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15-15998 - KnightBrook Ins. Co., et al v. Payless Car Rental System, et al


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15-15998 - KnightBrook Ins. Co., et al v. Payless Car Rental System, et al
May 5, 2017
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Filed Order for PUBLICATION (MILAN D. SMITH, JR., N. RANDY SMITH and GARY FEINERMAN) KnightBrook Insurance Company and Knight Management Insurance Services, LLC (together, KnightBrook) sued PCR Venture of Phoenix, LLC, a franchisee of Payless Car Rental System, Inc. (together, Payless), for, among other things, equitable indemnification. After a bench trial, the district court awarded KnightBrook $970,000; in so doing, the court applied §§ 76 and 78 of the Restatement (First) of Restitution. Having heard oral argument on Payless’s appeal, we have concluded that the appeal’s outcome turns on two questions of law: (1) whether Arizona equitable indemnity law incorporates § 78 of the Restatement; and, if so, (2) whether equitable indemnity under § 78 requires that the indemnity plaintiff’s liability to the underlying plaintiff have been coextensive with the indemnity defendant’s liability to the underlying plaintiff. Because these questions are governed by Arizona law but have not been definitively resolved by the Arizona judiciary, we respectfully certify them to the Supreme Court of Arizona pursuant to Arizona Revised Statutes § 12–1861 and Supreme Court of Arizona Rule 27. (SEE ORDER FOR FULL TEXT) In light of our decision to certify the two issues set forth above, the submission of this appeal is withdrawn, and all further proceedings in this case before our court are stayed pending final action by the Supreme Court of Arizona, save for any petition for rehearing regarding this order. The Clerk is directed to administratively close this docket, pending further order. The parties shall notify the Clerk of this court within fourteen days of the Supreme Court of Arizona’s acceptance or rejection of certification, and again, if certification is accepted, within fourteen days of the Supreme Court of Arizona’s issuance of a decision. QUESTION CERTIFIED; PROCEEDINGS STAYED. [10423243]