Administrative review by agreement?

This is more of a civil procedure issue than an administrative law issue, but it is still a useful administrative practice lesson. In an agreement between a developer and a county, paragraph twenty-one reads in part:

Any dispute between Developer and County arising from the failure of either party to comply with material terms and conditions of the Development Plan or this Agreement after an impasse has been reached, shall be resolved by a review hearing by the Board. ... The Board's decision shall be subject to appeal and judicial review in the Superior Court of the State of Arizona in and for Pinal County pursuant to [the Administrative Review Act or ARA] ...

The parties reached in "impasse" and the Developer sued the County alleging, inter alia, that the ARA did not apply to this matter and, even if it did, the County hadn't followed it. The trial judge decided that the ARA did apply, but that there was no final order arising from a properly noticed hearing to be reviewed, sending it back to the County. The Developer brought a Special Action (interlocutory) appeal on this issue to the Court of Appeals. The Court of Appeals found that the ARA did not apply to this matter, and remanded the case back to the trial court for it to be treated as a normal civil action.

¶16 Nothing in the ARA states or suggests that parties to a contract can agree to its application and confer jurisdiction on the superior court when the ARA is otherwise inapplicable. On the contrary, the statute’s applicability provision, § 12-902, and its definitions section, § 12-901, clearly and unambiguously limit the scope of the ARA's application. The legislature has made clear that the ARA applies to final decisions of an administrative agency only, § 12-902(A), and that the terms "administrative agency" or "agency" do "not include an agency in the judicial or legislative departments of the state government, any political subdivision or municipal corporation or any agency of a political subdivision or municipal corporation." § 12-901(1). Had the legislature intended to include within the ARA's purview decisions by boards otherwise excluded by the definition of administrative agency, it could have done so. And, had it intended to permit excluded entities to render the ARA applicable by agreement, it could have done so as well. ...

¶21 Thus, there is no statutory authority supporting the portion of paragraph twenty-one that provides for judicial review of the Board's decision pursuant to the ARA. Absent such authority, the County and [the Developer] could not agree to confer such jurisdiction on the superior court. ... Parties cannot, by agreement or consent, confer subject matter jurisdiction on a court where it would not otherwise exist. Nor can parties limit the court's jurisdiction, which is the effect of the respondent judge's consideration of petitioners' complaint as nothing more than a request for review under the ARA rather than a de novo complaint.

While this opinion is applying a statute in one particular jurisdiction, the principal holds generally. Without explicit statutory authority, parties cannot by agreement add or subtract from the authority of the courts. One might suspect that the boilerplate language of this dispute resolution provision was copied from some other contract or from a form book, the drafter failed to make sure that it would work in a development agreement with an Arizona county, and nobody on either side of the negotiating table noticed. Lesson for contract drafters: Boilerplate isn't.

Grosvenor Holdings v. Pinal County, No. 2 CA-SA 2009-0050 (Ariz. App. Oct. 22, 2009). EMM