§ 5.2.1 Determination of Rights or Liabilities Under a Contract or Instrument.

• Jurisdiction: Arizona

§ 5.2.1 Determination of Rights or Liabilities Under a Contract or Instrument. Declaratory relief is available to resolve the construction or validity of a written contract or writings constituting a contract. A.R.S. § 12-1832 . This statutory authority is particularly useful to settle contract disputes that arise prior to breach. In such situations, “declaratory relief tends to coerce or induce performance and is often a valuable tool for indirect enforcement of the contract and for preventing breach by clarifying rights.” D. Dobbs, Remedies 797-98 (West ed., 1973).

In general, if a dispute has arisen over a debtor’s contractual obligation, a creditor may bring a declaratory judgment action to determine the debtor’s obligation in various situations. See, e.g., McClintick v. Frame, 98 Cal. App. 338, 276 P. 1033 (Dist. Ct. App. 1929); Family Loan Co. v. Hickerson, 168 Tenn. 36, 73 S.W.2d 694 (1934).

Thus, a creditor may use a declaratory judgment action to secure a declaration of the amount due under a real estate contract or note given in connection with other transactions among the parties when a dispute over the amount arises between the creditor and the debtor. Drews v. Girsh, 212 Cal. 81, 297 P. 883 (1931). In Elkins v. Vana, 25 Ariz. App. 122, 541 P.2d 585 (1975) , the court was asked to determine whether the negotiation and satisfaction of notes had occurred, even though arguably the notes had not matured, and the same issues could have been raised later in an action on the notes. A claimant under a contract may be able not only to secure a determination of his rights under the contract, but also to impress a constructive trust on land. Bowen...