Court Opinion

ID: 9546152
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:25:37.786004+00
Date Added: 2024-06-11T15:16:03.514014
License: Public Domain

MEYERSON, Judge, specially
concurring:
The majority opinion has correctly applied A.R.S. § 12-348 to the facts of this case. Its decision, however, exposes the breadth of the statute’s applicability and demonstrates the sweeping results required by the statute—results certainly unintended by the legislature.
The majority decision correctly notes that what began in this case as a consumer dispute over workmanship ended up as a proceeding before the Registrar of Contractors in which the license of Mission Hardwood was suspended pending its repair of the floor which it installed. Indeed, the primary method which our agencies use to police misconduct by regulated industries and professions is through the license revocation and suspension process.
The most common administrative tools available to state agencies are the sus*18pension and revocation of licenses and permits issued by the agency to those persons it regulates. In the case of nearly every agency, a licensee who has violated the statute or rules applicable to that license is subject to proceedings by the agency to suspend or revoke its license.
R. Corbin, Arizona Agency Handbook § 12.4.2 (1982). The majority decision highlights the fact that in all cases where the agency takes an active role on appeal an award of attorney’s fees will now be possible if the agency decision is not sustained in the superior court.
In my opinion, the effect of the majority’s holding will be to chill the vitality of state regulation and enforcement. Admittedly, overreaching or oppressive conduct on the part of state agencies should be discouraged and undoubtedly A.R.S. § 12-348 has this purpose. On the other hand, there are certainly many “close” cases in which the propriety of the state’s enforcement action could not legitimately be disputed. But regardless of the reasonableness of the state’s action, should it ultimately lose on appeal in the superior court, the state will become liable for an award of attorney’s fees. Although the purpose of the statute was to assist those “defending against unreasonable governmental action,” Laws 1981, ch. 208, § 1, the natural consequence of this court’s holding will be to instill an attitude of paralysis in our state regulatory community. I do not believe that the legislature intended that reasonable enforcement actions could result in fee awards should the state fail to prevail on appeal.
The majority notes that our law has been taken from the federal Equal Access to Justice Act. Surprisingly, however, an important limiting feature of the federal act has not been included in the state law. Under the federal act, a court must award fees and other expenses to the prevailing party unless it finds that the position of the agency “was substantially justified or that special circumstances make an award unjust.” 28 U.S.C. § 2412(d)(1)(A). This provision gives important flexibility under the federal law which is not present under the Arizona statute. Thus, the federal law carefully focuses in on the select group of cases which warrant an award of attorney’s fees against the government. These cases are those in which the government’s position is not substantially justifiable. But where the government’s position is responsible, little purpose is served in penalizing its enforcement action simply because it is ultimately proven to be wrong.
In Cortaro Water Users’ Ass’n v. Steiner, 148 Ariz. 314, 319, 714 P.2d 807, 812, the supreme court recognized that if the features of the federal law are to be followed in Arizona then legislative action is required. For the above reasons, the Arizona Legislature should take the earliest opportunity to revisit A.R.S. § 12-348 and modify it so as not to discourage the proper enforcement of Arizona’s regulatory laws.