McNamara v. Citizens Protecting Tax Payers

• Decision Date: 30 October 2014
• Docket Number: No. 1 CA–CV 13–0551.,1 CA–CV 13–0551.
• Citation: 236 Ariz. 192,337 P.3d 557
• Parties: Jane H. McNAMARA; Kim Rosenthal; and Madeleine Kesselman, qualified electors, Plaintiffs/Appellants, v. CITIZENS PROTECTING TAX PAYERS, an Arizona non-profit corporation; Committee Citizens Protecting Taxpayers in Opposition to RC–2–11, a political committee, Defendants/Appellees.
• Court: Arizona Court of Appeals

236 Ariz. 192
337 P.3d 557

Jane H. McNAMARA; Kim Rosenthal; and Madeleine Kesselman, qualified electors, Plaintiffs/Appellants
v.
CITIZENS PROTECTING TAX PAYERS, an Arizona non-profit corporation; Committee Citizens Protecting Taxpayers in Opposition to RC–2–11, a political committee, Defendants/Appellees.

No. 1 CA–CV 13–0551.

Court of Appeals of Arizona, Division 1.

Oct. 30, 2014.

337 P.3d 558

Coppersmith Brockelman, P.L.C., Phoenix By L. Keith Beauchamp, Roopali H. Desai, Melissa A. Soliz, Counsel for Plaintiffs/Appellants.

Tiffany & Bosco, P.A., Phoenix By Timothy A. LaSota, William M. Fischbach, III, Counsel for Defendants/Appellees.

Presiding Judge MARGARET H. DOWNIE delivered the opinion of the Court, in which Judge ANDREW W. GOULD and Judge SAMUEL A. THUMMA joined.

OPINION

DOWNIE, Judge.

236 Ariz. 193

¶ 1 The dispositive issue in this appeal is whether qualified electors may maintain a private cause of action based on alleged violations of Arizona Revised Statutes (“A.R.S.”) section 16–915.01 (disposal and use of surplus monies held by political committees). We conclude no such private right of action exists and therefore affirm the superior court's dismissal of the complaint filed by Jane McNamara, Kim Rosenthal, and Madeleine Kesselman (“Appellants”).

FACTS AND PROCEDURAL HISTORY

¶ 2 Phoenix City Councilman Sal DiCiccio became the target of a recall effort in 2011. Appellee Committee Citizens Protecting Taxpayers in Opposition to RC–2–11 (“the Committee”) is a political committee formed to counter the recall campaign. According to Appellants, “the recall effort never got off the ground and ended prior to completion of the petition circulating phase.” The Committee had raised funds, some of which remained in its account when the recall effort concluded. Meanwhile, DiCiccio formed Appellee Citizens Protecting Tax Payers, Inc. (“Citizens”), a non-profit corporation. In October 2011, the Committee transferred surplus funds totaling $121,265.37 to Citizens.

¶ 3 Appellants filed a verified complaint in June 2013, alleging that the Committee's transfer of surplus monies to Citizens violated A.R.S. § 16–915.01 and that DiCiccio was illegally using the transferred funds in his 2013 re-election campaign. Appellants requested injunctive relief and an order requiring Citizens to return the surplus funds to the Committee.

337 P.3d 559

236 Ariz. 194

¶ 4 Appellees moved to dismiss the complaint, arguing, inter alia, that no private right of action exists for alleged violations of A.R.S. § 16–915.01. After briefing and oral argument, the superior court agreed with Appellees and dismissed the complaint under Arizona Rule of Civil Procedure 12(b)(6). Appellants timely appealed. We have jurisdiction pursuant to A.R.S. § 12–120.21(A)(1), –2101(A)(1).

DISCUSSION

¶ 5 We review legal questions and issues of statutory interpretation de novo. See Lincoln v. Holt, 215 Ariz. 21, 23, ¶ 4, 156 P.3d 438, 440 (App.2007). We similarly review the dismissal of claims under Rule 12(b)(6) de novo. Coleman v. City of Mesa, 230 Ariz. 352, 355, ¶ 7, 284 P.3d 863, 866 (2012).

¶ 6 Section 16–915.01 dictates how political committees are to dispose of “surplus monies.”¹ The statute does not expressly state that a private cause of action exists to enforce its terms. Nevertheless, our appellate courts have implied the existence of a private right of action when doing so is consistent with “the context of the statutes, the language used, the subject matter, the effects and consequences, and the spirit and purpose of the law.” Transamerica Fin. Corp. v. Superior Court, 158 Ariz. 115, 116, 761 P.2d 1019, 1020 (1988). Evaluation of these factors is a tool of statutory construction designed to discern legislative intent, not a license for the judicial branch to read into a statute something that might be perceived as better effectuating a statute's spirit and purpose. See Transamerica Mortg. Advisors, Inc. v. Lewis, 444 U.S. 11, 15, 100 S.Ct. 242, 62 L.Ed.2d 146 (1979) (“The question whether a statute creates a cause of action, either expressly or by implication, is basically a matter of statutory construction.”); New Sun Bus. Park, LLC v. Yuma Cnty., 221 Ariz. 43, 47, 209 P.3d 179, 183 (App.2009) (Courts “are not at liberty to rewrite ... statute [s] under the guise of judicial interpretation.”).

¶ 7 Several Arizona appellate decisions have addressed whether an implied private right of action exists under various statutory schemes. In Transamerica Financial Corp., the Arizona Supreme Court held that borrowers have an implied private right of action under the Consumer Loan Act. 158 Ariz. at 116, 761 P.2d at 1020. The court traced the Act's origins, observing that as far back as 1935, it had “recognized a borrower's implied right to enforce provisions of the Small Loan Act by permitting a borrower to seek and receive relief in the courts from loans alleged to be usurious under that act.” Id. at 117, 761 P.2d at 1021. Although the Act was later amended several times, the legislature took no steps to prohibit a private right of action, indicating “a legislative intent to preserve the private right judicially recognized by the court.” Id. The court concluded:

Since 1919 Arizona's legislative policy has been to forfeit usurious small loans. In 1956 the legislature specifically stated that loans made in violation of the Consumer Loan Act were void and that a licensee had no right to collect principal, interest or other charges. Since Walker [v. People's Finance & Thrift Co., 45 Ariz. 226, 42 P.2d 405

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