Arizona Court of Appeals Division One holds that any person aggrieved by a Director of Gaming’s licensing decision (and not just the license applicant) may appeal that decision to the Arizona Racing Commission.

Two brothers owned and operated a thoroughbred and quarter horse racetrack.  Their business relationship deteriorated, and the first brother attempted to oust the second brother from the business in a lawsuit.  During the dispute over who would control the business, the second brother applied to renew his racing license with the Director of the state gaming agency.  Unbeknownst to him, the first brother and the first brother’s attorney delivered information to the Director and the first brother’s attorney gave input on the decision.  The Director denied the second brother’s application for a new license.

The second brother appealed the decision to an Administrative Law Judge (ALJ).  The ALJ recommended that the Director’s decision be reversed, finding that the second brother was qualified to have a racing license.  The first brother then appealed that decision to the Arizona Racing Commission.  After a hearing on the merits, the Commission reinstated the denial of the second brother’s application for a license, finding that he did not satisfy the statutory requirements for a license.

The second brother appealed the Commission’s decision to superior court.  The second brother argued that under the applicable regulation, the first brother did not have a right to appeal the ALJ’s decision to the Commission, because the regulation only permits “a person aggrieved by a ruling of the Director” to appeal that decision.  See A.A.C. R19-2-124(A)(1).  The superior court agreed, and held that the first brother did not qualify as a person “aggrieved” under the statute, and therefore lacked standing to challenge the ALJ’s final decision. 

The Court of Appeals vacated the superior court’s decision and remanded the case to the superior court for reconsideration of the second brother’s arguments on the merits of his licensing application.  The Court explained that, although the phrase “person aggrieved” was ambiguous, a broad definition permitting many people to appeal decisions from the Director was appropriate.  The Court explained that if it adopted a narrow interpretation of the phrase, it would limit the Commission’s jurisdiction, because persons concerned about an applicant’s questionable qualification could not seek review of the Director’s decision granting the license application.   

Judge Weinzweig authored the opinion for the Court; Judges Perkins and Morse joined.

Posted by: John Bullock