FLA. DEPT. OF BUS. REG. v. INVEST. CORP.

• Decision Date: 04 November 1999
• Docket Number: No. 93,952.,93,952.
• Citation: 747 So.2d 374
• Parties: FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, DIVISION OF PARI-MUTUEL WAGERING, Petitioner, v. INVESTMENT CORP. OF PALM BEACH, d/b/a Palm Beach Kennel Club and Palm Beach Jai Alai, et al., Respondents.
• Court: Florida Supreme Court

747 So.2d 374

FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, DIVISION OF PARI-MUTUEL WAGERING, Petitioner, v. INVESTMENT CORP. OF PALM BEACH, d/b/a Palm Beach Kennel Club and Palm Beach Jai Alai, et al., Respondents.

No. 93,952.

Supreme Court of Florida.

November 4, 1999.

Robin L. Suarez, Chief Assistant General Counsel, and Charles D. Peters, Assistant General Counsel, Tallahassee, Florida, for Petitioner.

Harold F.X. Purnell of Rutledge, Ecenia, Purnell & Hoffman, P.A., Tallahassee, Florida; Wilbur E. Brewton and Kelly B. Plante of Gray, Harris & Robinson, P.A., Tallahassee, Florida; and David S. Romanik of Romanik, Huss, Paoli & Ivers, Hollywood, Florida, for Respondents.

Jonathan Sjostrom of Steel, Hector & Davis, LLP, Tallahassee, Florida, for Phycor, Inc., Amicus Curiae.

LEWIS, J.

We have for review Investment Corp. of Palm Beach v. Division of Pari-Mutuel Wagering, 714 So.2d 589 (Fla. 3d DCA 1998), based on express and direct conflict with the decision in Chiles v. Department of State, 711 So.2d 151 (Fla. 1st DCA 1998). We have jurisdiction. See Art. V, § 3(b)(3), Fla. Const. For the reasons expressed below, we quash the decision under review and remand this case to the Third District for consideration of the merits of the declaratory statement discussed herein. We approve the First District's decision in Chiles.

MATERIAL FACTS AND PROCEEDINGS BELOW

Petitioner Department of Business and Professional Regulation, Division of Pari-Mutuel Wagering (Division), rendered a declaratory statement in response to a petition from respondents Investment Corp. of Palm Beach (Investment Corp.), Calder Race Course, Inc. (Calder), Tropical Park, Inc. (Tropical), and Gulfstream Park Racing Association (Gulfstream). Investment Corp.,714 So.2d at 590. The respondents sought the Division's opinion regarding the applicability of several statutory provisions in determining the distribution of uncashed tickets and breaks¹ generated from wagering on out-of-state thoroughbred races rebroadcast to Investment Corp. subsidiaries through Calder, Tropical, and Gulfstream. Id. The declaratory statement read, in pertinent part:

The Division is cognizant that a similar fact pattern may exist between other tracks in Florida and that the same dispute may reoccur between one of these Petitioners and a non-Petitioner. Therefore, the Division will initiate rulemaking to establish an agency statement of general applicability.

On appeal, a divided Third District panel agreed with respondents that "once the Division reached the conclusion that the questions asked of it in the petitions had general applicability to the pari-mutuel industry, thus requiring rulemaking, the Division overstepped administrative bounds when it issued the declaratory statement." Id. at 590-91. After quoting the text of the statute controlling an agency's use of declaratory statements,² the majority opinion concluded:

The statute contemplates that declaratory statements are appropriate where they deal with a petitioner's particular factual situation, but are not appropriate where they would result in agency statements of general applicability interpreting law and policy. See Sutton v. Department of Envtl. Protection, 654 So.2d 1047 (Fla. 5th DCA 1995)

; Mental Health Dist. Bd., II-B v. Dep't of Health & Rehabilitative Servs., 425 So.2d 160 (Fla. 1st DCA 1983). Where a declaratory statement provides a response which is not limited to specific facts and specific petitioners, but in reality adopts a broad agency policy or provides statutory or rule interpretations that apply to an entire class of persons, it will be set aside on appeal. See Tampa Elec. Co. v. Florida Dep't. of Community Affairs, 654 So.2d 998 (Fla. 1st DCA 1995); Regal Kitchens, Inc. v. Florida Dep't of Revenue, 641 So.2d 158 (Fla. 1st DCA 1994).

Our review of the declaratory statement reveals that it construes various statutory provisions of general applicability to all pari-mutuel permitholders who conduct intertrack wagering on simulcast rebroadcasts of horse races. As we have already noted, the Division itself recognized the need for rulemaking and initiated it. Its instincts in this regard were excellent, except for those which led it to issue the declaratory statement in this situation wherein rulemaking is the proper procedure.

Investment Corp., 714 So.2d at 591. On that basis, the majority set aside the Division's declaratory statement. Id.

Judge Cope dissented on both procedural and substantive grounds. First, he objected to even considering the racetracks' argument that the agency should not have issued a declaratory statement because that specific argument was not preserved for appellate review. Id. at 591-92 (Cope, J., dissenting). Then, in addressing the merits of the issue, Judge Cope explained that the purpose of the declaratory statement provision of the Administrative Procedure Act (APA) is "to enable the public to secure definitive binding advice as to the applicability of agency-enforced law to a particular set of facts." Id. at 592 (quoting Patricia A. Dore, Access to Florida Administrative Proceedings, 13 Fla. St. U.L.Rev. 965, 1052 (1986)). From that starting point, Judge Cope continued:

The majority opinion takes the position that "declaratory statements are appropriate where they deal with a petitioner's particular factual situation, but are not appropriate where they would result in agency statements of general applicability interpreting law and policy." Majority opinion at 591 (citations omitted). The statute says no such thing; indeed, the statute says the opposite.

In subsection (1), the statute creates the right to "seek a declaratory statement regarding an agency's opinion as to the applicability of a statutory provision, or of any rule or order of the agency, as it applies to the petitioner's particular set of circumstances." § 120.565(1), Fla. Stat.

In subsection (3), the statute requires the agency to "give notice of the filing of each petition in the next available issue of the Florida Administrative Weekly and transmit copies of each petition to the [Legislature's administrative procedures] committee." Id. § 120.565(3). The agency must issue the declaratory statement, or deny the petition, within ninety days. See id. The declaratory statement or denial is to be noticed in the next available issue of the Florida Administrative Weekly. See id.

By providing for publication of notice when the petition is filed, the Legislature clearly understood that the answer to a petition for declaratory statement may very well have impact on others who are regulated by the agency. See Chiles v. Department of State, Div. of Elections, 711 So.2d 151, 153-54 (Fla. 1st DCA 1998)

. Notice is published so that "[a]ny substantially affected party can intervene in a declaratory statement proceeding before the agency...." Id. Equally clearly, the Legislature required publication of the resulting declaratory statement precisely because— assuming the agency is operating evenhandedly—the interpretation announced in the declaratory statement will be applied to others who are similarly situated.

The point is that in enacting section 120.565, the Legislature created an important tool to vindicate the individual rights of individual citizens. The citizen has a right under the statute to get a clear, binding answer from the agency on how the agency's statute and rules apply to that individual citizen. The citizen not only has a right to an answer, but also a right to an answer within a time certain: ninety days. See § 120.565(3), Fla. Stat. (Supp.1996). "Agencies are required to give declaratory statements to persons who meet the minimum access standard...." Dore, supra, at 1061. It renders the statute nearly useless to say, as the majority does, that the agency cannot issue a declaratory statement if it will impact on anyone other than the petitioner. "[A] declaratory statement is not transformed into a rule merely because it addresses a matter of interest to more than one person." Chiles, 711 So.2d at 154.

In the declaratory statement in this case, the agency said it was "cognizant that a similar fact pattern may exist between other tracks in Florida and that the same dispute may reoccur between one of these Petitioners and a non-Petitioner. Therefore, the Division will initiate rulemaking to establish an agency statement of general applicability." This was a perfectly permissible step for the agency to take, but it did not thereby invalidate the declaratory statement. See Chiles, 711 So.2d at 153-54

.

. . . .

... It was proper for the agency to answer the petition for declaratory statement from the two racetracks in the present case, even though the answer is potentially applicable to other racetracks as well. It is true that there are statements in Chiles which, taken out of context, can be read to support the majority's position in this case.

When the Chiles opinion is read as a whole, however, it is clear that, were this case pending in the First District, the First District would hold that this declaratory statement was properly issued.

In taking the position it does, the majority opinion fails to give effect to the 1996 amendments to the APA. The majority opinion acknowledges that the pre-1996 statute had said that a petitioner could request a declaratory statement "as it applies to the petitioner in his or her particular set of circumstances only." § 120.565, Fla. Stat. (1995) (emphasis added); majority opinion at 591 n. 3. In the 1996 amendments, the word "only" was removed. See Chiles, 711 So.2d at 154

. As explained in Chiles, "[the] deletion of the word `only' signifies that a petition for declaratory statement need not raise an issue that is unique. While the issue must apply in the petitioner's particular set of circumstances, there is no longer a requirement that the issue apply only to the petitioner." 711 So.2d at 154.7

Note 7: The line of cases relied on by...