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Collecting on a Judgment

On May 11, 2017, the Court of Appeals held that the trial court must look to the fundamental nature of the underlying obligation to determine which subsection of A.R.S. § 44-1201 applies to a collection judgment. See Arizona State University Board of Regents v. Arizona State Retirement System, 1 CA-CV 16-0239, filed 5/11/2017. The Court held that while a judgment may be necessary to secure a monetary obligation, that fact alone does not mean the lesser rate of A.R.S. § 44-1201(B) applies to the judgment of indebtedness. The Court further held that any party that successfully obtains judgment to collect an owed “indebtedness” is permitted to recover the higher 10% interest rate under A.R.S. § 44-1201(A).