Hamm v. Central States Health and Life Co. of Omaha

• Decision Date: 08 May 1989
• Docket Number: No. 1350,1350
• Citation: 298 S.C. 446,381 S.E.2d 355
• Court: South Carolina Court of Appeals
• Parties: Steven W. HAMM, Consumer Advocate for the State of South Carolina, Appellant, v. CENTRAL STATES HEALTH AND LIFE COMPANY OF OMAHA, John G. Richards, V, Chief Insurance Commissioner, and the South Carolina Department of Insurance, Respondents. . Heard

Page 355

381 S.E.2d 355

298 S.C. 446

Steven W. HAMM, Consumer Advocate for the State of South Carolina, Appellant, v. CENTRAL STATES HEALTH AND LIFE COMPANY OF OMAHA, John G Richards, V, Chief Insurance Commissioner, and the South Carolina Department of Insurance Respondents.

No. 1350.

Court of Appeals of South Carolina.

Heard May 8, 1989.

Decided June 12, 1989.

Steven W. Hamm, Raymon E. Lark, Jr., and Nancy J. Vaughn, all of S.C. Dept. of Consumer Affairs, Columbia, for appellant.

James C. Gray, Jr., of Nelson, Mullins, Riley & Scarborough, and Susanne K. Murphy, of S.C. Dept. of Ins., Columbia, for respondents.

PER CURIAM:

This is an appeal from an order of the Circuit Court dismissing a petition by appellant Steven W. Hamm, Consumer Advocate for the State of South Carolina, for judicial review of an order of respondents John G. Richards, V, Chief Insurance Commissioner and the South Carolina Department of Insurance. We certify the case to the Supreme Court pursuant to Section 14-8-210(c) of the Code of Laws of South Carolina, 1976, as amended.

Respondent Central States Health and Life Company of Omaha filed an application for a rate increase with the Insurance Commissioner. The Consumer Advocate intervened and was made a party in the proceeding. The Insurance Commissioner granted Central States the increase. The Consumer Advocate appealed, contending that a part of the increase was not supported by substantial evidence. The Supreme Court reversed and remanded the case for a determination by the Commission of the appropriate rate to be charged. The Court specifically required Central States to refund any money erroneously collected. Central States filed a petition for rehearing. In its petition, Central States contended that the Court was mistaken in requiring the refund. The Court granted rehearing and substituted an opinion for its previous opinion. The substituted opinion deleted the reference to a refund. 292 S.C. 408, 357 S.E.2d 5. On remand, the Insurance Commissioner reduced the rate increase but did not order a refund. Nor did the Insurance Commissioner take the overcharge into account in determining the appropriate rate. The Consumer Advocate petitioned for judicial review, contending that a refund should have been ordered. The Circuit Court dismissed the petition. This appeal followed.

The Consumer Advocate argues that the Insurance Commissioner has the authority, inherent or implied, to order a refund. In support of his argument, the Consumer Advocate relies on a pair of cases: Parker v. South Carolina Pub. Serv. Comm'n, 280 S.C. 310, 313 S.E.2d 290 (1984) (Parker I ) and Parker v. South Carolina Pub. Serv. Comm'n, 285 S.C. 231, 328 S.E.2d 909 (1985) (Parker II ). In Parker I, the Supreme Court remanded for the Public Service Commission to make an adjustment in the rate charged by a utility company. In Parker II, the Supreme Court held that, on remand, the Commission had erred by permitting the company to retain funds to which it was not entitled.

The Insurance Commissioner and Central States argue that the Parker cases are inapplicable because the powers of the Public Service Commission are different from those of the Insurance Commissioner. They argue that the Insurance Commissioner has no authority to order a refund because no such authority has been specifically granted by statute. In support of their argument, they rely on three cases: Mungo v. Smith, 289 S.C. 560, 347 S.E.2d 514 (Ct.App.1986); Calhoun Life Ins. Co. v. Gambrell, 245 S.C. 406, 140 S.E.2d 774 (1965); ...