07/13/2016 — CV2016005111 / ARIZONA INC, TAYLOR MORRISON 07/13/2016 HONORABLE JOSHUA D. ROGERS View Minute Entry ↑ top

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Minute Source

Michael K. Jeanes, Clerk of Court

*** Electronically Filed ***

07/15/2016 8:00 AM
SUPERIOR COURT OF ARIZONA
MARICOPA COUNTY

CV 2016-005111

07/13/2016

Docket Code 019
Form V000A
Page 1

CLERK OF THE COURT
HONORABLE JOSHUA D. ROGERS
S. Ortega

Deputy

CANYON TRAILS UNIT 4 SOUTH
HOMEOWNERS ASSOCIATION
RODNEY GALARZA

v.

TAYLOR MORRISON / ARIZONA INC, et al.
JOHN DOUGLAS WILENCHIK

RULING

The Court has received and considered Taylor Morrison’s Opposition to Award. The
Court notes that oral argument has been requested. Pursuant to Ariz. R. Civ. P. 7.1(c)(2), the
Court determines that, in order to expedite its business, this matter shall be decided without oral
argument. The Court is fully informed of the issues.

Respondent Taylor Morrison/Arizona, Inc. (“Taylor Morrison”) filed its objection
pursuant to A.R.S. § 12-1512 on the grounds that Arbitrator Lawrence Fleischman (the
“Arbitrator”) exceeded his authority under the terms of the subject Arbitration Agreement. More
specifically, Taylor Morrison asserts that the Arbitrator was precluded from awarding
consequential damages under the terms of the Arbitration Agreement and that at least
$178,009.88 of the $209,550.88 award was for consequential damages. The Court disagrees.

The damages awarded by the Arbitrator in this case are cost of repair damages and were
expressly designated as such. “Generally, the measure of damages for a breach by a builder of a
construction contract is the cost of repair.” Fairway Builders, Inc. v. Malouf Towers Rental Co.,
124 Ariz. 242, 253, 603 P.2d 513, 524 (App. 1979). Thus, cost of repair damages are the
compensatory damages awarded for purposes of a construction defect action. Consistent with
this fact, the Arizona courts have consistently differentiated between cost of repair damages and
consequential damages. See Id. at 253-56, 603 P.2d at 524-27; Flagstaff Affordable Hous. Ltd.

SUPERIOR COURT OF ARIZONA
MARICOPA COUNTY

CV 2016-005111

07/13/2016

Docket Code 019
Form V000A
Page 2

P'ship v. Design All., Inc., 223 Ariz. 320, 323, ¶ 11, 223 P.3d 664, 667 (2010) (Differentiating
between cost of repair damages and consequential damages for purposes of the economic loss
doctrine); Sullivan v. Pulte Home Corp., 232 Ariz. 344, 346, ¶ 8, 306 P.3d 1, 3 (2013) (same).
Only “where an award based on this measure of damages would result in ‘economic waste,’ …
[would] the proper measure of damages would be the difference in value” as Respondent
suggests. Fairway Builders, Inc., 124 Ariz. at 253, 603 P.2d at 524. In sum, because the
damages awarded are compensatory in nature and not consequential, the arbitrator did not exceed
his authority under the applicable Arbitration Agreement.

Finally, Taylor Morrison also objects to this Court awarding interest as part of any
judgment entered on the subject arbitration award. This objection is misplaced. Interest has only
been requested from the date of entry of the award itself. Under Arizona law the general rule is
that, in the absence of statutory provisions requiring a different result, interest accrues from the
date the arbitration award is entered. Creative Builders, Inc. v. Ave. Developments, Inc., 148
Ariz. 452, 457-58, 715 P.2d 308, 313-14 (App. 1986). The Court therefore finds that an award
of interest from the date the arbitration award was entered on April 1, 2016 is appropriate in this
case.

Therefore,

IT IS ORDERED denying Taylor Morrison’s Opposition to Award.