Arizona Court of Appeals Division One holds that (i) issue of punitive damages should be submitted to the jury when a question of fact regarding intent is presented; (ii) a statutory right to attorneys’ fees under A.R.S. § 46-455(H) accrued when the claim accrued; and (iii) “costs of suit” under A.R.S. § 46-455(H) does not expand the definition of taxable costs under A.R.S. § 12-332.

In 2008, a motor vehicle accident rendered Ethan Newman a quadriplegic.  Newman was admitted for treatment at Select Specialty Hospital-Arizona.  When admitted, Newman had a wound on the base of his spine.  Despite receiving specific treatment instructions from the treating physician, hospital staff failed to adequately treat, clean, and relieve the pressure on the wound site, allowing the wound to progress.  Newman filed suit alleging the Hospital violated Arizona’s Adult Protective Services Act (“APSA”) and Arizona Revised Statutes sections 46-451 through -459. 

At the close of Newman’s evidence, the trial court granted the Hospital’s motion for a directed verdict on punitive damages.  The jury found for Newman and awarded him $250,000 in compensatory damages.  Newman applied for $388,400 in attorneys’ fees under the 2010 version of A.R.S. § 46-455(H)(4).  The trial court granted Newman’s request, but awarded Newman $112,500, and denied Newman’s request for $48,544.06 in “costs of suit.”  The parties cross-appealed.

As to the Hospital’s directed verdict motion, the Court of Appeals agreed with Newman that he had presented sufficient evidence to create a question of fact as to the Hospital’s intent.  The Hospital staff knew that they should have treated Newman’s wound in a certain manner, but did not assess the wound for 12 days and did not properly apply a specific medical treatment for 8 days.  Given this evidence, the Court of Appeals held that a reasonable jury could find that the Hospital consciously disregarded a known risk of substantial harm. 

The Court of Appeals then upheld the trial court’s fee award.  The 2010 version of A.R.S. § 46-455(H)(4) provided for attorneys’ fees, but the 2012 version did not.  The Court of Appeals rejected the Hospital’s argument that the 2012 version was applicable because Newman’s right to attorneys’ fees did not accrue until the jury rendered its verdict.  The right to attorneys’ fees is a substantive right, and a statute may not apply retroactively unless it contains an express statement of retroactive application.  Moreover, under the APSA, a plaintiff’s right to damages accrues when the claim is filed.  Thus, because Newman’s claim accrued in 2010 when he filed suit, the 2010 version of the statute applied, and the superior court properly awarded attorneys’ fees.  

The Court of Appeals also affirmed the amount of fees and costs awarded to Newman.  Newman’s trial counsel did not consistently complete contemporaneous descriptions of their work, and, as a result, the trial court had the discretion to reject the fee application for $388,400.  Instead, the Court of Appeals affirmed the finding that the 45% contingent attorneys’ fee agreement was a reasonable determination of the attorneys’ fees for the case.  Finally, the Court of Appeals affirmed that “costs” under § 46-455(H)(4) does not expand the definition of “costs” under § 12-332.

Presiding Judge Gemmill authored the opinion; Judge Jones and Judge Portley concurred.