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Associated Aviation Underwriters v. Wood9/29/2004
y Constructors, Inc., 659 So. 2d 1242, 1245-46 (Fla. Dist. Ct. App. 1995).
The reasoning behind the general rule that actions on judgments cannot be brought against individuals or entities not parties to the original judgment is obvious: "It is a violation of due process for a judgment to be binding on [and enforceable against] a litigant who was not a party or a privy, and therefore has never had an opportunity to be heard." Parklane Hosiery Co., Inc. v. Shore, 439 U.S. 322, 327 n.7, 99 S.Ct. 645, 649 n.7, 58 L.Ed. 2d 552, 559 n.7 (1979); see Cravens, Dargan & Co. v. Superior Court, 153 Ariz. 474, 476, 737 P.2d 1373, 1375 (1987). Thus, at its core, the question of whether Intervenors' complaint-in-intervention in this DRA can be construed as an action upon the Gerardo judgments depends on the extent to which AAU was bound by those judgments. See Peterson, 611 N.E.2d at 1141 (joint-venturers not bound by arbitration award entered against co-joint venturer "unless consent had been given or unless their conduct ratified the contract").
The Morris agreement and consent judgments entered thereon bound AAU to the extent its interests did not conflict with those of TAA/City and to the extent the agreement was reasonable in fact and amount. For all the reasons stated above, see 42- 47, supra, application of collateral estoppel to bind AAU on issues not directly affecting coverage did not violate AAU's due process rights. And, as to its due process rights on the remaining coverage issues and, in turn, its indemnity liability for the Gerardo judgments, AAU was able to and did fully litigate those issues in the trial court. Because AAU was thus obligated to indemnify TAA/City (by paying Intervenors as their assignees) for the Gerardo judgments, we conclude that Intervenors' claim against AAU for indemnification as stated in their complaint-in-intervention here was an action on the Gerardo judgments.
That TAA/City assigned to Intervenors its right to indemnification from AAU also supports our conclusion. When a judgment is entered against an insured, the insured has the right to seek indemnification from the insurer, assuming the basis for liability is covered by the policy. In this case, when TAA/City assigned its indemnity rights to Intervenors, they merely stepped into TAA/City's shoes and assumed the burden of establishing coverage and AAU's indemnity obligation. See K.B. v. State Farm Fire & Cas. Co., 189 Ariz. 263, 267, 941 P.2d 1288, 1292 (App. 1997) ("An assignee steps into the shoes of her assignor."). Notably, before Intervenors intervened in this case, TAA/City had brought counterclaims against AAU for essentially the same relief Intervenors ultimately requested in their complaint-in-intervention. Thus, both TAA/City and Intervenors sought to prove in this case that AAU was, in fact, the judgment debtor in the underlying tort action. Intervenors met that burden by proving that coverage existed under AAU's policy and that their settlements with TAA/City were reasonable in fact and amount.
In sum, by intervening and pursuing their interests in this action, Intervenors renewed the Gerardo judgments pursuant to § 12-1611. Because those judgments have not expired, TAA/City's underlying tort liability still exists and forms the basis for AAU's indemnity obligation. And, because the Gerardo judgments have not expired, Intervenors' right to seek indemnity from AAU also still exists, pursuant to TAA/City's assignment of its rights under the policies. Moreover, that AAU has an outstanding indemnity obligation under its policies thus renders an award of further relief in the form of a money judgment pursuant to § 12-1838 both "necessary and proper." Although the t
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