Blue Cross and Blue Shield of Mich. v. Commissioner of Ins., Docket No. 79222
Decision Date | 20 February 1987 |
Docket Number | Docket No. 79222 |
Parties | BLUE CROSS AND BLUE SHIELD OF MICHIGAN and F.W. Grotenhuis Underwriters, Inc., Plaintiffs-Appellants, v. COMMISSIONER OF INSURANCE, Defendant-Appellee. |
Court | Court of Appeal of Michigan — District of US |
Warher, Norcross & Judd (by John H. Logic, Richard E. Cassard and Mark J. Henderson), Grand Rapids, for plaintiffs-appellants.
Frank J. Kelley, Atty. Gen., Louis J. Caruso, Sol. Gen., and Harry G. Iwasko, Jr. and Deborah K. Canja, Asst. Attys. Gen., for defendant-appellee.
Before BEASLEY, P.J., and MAHER and TAHVONEN, * JJ.
Plaintiffs appeal as of right from a circuit court order denying their motion for leave to appeal from an order of the Commissioner of Insurance and from an order granting defendant's motion for summary judgment pursuant to GCR 1963, 117.2(1).
F.W. Grotenhuis Underwriters, Inc. (hereinafter Grotenhuis) is a Michigan corporation licensed to sell insurance in Michigan. In 1983, Grotenhuis entered into a contract with Blue Ribbon, Inc., a subsidiary of Blue Cross and Blue Shield of Michigan (hereinafter BCBSM), to market BCBSM health care benefits in exchange for service fees. In July, 1983, defendant became aware of plaintiffs' "packaging" arrangement and requested information on the proposal. The information submitted by BCBSM revealed that the campaign to sell the packaged benefits would commence on September 1, 1983. In a letter dated September 9, 1983, defendant stated in part:
In a letter dated September 20, 1983, BCBSM stated that it would not cease and desist from entering into packaging agreements until defendant provided "specific legal reference as to why such contracts are not legal under PA 108 and 109 of 1939." A second letter requesting legal authority was sent to defendant by BCBSM on November 3, 1983.
In the meantime, defendant learned that BCBSM, its subsidiaries and its agents were conducting marketing seminars throughout the state to solicit licensed insurance agents to market the packaged benefits plans. An affidavit submitted on defendant's behalf states that BCBSM represented at the seminars that defendant's letter of September 9, 1983, did not constitute a valid order and did not have to be obeyed and that agents who marketed the package were not in jeopardy of losing their licenses. In response to this information, defendant sent a letter to BCBSM on January 13, 1984, stating:
On the same day, defendant sent a memorandum to all licensed life and health insurance companies informing them that agents who participated in the BCBSM packaging program could be placing their licenses in jeopardy.
On January 23, 1984, BCBSM filed suit in federal district court, alleging a violation of 42 U.S.C. § 1983 and seeking to enjoin defendant from interfering with BCBSM's marketing practices. That lawsuit was dismissed on February 23, 1984, on the ground that BCBSM had failed to state a claim upon which relief may be granted. The federal court held that the due process requirements had been met since there were meaningful post-deprivation remedies available, i.e., an administrative appeal pursuant to M.C.L. § 600.631; M.S.A. § 27A.631.
On February 27, 1984, plaintiffs commenced the instant lawsuit in Kent Circuit Court, alleging a violation of due process under U.S. Const., Am. XIV, 42 U.S.C. § 1983, and Const. 1963, art. 1, § 17. On February 28, 1984, plaintiffs filed a motion in Wayne Circuit Court for leave to appeal the cease and desist order contained in defendant's letter of September 9, 1983. The Wayne Circuit Court judge denied leave to appeal on the ground that leave to appeal should be sought in the Kent Circuit Court, since the underlying issues had already been raised in that county.
On March 29, 1984, plaintiffs moved in Kent Circuit Court for leave to appeal defendant's September 9, 1983, letter to BCBSM and the January 13, 1984, memo to Grotenhuis. Leave to appeal was denied on May 18, 1984, on the ground that BCBSM was guilty of culpable negligence in filing an untimely appeal.
Thereafter, defendant filed a motion for summary judgment pursuant to GCR 1963, 117.2(1), now MCR 2.116(C)(8). In an opinion dated September 7, 1984, the trial court held that plaintiffs had not been deprived of property without due process of law because there were adequate post-deprivation remedies available to protect plaintiffs' property interests. An order granting defendant's motion for summary judgment was entered on November 29, 1984.
On appeal, plaintiffs claim that the court erred in denying their motion to appeal defendant's cease and desist order and memorandum to licensed agents and in granting defendant's motion for summary judgment.
Litigants seeking judicial review of decisions by administrative agencies have three potential avenues of relief: review prescribed in the statutes applicable to the particular agency, appeal pursuant to M.C.L. § 600.631; M.S.A. § 27A.631 which allows appeals from such decisions to circuit court, or the method of review provided by the Administrative Procedures Act, M.C.L. § 24.201 et seq.; M.S.A. § 3.560(101) et seq. Nestell v. Bd. of Ed. of Bridgeport-Spaulding Community Schools, 138 Mich.App. 401, 360 N.W.2d 200 (1984).
Both the Insurance Code of 1956, M.C.L. § 500.100 et seq.; M.S.A. § 24.1100 et seq., and the Nonprofit Health Care Corporation Reform Act, M.C.L. § 550.1101 et seq.; M.S.A. § 24.660(101) et seq., provide for review of any final order or decision of the Commissioner of Insurance. Both acts provide that the Administrative Procedures Act governs review of a final order or decision of the commissioner made, issued or excuted after a hearing. M.C.L. § 500.244; M.S.A. § 24.1244; M.C.L. § 550.1615; M.S.A. § 24.660(615). In this case, a hearing was not held prior to the issuance of the order, and, thus, review of the order is not governed by the provisions of either act.
The review of agency orders and decisions under the Administrative Procedures Act is also predicated upon an evidentiary hearing at the administrative level. Since no hearing was held in this case, the Administrative Procedures Act is also inapplicable.
Thus, review of defendant's order in this case is governed by M.C.L. § 600.631; M.S.A. § 27A.631, which provides:
An appeal to the circuit court under this statute is also governed by the Michigan General Court Rules. GCR 1963, 706.1, now MCR 7.104(A). GCR 1963, 701.2 provides that an appeal as of right must be taken within twenty days after entry of the order or judgment. If the time for taking the appeal has expired, the trial court has the discretion to grant leave to appeal upon the appellant's motion accompanied by an affidavit of nonculpable negligence. GCR 1963, 703. A decision denying a motion for leave to appeal will not be reversed absent an abuse of discretion. Lapham v. Wayne Circuit Judge, 231 Mich. 449, 451, 204 N.W. 101 (1925); Smilansky v. Wayne Circuit Judge, 186 Mich. 463, 152 N.W. 1067 (1915); Jewell v. Grand Traverse County Probate Judge, 51 Mich.App. 134, 142, 214 N.W.2d 717 (1974).
In denying plaintiffs' motion for leave to appeal, the trial court stated:
To continue reading
Request your trial-
Ins. Institute v. Comm'R of Ins.
... 761 N.W.2d 184 ... 280 Mich. App. 333 ... INSURANCE INSTITUTE OF MICHIGAN ... COMMISSIONER OF THE OFFICE OF FINANCIAL AND INSURANCE ... Docket No. 262385 ... Court of Appeals of Michigan ... 7. In Blue Cross & Blue Shield of Michigan v. Comm'r of ... ...
- Buchwald Capital Advisors, LLC v. Papas (In re Greektown Holdings, LLC)
- In re GREEKTOWN HOLDINGS, LLC, et al., Debtors
-
Mayor of the City of Lansing v. Knights of the Ku Klux Klan
... Page 177 ... 564 N.W.2d 177 ... 222 Mich.App. 637 ... MAYOR OF THE CITY OF LANSING and ... (After Remand) ... Docket No. 187765 ... Court of Appeals of Michigan ... decision, the parties then brought cross motions for summary disposition in the trial ... the issuance of an arrest warrant will not shield a police officer from liability if a reasonably ... Blue Cross & Blue Shield of Michigan v. Comm'r of ... § 27A.2591; State Farm Automobile Ins. Co. v. Allen, 50 Mich.App. 71, 74-80, 212 N.W.2d ... ...