Investment Corp. of Palm Beach v. Division of Pari-Mutuel Wagering, Dept. of Business and Professional Regulation

• Court: Florida District Court of Appeals
• Writing for the Court: FLETCHER; SHEVIN; COPE
• Citation: Investment Corp. of Palm Beach v. Division of Pari-Mutuel Wagering, Dept. of Business and Professional Regulation, 714 So.2d 589 (Fla. App. 1998)
• Decision Date: 08 July 1998
• Docket Number: 97-2926,Nos. 97-3414,PARI-MUTUEL,s. 97-3414
• Parties: 23 Fla. L. Weekly D1621 INVESTMENT CORP. OF PALM BEACH d/b/a Palm Beach Kennel Club and Palm Beach Jai Alai, Calder Race Course, Inc., Tropical Park, Inc., and Gulfstream Park Racing Association, Appellants, v. DIVISION OFWAGERING, DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, Appellee.

Page 589

714 So.2d 589

23 Fla. L. Weekly D1621

INVESTMENT CORP. OF PALM BEACH d/b/a Palm Beach Kennel Club and Palm Beach Jai Alai, Calder Race Course, Inc., Tropical Park, Inc., and Gulfstream Park Racing Association, Appellants, v. DIVISION OF PARI-MUTUEL WAGERING, DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, Appellee.

Nos. 97-3414, 97-2926.

District Court of Appeal of Florida Third District.

July 8, 1998.

Rutledge, Ecenia, Underwood, Purnell & Hoffman and Harold Purnell, Tallahassee; Gray Harris & Robinson and Wilbur E. Brewton and Kelly B. Plante, Tallahassee; Romanik, Huss, Paoli & Ivers, Hollywood, for appellants.

Lisa S. Nelson, Tallahassee, for appellee.

Before COPE, FLETCHER and SHEVIN, JJ.

FLETCHER, Judge.

In these consolidated cases, Calder Race Course, Inc. [Calder], Tropical Park, Inc. [Tropical], Gulfstream Park Racing Association [Gulfstream], and Investment Corp. of Palm Beach [Palm Beach Kennel Club] appeal a declaratory statement rendered by the Director of the Division of Pari-Mutuel Wagering of the State Department of Business and Professional Regulation [Division]. We hereby set aside the declaratory statement.

By petition the appellants requested the Division's opinion as to the applicability of certain statutory provisions in determining the distribution of uncashed tickets and breaks ¹ generated from wagering on out-of-state thoroughbred races that are rebroadcast to Palm Beach Kennel Club and Palm Beach Jai Alai through Calder, Tropical, and Gulfstream. The Division issued a declaratory statement, noting therein:

"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."

The Division then went on in the declaratory statement and provided its opinions on the issues raised by the petitions, but attempted to limit them to the appellants and their relationship with each other as to the matters questioned.

The appellants here correctly contend 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. ² Declaratory statements are controlled by section 120.565, Florida Statutes (Supp.1996), subsection (1) of which provides: ³

"Any substantially affected person may 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." (e.s.)

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.

The declaratory statement is set aside.

SHEVIN, J., concurs.

COPE, Judge (dissenting).

I respectfully dissent. First, the issue addressed by the majority opinion was not preserved for appellate review. Second, the majority opinion misapprehends the declaratory statement statute.

I.

The two appellant racetracks had a business dispute over the division of certain funds generated from wagering on out-of-state thoroughbred races that are rebroadcast within Florida. ⁴ They petitioned the appellee agency for a declaratory statement, anticipating that the agency would either tell the racetracks to divide the funds, or award the disputed funds entirely to one of the two racetracks. The agency instead decided that the statutes relied on by the racetracks were inapplicable. The agency ruled that under a different provision of the pari-mutuel laws, the disputed funds escheat to the State School Fund. See § 550.1645, Fla. Stat. This ruling undoubtedly pleased the State School Fund, but displeased the racetracks.

Seeking to vacate the agency decision, the racetracks contend for the first time on appeal that the agency never should have issued a declaratory statement--even though the appellant racetracks were the very ones who requested the declaratory statement. This argument should be rejected out of hand because it is not preserved for appellate review. The racetracks asked for a declaratory statement. The racetracks got a declaratory statement. Assuming arguendo that the agency erred by issuing a declaratory statement in these circumstances, any error was invited by the racetracks themselves. See Commission on Ethics v. Barker, 677 So.2d 254, 256 (Fla.1996) ("A party 'cannot argue on appeal matters which were not properly excepted to or challenged before the [agency] and thus were not preserved for appellate review.' "); Kantor v. School Board of Monroe County, 648 So.2d 1266, 1267 (Fla. 3d DCA 1995) (same); Couch v. Commission on Ethics, 617 So.2d 1119, 1124 (Fla. 5th DCA 1993) (same). ⁵

II.

On the merits, the majority errs in its interpretation of the declaratory statement provision of the Florida Administrative Procedure Act (APA). The declaratory statement mechanism was created in order to deal with the common citizen complaint that some agencies will not give the citizen a direct, binding answer on how the agency's statutes and rules apply to a citizen's individual case. Or, in another variation on the same theme, citizens complain that with some agencies, the administrative position varies from day to day, or varies from agency employee to agency employee. See Patricia A. Dore, Access to Florida Administrative Proceedings, 13 Fla. St. U.L.Rev. 965, 1052 (1986).

The drafters of the Florida APA adopted an innovative solution to this problem by creating the declaratory statement procedure under section 120.565, Florida Statutes. The current statute provides:

120.565 Declaratory statement by agencies.--

(1) Any substantially affected person may 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.

(2) The petition seeking a declaratory statement shall state with particularity the petitioner's set of circumstances and shall specify the statutory provision, rule, or order that the petitioner believes may apply to the set of circumstances.

(3) The agency shall 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 committee. The agency shall issue a declaratory statement or deny the petition within 90 days after the filing of the petition. The declaratory statement or denial of the petition shall be noticed in the next available issue of the Florida Administrative Weekly. Agency disposition of petitions shall be final agency action.

§ 120.565, Fla. Stat. (Supp.1996).

The purpose is " 'to enable the public to secure definitive binding advice as to the applicability of agency-enforced law to a particular set of facts.' " Dore, supra, at 1052 (citation omitted). The intent is for declaratory statements to "be more widely available than the judicial [declaratory judgment] and that its use not be unduly restricted by artificial access barriers that would frustrate its primary purposes." Id. at 1053.

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...