Gregg Forszt And Vestar Arizona Xli, L.L.C. v. F. Ann Rodriguez and Stop O v. Outrageous Giveaways ( 2006 )

FILED BY CLERK
FEB 15 2006
IN THE COURT OF APPEALS
STATE OF ARIZONA COURT OF APPEALS
DIVISION TWO
DIVISION TWO
GREGG FORSZT and VESTAR )
ARIZONA XLI, L.L.C., )
)
Plaintiffs/Appellants/ ) 2 CA-CV 2005-0216
Cross-Appellees, ) DEPARTMENT A
)
v. ) OPINION
)
F. ANN RODRIGUEZ, Pima County )
Recorder, )
)
Defendant/Appellee/ )
Cross-Appellant, )
)
and )
)
STOP O.V. OUTRAGEOUS )
GIVEAWAYS, an Arizona political )
committee, )
)
Intervenor/Cross-Appellant. )
)
APPEAL FROM THE SUPERIOR COURT OF PIMA COUNTY
Cause No. C20055917
Honorable Ted B. Borek, Judge
AFFIRMED
Lewis and Roca LLP
By Susan M. Freeman, John N. Iurino, and
John C. Hinderaker Tucson
Attorneys for Plaintiffs/
Appellants/Cross-Appellees
Barbara LaWall, Pima County Attorney
By Karen Friar and Christopher Straub Tucson
Attorneys for Defendant/
Appellee/Cross-Appellant
Stinson Morrison Hecker LLP
By Jeffrey J. Goulder and James E. Holland, Jr. Phoenix
Attorneys for Intervenor/
Cross-Appellant
H O W A R D, Presiding Judge.
¶1 Plaintiffs/appellants Gregg Forszt and Vestar Arizona, XLI, L.L.C., appeal
from the trial court’s denial of a writ of mandamus and declaratory judgment compelling
defendant/appellee F. Ann Rodriguez, the Pima County Recorder, to disqualify the signature
sheets filed by intervenor Stop O.V. Outrageous Giveaways (SOVOG) requesting a
referendum election in the Town of Oro Valley. Because we conclude the trial court
correctly denied the relief requested, we affirm its ruling.1
¶2 The facts relevant to this appeal are not in dispute. On April 7, 2004, the
Town of Oro Valley adopted an ordinance that authorized it to enter into an economic
development agreement with Vestar. The agreement provided that Vestar would develop
1
The Pima County Recorder cross-appealed, challenging the trial court’s decision on
the scope of her duties when referendum petitions are filed. Because we determine that she
properly fulfilled her duties in this case, we need not determine the extent of her duties for
other referendum petitions. Furthermore, any discussion of her duties in the trial court’s
order was unnecessary to the ultimate decision and has no binding effect. The cross-appeal
is therefore moot.
2
a shopping center on land it owned in Oro Valley. In exchange, Oro Valley would share
with Vestar a portion of the sales tax revenues collected from the shopping center. SOVOG
sought to challenge the ordinance by referendum and collected over 1,200 signatures on 118
signature sheets. SOVOG circulated the signature sheets with a copy of the ordinance
attached while it was collecting these signatures, but removed the ordinance from the
signature sheets before submitting the completed referendum petition to the Oro Valley town
clerk. The clerk refused to accept the petition for filing on the ground that the ordinance
was an administrative rather than a legislative act and, therefore, was not subject to
referendum.
¶3 SOVOG filed a special action petition challenging the town clerk’s conclusion
that the ordinance was not referable and sought an order requiring the clerk to transmit the
petition to the Pima County recorder’s office for the verification of signatures (SOVOG I).
Vestar intervened in the action and moved for summary judgment against SOVOG. SOVOG
filed a cross-motion for summary judgment against Vestar and moved for summary judgment
against Oro Valley. The trial court granted Vestar’s motion on the basis that the ordinance
was an administrative act and, thus, was not referable. On appeal, this court reversed that
decision, holding that the ordinance was a legislative act subject to referendum. Stop O.V.
Outrageous Giveaways v. Cuvelier, No. 2 CA-CV 2004-0216 (decision order filed Feb. 11,
2005). On remand, the parties to SOVOG I stipulated to a form of judgment, which the trial
court subsequently entered. That judgment expressly ordered the town clerk “to accept and
transmit” the referendum petition to the Pima County recorder for verification of signatures.
3
¶4 SOVOG again attempted to submit its referendum petition to the town clerk.
The clerk notified SOVOG that the petition was incomplete because the ordinance was not
attached to the signature sheets as required by A.R.S. § 19-121(A)(3). SOVOG immediately
requested permission to reattach the ordinance to the signature sheets. The clerk denied the
request and refused to transmit the signature sheets to the recorder.
¶5 SOVOG again sought special action relief against the town clerk (SOVOG II).
Vestar did not intervene in that proceeding. In its complaint, SOVOG argued that the
doctrine of res judicata prevented the town clerk from refusing to transmit the signature
sheets. SOVOG also argued that the clerk should have given SOVOG the opportunity to
cure the technical defect. The trial court ruled in SOVOG’s favor, finding that the town
clerk was barred by res judicata from refusing to transmit the petitions. The court declined
to reach the issue of whether SOVOG had cured or should have been allowed to cure any
defect. The town clerk did not appeal the court’s ruling.
¶6 In compliance with the trial court’s order in SOVOG II, the town clerk
transmitted a sample of the signed petitions to the Pima County recorder. See A.R.S. § 19-
121.01(B) and (C). Vestar independently wrote to the Pima County recorder, asking her to
disqualify SOVOG’s referendum petition pursuant to her authority under § 19-
121.01(A)(1)(a) because the signature sheets had not been filed with the clerk with the
ordinance attached. The Pima County recorder responded that, in conformity with statutory
procedure, she had only received a copy of “the front page” of the sample signature sheets
and, therefore, never possessed, nor would ever possess, the materials from which she could
4
disqualify the referendum petition on that ground. The recorder verified that the referendum
petition contained sufficient valid signatures for an election.
¶7 Forszt and Vestar then filed this action, seeking a writ of mandamus and
declaratory judgment against the Pima County recorder to compel her to disqualify the
signature sheets (SOVOG III ). Forszt had not been a named party in any of the previous
lawsuits concerning this issue. SOVOG intervened and opposed the request on the
following grounds: (1) the signatures were still valid, notwithstanding the failure to attach
the ordinance when filed, because the ordinance had been properly attached when the
petitions had been circulated; (2) that the Pima County recorder did not have statutory
authority to disqualify the signatures based on their condition at the time of filing with the
town clerk; (3) under the doctrine of res judicata, the judgment in SOVOG I barred Forszt
and Vestar from receiving the relief they sought; and (4) SOVOG would have cured the
defect in a timely fashion had the town clerk allowed it to do so.
¶8 Although Forszt and Vestar did not dispute that the petitions had been
circulated with the ordinance attached, they maintained that the failure to file the petitions
in that form required that the Pima County recorder declare all signatures invalid. The trial
court denied relief, finding that SOVOG had rebutted the presumption of invalidity that had
arisen when it submitted the petition without copies of the ordinance attached and that
equitable considerations weighed in favor of allowing the petition to be “placed before the
voters.” This appeal followed.
5
PRESUMPTION OF VALIDITY
¶9 Forszt and Vestar first argue that the trial court erred by finding that SOVOG
had restored the presumption of validity of the signature sheets. “Because election contests
are statutory proceedings, we evaluate appellants’ argument by considering the applicable
statutory scheme. We resolve questions of law involving statutory construction de novo.”
Open Primary Elections Now v. Bayless, 193 Ariz. 43, ¶ 9, 969 P.2d 649, 652 (1998). We
may affirm the trial court’s ruling if it is correct for any reason apparent in the record. See
Washburn v. Pima County, 206 Ariz. 571, ¶ 7, 81 P.3d 1030, 1034 (App. 2003). And we
review the denial of a writ of mandamus for an abuse of discretion. Garcia v. City of South
Tucson, 135 Ariz. 604, 606, 663 P.2d 596, 598 (App. 1983).
¶10 Arizona recognizes a strong public policy favoring the powers of initiative and
referendum. W. Devcor, Inc. v. City of Scottsdale, 168 Ariz. 426, 428, 814 P.2d 767, 769
(1991); Pioneer Trust Co. of Ariz. v. Pima County, 168 Ariz. 61, 66, 811 P.2d 22, 27
(1991). But, because the referendum process, as distinguished from the initiative process,
permits a minority to challenge and delay the effective date of legislation already passed by
the voters’ elected representatives, our supreme court has required referendum proponents
to strictly comply with applicable constitutional and statutory provisions governing that
process. W. Devcor, 168 Ariz. at 429, 814 P.2d at 770; Cottonwood Dev. v. Foothills Area
Coal. of Tucson, Inc., 134 Ariz. 46, 49, 653 P.2d 694, 697 (1982); see also Feldmeier v.
Watson, 211 Ariz. 444, ¶¶ 14-15, 123 P.3d 180, 183-84 (2005).
6
¶11 Nonetheless, proponents’ failure to strictly comply with a procedural statutory
requirement does not always necessitate that the referendum petition be declared void. In
Direct Sellers Ass’n v. McBrayer, 109 Ariz. 3, 5, 503 P.2d 951, 953 (1972), our supreme
court noted the limited permissible scope of statutory referendum requirements: “If such
legislation does not unreasonably hinder or restrict the constitutional provision and if the
legislation reasonably supplements the constitutional purpose, then the legislation may
stand.” (Emphasis added.) The court held that the omission of a required avowal in a
circulator’s affidavit that the circulators were qualified electors did not render all the
attached signatures “null and void,” but merely destroyed their presumption of validity. Id.
And, although the court had previously concluded that the avowal in question was a valid
statutory requirement, it held that the presumption could be reinstated “on proof that the
circulators were in fact qualified electors.” Id.; see also W. Devcor, 168 Ariz. at 429-31,
814 P.2d at 770-72 (acknowledging that defect in affidavit attached to referendum petition
did not render signatures null and void and that presumption of validity could be restored
with proper showing); Homebuilders Ass’n of Cent. Ariz. v. City of Scottsdale, 186 Ariz.
642, 649, 925 P.2d 1359, 1366 (App. 1996) (some statutory referendum requirements are
not strictly construed).
¶12 The legislature has adopted an approach to technical defects very similar to
that announced in Direct Sellers and has directed that its statutory requirements be
interpreted to enhance the right of referendum, stating its intent as follows:
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If there is doubt about requirements of ordinances, charters,
statutes or the constitution concerning only the form and
manner in which the power of an initiative or referendum
should be exercised, these requirements shall be broadly
construed, and the effect of a failure to comply with these
requirements shall not destroy the presumption of validity of
citizens’ signatures, petitions or the initiated or referred
measure, unless the ordinance, charter, statute or constitution
expressly and explicitly makes . . . fatal [any] departure from
the terms of the law.
1989 Ariz. Sess. Laws, ch. 10, § 1; see also Sherrill v. City of Peoria, 189 Ariz. 537, 540-
41, 943 P.2d 1215, 1218-19 (1997); Lawrence v. Jones, 199 Ariz. 446, ¶ 7, 18 P.3d 1245,
1248 (App. 2001). We must apply this approach in analyzing the statutes and petitions in
this case.
¶13 As pertinent here, article IV, pt. 1, § 1(9) of the Arizona Constitution provides,
in part, that “[e]ach sheet containing petitioners’ signatures shall be attached to a full and
correct copy of the title and text of the measure so proposed to be initiated or referred to the
people.” Section 19-112(B), A.R.S., restates this requirement, Sherrill, 189 Ariz. at 538,
943 P.2d at 1216, and § 19-112(C) imposes a requirement that the affidavit of the circulator
state that the measure, in this case, the ordinance, was attached to the signature sheets “at
all times during circulation.”2 Section 19-121(A)(3), A.R.S., then requires that the signature
sheets be attached to the ordinance when filed. Finally, A.R.S. § 19-121.01(A)(1)(a)
2
The statutory requirements for statewide referenda are imposed on the town by
article IV, pt. 1, § 1(2) and (8) of the Arizona Constitution and A.R.S. § 19-141(C). See
Sedona Private Prop. Owners Ass’n v. City of Sedona, 192 Ariz. 126, ¶ 8, 961 P.2d 1074,
1075 (App. 1998).
8
requires the clerk to remove any sheets not attached to a copy of the ordinance. The
purpose of attaching the ordinance to the signature sheets is so each potential petitioner has
access to the measure under consideration. Cottonwood Dev., 134 Ariz. at 49, 653 P.2d at
697.
¶14 SOVOG indisputably complied with the constitutional provision that the
ordinance be attached to the signature sheets and with the statutory restatement of that
requirement that the ordinance be attached “at all times during circulation.” § 19-112(C).
But it failed to strictly comply with an express statutory requirement when it filed its petition
without the copies of the ordinance attached to each signature page. See § 19-121(A)(3)
and § 19-121.01(A)(1)(a). Nevertheless, neither of the statutes containing this requirement
“expressly and explicitly makes . . . fatal [any] departure from the terms of the law.” 1989
Ariz. Sess. Laws, ch. 10, § 1. And, as in Direct Sellers, this requirement is valid only to the
extent it does not unreasonably hinder and reasonably supplements the constitutional
purpose.
¶15 Based on the above analysis, SOVOG’s technical failure to comply with the
statute’s filing requirement did not compel the trial court to declare the signatures void.
Rather, the court was entitled to determine that SOVOG had successfully restored the
presumption that the signatures had been collected in the constitutionally required manner
and were valid. Under the specific circumstances of this case, in which Forszt and Vestar
have not disputed that the ordinance was attached to the petitions when they were circulated
9
for signature, we conclude the trial court did not err when it found the presumption of the
signatures’ validity had been restored.
¶16 Forszt and Vestar argue that the mere circulation of the petition with the
ordinance attached did not suffice to restore the presumption of validity because SOVOG
violated the statute by failing to file the petition with the ordinance attached—not by failing
to circulate it properly. And they maintain that compliance with one statutory provision
cannot remedy a failure to comply with a separate provision. See W. Devcor, 168 Ariz. at
432, 814 P.2d at 773 (compliance with requirement that recorder verify random sample of
signatures does not cure failure to abide by separate constitutional obligation that circulators
verify that every signature is by qualified elector of relevant constituency). In this vein, they
emphasize correctly that the legislature saw fit to require both the circulation and filing of
the signature sheets with the ordinance attached. See § 19-112(B) (requiring signature
sheets to “be attached at all times during circulation to a full and correct copy of the . . .
measure”); § 19-121(A)(3) (requiring that signature sheets be filed with a copy of the
measure attached).
¶17 But, unlike the situation addressed in Western Devcor, in which the court
emphasized that both relevant requirements played a substantial, independent role in
assuring the validity of the signatures submitted, 168 Ariz. at 432, 814 P.2d at 773, we can
conceive of no independent purpose for the requirement that signatures be filed with the
ordinance attached other than to confirm that they have been so circulated. Indeed, our
supreme court has apparently drawn the same conclusion, stating that the filing requirement
10
in § 19-121(A)(3) exists to confirm “that prospective signatories [had] immediate access to
the exact wording of the public action which is to be suspended.” Cottonwood Dev., 134
Ariz. at 49, 653 P.2d at 697. Notably, § 19-121.01(A)(1)(b) requires the clerk to detach any
copies of the ordinance from the signature sheets immediately upon confirming that they
were submitted attached—a provision that suggests the legislature lacked any additional
purpose for requiring that the ordinance be attached when the petition is filed.
¶18 Moreover, the courts and the legislature have specifically directed us to
evaluate procedural oversights like the one here, and any effort to overcome them, in the
context of “the presumption of validity.” 1998 Ariz. Sess. Laws, ch. 10, § 1; Sherrill, 189
Ariz. at 540, 943 P.2d at 1218; Lawrence, 199 Ariz. 446, ¶ 7, 18 P.3d at 1248. That
presumption refers to the validity of the signatures on the petition, not to the propriety of
the petition’s form when filed. W. Devcor, 168 Ariz. at 431, 814 P.2d at 772 (interpreting
Direct Sellers as holding that “the defect in the circulator’s affidavit . . . only destroyed the
presumption of validity of the signatures”) (emphasis added); Direct Sellers, 109 Ariz. at
5, 503 P.2d at 953 (omission in circulator’s affidavit merely destroyed presumption of
validity of “signatures appearing on the petitions”) (emphasis added). And the filing
requirement is only valid when it reasonably supplements the constitutional purpose of
giving potential petitioners access to the measure under consideration. Direct Sellers;
Cottonwood Dev. Accordingly, although the trial court’s inquiry was triggered by SOVOG’s
failure to file the petition without the ordinance attached, the trial court did not err when
it focused on the form of the petition when circulated to the signatories in evaluating
11
whether the presumption had been restored. Only the latter event would be relevant to the
underlying validity of the signatures obtained.
¶19 Our conclusion is reinforced by the supreme court’s own analysis in Direct
Sellers. There, the proponents of the referendum had omitted from the circulator’s affidavit
an avowal that the circulator was a qualified elector. 109 Ariz. at 4, 503 P.2d at 952.
Nonetheless, the court did not require the proponents to recirculate the petitions with
corrected affidavits in order to restore the presumption. Rather, it held the signatures could
again be presumed valid “on proof that the circulators were in fact qualified electors.” Id.
at 4, 503 P.2d at 952. Here, in determining whether the presumption was restored, we
similarly focus on whether the underlying event relevant to assuring the validity of the
signatures occurred—whether the signatories had the correct copy of the ordinance before
them when they signed the petition for referendum.
¶20 Forszt and Vestar argue that allowing the above remedy for the filing defect
here would have the effect of “reading out of existence” a statutory requirement that the
legislature saw fit to impose, an event Western Devcor requires us to avoid. 168 Ariz. at
432, 814 P.2d at 773. But the statute does not “expressly and explicitly” render the
petitions void if they are not filed with the ordinance attached. And under our analysis, and
that conducted by the trial court, SOVOG’s violation of § 19-121(A)(3) effectively rendered
the signatures invalid in the absence of an additional showing that they had been properly
collected in the first instance. In contrast, had a copy of the ordinance been attached to the
signature sheets, the signatures would have been presumed valid and the burden of
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persuasion would have been on the referendum’s opponents. See, e.g., McDowell Mountain
Ranch Land Coal. v. Vizcaino, 190 Ariz. 1, 3-4, 945 P.2d 312, 314-15 (1997) (analyzing
sufficiency of evidence to overcome presumption). Thus, far from giving the requirement of
proper filing no effect, we have concluded that the failure to strictly comply with that
provision imposed a substantial evidentiary burden on the proponents of the referendum.
¶21 Forszt and Vestar assert that, even if SOVOG could restore the presumption
of validity by demonstrating that the petitions had been properly circulated with the measure
attached, they needed to do so within the initial thirty-day deadline for filing a petition for
referendum. Our supreme court has held that the proponents of a referendum cannot
obstruct the passage of legislation by amending a defective petition outside the deadline for
its filing. Direct Sellers, 109 Ariz. at 5, 503 P.2d at 953. The court observed:
To hold otherwise would allow a small minority of voters to
present a protest to the passage of a law[,] . . . have the protest
found insufficient, file amendments, have those found
insufficient, and in this obstructive manner prevent a law from
going into effect for any number of years after its enactment.
Id. at 6, 503 P.2d at 954. And the court noted that the legislature had specifically passed
the affidavit requirement of § 19-112 in response to such “‘fraudulent and corrupt practices
in connection with the circulation of petitions.’” Id., quoting 1953 Ariz. Sess. Laws, ch. 82,
§ 1.
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¶22 But the trial court’s ruling here was not based on any conclusion that SOVOG
had amended its referendum petition or otherwise “cured” the defect.3 Rather, the court
found that SOVOG had restored the presumption of validity of the signatures by presenting
independent proof of proper compliance with the underlying requirements. And, although
the supreme court has not clarified whether independent proof must also be presented within
the deadline for filing the referendum petition,4 the trial court ultimately concluded that the
presumption had been restored based on material that had been submitted within the
3
SOVOG has argued alternatively that it attempted to cure the defect within the
effective deadline for filing the petition after the conclusion of SOVOG I. Given our
conclusion that SOVOG timely restored the presumption of validity, we do not address that
complex issue.
4
In De Szendeffy v. Threadgill, 178 Ariz. 464, 466, 874 P.2d 1021, 1023 (App.
1994), Division One of this court interpreted Direct Sellers Ass’n v. McBrayer, 109 Ariz.
3, 503 P.2d 931 (1972), to require that independent proof offered to restore the presumption
must be offered within the deadline for filing the referendum petition. But we read Direct
Sellers as drawing a clear distinction between (1) proof to restore the presumption of
validity notwithstanding a defect and (2) amending a petition to eliminate its defect. On the
facts before it, the supreme court suggested that the former would involve “proof that the
circulators were in fact qualified electors” while the latter would involve “amend[ing] their
petitions to comply with the verification provision,” a wholly different undertaking that
would require each circulator to sign and submit new differently worded affidavits. 109
Ariz. at 4, 5, 503 P.2d at 952, 953. We also read Direct Sellers as requiring that the latter
action occur within the deadline but leaving the timeliness question for the former process
intentionally unaddressed. In fact, Direct Sellers’s basis for rejecting late amendments to
a petition—that, once the deadline has run, “the power to petition . . . has lapsed”—would
not necessarily apply to a trial court’s determination that a timely but defective petition
ultimately contains enough presumptively valid signatures to require an election. Id. at 6,
503 P.2d at 954. More recently, the court stated, albeit in dictum, that the referendum
proponents could have cured the defect with independent proof, but noted the record
contained no such proof. W. Devcor, Inc. v. City of Scottsdale, 168 Ariz. 426, 431, 814
P.2d 767, 772 (1991). The court did not suggest or otherwise indicate that such proof
would be limited to that submitted before the filing deadline. Id.
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deadline: affidavits printed on each signature sheet in which each circulator had avowed that
the correct measure had been attached when circulated. Indeed, as noted earlier, Forszt and
Vestar have not disputed that the ordinance was properly circulated with the petition and
that the circulation occurred before the deadline. And SOVOG submitted a valid petition
within the time limits. Any delay has been occasioned by the town clerk’s refusal to accept
the petition and Forszt’s and Vestar’s institution of this litigation.
CONCLUSION
¶23 Because SOVOG had successfully restored the presumption of validity, the
trial court did not err when it found that the signature sheets submitted to the Pima County
recorder for verification were not invalid. Accordingly, we affirm the trial court’s grant of
summary judgment in favor of SOVOG and the Pima County recorder.
____________________________________
JOSEPH W. HOWARD, Presiding Judge
CONCURRING:
____________________________________
J. WILLIAM BRAMMER, JR., Judge
____________________________________
PETER J. ECKERSTROM, Judge
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