Arizona court strips agencies of the right to supply their own facts in court
Under Arizona law, when a government agency asserted something as fact, courts were required to accept it, as long as any evidence supported it—even a shred, even if the weight of the evidence pointed the other way. That standard, known as substantial evidence review, gave agencies something no ordinary litigant enjoys: the ability to lose on the facts and still win in court. On May 14, the Arizona Supreme Court all but put an end to it.
The problem with deference
In practice, the substantial evidence standard functioned as a near-impenetrable shield. As Pacific Legal Foundation argued in an amicus brief in Simms v. Arizona Racing Commission, the test “results in affirmance if ‘there [is] any evidence at all’ ‘to sustain the decision of the [agency],’ ‘even if substantial conflicting evidence exists,’ even if the record contains ‘contradictions,’ and even if ‘reasonable persons’ would ‘draw different conclusions.’”
That might be defensible if agencies were neutral arbiters. But as PLF’s brief noted, the modern agency “investigates, accuses, indicts, prosecutes, adjudicates, finds facts, concludes law, and enters binding orders.” An agency that loses at trial can simply assert its own version of the facts—and under the substantial evidence standard, courts were required to defer to that version on appeal.
The result: a biased playing field with no meaningful check on agency overreach.
The case behind the ruling
Ronald Simms was a proprietor of Turf Paradise, a Phoenix horse racing track, and held a racing license that entitled him to remain in that role. When a licensing dispute arose, his brother-turned-business-rival Jeremy—who stood to gain control of the track if Ronald lost his license—appealed to the Arizona Racing Commission to have it revoked.
An independent administrative law judge conducted a 21-day trial and observed Ronald’s testimony firsthand. The ALJ recommended approval, finding Ronald credible on every disputed question of fact.
The Commission reversed the ALJ’s recommendation on a cold record—no live witnesses, no new testimony—and denied Ronald’s license. The superior court affirmed, deferring to the Commission’s version of the facts. Under Arizona’s then-prevailing standard, that deference was required: As long as the Commission could point to some evidence for its conclusions, the court had to accept them.
The Arizona Court of Appeals sided with Ronald, finding that a 2021 amendment to state law required courts to independently evaluate agency factual findings. The Commission and Jeremy pushed the case to the Arizona Supreme Court. PLF filed amicus briefs in Ronald’s support at both the Arizona Court of Appeals and at SCOAZ.
What the ruling changes
The Arizona Supreme Court agreed with the Court of Appeals that courts must independently determine facts without deference to agencies. As the court put it, reviewing courts must now “independently determine[s] all questions of law, fact, and their application, without deferring to any agency determination on those questions.”
The court did not eliminate the substantial evidence standard entirely. It changed who supplies the facts that standard operates on. Courts must now determine the facts themselves—independently—and then ask whether the agency’s action holds up against those court-determined facts, not the agency’s own version of them.
In practice, that marks a seismic shift in administrative law. An agency can no longer come to court with its own preferred factual narrative and rely on judicial deference to make it stick. The court returned agencies to the status of an ordinary litigant, removed the substantial-evidence standard’s thumb from the scales of justice, and restored Arizona’s system of separation of powers.
The broader stakes
Arizona isn’t alone in operating under deference doctrines that have tilted the scales toward agencies for decades. Many other states have similar frameworks in place.
“Dozens of states apply similar deference doctrines in administrative proceedings, leaving individuals with little meaningful judicial recourse when agencies act against them,” said PLF attorney Adi Dynar. “Those deference doctrines should be revisited in light of Arizona’s ruling today.”
Ronald’s case returns to the superior court for the independent review he never got. For the many others in Arizona subject to agency power, the court’s ruling restores something that should never have been taken away: a fair hearing before a neutral judge.
