Cosper v. Rea: In an Appeal From Arbitration, Disclosure of Witnesses and Exhibits is Limited to Simultaneous Filing With the Notice of Appeal

In a decision released Monday, the Arizona Supreme Court clarified a procedural question concerning disclosure in appeals from arbitration. Pursuant to Arizona Rule of Civil Procedure 77(g)(1), an appellant must file an Appeal from Arbitration and Motion to Set for Trial simultaneously with a list of witnesses and exhibits that complies with the requirements of Rule 26.1. If the appellant does not file a list of witnesses and exhibits, “then the witnesses and exhibits intended to be used at trial by appellant shall be deemed to be those set forth in any such list previously filed in the action.” Subsection (g)(3) also states that the parties have 80 days from the filing of the appeal to complete discovery under Rules 26 through 37 of the Arizona Rules of Civil Procedure. And, subsection (g)(4) states: “For good cause shown the court may extend the time for discovery set forth in subsection (3) above and/or allow a supplemental list of witnesses and exhibits to be filed.”

In September 2009, Marco and Flor Mora sued Pauline Cosper for damages that resulted from a car accident. Following a mandatory arbitration in August 2010, the arbitrator entered an award in favor of the Moras. The next day, Cosper filed an Appeal from Arbitration requesting a trial de novo in superior court. He also then filed a list of witnesses and exhibits.

In October 2010, Cosper supplemented her witness list by designating a biomechanical expert and disclosing his report. The Moras moved to strike these supplemental disclosures as untimely. The superior court granted the Moras’ motion and found that Cosper had not ”attempted to show good cause” for the subsequent disclosure under subsection (g)(4). Cosper filed a special action petition with the court of appeals, and the court of appeals reversed. The court found that the disclosure fell within the 80-day discovery period in (g)(3). Specifically, it held that “Rule 77 permits supplemental disclosure pursuant to [Arizona Rules of Civil Procedure] 26 through 37 within [eighty] days after the filing of an appeal from compulsory arbitration, without requiring that parties show good cause or obtain the permission of the court.” Cosper v. Rae, No. CV–11–0083–PR, 2012 WL 360278, at ¶3 (Ariz. 2012). Essentially, the court of appeals held that “during the 80-day discovery period prescribed in (g)(3), parties have the right to both conduct discovery and disclose additional witnesses and exhibits.” Id. at ¶9.

The Arizona Supreme Court granted review to clarify the role of Rule 77(g) in appeals from arbitration. The Court held that subsection (g)(4)—which allows for the filing of a supplemental list of witnesses and exhibits for “good cause shown”—contradicts “any ongoing right to additional disclosure.” The parties, the Court held, “cannot possess an automatic and unqualified right to supplement witness and exhibit lists when the rule expressly requires good cause and approval of the court.” Id. at ¶8.

The Court rejected the court of appeals’ conclusion that during the 80-day period provided for in (g)(3), the “parties have the right to both conduct discovery and disclose additional witnesses and exhibits.” This conclusion, the Court found, would render (g)(1)—which requires concurrent filing of witness and exhibit lists—unnecessary. It would also mean that (g)(4)—which requires court approval to file supplemental lists—would not apply until after the 80-day period had run. The Court noted that both the “rule’s text and the consequences of creating an ongoing eighty-day disclosure period” cut against such a reading of the rule. Id. at ¶9.

Cosper pointed out to the Court that Rule 77(g) refers to Rules 26 through 37. As such, it applies to 26.1, which generally allows parties to supplement their disclosure of witnesses in civil cases. Therefore, Cosper argued, subsection (g)(3) creates the same right in appeals from arbitration awards. However, the Court held that Rule 77(g) and its “simultaneous” filing requirement govern appeals from arbitration, and that it controls over the more general Rule 26.1. The Court also noted that the Rule distinguishes between discovery and the filing of supplemental witnesses lists in, for example, subsection (g)(4). And, as such, reading “discovery” in (g)(3) to include the supplemental disclosure of witness and exhibit lists would obviate the need for their distinction elsewhere in the rule. Citing Arizona Dep’t of Revenue v. Action Marine Inc., 181 P.3d 188, 190 (2008), the Court noted that it will “not construe text to render any of its terms meaningless.” Cosper, WL 360278, at ¶10.

Finally, the Court also noted that the court of appeals’ holding could “undermine Rule 77’s goal of a prompt trial de novo,” by allowing for the disclosure of witnesses up until the end of the 80-day period. Such a disclosure would likely mandate the extension of the discovery period.

The court vacated the court of appeals’ opinion, and held that the appellant must file her list of witnesses and exhibits simultaneously with the notice of appeal, and that the list could not be supplemented without good cause shown.