Arizona Court of Appeals Division One holds that attorneys’ fees imposed as sanctions pursuant to A.R.S. § 12-349 and Rule 11 are not “damages awarded” for purposes of calculating a supersedeas bond.

After dismissing the plaintiff’s civil claims, the superior court awarded attorneys’ fees to the defendants as a sanction pursuant to A.R.S. § 12-349 and Ariz. R. Civ. P. 11.  The plaintiff asked the superior court to stay enforcement of the judgment and argued that no supersedeas bond was necessary because the judgment awarded no damages.  The superior court denied the stay and the plaintiff filed this special action.

The Court of Appeals granted special action review to decide whether attorneys’ fees awarded as sanctions are “damages awarded” for purposes of calculating the required supersedeas bond under A.R.S. § 12-2108(A).  The Court noted that while attorneys’ fees may be recovered as a component of damages for certain substantive claims, the fee award, in this case, was not premised on any of those types of claims.  Further, the Court reasoned that the fees could not be considered “damages” because the statutory basis for the attorneys’ fees sanction, A.R.S. § 12-349, differentiates between attorneys’ fees and damages.  The Court, therefore, concluded that attorneys’ fees awarded as sanctions pursuant to A.R.S. § 12-349 and Ariz. R. Civ. P. 11 are not “damages awarded” for purposes of the supersedeas bond statute and rule.

Judge Thumma authored the opinion; Presiding Judge Cattani and Judge Johnsen concurred.