Callanan v. Sun Lakes Homeowners' Ass'n No. 1, Inc

In Callanan v. Sun Lakes Homeowners' Ass'n No. 1, Inc., 134 Ariz. 332, 337, 656 P.2d 621, 626 (App. 1982), the trial court dismissed a stockholder's derivative action without prejudice because the stockholder had failed to make a demand on the defendant corporation, or explain the futility of such an effort, as required by Arizona Rule of Civil Procedure 23.1. 134 Ariz. at 334, 656 P.2d at 623. The court then granted the defendant corporation its attorneys' fees, but did not indicate whether the fees were ordered pursuant to A.R.S. 10-049(B) or 12-341.01. Id. Section 10-049, a permissive statutory basis for awarding either party to a derivative action attorneys' fees, was subsequently amended and renumbered as 10-746. See 1994 Ariz. Sess. Laws, ch. 223, 4 (2d Reg. Sess.). The stockholder did not challenge the dismissal, but did contest the award of attorneys' fees; thus, the fee award was the only issue on appeal. Id. The Court determined that, although "a subsequent suit would not be barred by the doctrine of res judicata," id. at 335, 656 P.2d at 624. The dismissal was a final judgment for fee purposes because it terminated the action, and affirmed the fee award under 10-049. Id. at 335-37, 656 P.2d at 624-26.