A.R.S 12-821.01 Interpretation
In Jones v. Cochise County, 218 Ariz. 372, 187 P.3d 97 (App. 2008), the county exchanged disclosure statements and other written discovery and participated in seven depositions without raising the allegedly dispositive defect in the plaintiff's notice under A.R.S 12-821.01 (2003), a statute that requires a party with a claim against a public entity or employee to notify the public entity or employee of the claim and state an "amount for which the claim can be settled" within 180 days after the cause of action accrues. 218 Ariz. at 380,27, 187 P.3d at 105.
The Court held the county waived the alleged defect. Id. at 381,29, 187 P.3d at 106.
"Waiver may be found when a governmental entity has taken substantial action to litigate the merits of the claim that would not have been necessary had the entity promptly raised the defense." Id. at 380,26, 187 P.3d at 105.
The Arizona Supreme Court cited Jones approvingly in City of Phoenix v. Fields, 219 Ariz. 568, 574-75,29-30 & 33, 201 P.3d 529, 535-36 (2009) (defendant city's active litigation waived its right to seek dismissal due to plaintiff's failure to abide by A.R.S. 12-821.01).
In Fields, the court pointed to arbitration as a useful analogy regarding waiver: "It is widely recognized that even when a dispute is subject to arbitration, that right may be waived by a party who participates substantially in litigation without promptly seeking an order from the court compelling arbitration." 219 Ariz. at 575 n.4,30, 201 P.3d at 536 n.4.
Both Jones and Fields cited Pritchard v. State, which, while based on A.R.S. 12-821, an earlier version of the current A.R.S. 12-821.01, held compliance with the statute was a procedural, not jurisdictional, prerequisite to bringing suit and thus subject to waiver, estoppel, and equitable tolling. 163 Ariz. 427, 430, 432, 788 P.2d 1178, 1181, 1183 (1990); see Lee v. State, 225 Ariz. 576, 579,10, 13, 225 Ariz. 576, 242 P.3d 175, 178 (App. 2010) (logic of Pritchard applies "equally to the current version of the statute"; jury question as to whether claimant complied with statute).
The version of A.R.S. 12-821 discussed in Pritchard became law in 1984, 1984 Ariz. Sess. Laws, ch. 285, 5, and was repealed nine years later. 1993 Ariz. Sess. Laws, ch. 90, 7.
In McCloud v. State, 217 Ariz. 82, P 25, 170 P.3d 691, 699 (App. 2007), we noted that 12-821.01 "has consistently been applied only to claims arising out of acts by public employees in the scope of their employment."
The Court further observed that an "employee's 'conduct falls within the scope of employment if it is the kind the employee is employed to perform, it occurs within the authorized time and space limits, and furthers the employer's business even if the employer has expressly forbidden it." Id. P 29 quoting Baker ex rel. Hall Brake Supply, Inc. v. Stewart Title & Trust of Phoenix, Inc., 197 Ariz. 535, P 17, 5 P.3d 249, 254 (App. 2000) (alteration in McCloud);
See also Love v. Liberty Mut. Ins. Co., 158 Ariz. 36, 38, 760 P.2d 1085, 1087 (App. 1988) (conduct within scope of employment if, inter alia, "it is actuated at least in part by a purpose to serve the master").