failure to respond to the motion and (2) the Deppens could
have appealed the arbitration award but failed to do so. See Ariz. R. Civ. P.
77.

¶14           The Deppens contend before the answer could be stricken, an
evidentiary hearing had to be held and there had to be an express “finding
that the party was responsible for noncompliance.” The Deppens, however,


3Although   non-compliance with Rule 7.1(h) was briefly mentioned by
counsel for the Deppens during oral argument on the motion to set aside
the judgment, this argument was neither developed before that court, nor
raised in the motion itself, which was insufficient to preserve the issue for
appeal. See Continental Lighting, 227 Ariz. at 386 ¶ 12.


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                  DALLABETTA, et al. v. DEPPEN, et al.
                        Decision of the Court

were self-represented at the time. Accordingly, no “culprit” hearing was
necessary to determine whether the inaction was attributed to the Deppens
or their counsel. See Hammoudeh v. Jada, 222 Ariz. 570, 572 ¶ 7 (App. 2009)
(“Although an evidentiary hearing may often be necessary to determine
whether responsibility for obstructing discovery lies with the party or with
his counsel, such a hearing is not required when the facts are apparent from
the record.”). For these same reasons, the Deppens have not shown the
process used by the arbitrator and the superior court — which the Deppens
refused to participate in — denied them their due process rights or resulted
in a disproportionate consequence.

III.   The Judgment Was Not A Default Judgment.

¶15            The Deppens argue the judgment “amounted to a default
judgment” under Rule 55, meaning the superior court was required to hold
a hearing before its entry because the complaint did not allege “a sum
certain” for damages and “legal fees and costs are not stated for a specific
sum if a default is rendered.” The judgment, however, was not entered as a
result of an entry of default under Rule 55. Instead, the Dallabettas moved
for entry of judgment on the arbitration award, after the Deppens failed to
appeal from that award and the time to do so had passed. See Ariz. R. Civ.
P. 77(b) (allowing for 20 days to appeal from arbitration award); id. at 76(d)
(“If no appeal is filed by the deadline for filing an appeal under Rule 77(b),
any party may file a motion to enter judgment on the [arbitration] award.”).
The superior court then granted the Dallabettas motion for entry of
judgment on the arbitration award after the Deppens failed to respond to
that motion. And the relief in the judgment mirrors precisely the relief in
the award. Because the judgment was not a default judgment, the Deppens’
argument fails.

IV.    Attorneys’ Fees On Appeal.

¶16           The Deppens request attorneys’ fees incurred on appeal
pursuant to A.R.S. §§ 12-341.01, 12-349 and 12-350. The Dallabettas request
attorneys’ fees incurred on appeal under the provisions of the contract and
A.R.S. § 12-341.01. The contract provides that the “prevailing party in any
dispute or claim” between the Deppens and the Dallabettas “shall be
awarded their reasonable attorney fees and costs.” Accordingly, the
Deppens’ request for attorneys’ fees on appeal is denied. The Dallabettas’
request for attorneys’ fees on appeal is granted, and they also are awarded
their taxable costs on appeal, all contingent upon their compliance with
Ariz. R. Civ. App. P. 21.




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          DALLABETTA, et al. v. DEPPEN, et al.
                Decision of the Court

                      CONCLUSION

¶17   The judgment is affirmed.




                AMY M. WOOD • Clerk of the Court
                FILED: AA




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