Aranda v. Industrial Commission of Arizona9/12/2000
173 Ariz. 19, 24, 839 P.2d 439, 444 (App. 1992). Substantive law "creates, defines and regulates rights" while a procedural law establishes only "the method of enforcing such rights or obtaining redress." Hall v. A.N.R. Freight Sys., Inc., 149 Ariz. 130, 138, 717 P.2d 434, 442 (1986) (quoting Allen, 188 Ariz. at 96, 574 P.2d at 1315)).
Procedural or Substantive
Several procedural statutes have been enacted in the field of workers' compensation. See, e.g., A.R.S. §§ 23-908 (Supp. 1995) (requiring accident/injury reports); -1026 (1995) (compelling periodic medical exams); -1047(D) (1991) (requiring annual income reports); -1071 (1995) (requiring written Commission approval for absence from state in excess of two weeks). Each of these serves as a procedural device to facilitate the manner and means by which benefits are administered. They do not create, define, or regulate the right to receive benefits.
For example, claimants receiving permanent compensation benefits must report annual income on the award's anniversary date, see A.R.S. § 23-1047(D), failing in which, they receive notice that the report must be filed within thirty days. After thirty days, benefits may be suspended until the report is filed. See id. The goal of the statute is the efficient administration of benefits. See Pima County Bd. of Supervisors v. Industrial Comm'n, 149 Ariz. 38, 45, 716 P.2d 407, 414 (1986).
In contrast, section 23-1031 functions substantively to redefine, regulate, or even eliminate a claimant's legal authorization to receive benefits based on his incarcerated status. Reinstatement of benefits would occur only by release from prison. Clearly, this is a matter of substantive law.
Even so, a substantive legal right may be subject to retroactive impairment before it becomes a vested right. See Rio Rico Properties v. Santa Cruz County, 172 Ariz. 80, 90, 834 P.2d 166, 176 (Tax 1992). But, once the right is vested, legislation may not interfere by retroactively altering the law that applies to completed events. See San Carlos, 193 Ariz. at 205, 972 P.2d at 189. "The conclusion that a particular legal right is substantive, in contrast to procedural, does not mean that it can never be modified or abolished by the legislature. 'The rule is that any right conferred by statute may be taken away by statute before it has become vested.'" Hall, 149 Ariz. at 138, 717 P.2d at 442 (quoting In re Dos Cabezas Power Dist., 17 Ariz. App. 414, 418, 498 P.2d 488, 492 (1972)). The core issue before us, therefore, is whether an earlier established right is a vested right and whether the right would be affected or altered retrospectively by section 23-1031.
Vested Rights
Property has been defined as "any vested right of any value." Rio Rico, 172 Ariz. at 88, 834 P.2d at 174. Workers' compensation benefits based on a final workers' compensation award constitute monetary value to the recipient. Accordingly, the right to receive predetermined workers' compensation benefits is a property right. See Madrid v. Industrial Comm'n, 178 Ariz. 606, 610, 875 P.2d 839, 843 (App. 1986); United Riggers Erectors v. Industrial Comm'n, 131 Ariz. 258, 262, 640 P.2d 189, 193 (App. 1981) (citing Bugh v. Bugh, 125 Ariz. 190, 608 P.2d 329 (App. 1980)).
A property right "vests" when every event has occurred which needs to occur to make the implementation of the right a certainty. See Hall, 149 Ariz. at 138, 717 P.2d at 442. A vested property right is a right which is "actually assertable as a legal cause of action or defense or is so substantially relied upon that retroactive divestiture would be manifestly unjust." San Carlos, 193 Ariz. at 200, 972 P.2d at 184.
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