Stanwitz v. Reagan

• Decision Date: 21 November 2018
• Docket Number: No. CV-18-0222-AP/EL,CV-18-0222-AP/EL
• Citation: 429 P.3d 1138
• Parties: Joshua STANWITZ, an Individual; Andrew Clark, an Individual; Scot Mussi, an Individual; and Roy Miller, an Individual, Petitioners/Appellees/Cross-Appellants, v. Michele REAGAN, in Her Capacity as the Secretary of State, Respondent/Appellee, and Outlaw Dirty Money, a Political Committee, Real Party in Interest/Appellant/Cross-Appellee. Terry Goddard, a Citizen and Qualified Elector of the State of Arizona; Paul Johnson, a Citizen and Qualified Elector of the State of Arizona; and Grant Woods, a Citizen and Qualified Elector of the State of Arizona; and Outlaw Dirty Money, a Political Committee, Petitioners/Appellants, v. Michele Reagan, in Her Official Capacity as the Secretary of State, Respondent/Appellee, and J.D. Mesnard, in His Official Capacity as Speaker of the Arizona House of Representatives; and Steve Yarbrough, in His Official Capacity as President of the Arizona Senate, Intervenors/Appellees.
• Court: Arizona Supreme Court

429 P.3d 1138

Joshua STANWITZ, an Individual; Andrew Clark, an Individual; Scot Mussi, an Individual; and Roy Miller, an Individual, Petitioners/Appellees/Cross-Appellants,

v.Michele REAGAN, in Her Capacity as the Secretary of State, Respondent/Appellee,andOutlaw Dirty Money, a Political Committee, Real Party in Interest/Appellant/Cross-Appellee.

Terry Goddard, a Citizen and Qualified Elector of the State of Arizona; Paul Johnson, a Citizen and Qualified Elector of the State of Arizona; and Grant Woods, a Citizen and Qualified Elector of the State of Arizona; and Outlaw Dirty Money, a Political Committee, Petitioners/Appellants,

v.Michele Reagan, in Her Official Capacity as the Secretary of State, Respondent/Appellee,andJ.D. Mesnard, in His Official Capacity as Speaker of the Arizona House of Representatives; and Steve Yarbrough, in His Official Capacity as President of the Arizona Senate, Intervenors/Appellees.

No. CV-18-0222-AP/EL

Supreme Court of Arizona.

Filed November 21, 2018

Amended November 27, 2018

Kory Langhofer, Thomas Basile, Stewart Salwin, Statecraft PLLC, Phoenix, Attorneys for Joshua Stanwitz, Andrew Clark, Scot Mussi, Roy Miller, J. D. Mesnard, and Steve Yarbrough.

Kimberly A. Demarchi, Joshua D. Bendor, Emma Cone-Roddy, Osborn Maledon, P.A., Phoenix, Attorneys for Terry Goddard, Paul Johnson, Grant Woods, and Outlaw Dirty Money.

Mark Brnovich, Arizona Attorney General, Kara M. Karlson, Joseph E. La Rue, Assistant Attorneys General, Phoenix, Attorneys for Michele Reagan.

Mark Brnovich, Arizona Attorney General, Dominic E. Draye, Solicitor General, Phoenix, Attorneys for Amicus Curiae State of Arizona.

Israel G. Torres, James E. Barton, II, Saman J. Golestan, Torres Law Group, PLLC, Tempe, Attorneys for Amicus Curiae Clean Energy for a Healthy Arizona.

JUSTICE LOPEZ authored the opinion of the Court, in which CHIEF JUSTICE BALES, VICE CHIEF JUSTICE BRUTINEL, and JUSTICES PELANDER, TIMMER, BOLICK, and GOULD joined.

JUSTICE LOPEZ, opinion of the Court:

¶ 1 We explain today the reasons for our prior decision order disqualifying the "Stop Political Dirty Money Amendment" from the November 2018 general election ballot. We honor the constitutional origins of our citizens' right to amend the Arizona Constitution and to enact legislation through the initiative process, and we are reluctant to impede such civic efforts. However, we must also enforce valid statutory requirements that permissibly regulate the initiative process. We hold that A.R.S. § 19-118(C) is constitutional, both facially and as applied here, because its requirement that registered petition circulators subpoenaed in an election challenge appear for trial "does not unreasonably hinder or restrict" the initiative process and it "reasonably supplements the constitutional purpose" by fostering the integrity of the process. Direct Sellers Ass'n v. McBrayer , 109 Ariz. 3, 5, 503 P.2d 951, 953 (1972).

I.

¶ 2 The right to initiate constitutional amendments and propose statutes was retained by the people when delegating legislative authority to the Arizona legislature. Ariz. Const. art. 4, pt. 1, § 1 (1)–(2). To exercise this right, a sufficient number of qualified electors must sign verified petitions in support of the proposed measure and submit them as prescribed by law. See A.R.S. tit. 19 ch. 1 (setting forth the specific process by which such petitions are to be submitted and processed). Constitutional initiatives require signatures from 15% of all qualified electors. Ariz. Const. art. 4, pt. 1, § 1 (2). For a statewide initiative, the Arizona Secretary of State (the "Secretary") is required to review the submitted petitions, remove petition sheets and individual signatures on petition sheets that fail to comply with statutory requirements, and count the remaining signatures on the petition sheets. A.R.S. § 19-121.01(A). If, after satisfying other Title 19 requirements not contested here, the Secretary determines that the initiative is supported by the requisite number of valid signatures, the measure is placed on the ballot. A.R.S. §§ 19-121.04(B), -125.

¶ 3 On July 5, 2018, the Outlaw Dirty Money political committee (the "Committee") filed signature petitions with the Secretary to qualify initiative C-03-2018, otherwise known as the "Stop Political Dirty Money Amendment" (the "Initiative"), for the November 2018 ballot. The Initiative's purpose is to amend the Arizona Constitution to ensure public knowledge of the original source of campaign contributions. The Committee was required to gather 225,963 valid signatures to qualify the Initiative for the ballot. The Committee's signature count exceeded the minimum required.

¶ 4 On July 19, the tenth business day after the Committee filed its petitions, the Stanwitz Petitioners ("Petitioners") filed a complaint pursuant to § 19-118(D) challenging the validity of certain petitions based on various objections to petition circulators, including that their registrations were defective, they were ineligible to circulate petitions, and they were improperly paid based upon the number of signatures gathered.

¶ 5 On August 2, the Secretary completed her preliminary review of the petitions pursuant to § 19-121.01, and determined that 263,000 signatures remained to be verified pursuant to additional statutory procedures. On August 7, the Committee filed a complaint pursuant to A.R.S. § 19-122(A) claiming the Secretary erroneously removed certain petition sheets and signatures during her review. The trial court consolidated the actions.

¶ 6 On August 9, prior to trial, Petitioners notified the Committee's counsel and the trial court that they intended to subpoena approximately twenty of the Committee's petition circulators to testify concerning their statutory qualifications to gather signatures. Counsel for the Committee requested additional time to prepare for the evidentiary hearing in light of the subpoenaed witnesses, which the court granted. The next day, Petitioners issued subpoenas to fifteen circulators, approximately 0.6% of the Committee's circulators, requiring their appearance at the August 20 evidentiary hearing.

¶ 7 On August 10 and 13, Petitioners served the Committee's circulators. Petitioners provided counsel for the Committee with copies of the subpoenas on August 10 and informed counsel that they had served, or were in the process of serving, the circulators. Fourteen of the circulators listed as their statutory address, for purposes of service of process pursuant to § 19-118(B)(2), the same location—a ninth-floor suite in a multi-tenant Phoenix commercial office building rented by the petition circulation company hired by the Committee.¹ Because there was a guard stationed at the first-floor entrance to the building, Petitioners served the subpoenas on the guard, who signed the service of process form and wrote that he was "authorized to receive and accept service of process."

¶ 8 None of the fifteen subpoenaed circulators appeared at the August 20 evidentiary hearing or otherwise responded to Petitioners' subpoenas. Petitioners moved the trial court to disqualify the non-appearing circulators' petitions containing 8824 signatures. In response, the Committee challenged the constitutionality of three statutes: A.R.S. § 19-102.01(A), which requires strict construction of, and compliance with, constitutional and statutory requirements for statewide initiative measures; § 19-122(A), which governs the Secretary's duties to accept and file a petition for an initiative or referendum; and § 19-118(C), which invalidates any petition signatures obtained by a registered circulator properly served with a subpoena who fails to appear for trial.

¶ 9 On August 22, the day before the trial court filed its ruling, the Secretary issued the results of her final review, which included county recorders' verifications of random signature samples pursuant to A.R.S. § 19-121.02(A)-(B). The Secretary determined, pursuant to A.R.S. § 19-121.04(A), that "the estimated total number of valid signatures is 223,892, which is less than the 225,963 minimum signatures required to qualify for the ballot under the Arizona Constitution." The Secretary concluded that, pending the outcome of legal challenges in the trial court, "[the Initiative] has not submitted a sufficient number of signatures for placement on the November 6, 2018 ballot."

¶ 10 On August 23, the trial court filed its ruling, in relevant part, upholding the constitutionality of § 19-102.01(A) (the strict compliance provision), finding that the statute "reasonably supplements" and does "not unreasonably hinder or restrict" the Constitution; upholding the constitutionality of § 19-118(C) (the circulator subpoena provision), "both on its face and as applied to the facts of this case," because it "reasonably supplements and does not unreasonably hinder[ ] the Committee's constitutional right of initiative"; and voiding the petition sheets containing 8824 signatures produced by the fifteen circulators who failed to appear pursuant to Petitioners' subpoenas. The trial court's ruling rendered the Initiative ineligible for the November 2018 ballot.

¶ 11 The Committee and Petitioners filed expedited appeals in this Court pursuant to A.R.S. § 19-122(A). The Committee challenges the constitutionality of §§ 19-102.01(A) and 19-118(C), and the trial court's decision to disqualify the non-appearing subpoenaed circulators' petition signatures. Because the parties agree that the validity of the signatures gathered by the non-appearing circulators is dispositive as to whether the Initiative qualified for inclusion on the November 2018 ballot, we do not consider Petitioners' appeal.

II.

¶ 12 As our decision does not turn on whether the Committee strictly complied with § 19-118(C), we need not determine the constitutionality of the strict compliance requirement of § 19-102.01(A). See, e.g. , Hayes v. Cont'l Ins. Co. , 178 Ariz. 264, 273, 872 P.2d 668, 677 (1994) (noting that, if possible, "we...