State Separation of Powers Wooley v State Farm

State Separation of Powers Wooley v. State Farm Fire and Cas. Ins. Co. , 893 So. 2 d 746 (La. 2005)

Quick Review of Adjudications n n Like trials n Specific parties n Specific facts n Individual due process rights Contrast with regulations n Like statutes n Apply to everyone n No due process rights

ALJs n n Agency employees who hear adjudications n Generally expert in the area n Often work with other agency personnel n Contrast with Article III judges Powers n Makes findings of fact n Recommends a ruling to the agency

State Regulation of Insurance Mc. Carron-Ferguson Act - 1945 n n With a few exceptions, leaves the regulation of insurance to the states n Insurers are organized by state n States do not have the information or expertise to do the job n Limits the risk sharing to small pools n ERISA is the big exception - no regulation at all Exempts insurance companies from antitrust laws n Allows collusive action between the

Office of Insurance Commissioner n n Who served as Insurance Commissioner prior to 1956? What did the constitutional amendment of 1960 provide? What powers and duties did the 1973 constitution provide to the insurance commissioner? Any problems with office over the past few commissioners?

ALJs in LA n n n Prior to the creation of DAL, did the LA APA have specific provisions authorizing ALJs? Who employed them at this time? Were there uniform criteria for selection? n Should there be? n Should they be lawyers?

Key Provisions of the DAL - 1995 n n The DAL shall handle all adjudications required by the LAPA, n that the ALJ shall issue the final decision or order and n the agency shall have no authority to override the decision or order, n no agency or official thereof shall be entitled to judicial review of an adjudication. that the governor shall appoint, and the Senate confirm, a director for DAL, who, in turn, shall employ the ALJs, and that the current ALJs employed by the various affected agencies shall be transferred to and employed in the DAL.

Key Questions n n n Why go to a central panel of ALJs? Why are the different backgrounds of the ALJs an issue? Why does finality mean that the ALJs are deciding legal and not just factual questions? What do other states and the feds do? What is the effect of having the ALJ bind the agency without appeal, while allowing the regulated party to appeal to

The Big Picture n Pushed by concerns about fairness to the regulated parties n Protects little guys, like Exxon n Smoke screen of individuals to pass the law n Like family farming and the farm bill

Realities of Government n n The rule of agencies n Agencies can be effective n Agencies can give extensive due process to regulated parties n Agencies can be cost-effective PICK 2

Courts in LA n n Article V, sec. 1 vests the judicial power of the state in the courts making up the judicial branch of government, the supreme court, courts of appeal, district courts, and other constitutionally-authorized courts. n Further, La. Const. art. V, sec. 22(A) provides that all judges shall be elected. n Finally, Article V, sec. 16 grants district courts original jurisdiction of all civil and criminal matters and appellate jurisdiction as provided by law. While a court's jurisdiction and judicial power traditionally flow from these constitutional grants, Article II, secs. 1 and 2 also establish the basis for inherent judicial powers which are not specifically enumerated in the constitution.

How are Agencies Hybrids? n n n What are the legislative functions of an agency? What are the executive functions? What are the judicial functions? Why are these only "quasi-judicial"? What would be the problem if they were really judicial? Does this make "quasi-judicial" a circular

Are DAL ALJs Judges - District Court Opinion? n What factors did the district court focus on? n Are these really legal factors? n Why are they politically significant?

The Nature of the ALJ Decision in Wooley n n What issue was before the ALJ? Is this an appropriate question for an ALJ? Did the court see the ALJs deciding these cases as acting as a part of the Department of Insurance? Why is this a critical part of the opinion?

What did the LA Supreme Court Find? n n DEQ decisions are not part of the traditional civil court matters as defined in the 1973 constitution. The testimony in the record reveals that ALJs do not have the power to enforce their decisions and orders, a power that unquestionably lies in Article V courts. The ALJs simply are not constitutionally allowed to exercise the judicial power of the state and Act 739 does not impermissibly attempt to authorize the exercise of judicial power. The ALJs make administrative law rulings that

Enforcement n n n Who does have the enforcement power? What did the legislature intend for the agency to do with the ALJ's ruling? Did the court ignore the plain language of the law? What would they have to rule if they read the law the way legislature intended? Why would they dodge this?

You Are Counsel for State Farm n n n What are you worried that the agency will do? n How would you have to fight that? n What court would you end up in? Can you mandamus the agency to approve it? n Bonvillian v. Department of Ins. , 906 So. 2 d 596, 2004 -0332 (La. App. 1 Cir. 05) Do you tell them to go ahead and use the policy based on the ALJ's ruling? n What about the res judicata act?

Does the Res Judicata Statute, La. R. S. 13: 4231, Apply? n n Pursuant to this statute, then, a second action is precluded when all of the following criteria are satisfied: n (1) the judgment is valid; n (2) the judgment is final; n (3) the parties are the same; n (4) the cause or causes of action asserted in the second suit existed at the time of final judgment in the first litigation; and n (5) the cause or causes of action asserted in the second suit arose out of the transaction or occurrence that was the subject matter of the first litigation. n Burguieres v. Pollingue, 02 -1385, p. 8 (La. 2/25/03), 843 So. 2 d 1049, 1053. Judgment by whom?

Changing this Ruling n n n Can the legislature change the Wooley decision by statute? n What about the law they just passed saying we really mean it? What was declared unconstitutional in Moore v. Roemer? n How was that fixed? Has the legislature tried this with Wooley?

What about Limiting Appeals by the Commissioner? n n How does this limit the power of the commissioner, assuming that the ALJ's opinion means anything? What is the commissioner's legal argument for declaring this part of the law unconstitutional?

Interagency Powers n n n What does the court say about the legislature's authority to limit the office of Insurance Commissioner? What is the general rule about right of an agency to judicially appeal the decision of another agency? What does this make the independent status of the DAL so important?

Does The Commissioner Have Another Way to Get Into Court? n n What is a declaratory ruling? Why would it be exactly on point in this case? Has the legislature prevented the commissioner from requesting one? n Could the legislature block this avenue of appeal? This was remanded to the Appeals Court

Wooley v. State Farm Fire and Cas. Ins. Co. , 928 So. 2 d 618, 2005 -1490 (La. App. 1 Cir. 2/10/06) n n On Remand: The "existing facts" of the present controversy, for our purposes, are simply these: The ALJ made an adjudication that the RCU form met La. R. S. 22: 621's requirement of compliance with law, an adjudication which is not subject to judicial review at the request of the Commissioner and with which the Commissioner is now bound by law to comply. A litigant not asserting a substantial existing legal right is without standing to seek a declaratory judgment, and such lack of standing renders any judicial opinion sought

Where does the Remand Leave the Case? n n What issue before the Commissioner right now? Do you want an ALJ deciding these issues?

Bonvillian v. Dep't of Insurance, 906 So. 2 d 596 (La. App. Cir. 1 2005) n n n What is the underlying dispute? n Insurance Commission refused to renew a bail bond agent's license What did the plaintiff do? n Went to the ALJ, who overruled the agency What did the agency do? n Refused to obey the ALJ's order

The District Court n n n What did plaintiff request in District Court? What did the district court do? Why could the agency appeal this? n "[n]o agency or official thereof, or other person acting on behalf of an agency or official thereof shall be entitled to judicial review under this Chapter. " Notably, although the Department now appeals the district court's grant of mandamus, the Department was prohibited from appealing the merits of the ALJ's decision.

Mandamus n n Must be a specific, non-discretionary right n The remedy is not available to command the performance of an act that contains any element of discretion, however slight. When may mandamus be used against the insurance commission? n "writ of mandamus may be sought to compel the commissioner of insurance to perform a ministerial duty as established by law, where it is alleged that the commissioner of insurance is acting fraudulently or not impartially fulfilling his duties, or where the delay involved in obtaining ordinary relief may cause injustice. "

What are the Alternative Remedies? n n Specifically, the Department suggests that Bonvillian could have intervened in a certain declaratory judgment action instituted by the Department and could have requested mandatory injunctive relief. Second, the Department contends that Bonvillian could have instituted a second lawsuit requesting declaratory and injunctive relief in his favor. Why are these alternatives important?

What did the Court Rule? n n In sum, Bonvillian has not met his burden of showing that a delay in obtaining ordinary relief would cause injustice sufficient to warrant the issuance of a writ of mandamus or that there were no ordinary remedies available through which he could obtain relief. As set forth in Wiginton, mandamus presumably can not lie in cases that are doubtful. Why did plaintiff avoid these alternatives? n Agency cannot contest facts in a mandamus