Lee v. Hodge

882 P.2d 408, 180 Ariz. 97, 175 Ariz. Adv. Rep. 3, 1994 Ariz. LEXIS 104
CourtArizona Supreme Court
DecidedSeptember 29, 1994
DocketCV-93-0312-PR
StatusPublished
Cited by8 cases

This text of 882 P.2d 408 (Lee v. Hodge) is published on Counsel Stack Legal Research, covering Arizona Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lee v. Hodge, 882 P.2d 408, 180 Ariz. 97, 175 Ariz. Adv. Rep. 3, 1994 Ariz. LEXIS 104 (Ark. 1994).

Opinions

OPINION

CORCORAN, Justice.

Pearl and Young Lee petitioned this court to review a court of appeals’ decision affirming the trial court’s ruling excluding evidence of defendant’s prior practices of intentionally increasing the costs of repairing his customers’ cars. We granted review to determine the admissibility of such evidence in a suit alleging a violation of the Consumer Fraud Act in which plaintiff sought punitive damages. We have jurisdiction pursuant to Ariz. Const, art. 6, § 5(3), and AR.S. § 12-120.24.

FACTS AND PROCEDURAL HISTORY

The Lees owned a 1986 Hyundai automobile that was damaged when Mrs. Lee rear-ended another vehicle. Mrs. Lee took the car to Autodynamics Body Shops, Inc.—a corporation owned and operated by Matthew Hodge—on a Friday afternoon. She entered into a written contract with Autodynamics authorizing the repair of the vehicle. Shortly after leaving Autodynamics, Mrs. Lee spoke with Randy McLeod, a representative of her insurer, Farmers Insurance Company. Based on his prior experiences with Hodge, McLeod advised Mrs. Lee to retrieve the car from the body shop.

By Monday morning, the engine had been removed from the car and Hodge refused to release the vehicle until he was paid $1,659.33. Approximately a month later, Hodge released the Lees' car after receiving $2,109.33, which included storage charges. Hodge admits that no repairs had been made to the car while it was at his shop.

The Lees sued Matthew and Mary Hodge for conversion; violation of the Consumer Fraud Act, A.R.S. § 44-1522; and breach of contract.1 The factual basis for the complaint was the Lees’ claim that Hodge removed the engine from their car after being told not to do any work on the car, that Hodge unnecessarily removed the engine to increase the cost of repairing the car, and that Hodge intentionally damaged the Lees’ engine.2 The matter was arbitrated and the [99]*99Lees were awarded compensatory damages of $2,611.41, punitive damages of $15,000, and attorneys’ fees and costs. Hodge appealed and the matter was tried before a jury.

At trial, the parties disagreed as to when Mrs. Lee told Hodge to stop work on the car. The Lees claimed that they told Hodge to stop all work on Friday, whereas Hodge claimed that he did not receive the notification until Monday. The parties also disagreed as to the necessity of removing the engine, with the parties presenting conflicting expert testimony on the issue. In addition, the Lees presented uncontroverted testimony that when their car reached the shop that ultimately repaired their car, the engine had sustained damage that would not have been caused by the accident. The damage to the engine included missing carburetor screws, missing vacuum hoses, and torn wiring. One of the Lees’ witnesses described the removal of the car’s engine as being “done in a very crude, quick and mean manner.”

During the trial, the Lees attempted to introduce evidence of prior practices that Hodge used to increase the costs of repairing his customers’ cars. Specifically, they sought to introduce testimony by Hodge’s former employees about his practice of bribing individuals at Scottsdale Hyundai to get referrals; defrauding his customers by intentionally damaging vehicles; overcharging customers by engaging in double sheeting and by charging customers for new parts when used parts were installed; and automatically and unnecessarily removing the engines from customers’ cars. With the exception of the evidence concerning Hodge’s practice of automatically and unnecessarily removing the engines of cars brought to his shop for repairs, the trial court refused to admit this evidence because the Lees had not established that Hodge intentionally damaged their car, and because the other acts the Lees alleged against Hodge were not substantially similar to the prior bad practices they sought to introduce.

The jury found in favor of Hodge on all counts. The trial court denied Lees’ motion for a new trial and ordered the Lees to pay Hodge $28,600 in attorneys’ fees and $1,238.99 in costs.

The Lees appealed to the court of appeals, arguing that the trial court erred in excluding the evidence of Hodge’s prior fraudulent practices. Despite repeatedly acknowledging that it would have ruled differently, the majority of the court of appeals affirmed the trial court’s decision because it concluded that the trial court did not abuse its discretion. The Lees petitioned for review, which we granted.

DISCUSSION

The only issue on review is whether, in an action alleging a violation of the Consumer Fraud Act and seeking punitive damages, the trial court erroneously excluded evidence of defendant’s prior practices of intentionally increasing his customers’ auto repair costs because plaintiffs had not proved that defendant deliberately damaged plaintiffs’ car and because the prior practices were not sufficiently similar to the allegations in this case.

I. Requirement that the Lees Prove Intentional Damage Before Allowing the Admission of Prior Acts Evidence

After introducing testimony that their car’s engine was missing carburetor screws, missing vacuum hoses, and had torn wiring when it arrived at the shop that ultimately repaired the car, the Lees tried to introduce evidence that defendant had intentionally damaged other customers’ cars to increase repair costs. The court excluded this evidence for two reasons, one of which was that no evidence showed that defendant intentionally damaged the Lees’ car. The Lees argue that this ruling was error, and we agree.

The trial court’s ruling is contrary to established Arizona precedent. This case is no different from Correa v. Pecos Valley Dev. Corp., in which the court of appeals concluded that a trial court erred in requiring a party “to show a violation of the consumer fraud statute before they could introduce evidence which, if accepted by the jury, would tend to prove that very violation.” 126 Ariz. 601, 607, 617 P.2d 767, 773 (App.1980); see also Dunlap v. Jimmy GMC of Tucson, Inc., [100]*100136 Ariz. 338, 343, 666 P.2d 83, 88 (App.1983) (allowing evidence of past deceptive sales practices to be used to prove alleged deceptive sales practices). To succeed in their suit, the Lees had to prove that defendant’s acts were intentional, and the trial court excluded the very evidence that could help them establish this fact. To exclude evidence on this basis alone was error.

II. Admissibility of Prior Acts Evidence

The trial court also excluded this evidence because it was not substantially similar to the acts currently alleged. The Lees argue that the exclusion of this evidence was prejudicial error.

To find for Hodge in this case, the jury must have concluded that: (1) the engine in the Lees’ car needed to be removed, (2) there was a miscommunication between the Lees and Hodge such that Hodge did not receive unequivocal instructions to stop working on the vehicle until after the motor had already been removed, and (3) the damage to the Lees’ engine must have been accidental.

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Cite This Page — Counsel Stack

Bluebook (online)
882 P.2d 408, 180 Ariz. 97, 175 Ariz. Adv. Rep. 3, 1994 Ariz. LEXIS 104, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lee-v-hodge-ariz-1994.