Roberts v. State, Dept. of Revenue

• Citation: 162 P.3d 1214
• Decision Date: 22 June 2007
• Docket Number: No. S-12180.,S-12180.
• Parties: Peter ROBERTS, Appellant, v. STATE of Alaska, DEPARTMENT OF REVENUE, Wilson L. Condon, Commissioner, and Larry Meyers, Deputy Director, and State Of Alaska, Department of Law, Bruce M. Botelho, Attorney General, Appellees.
• Court: Supreme Court of Alaska (US)

162 P.3d 1214

Peter ROBERTS, Appellant, v. STATE of Alaska, DEPARTMENT OF REVENUE, Wilson L. Condon, Commissioner, and Larry Meyers, Deputy Director, and State Of Alaska, Department of Law, Bruce M. Botelho, Attorney General, Appellees.

No. S-12180.

Supreme Court of Alaska.

June 22, 2007.

Rehearing Denied August 14, 2007.

Peter Roberts, pro se, Anchorage, Appellant.

Dan N. Branch, Assistant Attorney General, and David W. Márquez, Attorney General, Juneau, for Appellees.

Before: FABE, Chief Justice, MATTHEWS, EASTAUGH, BRYNER, and CARPENETI, Justices.

OPINION

FABE, Chief Justice.

I. INTRODUCTION

Peter Roberts, owner of Downtown Bicycle Rental, Inc., filed a complaint objecting to the Alaska Department of Revenue's issuance of a gaming permit to Earth, a nonprofit organization. The superior court dismissed several counts of the complaint as an invalid assignment of claims from Downtown Bicycle Rental, which had no attorney, to Roberts. The court granted summary judgment for the State on all remaining counts, declared that Roberts was not a public interest litigant, and ordered him to pay attorney's fees. Roberts appeals. Because the assignment of claims was an invalid attempt to circumvent statutory requirements, and because the Department of Revenue did not abuse its discretion or violate public policy or Roberts's constitutional rights when it approved Earth's permit application, we affirm the superior court's ruling. Because Roberts had economic incentive to sue, we also affirm the superior court's determination that he was not a public interest litigant.

II. FACTS AND PROCEEDINGS

A. Facts

Peter Roberts owns Downtown Bicycle Rental, a bicycle rental business located in downtown Anchorage. Roberts objected to a free bicycle loan program that Earth funded with proceeds of a state gaming permit.

Earth applied for and was granted a charitable gaming permit from the Alaska Department of Revenue. Earth conducted gaming activities under the permit, received over $39,000 in gaming proceeds, and spent approximately $7,000 on its Earth Cycle Program.

In June 2000 Earth operated the Earth Cycle Program, offering bicycles to the public for use free of charge from a location in front of the Old Federal Building in Anchorage. Peter Roberts and other bicycle rental business owners sent a letter to the federal General Services Administration, asking that Earth's permit to operate on federal property be revoked. The General Services Administration revoked the permit. Earth then moved its program to another downtown location. In response, Roberts complained to the owner of the land, and Earth moved again. In July 2000 Earth relocated to the grounds of the Anchorage International Youth Hostel. Roberts then asked the hostel to discontinue allowing Earth to operate the program from its property. The hostel refused to revoke its permission.

In the summer of 2000 Roberts complained to the Department of Revenue about Earth's use of gaming funds to operate the Earth Cycle Program. Dissatisfied with the Department's response, Roberts wrote to Attorney General Bruce Botelho and Commissioner of Revenue Wilson Condon, demanding a halt to the program and claiming that the program was not educational and not charitable because it did not "lessen neighborhood tensions." Commissioner Condon issued a written response, indicating that the Department would not take the action Roberts requested.

In September 2001 Roberts filed a complaint with the Alaska Ombudsman, asking the Ombudsman to investigate the Department of Revenue's handling of his complaint. Several months later Roberts filed another complaint with the Ombudsman, expressing concerns about the Department of Law's handling of the issue. In March 2002 Assistant Ombudsman Linda Lord-Jenkins wrote to Roberts, explaining that she was closing the complaints because she found no "evidence of impropriety, serious flaws in the decision-making process or evidence that the decision [was] completely insupportable." She also informed Roberts that Earth had surrendered its gaming permit in September 2000 and had given the twenty-five bicycles to the hostel to distribute.¹ In May 2002 Acting Ombudsman Maria Moya wrote to Roberts, sustaining closure of the complaint.

B. Proceedings

Appearing pro se, Roberts filed a complaint in October 2002 in Anchorage Superior Court on behalf of himself and Downtown Bicycle Rental. The complaint named the State of Alaska, Revenue Commissioner Condon, Attorney General Botelho, and Deputy Director Larry Meyers of the Department of Revenue as defendants. On December 2, 2002, Judge Peter A. Michalski dismissed the case without prejudice pursuant to AS 22.20.040(a)(2) because Downtown Bicycle Rental was not represented by an attorney, as Alaska law requires of corporations.² Roberts did not appeal Judge Michalski's order.

In December 2002 Downtown Bicycle Rental assigned its claims to Roberts. In March 2003 Roberts appeared pro se and filed a new complaint in Anchorage Superior Court, naming the same defendants as the first suit.³ The complaint contained fourteen claims: (1) negligence; (2) violation of AS 05.15.150(a); (3) violation of AS 05.15.140(a); (4) violation of public policy; (5) bad faith/abuse of discretion; (6) breach of fiduciary and statutory duties; (7) violation of the public purpose clause of the Alaska Constitution; (8) a taking of property without just compensation; (9) violation of procedural due process; (10) impairment of freedom to contract; (11) violation of substantive due process; (12) violation of inherent rights/privileges and immunities; (13) tortious interference; and (14) violation of 42 U.S.C. § 1983.

In July 2003 Judge Tan declared Downtown Bicycle Rental's assignment of claims to Roberts invalid as an attempt to circumvent the requirement that corporations be represented by counsel and dismissed all claims arising under the assignment. In March 2004 Roberts filed an amended complaint, adding claims of violation of state antitrust statutes and equal protection. In August 2004 the superior court issued an order dismissing all claims for compensatory and punitive damages arising from the assignment; the claims for declaratory relief remained. The order noted Roberts's voluntary dismissal of four of his claims.⁴ The judge dismissed Roberts's negligence claim because the complaint did not allege harm to Roberts individually and dismissed Roberts's 42 U.S.C. § 1983 claim because such claims cannot be brought against state officials acting in their official capacity. The court also dismissed Roberts's claim of an antitrust violation because the alleged injury was "not the type of injury the state antitrust statute intended to protect," the claimed loss was not incurred by Roberts individually, and the statute was "not intended to prevent the State from operating the charitable gaming program."

Nine claims for declaratory relief remained after the superior court's August 2004 ruling. After cross-motions for summary judgment, the superior court granted summary judgment for the State on all remaining counts. The State moved for a Civil Rule 82 award of attorney's fees. The court found that Roberts was not a public interest litigant and ordered him to pay attorney's fees of $5,226. Roberts appeals the superior court's ruling as to the alleged violation of gaming statutes and public policy, bad faith and breach of fiduciary and statutory duty, and violations of substantive due process and privileges and immunities. He also argues the superior court erred in declaring the assignment invalid and contends that the court abused its discretion in determining that he is not a public interest litigant.⁵

III. DISCUSSION

A. Standard of Review

We affirm a grant of summary judgment if "there are no genuine issues of material fact and if the movant is entitled to judgment as a matter of law. When making this determination, we draw all reasonable inferences in favor of the non-movant."⁶ For questions of law, we adopt "the rule of law that is most persuasive in light of precedent, reason, and policy."⁷ We review a superior court's determination of a party's public interest litigant status for an abuse of discretion.⁸

When the superior court acts as an intermediate court of appeal, we independently review the merits of the administrative decision.⁹ We review discretionary actions that do not require formal procedures for an abuse of discretion.¹⁰ This is the standard we applied in another challenge to the administration of gaming statutes, Malone v. Anchorage Amateur Radio Club, Inc.¹¹ In Malone, we reviewed the Revenue Commissioner's denial of a request to operate computerized bingo games and applied the "arbitrary, unreasonable or an abuse of discretion" standard of review after concluding that the statute committed the question of equipment to the Department's discretion.¹²

Here, the statutory provisions at issue also grant considerable discretion to the Department. Alaska Statute 05.15.100(a) provides that "[t]he department may issue a permit to a municipality or qualified organization." Alaska Statute 05.15.130 provides that "[t]he department may supplement the definitions of qualified organizations and activities by . . . adding . . . additional requirements that the department considers necessary for the best interests of the public." Although the Department has not supplemented those definitions, this provision suggests that the legislature intended to grant the Department considerable discretion in administering the statutes. Alaska Statute 05.15.140(a) allows the Department to make a determination whether issuance of a permit is "in the best interests of the public."¹³ This discretion, coupled with the lack of formal procedures,¹⁴ make the abuse of discretion standard appropriate.

B. The Superior Court Properly Declared the Assignment Invalid and Dismissed Claims Arising out of the Assignment.

Judge Michalski dismissed...