Shernoff v. Superior Court
| Decision Date | 10 January 1975 |
| Citation | 118 Cal.Rptr. 680,44 Cal.App.3d 406 |
| Court | California Court of Appeals Court of Appeals |
| Parties | William SHERNOFF et al., Petitioners, v. The SUPERIOR COURT OF LOS ANGELES COUNTY, Respondent, TITLE INSURANCE AND TRUST COMPANY et al., Real Parties in Interest. Civ. 44439. |
Hafif & Shernoff and Alton H. Saxer, Claremont, by Herbert Hafif, Claremont, for petitioners.
No appearance by respondent.
O'Melveny & Myers, Philip F. Westbrook, Jr., and Charles W. Bender, Los Angeles, by Charles W. Bender, Los Angeles, for real parties in interest.
Petitioners, plaintiffs in a class action for damages against numerous California title insurers on allegations of a conspiracy to fix title insurance rates, seek a writ of mandate to compel the superior court to dissolve a stay of proceedings issued in April 1973 several months after the filing of the complaint.
The superior court premised its stay on a theory of primary jurisdiction, a theory which assumed that for reasons of comity the Insurance Commissioner should be given the first opportunity to act on the ratefixing allegations. Simultaneously with the stay, the superior court overruled the title insurers' general demurrer, thereby rejecting their argument that because of petitioners' failure to exhaust administrative remedies the court lacked jurisdiction over the action. (E. B. Ackerman Importing Co. v. City of Los Angeles, 61 Cal.2d 595, 600, 39 Cal.Rptr. 726, 394 P.2d 566.) Thereafter in August 1973, petitioners submitted a formal complaint to the Insurance Commissioner charging rate-fixing by the title insurers.
In April 1974 the superior court renewed its stay pending a further review 150 days thence if the Commissioner had not acted by that time:
In July 1974 this court denied a writ of mandate to vacate the stay order, but in September 1974 the Supreme Court directed us to issue an alternative writ to consider vacation of the stay.
Thereafter in November 1974 the Insurance Commissioner informed the superior court that his department would not conduct a formal administrative hearing into the rate-fixing charges.
More than 150 days have elapsed since the last action of the superior court, the Insurance Commissioner has formerly declined to initiate proceedings, and the professed justification for the superior court's stay order has vanished. The stay, therefore, has outlived its usefulness. But the title insurers, real parties in interest, suggest its continuance on the ground that petitioners brought about Insurance Commissioner's inaction by failing to vigorously pursue their administrative remedy with him. However, the Commissioner's letter to the superior court does not sustain this suggestion. The Commissioner states that based on an 'investigation, review and analysis of the allegations' of petitioners he 'decided not to conduct a formal administrative hearing.' The doctrine of primary jurisdiction does not permanently foreclose judicial action but rather it provides the appropriate administrative agency with an opportunity to act if it so chooses. At most, the Commissioner's jurisdiction is 'primary,' not 'exclusive,' and in this instance he has chosen not to exercise it.
During oral argument real parties in interest for the first time in these writ proceedings sought to revive the issue of petitioners' failure to exhaust administrative remedies, arguing in effect that the Commissioner possesses exclusive jurisdiction in the first instance over the subject matter of the lawsuit and that this court should in some manner require him to exercise it. But the doctrine of exhaustion of administrative remedies has no relevancy to the relief sought in this complaint. The Commissioner's disciplinary authority is limited to...
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CHAPTER 6
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