First Am. Title Ins. Co. v. Robertson

• Decision Date: 28 June 2013
• Docket Number: No. 49A04–1206–PL–326.,49A04–1206–PL–326.
• Citation: 990 N.E.2d 9
• Parties: FIRST AMERICAN TITLE INSURANCE COMPANY, Appellant–Petitioner/Cross–Appellee, v. Stephen W. ROBERTSON, Insurance Commissioner of the State of Indiana, in his official capacity, on Behalf of the INDIANA DEPARTMENT OF INSURANCE, Appellee–Respondent/Cross–Appellant.
• Court: Indiana Appellate Court

990 N.E.2d 9

FIRST AMERICAN TITLE INSURANCE COMPANY, Appellant–Petitioner/Cross–Appellee,

v.Stephen W. ROBERTSON, Insurance Commissioner of the State of Indiana, in his official capacity, on Behalf of the INDIANA DEPARTMENT OF INSURANCE, Appellee–Respondent/Cross–Appellant.

No. 49A04–1206–PL–326.

Court of Appeals of Indiana.

May 13, 2013.

Rehearing Denied June 28, 2013.

Thomas E. Wheeler, III, Sarah Steele Riordan, Maggie L. Smith, Frost Brown Todd, Indianapolis, IN, for Appellant.

Gregory F. Zoeller, Attorney General of Indiana, David Steiner, Deputy Attorney General, Indianapolis, IN, Attorneys for Appellee.

OPINION

ROBB, Chief Judge.

Case Summary and Issues

First American Title Insurance Company (“First American”) filed a verified petition for judicial review and declaratory relief against Stephen W. Robertson in his official capacity as Insurance Commissioner of the State of Indiana (the “Commissioner”). First American sought a declaration and judgment that the Commissioner's order setting an investigatory hearing was void because it was issued outside the statutory time frame. First American appeals the trial court's subsequent denial of its petition, raising the following restated issues: 1) whether the Commissioner's failure to comply with the statutory deadline rendered his order void, and 2) whether the trial court erred by requiring a separate showing of prejudice. On cross-appeal, the Commissioner appeals the trial court's denial of his motion to dismiss First American's petition, raising the following restated issues: 1) whether First American's failure to exhaust its administrative remedies deprived the trial court of subject matter jurisdiction over the petition, and 2) whether First American submitted sufficient materials for judicial review. Concluding the Commissioner's claim with regard to the failure to exhaust administrative remedies is waived and there were sufficient materials to enable judicial review, but that the Commissioner's failure to comply with the statutory deadline rendered his order void and the trial court erred by requiring a separate showing of prejudice, we affirm in part, reverse in part, and remand.

Facts and Procedural History

First American is an insurer licensed to do business in the state of Indiana. In March 2009, the Commissioner appointed a third party to perform a market conduct examination of First American. The third party examiner completed its examination and filed the market conduct examination report (the “report”) with the Commissioner on September 30, 2010. The Commissioner forwarded the report to First American on October 18, 2010. First American filed its response and rebuttal on November 10, 2010. On December 20, 2010, the Commissioner requested, and First American agreed, to retroactively extend the statutory thirty day deadline for an additional thirty days. The parties met on January 26, 2011, at which time they were unable to reach a resolution of the issues. The Commissioner requested and First American agreed to extend the deadline to February 4, 2011. On March 21, 2011, the Commissioner, through his agents, requested that First American agree to a third extension of time up through April 15, 2011. First American denied this request. On April 15, 2011, the Commissioner issued an order appointing an administrative law judge and setting an investigatory hearing on the report. On April 19, 2011, a notice of hearing was issued by the administrative law judge, setting the hearing for July 12, 2011.

On May 17, 2011, First American filed a verified petition for judicial review and declaratory relief with the trial court. First American sought a judgment and declaration that the Commissioner's failure to act on the report within the statutory time frame rendered his order void. The Commissioner filed a motion to dismiss, arguing that First American failed to serve the Attorney General with its petition and that it failed to submit the agency record to the court. The trial court heard oral argument on the motion to dismiss on September 28, 2011. The court denied the motion, finding that First American properly served the Attorney General and that the documents attached to the petition were sufficient for judicial review.

After both parties submitted briefs on the merits of the petition for review and the Commissioner renewed his motion to dismiss on the ground that First American had not properly filed an agency record with the court, the trial court heard oral argument on these matters on April 23, 2012. The trial court denied the motion to dismiss, finding again that the materials submitted were sufficient for judicial review. However, the court denied the petition for judicial review and declaratory relief on the merits. In its order, the trial court stated that under the guidelines of the Administrative Orders and Procedures Act (“AOPA”), “the Court must find both that an agency action fits into one of the five aforementioned categories and that the agency action prejudiced the petitioner,” and found that First American did not meet its burden of proof with regard to the second prong of prejudice. Appellant's Appendix at 11. First American now appeals and the Commissioner cross-appeals. Additional facts will be provided as necessary.

Discussion and Decision

I. Standard of Review

Judicial review of administrative decisions is governed by the AOPA. Ind.Code § 4–21.5–2–0.1(a). When reviewing the decision of an administrative agency, we are bound by the same standard of review as the trial court. The Kroger Co. v. Plan Comm'n of Town of Plainfield, 953 N.E.2d 536, 539 (Ind.Ct.App.2011), trans. denied. A court may set aside an agency action if the petitioner was prejudiced by an agency action that fits into one of five categories set forth in Indiana Code section 4–21.5–5–14(d). On appeal, to the extent the trial court's factual findings were based on a paper record, review is de novo. Equicor Dev., Inc. v. Westfield–Washington Twp. Plan Comm'n, 758 N.E.2d 34, 37 (Ind.2001). Similarly, we review a trial court's ruling on a motion to dismiss de novo where the facts are not in dispute and the court ruled on a paper record. Wayne Cnty. Prop. Tax Assessment Bd. of Appeals v. United Ancient Order of Druids–Grove No. 29, 847 N.E.2d 924, 926 (Ind.2006).

II. Cross–Appeal

A. Subject Matter Jurisdiction

We address first the jurisdictional argument, as jurisdiction is a threshold issue. On cross-appeal, the Commissioner argues that First American's failure to exhaust its administrative remedies deprived the trial court of subject matter jurisdiction over the petition. This is the first time the Commissioner has raised this issue. The Commissioner argues that this issue is properly before the court by citing the rule that subject matter jurisdiction cannot be waived and may be raised at any time. First American argues that the failure to exhaust administrative remedies goes to whether the trial court had jurisdiction over this particular case and, as such, is a procedural error that can be waived.¹ We agree with First American.

While it is well-established that a court's subject matter jurisdiction cannot be waived, whether a particular error impacts a court's subject matter jurisdiction is not as clear. Our supreme court recently clarified the concept of subject matter jurisdiction and stated the following:

Attorneys and judges alike frequently characterize a claim of procedural error as one of jurisdictional dimension. The fact that a trial court may have erred along the course of adjudicating a dispute does not mean it lacked jurisdiction.

....

Thus, while we might casually say, “Judge Flywheel assumed jurisdiction,” or “the court had jurisdiction to impose a ten-year sentence,” such statements do not have anything to do with the law of jurisdiction, either personal or subject matter. Real jurisdictional problems would be, say, a juvenile delinquency adjudication entered in a small claims court, or a judgment rendered without any service of process. Thus characterizing other sorts of procedural defects as “jurisdictional” misapprehends the concepts.

K.S. v. State, 849 N.E.2d 538, 541–42 (Ind.2006) (emphasis in original) (holding that the juvenile court's alleged failure to approve by written order the filing of a delinquency petition was a procedural error, and not a jurisdictional one, and thus could not be attacked collaterally). In Packard v. Shoopman, our supreme court held that the alleged failure to comply with a deadline for filing a petition for judicial review in the Tax Court was a procedural rather than jurisdictional error despite the fact that “cases from this Court and the Court of Appeals from time to time have described timely filing requirements as implicating the ‘jurisdiction’ of the court.” 852 N.E.2d 927, 930 (Ind.2006). The court noted that the phrase, “ ‘jurisdiction over the particular case,’ is something of a misnomer and refers to failure to meet procedural requirements.” Id. at 929–30. Because the error was procedural and was not raised in a timely fashion, any objection to the timeliness of the filing was waived. Id. at 932.

Our supreme court's analysis in K.S. and Packard applies here. See St. Joseph Hosp. v. Cain, 937 N.E.2d 903, 906 (Ind.Ct.App.2010) (rejecting the argument that “the analysis of jurisdictional concepts in K.S. applies with less force in an AOPA case than it does in a juvenile delinquency adjudication”), trans. denied. Like the error in Packard, the alleged error here—the failure to exhaust administrative remedies—has often been described as implicating a court's subject matter jurisdiction. See, e.g., Johnson v. Celebration Fireworks, Inc., 829 N.E.2d 979, 984 (Ind.2005). Yet, in Packard, the court held that the error was actually a procedural and not jurisdictional error. 852 N.E.2d at 932. Subject matter jurisdiction is defined as “the power to hear and determine cases of the general class to which...