Stephens v. State, Department of Revenue

OPINION

MOORE, Justice.

I. FACTS AND PROCEEDINGS

Claude Stephens failed to pay his 1976 Alaska state income taxes. The Alaska Department of Revenue (DOR) sued him to recover taxes due. In June 1981, Stephens filed for bankruptcy in Texas. Without knowledge of Stephens’ bankruptcy, the State entered a default judgment in July of 1981, and retained Arizona counsel to collect the judgment. Stephens’ debts, including the tax obligation, were discharged in December 1981. Stephens notified the Arizona attorney. Subsequently, in March 1983, the DOR garnished Stephens’ wages and attached his bank…