Civil Procedure—Comparative Fault Not Applicable to Breach of Contract

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Fidelity & Deposit Co. v. Bondwriter Southwest, Inc., 613 Ariz. Adv. Rep. 9 (App. Div. I, July 28, 2011) (J. Gemmill)

IN SUIT FOR BREACH OF CONTRACT AND NEGLIGENCE ARISING OUT OF THE SAME CONDUCT CONTRACT DAMAGES ARE NOT SUBJECT TO UCATA OR APPORTIONMENT OF DAMAGES BASED UPON FAULT


Plaintiff and defendant entered into an agency contract whereby defendant agreed to solicit surety bonds on behalf of the plaintiff. In a trial to the court, the defendant was found to have negligently and in breach of contract, improperly bound plaintiff to bond a project without plaintiff's prior approval as required by the contract. The court awarded $511,061 in contract damages and the identical amount in negligence caused damages but after apportionment of fault left the defendant only responsible for 5% of these damages. The Arizona Court of Appeals reversed in part finding that the contract damages are not subject to ARS sec. 12-2506 which is expressly limited to actions for “personal injury, property damage or wrongful death.” Similarly, “breach of contract” is not logically included within the definition of “fault.” A breach of contract may occur without regard to fault. Accordingly, the plaintiff was entitled to recover the full amount of its contract damages without consideration of degrees of fault.

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