Correa v. Pecos Valley Development Corp.

617 P.2d 767, 126 Ariz. 601, 1980 Ariz. App. LEXIS 572
CourtCourt of Appeals of Arizona
DecidedJuly 8, 1980
Docket2 CA-CIV 3220
StatusPublished
Cited by27 cases

This text of 617 P.2d 767 (Correa v. Pecos Valley Development Corp.) is published on Counsel Stack Legal Research, covering Court of Appeals of Arizona primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Correa v. Pecos Valley Development Corp., 617 P.2d 767, 126 Ariz. 601, 1980 Ariz. App. LEXIS 572 (Ark. Ct. App. 1980).

Opinions

HATHAWAY, Chief Judge.

Plaintiffs-appellants, Correa, filed this lawsuit in the Superior Court of Pinal County against appellees, alleging consumer fraud, breach of contract and tort. Also, as to Papago Butte Water Delivery District of Pinal County # 4, they claimed breach of a statutory duty. Appellees-defendants answered and Pecos Valley Development Corporation counterclaimed for taxes paid by it in the sum of $202.91.

At the completion of the plaintiffs’ case, the court granted defendants’ motion for, directed verdict as to all counts. By stipulation, the counterclaim was tried to the court, judgment was granted against appellants and in favor of appellees for the sum of $202.91, plus attorneys’ fees and costs. Appellants contend on appeal that the evidence was sufficient to go to the jury, that the court erred in excluding certain evidence and in awarding attorneys’ fees. We consider the matters seriatim as presented in appellants’ brief, after the following brief statement of the facts.

On February 16, 1974, Richard Correa and his wife, Socorro, purchased from defendant Pecos Valley Development Corporation a 3% acre “mini-farm,” lot 6, unit one, in Papago Butte Ranchos, a remote farming area of Pinal County. On March 23, 1975, Richard’s father, Joe Correa, purchased a “mini-farm,” lot 156, unit 2, in the same subdivision. Written and oral representations were made that the “mini-farms” offered for sale by Pecos Valley Development Corporation would be serviced by an irrigation system to be installed by the developer. The Papago Butte Water Delivery District of Pinal County # 4 was formed by a resolution and order of the Pinal County Board of Supervisors on July 22, 1974. A water master was appointed whose duties included maintenance of the system and overseeing the irrigation schedule and water deliveries to the property owners.

Richard and Socorro Correa purchased their “mini-farm” at the suggestion of Joe Correa. The Correas had an understanding among themselves that Joe would farm the land and that they would share in the output or profit.

This lawsuit arose out of the alleged inadequacies of the irrigation system installed by the developers and the water supplied to the “mini-farms.” Although the record is less than crystal clear on this point, a directed verdict admits the truth of all the competent evidence introduced by appellants, including all reasonable inferences to be drawn therefrom, and we must view such evidence most strongly against appellees and in the light most favorable to appellants. Jackson v. H. H. Robertson Company, Inc., 118 Ariz. 29, 574 P.2d 822 (1978); Byrns v. Riddell, Inc., 113 Ariz. 264, 550 P.2d 1065 (1976). We reject appellees’ suggestion that appellants’ failure to move for a new trial precludes us from considering the sufficiency of the evidence. McClinton v. Rice, 76 Ariz. 358, 265 P.2d 425. (1953). In ruling on the motion for a directed verdict, the trial court was called upon to determine whether the plaintiffs had introduced any evidence which would justify a reasonable person returning a verdict for them. Only if no such evidence was introduced was the granting of a directed verdict correct. Matson v. Naifeh, 122 Ariz. 360, 595 P.2d 38 (1979); Han v. Horwitz, 2 Ariz.App. 245, 407 P.2d 786 (1965).

Appellants first contend that there was sufficient evidence to go to the jury on the claim of consumer fraud against Pecos Valley Development Corporation. Their claim is based upon A.R.S. Sec. 44-1522, which applies to specified unlawful practices in connection with the sale or advertisement of merchandise. “Merchandise” is defined to include real estate. A.R.S. Sec. [605]*60544-1521(5), as amended. The requisites of a private cause of action for a statutory fraud are a false promise or a misrepresentation made in connection with the sale or advertisement of merchandise and the consumer’s consequent and proximate injury. Sellinger v. Freeway Mobile Home Sales, Inc., 110 Ariz. 573, 521 P.2d 1119 (1974). Injury occurs when the consumer relies on the misrepresentation, even though reliance need not be reasonable. Parks v. Macro-Dynamics, Inc., 121 Ariz. 517, 591 P.2d 1005 (App.1979); Peery v. Hansen, 120 Ariz. 266, 585 P.2d 574 (App.1978).

The record indicates that the developers represented that there would be sufficient water for farming. The sales literature characterized the land to be sold as “3V3 Acre Irrigated Mini Farms,” showing before and after pictures representing the land transformed through planting and irrigation, producing “lush grazing land” and “sleek cattle grazing in green fields . . . they could be yours.! ” The brochure asks, “Have you ever? ... Wanted to grow trees, or an orchard for a profit? Wanted to raise and board your own horses? ... Wanted to have your family enjoy the freedom of a small farm? Papago Butte Ranchos offers the opportunity to be independent. On your own 3V3 acre Mini-Farm you can raise trees or an orchard, have horses or other livestock, gather vegetables from your own garden ...” The brochure in another section further recounted the profits of ownership through “... growing fresh vegetables in your own garden, planting all kinds of fruit trees, raising chickens if you desire, growing feed to raise your own calves, or maybe a milk cow or two, keep horses for your own riding pleasure. All this and much, much more can be yours on you own Mini-Farm at Papago Butte Ranchos.” The literature discloses: “Modern planned irrigation system (water to every tract), no wells to drill no pumps to buy.”

The representations as to the adequacy of the water supply referred, as the parties knew, to an irrigation system in the process of development. The statute, A.R.S. Sec. 44-1522, distinguishes between concealment, suppression or omission of any material fact, and a false promise. The former applies to pre-existing or present facts while the latter covers events to occur in the future. When the promise is made without a present intent to perform, an action for fraud will lie. Ahmed v. Collins, 23 Ariz.App. 54, 530 P.2d 900 (1975). We believe the rationale for this rule is equally applicable to statutory consumer fraud actions.

Here the record shows, from testimony of the water master, that of the 180 lot owners in each unit of Papago Butte Ranchos, only 16 could irrigate their land at any one time. This means that, assuming the system is used 24 hours a day, each lot owner would be able to irrigate once every 5V2 days. The water master also testified, from his personal knowledge, that watering every two or three days was required to grow alfalfa, a crop which was already in cultivation on some of the lots when they were sold.

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Bluebook (online)
617 P.2d 767, 126 Ariz. 601, 1980 Ariz. App. LEXIS 572, Counsel Stack Legal Research, https://law.counselstack.com/opinion/correa-v-pecos-valley-development-corp-arizctapp-1980.