State v. Taylor (CA1 2/2/10)

A minor prejudgment-interest opinion that needed more editing.

In 1994 a State commission fined the Taylors for controlling pests without a pest-control license. They didn’t pay. In 2007 the State filed suit to convert the commission’s order into a judgment. The trial court did so but refused to award prejudgment interest. This opinion affirms.

The State cited A.R.S. §44-1201(A): prejudgment interest “on any loan, indebtedness, judgment or other obligation.” The State argued that the commission order was an indebtedness or other obligation. The opinion discusses in detail several different definitions of “indebtedness” and “obligation.” Nothing in the definitions really suggests that the commission’s order wasn’t one or the other, if not both.

But then the opinion suddenly veers in a different direction, revealing that that’s not the issue after all. The issue is statutory construction, all right, but not of the statute that it just spent a few pages construing.

Penalties don’t bear prejudgment interest at common law. Some statutes providing for administrative penalties specifically allow it. The statute that the Taylors were penalized under doesn’t. And so, under classic principles of construction that the opinion doesn’t quite mention, the legislature didn’t intend it to.

The court’s approach to this is a bit meandering and backhanded but ends up in the same place. The opinion would be less ungainly if the the second part of the analysis were first and the first second (or omitted altogether; the court apparently thinks it logically necessary but it isn’t).