Opinion ID: 1158320
Heading Depth: 3
Heading Rank: 2

Heading: Substantial Compliance and Statutory Purpose

Text: Our cases suggest that whether a rule of strict or substantial compliance applies depends upon which rule promotes legislative purpose. In Matcha v. Wachs, 132 Ariz. 378, 646 P.2d 263 (1982), we held that substantial compliance with mortgage redemption statutes was sufficient to perfect a lien creditor's right to redeem. Id. at 379, 646 P.2d at 264. A lienholder tardily filed documents required to redeem foreclosed property and improperly filed copies instead of originals. We said that [w]hether a statute should be given a strict or equitable interpretation must be decided in accordance with the legislature's intent in enacting that statute. Id. at 381, 646 P.2d at 266. The statute's purpose was to insure that property is sold at a fair price and that creditors are paid in order of priority. A rule of substantial compliance would not defeat that purpose. We considered the nature and extent of the deviation from the statutory plan, the fulfillment or nonfulfillment of the statutory purpose, and the prejudice or lack of prejudice to junior creditors whom the statute was designed to protect. Id.; see also State v. McEuen, 42 Ariz. 385, 392, 26 P.2d 1005, 1008 (1933) (The first and most important principle of statutory interpretation is that the intent of the legislature is to be ascertained and followed.... The second, at least in Arizona, is that statutes shall be liberally construed to effect their objects and to promote justice.). We have found substantial compliance adequate in a variety of statutory settings. E.g., Pima County v. Cyprus-Pima Mining Co., 119 Ariz. 111, 114, 579 P.2d 1081, 1084 (1978) (allowing substantial compliance with statute requiring payment of disputed taxes because spirit of the law was satisfied); State v. Town of Benson, 95 Ariz. 107, 108, 387 P.2d 807, 808 (1963) (only substantial compliance with annexation statute required; [a]bsolute and literal compliance with the statute would result in defeating the purpose of the statute in situations where no one has been or could be misled); Leeson v. Bartol, 55 Ariz. 160, 167, 99 P.2d 485, 489 (1940) (copy instead of duplicate copy allowed; to hold otherwise defeats rather than preserves the law's intent). But we have required strict compliance when less would defeat a statute's purpose. For example, in Estate of Ball v. American Motorists Ins. Co., 181 Ariz. 124, 888 P.2d 1311 (1995), we required an insurer to strictly comply with A.R.S. § 20-259.01(B) where failure to do so would compromise the protection afforded an additional insured under the statute. In short, whether substantial or strict compliance is required is largely a question of which test best promotes legislative purpose. See A.R.S. § 1-211(B) (Statutes shall be liberally construed to effect their objects and to promote justice.).