BLUNT v. TOWN OF GILBERT

IN THE SUPREME COURT OF THE STATE OF ARIZONA BRIAN BLUNT, ET AL., Plaintiffs-Appellants, v. TOWN OF GILBERT, ET AL., Defendants-Appellees. No. CV-26-0106-CQ Filed October 9, 2026 United States District Court for the District of Arizona No. 2:23-cv-02215-SMB Certified Questions from the United States Court of Appeals for the Ninth Circuit Blunt v. Soelberg, 172 F.4th 689 (9th Cir. 2026) QUESTIONS ANSWERED COUNSEL: Steven J. Serbalik (argued), Steven J. Serbalik, P.L.C., Scottsdale, Attorney for Brian Blunt, et al. Aaron D. Arnson (argued), Refine Legal PLLC, Queen Creek, Attorney for Town of Gilbert, et al. JUSTICE CRUZ authored the Opinion of the Court, in which CHIEF JUSTICE TIMMER, VICE CHIEF JUSTICE LOPEZ and JUSTICES BOLICK, BEENE, MONTGOMERY, and KING joined.  BLUNT v. TOWN OF GILBERT Opinion of the Court JUSTICE CRUZ, Opinion of the Court: ¶1 The United States Court of Appeals for the Ninth Circuit has certified three questions of law to this Court pursuant to A.R.S. § 12-1862 and Arizona Rule of the Supreme Court 27. The questions concern how the 2022 Legislative Amendment to A.R.S. § 38-1102, the Peace Officers’ Bill of Rights (“POBR”), applies to pre-existing employment agreements. We have jurisdiction pursuant to A.R.S. § 12-1861. The certified questions are: 1. Does the presumption against retroactivity prohibit application of the 2022 amendment to Ariz. Rev. Stat. Ann. § 38-1102 to at-will employment agreements that were signed before the 2022 amendment? 2. If the presumption against retroactivity does not apply, does the 2022 amendment void the at-will employment contract between Blunt and the Town of Gilbert because the facts giving rise to Blunt’s termination occurred after enactment of the amendment, such that any discipline imposed against him by the Town must be supported by just cause? 3. If the 2022 amendment voids the at-will employment contract between Blunt and the Town of Gilbert, would that result in impairment of a vested contractual right in violation of the Contract Clause of the Arizona State Constitution? ¶2 We hold that the answer to Certified Question One is “yes.” The presumption against retroactivity bars applying the 2022 amendment of § 38-1102 to at-will employment agreements signed before the amendment’s September 24, 2022 effective date. Because that answer is dispositive, we do not reach Certified Questions Two and Three. BACKGROUND ¶3 In 2021, after years-long employment by the Town of Gilbert (“the Town”), Brian Blunt was promoted to Commander with the Gilbert Police Department. In conjunction with this promotion, the Town provided a pay raise to Blunt in exchange for his agreement to at-will employment, 2  BLUNT v. TOWN OF GILBERT Opinion of the Court as memorialized by Blunt’s signature on the Town’s offer letter. Pursuant to their agreement, either Blunt or the Town could end the employment relationship at any time with or without cause. At the time Blunt signed, the then-current version of POBR expressly permitted written agreements that deviated from POBR’s provisions, including the just-cause protections for officers. See § 38-1102 (2014). ¶4 POBR provides that “[a] law enforcement officer is not subject to disciplinary action except for just cause.” A.R.S. § 38-1103(A). POBR defines “just cause” as a disciplinary action in which (1) the law enforcement officer had notice of the relevant conduct standards, (2) the disciplinary action is job related and proportionate to the offense, and (3) the disciplinary action is supported by a preponderance of the evidence. A.R.S. § 38-1101(7). POBR also provides other protections to law enforcement officers, such as protections during an internal investigation, see A.R.S. § 38-1104, including notice and an opportunity to be heard before termination, see § 38-1104(A), and the opportunity for a post-termination appeal, see A.R.S. § 38-1106. ¶5 In 2023, based on employee complaints about Blunt, the Town retained an outside firm to investigate the allegations against him. He refused to participate in the investigation unless he was provided with the underlying materials. The Town eventually terminated Blunt, denied his request for a copy of the investigation report and a pre-termination hearing, and did not respond to his request for an appeal. ¶6 Blunt filed an action in superior court against the Town, the police chief, and the HR director, seeking a writ of mandamus forcing the Town to rescind his termination until it provided him with a pre-termination hearing and a meaningful appeals process consistent with POBR and constitutional due process. Defendants removed the case to federal court and filed a motion to dismiss, which the district court granted with prejudice. The court found that Blunt had no constitutionally protected employment interest because his contract clearly provided that he was an at-will employee and the 2022 amendment to POBR did not apply retroactively to change his at-will status. ¶7 Blunt appealed to the Ninth Circuit, which certified the previously mentioned questions to this Court. 3  BLUNT v. TOWN OF GILBERT Opinion of the Court DISCUSSION ¶8 The issue is whether the 2022 amendment to § 38-1102 reaches an at-will agreement executed in 2021, or whether the presumption against retroactivity leaves that agreement governed by the statute in force when it was signed. ¶9 In 2022, the Legislature amended POBR, A.R.S. §§ 38-1101 to -1120. The relevant portion originally read: This article does not preempt agreements that supplant, revise or otherwise deviate from the provisions of this article, including written agreements between the employer and the law enforcement officer . . . . § 38-1102 (2014) (emphasis added). As of 2022, that portion now reads: This article outlines the minimum rights given to peace officers in this state. This article does not preempt agreements that supplement or enhance the provisions of this article, including written agreements between the employer and the law enforcement officer . . . . § 38-1102 (2022) (emphasis added). Thus, after the effective date of the amendment, § 38-1102 preempted agreements that supplant, revise, or otherwise deviate from POBR’s provisions. ¶10 The Arizona Legislature has enacted a statutory presumption against retroactivity. In A.R.S. § 1-244, it directed: “No statute is retroactive unless expressly declared therein.” An express declaration means any language specifically stating a legislative purpose to bring about that result. Vande Krol v. Indus. Comm’n, 259 Ariz. 261, 268 ¶ 27 (2025). The presumption against retroactivity limits “the [L]egislature’s ability ‘to sweep away settled expectations suddenly and without individualized consideration.’” Id. at 268 ¶ 24 (quoting Landgraf v. USI Film Prods., 511 U.S. 244, 266 (1994)). And the Legislature has inserted such language into other statutes when it intends a retroactive application. See, e.g., A.R.S. § 44-503(D) (“A contract or agreement that violates this chapter and that is recorded before September 14, 2024 is void.”). It did not insert such language into § 38-1102. 4  BLUNT v. TOWN OF GILBERT Opinion of the Court ¶11 When a statute is “procedural only, and do[es] not alter or affect earlier established substantive rights [it] may be applied retroactively.” State v. Fell, 210 Ariz. 554, 560 ¶ 22 (2005) (quoting Aranda v. Indus. Comm’n, 198 Ariz. 467, 470 ¶ 11 (2000)). But the Legislature “may not disturb vested substantive rights by retroactively changing the law that applies to completed events.” Vande Krol, 259 Ariz. at 269 ¶ 31 (quoting San Carlos Apache Tribe v. Superior Court, 193 Ariz. 195, 205 ¶ 15 (1999)). The distinction between the two categories of laws is that substantive law “creates, defines and regulates rights,” id. at 269 ¶ 32 (quoting Aranda, 198 Ariz. at 470 ¶ 12), while procedural law “prescribes the method of enforcing such rights or obtaining redress,” id. (quoting Hall v. A.N.R. Freight Sys., Inc., 149 Ariz. 130, 138 (1986)). ¶12 To trigger the presumption against retroactivity, a substantive right must have vested at the time the new legislation takes effect. See Hall, 149 Ariz. at 139–40; see also San Carlos Apache Tribe, 193 Ariz. at 205 ¶ 15 (stating that the Legislature “may not disturb vested substantive rights” (emphasis added)). Here, the parties agree that the Legislature did not expressly declare that its 2022 POBR amendment should apply retroactively. But they disagree on whether the rights affected were substantive and had vested prior to the 2022 amendment. The Town argues that its contractual rights in an at-will employment agreement vested at the time the contract was executed, while Blunt contends that the Town’s interest in terminating an employee at will is only a contingent interest until such time as a disciplinary action is initiated. I. Vested Rights ¶13 A right is vested when “it is actually assertable as a legal cause of action or defense or is so substantially relied upon that retroactive divestiture would be manifestly unjust.” Hall, 149 Ariz. at 140. In the contract context, the parties’ rights and obligations vest on the date the agreement is executed; the law in force at the time forms a part of the contract. Ward v. Chevron U.S.A. Inc., 123 Ariz. 208, 209 (App. 1979). That is so even when the conduct that later calls the vested right into play occurs after the law is amended. See id. at 209–10 (finding that the plaintiff could not invoke statutory protections against failure to renew the contract enacted after the original contract, even though the non-renewal occurred after the statute took effect); see also Foltz v. Noon, 16 Ariz. 410, 414 (1915) (concluding that miners could not rely on a post-contract statutory 5  BLUNT v. TOWN OF GILBERT Opinion of the Court amendment authorizing wage liens, even though the labor was done after the amendment); Kresos v. White, 47 Ariz. 175, 178–79 (1936) (affirming a mortgagee’s vested right to a deficiency judgment was not affected by a later-enacted anti-deficiency statute, even though the foreclosure and deficiency proceeding occurred after the statute took effect). ¶14 By contrast, in Hall we found the right to a defense of contributory negligence vested only at the onset of the lawsuit and not when the incident occurred because a defense cannot be asserted until a lawsuit has been filed. 149 Ariz. at 140; see also Vande Krol, 259 Ariz. at 273 ¶ 48 (holding that the right to apply a 2017 statute vested when a firefighter filed his workers’ compensation claim, because that is when the statutory presumption and rebuttal were “actually assertable”). But the Town’s contract rights to terminate Blunt with or without cause were assertable at execution, even if not asserted until later. ¶15 Blunt dismisses that distinction, contending that applying the 2022 amendment works no retroactive effect because the operative event is his 2023 discipline, not the 2021 agreement. To test that contention, the court must “identify the operative event that is relevant to the statute’s applicability.” State v. Gum, 214 Ariz. 397, 404 ¶ 27 (App. 2007). For a statute regulating the terms parties may contract for, that event is contract formation. See Ward, 123 Ariz. at 209. ¶16 Although POBR provides some procedural rights, the provisions at issue here are substantive. First, the provisions restricting disciplinary actions regulate the parties’ right to contract by placing limits on the right to otherwise freely negotiate employment contracts for law enforcement officers. See Landgraf, 511 U.S. at 271 (“The largest category of cases in which we have applied the presumption against statutory retroactivity has involved new provisions affecting contractual or property rights, matters in which predictability and stability are of prime importance.”). Additionally, POBR creates a right to just-cause disciplinary protections for certain law enforcement officers within the state. § 38-1103(A). Although POBR also prescribes procedures for enforcing these rights, the just-cause guarantee itself creates and defines a substantive right, not merely a method of redress. This stands in sharp contrast with an at-will employment relationship, where an employee may be terminated for any reason not prohibited by law. See A.R.S. § 23-1501(A)(1)–(2); Wagenseller v. Scottsdale Mem’l Hosp., 147 Ariz. 370, 378 (1985) (“[A]n 6  BLUNT v. TOWN OF GILBERT Opinion of the Court employer may fire for good cause or for no cause. He may not fire for bad cause—that which violates public policy.”), superseded by statute on other grounds, as recognized in Powell v. Washburn, 211 Ariz. 553, 560 ¶ 29 (2006). ¶17 The statute itself reinforces the substantive nature of these rights, explicitly stating that it “outlines the minimum rights given to peace officers in this state.” § 38-1102. Because POBR affects substantive rights, it cannot apply retroactively unless the Legislature has expressly provided for retroactive application, which it has not. See generally Veach v. City of Chandler, No. 1 CA-CV 25-0087, 2025 WL 2781328 (Ariz. App. Sep. 30, 2025) (mem. decision) (applying a similar analysis to a police commander’s 2020 at-will agreement and 2023 disciplinary action). ¶18 The same is true in the case of Blunt’s employment contract. The parties’ rights—including the agreement to at-will termination—vested at formation in 2021. Blunt’s argument that any right to at-will termination vested only at the time of the 2023 disciplinary action is unavailing. The version of § 38-1102 in force at formation became part of the contract, see Ward, 123 Ariz. at 209, and the version of that statute in force in 2021 expressly permitted agreements that “deviate[d] from” the statutory protections, including the for-cause termination protection, § 38-1102 (2014). The at-will employment term was assertable from execution: Had the Town discharged Blunt the next day and had he sued, the Town could have raised his at-will status as a complete defense. The right had therefore vested in 2021, a year before the statutory amendment. See Hall, 149 Ariz. at 140. ¶19 Blunt asserts a contrary theory for why his rights did not vest until the amendment took effect. Drawing from Demasse v. ITT Corp., 194 Ariz. 500 (1999), he argues that at-will employment essentially consists of an ongoing series of contracts for “a day’s work for a day’s wages.” Id. at 505 ¶ 12; see also Wagner v. City of Globe, 150 Ariz. 82, 86 (1986). Thus, because the Town terminated Blunt after the amendment’s effective date, the at-will employment in his contract would be void under the amended POBR. But Demasse describes how an employer and employee may modify a term going forward through mutual assent and consideration, 194 Ariz. at 506–08 ¶¶ 17–25; it does not suggest that an unchanged term must be re-ratified with each day of continued performance, nor that either party may alter the term unilaterally. 7  BLUNT v. TOWN OF GILBERT Opinion of the Court ¶20 Moreover, Blunt was not merely in an at-will employment relationship with the Town ungoverned by any contract; he explicitly contracted away his right to just-cause protections under the then-existing POBR. Under Demasse, this term is binding and cannot be unilaterally changed by one party without additional consideration to the other. Id. at 507 ¶ 21. Blunt’s theory fails at the threshold. The operative event is the 2021 execution, when the at-will termination right was assertable. Treating the Town’s right to terminate Blunt without cause, an unexercised contractual right, as unvested until invoked cannot be reconciled with Foltz, Kresos, Ward, or Veach. ¶21 Some contractual rights do vest at a point after execution, such as remedies for breach. See FL Receivables Tr. 2002-A v. Ariz. Mills, LLC, 230 Ariz. 160, 170–71 ¶¶ 52–54 (App. 2012) (“The right [the party] claims concerns remedies that would not go into effect unless and until [the other party] defaulted. Consequently, the right was not vested.”). The inquiry remains the same: When is the right “actually assertable” as a legal claim? See Hall, 149 Ariz. at 140. Like a legal defense is not assertable until a claim is filed (as in Hall), or a statutory presumption and rebuttal are not assertable until a workers’ compensation claim is filed (as in Vande Krol), a remedy is not assertable until breach. But here, the at-will termination authority is not a remedy for breach of the employment contract; it is a substantive right in itself, assertable at the formation of the contract, and thus it vested at that time. ¶22 Because the POBR amendment would alter earlier-established substantive rights, it only governs agreements executed on or after its September 24, 2022 effective date. Under the amendment, POBR’s disciplinary standards and procedures must apply to all officers, and the parties may not contract to provide lesser protections. II. The Civil Rights and Minimum Wage Objections ¶23 Blunt argues that a holding for the Town would destabilize civil rights and minimum wage statutes, which apply to conduct under contracts formed before those statutes took effect. The analogy does not hold; those legal regimes differ from the POBR amendment in kind, in mechanism, and in reach. And Blunt is not left unprotected: even as an at-will employee, he retains the baseline protection against discharge for a reason that contravenes public policy as articulated by constitutional, 8  BLUNT v. TOWN OF GILBERT Opinion of the Court statutory, or decisional law. See Wagenseller, 147 Ariz. at 378–79; see also § 23-1501(A)(3) (providing a cause of action to employees terminated in violation of statute or in retaliation for lawful activities). ¶24 First, the civil rights and minimum wage regimes differ from the POBR amendment in kind. Civil rights provided by statute reflect public policy, not bargained-for terms. Civil rights laws exist independent of any agreement. See Title VII, 42 U.S.C. § 2000e-2(a); Arizona Civil Rights Act, A.R.S. § 41-1463(B); Francini v. Phx. Newspapers, Inc., 188 Ariz. 576, 583 (App. 1996) (stating an employee’s contractual rights under a collective bargaining agreement are distinct and may be asserted separately from his statutory Title VII rights). ¶25 Second, they differ in mechanism. This distinction is structural: A term paying below the legislated minimum wage is unenforceable from inception, because the statute fixes a floor the parties cannot waive by agreement, A.R.S. §§ 23-363(B) and 23-364(H)—so voiding it presents no retroactivity question at all. “Contract provisions are unenforceable if they violate legislation or other identifiable public policy.” 1800 Ocotillo, LLC v. WLB Grp., Inc., 219 Ariz. 200, 202 ¶ 7 (2008). The 2014 POBR, by contrast, expressly allowed parties to contract around its protections, so Blunt’s at-will employment term was valid when made, and voiding it raises a retroactivity issue that voiding an unlawful sub-minimum wage agreement never presents. ¶26 Third, they differ in reach. Minimum wage and civil rights laws are generally applicable to every employment relationship in the state by force of statute, without regard to the terms of any individual agreement. See A.R.S. § 41-1463(B); 42 U.S.C. § 2000e-2(a); A.R.S. § 23-363. POBR’s just-cause disciplinary requirement, by contrast, does not operate at large; it governs a defined group—peace officers—and a single bargained-for term about whether disciplinary action can only be taken with just cause. That narrower reach is what makes the retroactivity question decisive here and absent there. Holding that the 2022 amendment does not reach pre-existing at-will employment agreements therefore leaves undisturbed the general, statewide protections Blunt invokes by analogy. 9  BLUNT v. TOWN OF GILBERT Opinion of the Court CONCLUSION ¶27 We answer Certified Question One in the affirmative. The presumption against retroactivity bars applying the 2022 amendment of A.R.S. § 38-1102 to at-will employment agreements executed before its September 24, 2022 effective date, including Blunt’s 2021 agreement. The Legislature made no express declaration of retroactivity; the amendment is substantive, not procedural; and the at-will employment term vested when the parties executed the agreement. Because our answer to the first certified question is dispositive, we do not reach Questions Two or Three. ¶28 We answer the certified question as stated and return this matter to the United States Court of Appeals for the Ninth Circuit. 10