Steiger v. Woods

32 P.3d 19, 201 Ariz. 94, 356 Ariz. Adv. Rep. 26, 2001 Ariz. App. LEXIS 132
CourtCourt of Appeals of Arizona
DecidedSeptember 18, 2001
DocketNos. 1 CA-CV 00-0081, 1 CA-CV 00-0084
StatusPublished

This text of 32 P.3d 19 (Steiger v. Woods) 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
Steiger v. Woods, 32 P.3d 19, 201 Ariz. 94, 356 Ariz. Adv. Rep. 26, 2001 Ariz. App. LEXIS 132 (Ark. Ct. App. 2001).

Opinion

OPINION

THOMPSON, Presiding Judge.

¶ 1 Appellee challenged the state’s provision of private attorneys to represent state officials in a criminal investigation. The trial court entered judgment in favor of appellee and ordered appellants to repay to the state the full amount of the funds paid to their attorneys. As discussed below, we hold that Arizona Revised Statutes Annotated (A.R.S.) § 41-193(A)(2) (1999) authorized the Arizona Attorney General to provide legal representation to protect the official interests of the Office of the Attorney General in the situation presented here, but did not allow the retention of counsel to defend an Assistant Attorney General who was under criminal investigation by a grand jury. We therefore reverse the judgment as to appellants J. Grant Woods and Marlene G. Woods, affirm the judgment as to appellant Robert B. Carey, and remand for entry of appropriate judgments.

BACKGROUND

¶2 The investigation relevant to this appeal began when a former secretary to appellant Robert B. Carey, who was then First Assistant Attorney General, accused him of using funds he had raised for support of programs of the Arizona Attorney General’s Office for activities other than those for which the funds had been solicited. She alleged in part that Carey used money collected for a luncheon honoring Dr. Martin Luther King, Jr. to instead fund retreats for attorneys employed by the Attorney General, and that he did not comply with state government procurement rules and regulations in handling the monies. The former employee took her allegations to Maricopa County Attorney Richard Romley. Romley initiated a grand jury investigation.

¶ 3 Appellant J. Grant Woods was the Attorney General when the allegations against Carey were made. He had no personal involvement in the management of the funds.

¶ 4 The Attorney General’s Office, by the Chief Counsel of the Civil Division, contracted with one law firm, Brown & Bain, to provide legal services to assist the Attorney General’s Office and Carey, “in his official capacity” as the First Assistant Attorney General, regarding the investigation by the Maricopa County Attorney’s Office. Attorney Paul Eckstein provided the bulk of these services for Carey. Another law firm, Wilenchik & Bartness, which had a contract to represent the state, provided representation to Woods and the law department. Funds from accounts of the Office of the Attorney General were used to pay the two law firms.

¶ 5 The grand jury proceeding did not result in any criminal indictments and instead the matter was resolved by an agreement. Under the agreement, Woods and Carey acknowledged that some monies collected to finance activities that were beneficial to the Attorney General’s Office and the community were expended for purposes other than the purpose for which they were solicited or collected. The amount of $29,321.49, which included a twenty percent penalty, was returned to the injured parties. The Attorney General’s Office paid $4,000.00 to the Maricopa County Attorney’s Office as reimbursement for costs of the investigation. Carey resigned from his position as First Assistant Attorney General. Woods agreed to “work with the State Treasurer to see that any future funds are handled in strict accordance with appropriate procedures.”

¶ 6 Appellee Sam Steiger demanded that Woods bring an action under A.R.S. § 35-212 in the name of the state to recover monies.paid by the state for the representation of Woods and Carey in the investigation. After Steiger’s request was declined, he filed this action against Carey, Woods, and Woods’s wife seeking a judgment ordering them to repay the state the funds paid to the [98]*98private attorneys plus a twenty percent penalty.

¶ 7 Carey and the Woodses filed motions to dismiss the complaint for failure to state a claim. They argued that A.R.S. §§ 41-192(A)(1) and 41-192.02(A) authorize the Attorney General to provide legal services, including the hiring of outside counsel, for a matter such as that for which Woods and Carey had been provided representation. They also asserted that the conflict of interest statutes, A.R.S. §§ 38-502, -503 and 505, had not been violated because they had no interest in the law firms that were retained nor did either Woods or Carey receive any compensation for work done in the matter. Finally, they argued that they had not violated A.R.S. § 38-601, which prohibits state officers from receiving any salary or emolument in excess of salary, because they did not receive any pecuniary profit from the payments made to private counsel.

¶ 8 The trial court granted the motions to dismiss on the grounds that the conflict of interest allegations failed to state claims under the cited statutes and that because the defendants did not receive any money in excess of their salaries, Steiger had failed to state a claim under A.R.S. § 38-601. The court denied Steiger’s motion for reconsideration but allowed him to amend his complaint.

¶ 9 Carey and the Woodses filed a motion to dismiss the amended complaint for failure to state a claim, arguing that the revised complaint merely alleged claims that had already been dismissed. The new judge assigned to the case found that Steiger had failed to allege facts that would permit the court to reconsider the previous decisions and entered an order dismissing the complaint.

¶ 10 Steiger appealed to this court. In a memorandum decision, Steiger v. Woods, 1 CA-CV 97-0595 (App. Sept. 15, 1998), we reversed the trial court, reasoning in part that A.R.S. § 41-192.02(A) gives the Attorney General the authority to defend employees against civil actions only, and the complaint alleged that the Maricopa County Attorney conducted a criminal investigation. This court also determined that the facts set forth in the amended complaint adequately alleged a violation of A.R.S. § 38-503 and that the trial court erred in ruling that State v. Boykin, 112 Ariz. 109, 538 P.2d 383 (1975), precluded the application of A.R.S. § 38-601 to payment of legal bills.

¶ 11 Upon remand, Steiger moved for summary judgment, arguing that A.R.S. § 41-192.02 does not allow state-paid legal representation for an officer or employee who is involved in a criminal proceeding. He further asserted that, as a matter of law, defendants’ actions violated the conflict of interest statutes and that they received emoluments in violation of A.R.S. § 38-601. The Woods-es and Carey filed cross motions for summary judgment in which they argued that A.R.S.

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Cite This Page — Counsel Stack

Bluebook (online)
32 P.3d 19, 201 Ariz. 94, 356 Ariz. Adv. Rep. 26, 2001 Ariz. App. LEXIS 132, Counsel Stack Legal Research, https://law.counselstack.com/opinion/steiger-v-woods-arizctapp-2001.