Nelson v. Schlener

• Decision Date: 11 February 2015
• Docket Number: No. A13–0936.,A13–0936.
• Citation: 859 N.W.2d 288
• Parties: Chad NELSON, Respondent Below, v. Troy SCHLENER, Respondent, Carla Brown, et al., Respondents Below, Minnesota Department of Human Services, Appellant.
• Court: Minnesota Supreme Court

859 N.W.2d 288

Chad NELSON, Respondent Below

v. Troy SCHLENER, RespondentCarla Brown, et al., Respondents BelowMinnesota Department of Human Services, Appellant.

No. A13–0936.

Supreme Court of Minnesota.

Feb. 11, 2015.

Seth Leventhal, Leventhal PLLC, Minneapolis, MN, for respondent.

Alan I. Gilbert, Solicitor General, Alethea M. Huyser, Kathryn A. Fodness, Assistant Attorneys General, Saint Paul, MN, for appellant.

Cort C. Holten, Jeffrey D. Bores, Chestnut Cambronne PA, Minneapolis, MN, for amicus curiae Minnesota Police and Peace Officers Association Legal Defense Fund.

OPINION

GILDEA, Chief Justice.

This action arises from a putative class action that Chad Nelson filed against respondent Troy Schlener in federal court. In his complaint, Nelson alleged that Schlener, a former employee of appellant the Minnesota Department of Human Services (“DHS”), had violated the federal Driver's Privacy Protection Act (“DPPA”), 18 U.S.C. § 2721 (2014).¹ Schlener sought defense and indemnification from DHS pursuant to Minn.Stat. § 3.736, subd. 9 (2014). DHS denied his request, concluding that Schlener's actions were outside the scope of his employment. Schlener filed a petition for a writ of certiorari with the Minnesota Court of Appeals, seeking review of DHS's decision. The court of appeals, holding that DHS's decision was not supported by substantial evidence, reversed and directed DHS to grant Schlener's request. Nelson v. Schlener, No. A13–0936, 2014 WL 502975 (Minn.App. Feb. 10, 2014). Because we conclude that the court of appeals did not have subject matter jurisdiction over Schlener's petition for a writ of certiorari, we vacate the court of appeals' decision.

The record reflects that Troy Schlener was employed as a member of the background study research staff of DHS. After discovering that Schlener was accessing the Driver and Vehicle Services (“DVS”) records system frequently, DHS conducted an audit of Schlener's searches. The report from that audit found that Schlener had searched DVS's driver's license database for at least 1,964 driver's license numbers and 1,274 names between June 1, 2010 and June 2, 2011.² Following the audit, Schlener's employment at DHS ended.

In July 2011 DHS sent a letter to Chad Nelson informing him that his DVS records had been accessed, without authorization, by a former DHS employee. The letter stated that the records of approximately 1,100 Minnesotans were viewed over the course of 11 months. Nelson subsequently filed a putative class action in the United States District Court for the District of Minnesota, alleging that Schlener accessed records without authorization in violation of the DPPA, 18 U.S.C. § 2721.³ On April 2, 2013, Schlener requested that DHS provide defense and indemnification for Nelson's lawsuit, pursuant to Minn.Stat. § 3.736 (2014).

On April 23, 2013, DHS's chief financial and operating officer responded to Schlener's defense and indemnification request, stating that DHS was considering denying “certification” of Schlener's request on the ground that Schlener's conduct was outside the scope of his employment. In response, Schlener explained the basis for his request for defense and indemnification, and asked DHS to reconsider its position.

As part of DHS's consideration of Schlener's request for defense and indemnification, an employee in the office of the inspector general of DHS's licensing division provided additional information to DHS personnel regarding Schlener's searches for people named Chad Nelson, as well as searches for other individuals with the last name “Nelson.” This employee reviewed Schlener's searches over a 2–month period in 2011 of several different people with the name “Chad Nelson.” Even though Schlener was running searches on the name “Chad Nelson” in 2011, the employee concluded that DHS had not conducted a background study on anyone named Chad Nelson since 2008. Based on this review, the employee concluded that Schlener's access to the information about “Chad Nelson” was “not within the scope of his employment as a background study research staff.”

On May 6, 2013, DHS's chief compliance officer formally notified Schlener that his request for defense and indemnification was denied based on DHS's conclusion that Schlener acted outside the scope of his employment. In response to an inquiry from Schlener's attorney, the compliance officer confirmed that DHS's decision was final and that there was no internal appeal process.

On May 24, 2013, Schlener filed a petition for a writ of certiorari with the court of appeals, requesting judicial review of DHS's decision. Nelson v. Schlener, No. A13–0936, 2014 WL 502975, at *2 (Minn.App. Feb. 10, 2014). The court of appeals concluded there was insufficient evidence to support DHS's decision that Schlener's actions were outside the scope of his employment, and therefore remanded the matter to DHS with instructions to grant Schlener's request. Id. at *5, *8. We granted DHS's petition for review on two issues: whether the court of appeals had jurisdiction to review DHS's denial of Schlener's request for defense and indemnification; and, if so, whether the court of appeals erred in requiring DHS to grant defense and indemnification.

I.

We begin with the issue of subject matter jurisdiction, which is a question of law that we review de novo. In re Civil Commitment of Giem, 742 N.W.2d 422, 425–26 (Minn.2007). For the first time on appeal, DHS asserts that the court of appeals lacked jurisdiction to review DHS's decision to deny Schlener's request for defense and indemnification. Schlener does not argue that DHS's jurisdictional argument has been waived. Indeed, defects in subject matter jurisdiction can be raised at any time and cannot be waived by the parties. Seehus v. Bor–Son Constr., Inc.,

783 N.W.2d 144, 147 (Minn.2010).

The issue presented by DHS's challenge to subject matter jurisdiction is whether Schlener could obtain review of DHS's decision through a petition for a writ of certiorari filed in the court of appeals. DHS argues that certiorari review is inconsistent with Minn.Stat. § 3.736, subd. 9. Specifically, DHS notes that the statute provides a process for determining whether an employee was acting within the scope of employment and that this process requires review by a “trier of fact.” DHS contends that the court of appeals is not a “trier of fact.” Because the statute provides for review of an agency's decision by a “trier of fact,” DHS argues that review through a writ of certiorari is inconsistent with the statute.

For his part, Schlener argues that the court of appeals had subject matter jurisdiction. Schlener relies on State v. Tokheim, 611 N.W.2d 375 (Minn.App.2000). In Tokheim, the court of appeals held that decisions under Minn.Stat. § 3.736, subd. 9, “are quasi-judicial and therefore review is exclusively by writ of certiorari to [the court of appeals].” 611 N.W.2d at 378. We agree with DHS that a petition for a writ of certiorari does not provide the court of appeals with jurisdiction to review DHS's decision.

We have held that certiorari review is available “absent statutory authority for a different process.” Willis v. Cnty. of Sherburne, 555 N.W.2d 277, 282 (Minn.1996) ; see also In re Occupational License of Haymes, 444 N.W.2d 257, 259 (Minn.1989) (holding that an aggrieved party has the right to petition for a writ of certiorari “[w]here no right of discretionary review has been provided by statute or appellate rules”). The writ of certiorari is an “extraordinary” remedy that “is not granted where there is an adequate remedy in the ordinary course of the law.” Aastad v. Bd. of Cnty. Comm'rs, 260 Minn. 357, 359, 110 N.W.2d 19, 20 (1961). Therefore, if section 3.736 provides a specific process for review, certiorari review by the court of appeals is not available.

Whether the process in Minn.Stat. § 3.736, subd. 9, is consistent with certiorari review in the court of appeals presents a question of statutory interpretation that we examine de novo. See Clark v. Lindquist, 683 N.W.2d 784, 785 (Minn.2004). Our objective is to ascertain and effectuate the intent of the Legislature. Minn.Stat. § 645.16 (2014). If a statute is susceptible to only one reasonable interpretation, we interpret the statute according to its plain meaning. State v. Nelson, 842 N.W.2d 433, 436 (Minn.2014) ; see also City of Brainerd v. Brainerd Invs. P'ship, 827 N.W.2d 752, 755 (Minn.2013) (“When legislative intent is clear from the statute's plain and unambiguous language, we interpret the statute according to its plain meaning....”).

Under Minn.Stat. § 3.736, subd. 9, the State must “defend, save harmless, and indemnify” state employees against costs and judgments “in connection with any tort, civil, or equitable claim or demand ... arising out of an alleged act or omission occurring during the period of employment ... if the employee was acting within the scope of employment.” The statute provides that a State employee is “conclusively presumed to have been acting within the scope of employment if the employee's appointing authority issues a certificate to that effect.” Id. But the appointing authority's determination that an employee was acting within the scope of employment “may be overruled by the attorney general.” Id. Finally, under the statute:

The determination of whether an employee was acting within the scope of employment is a question of fact to be determined by the trier of fact based upon the circumstances of each case:

(i) in the absence of a certification,

(ii) if a certification is overruled by the attorney general,

(iii) if an unfavorable certification is made, or

(iv) with respect to an elected official.

The absence of the certification or an unfavorable certification is not evidence relevant to a determination by the trier of fact.

Id.

The statute essentially provides a three-step process for determining whether an employee's actions were within the scope of employment, and therefore subject to defense and...