St. Louis Metro. Towing v. Dir. of Revenue
| Decision Date | 02 September 2014 |
| Docket Number | No. WD 77241.,WD 77241. |
| Citation | 450 S.W.3d 303 |
| Parties | ST. LOUIS METROPOLITAN TOWING, Appellant, v. DIRECTOR OF REVENUE, Respondent. |
| Court | Missouri Court of Appeals |
David F. Barrett, Jefferson City, MO, for Appellant.
Chris Koster, Attorney General, Linda Lemke, Assistant Attorney General, Jefferson City, MO, for Respondent.
Before Division I: MARK D. PFEIFFER, Presiding Judge, and LISA WHITE HARDWICK and KAREN KING MITCHELL, Judges.
St. Louis Metropolitan Towing (“Metro Towing”) appeals the Judgment of the Circuit Court of Cole County, Missouri, affirming the Administrative Hearing Commission's (“AHC”) dismissal of Metro Towing's petition for review regarding the Director of Revenue's (“Director”) letter notifying Metro Towing that its application for a salvage dealer license had already been denied. We affirm.
Metro Towing is a partnership owned by William A. Bialczak and Kenneth J. Bialczak and operating in St. Louis, Missouri. On December 3, 2010, William and Kenneth Bialczak each pleaded guilty to income tax evasion under 26 U.S.C. § 7201. On January 18, 2013, the Director received Metro Towing's application for a license as a salvage dealer or dismantler, a body shop or rebuilder, and a scrap processor1 (“January 18 Application”). William and Kenneth Bialczak were listed as the two owners/partners of Metro Towing.
On February 4, 2013, the Director sent Metro Towing a “Notice of Refusal to Issue or Renew License” (“February 4 Decision”). The February 4 Decision stated that the Director's decision to reject Metro Towing's January 18 Application was due to Metro Towing's failure to meet the requirements of section 301.559.32 and 12 CSR 10–23.160, which require an applicant for licensure as a salvage dealer to be of good moral character. Additionally, the Director refused to issue or renew the license because the applicant had “within ten years prior to the date of the application, been finally adjudicated and found guilty, or entered a plea of guilty ... for [an] offense, an essential element of which is fraud, dishonesty, or an act of violence; or for any offense involving moral turpitude.” § 301.562.2(3). The February 4 Decision notified Metro Towing that if it was adversely affected by the decision, it must file an appeal with the AHC within thirty days after the decision was mailed.
Metro Towing did not appeal the February 4 Decision to the AHC. Instead, on June 10, 2013, Metro Towing re-submitted its application (“June 10 Application”) in substantially similar form as the January 18 Application.
The Director sent a letter to Metro Towing on June 11, 2013 (“June 11 Letter”), returning the June 10 Application and check to Metro Towing and notifying Metro Towing that the Director had already received the original January 18 Application to renew, which it had denied on February 4, 2013.
On June 12, 2013, Metro Towing filed an administrative review request with the AHC to appeal the Department's June 11 Letter. On July 29, 2013, the AHC issued its decision dismissing Metro Towing's request for review, stating:
[Metro Towing] failed to timely appeal the Director's February 4 decision; as a consequence, the Director's determination that its owners lacked the good moral character required for licensure by § 301.559.3 and 12 CSR 10–23.160 must stand, at least until the prima facie presumption embodied in that decision no longer applies. The June 11 letter is not a “decision of the Director” from which [Metro Towing] may appeal under § 621.050.
The AHC also concluded that failure to dismiss Metro Towing's request for review “would create a ‘whack-a-mole’ situation, where the Director is required to repeatedly deny identical applications until the applicant obtains the desired approval, resulting in an unwarranted increase in the Department's cost of administering the licensing statute.”3
Metro Towing filed a petition for administrative review on August 16, 2013, in the Circuit Court of Cole County. The circuit court issued its findings of fact, conclusions of law, and judgment on December 31, 2013, upholding the AHC's decision.
Metro Towing appeals.
“In an appeal following judicial review of an agency's administrative action, [an appellate court] reviews the decision of the agency, not the circuit court.”TAP Pharm. Prods., Inc. v. State Bd. of Pharmacy, 238 S.W.3d 140, 141 (Mo. banc 2007). Article V, section 18 of the Missouri Constitution provides for judicial review of final administrative agency “decisions, findings, rules and orders” to determine whether they are authorized by law and “are supported by competent and substantial evidence upon the whole record.” Section 536.140.2 further provides that the scope of judicial review extends to a determination of whether the action of the agency: is in violation of constitutional provisions; is in excess of the statutory authority of the agency; is unsupported by competent and substantial evidence on the record; is otherwise unauthorized by law; is made upon unlawful procedure or without a fair trial; is arbitrary, capricious, or unreasonable; or involves an abuse of discretion. Questions of law are reviewed de novo. § 536.140.3.
Metro Towing asserts two points on appeal, both contending that the AHC had no statutory authority to refuse its administrative appeal or give preclusive effect to the February 4 Decision. Because Metro Towing's points are sufficiently related, we consider them together.
One of the requirements for licensure as a salvage dealer is that the Director must be satisfied that “each of the partners ... of the applicant, if a partnership ..., is of good moral character.” § 301.221.1. The Director has established guidelines to determine if an applicant for registration as a salvage dealer should be denied registration because of lack of good moral character:
12 CSR 10–23.160 (emphasis added). William and Kenneth Bialczak were listed on the January 18 Application as the two owners/partners of Metro Towing. Both of them pleaded guilty to income tax evasion on December 3, 2010, which was prima facie evidence under the guidelines that they lacked the good moral character for licensure. 12 CSR 10–23.160(1). There is no evidence in the record that Metro Towing requested a hearing to rebut that presumption by “showing substantial rehabilitation or improvement in character.” 12 CSR 10–23.160(2). In its February 4 Decision, the Department cited section 301.559.3 and 12 CSR 10–23.160 as well as section 301.562.1 as the bases for rejecting Metro Towing's January 18 Application because its owners lacked good moral character and had recent felony convictions for tax evasion.
Under section 621.050.1, any person or entity has the right to appeal to the AHC “from any finding, order, [or] decision” made by the Director “by the filing of a petition with the [AHC] within thirty days after the decision of the [D]irector is placed in the United States mail or within thirty days after the decision is delivered, whichever is earlier.” The Director's decision is required to contain a notice of the right to appeal § 621.050.1.4 “Failure to comply with statutory time for appeal in an administrative proceeding results in a lapse of jurisdiction and loss of right of appeal.” Cmty. Fed. Sav. & Loan Ass'n v. Dir. of Revenue, 752 S.W.2d 794, 799 (Mo. banc 1988) (citing Springfield Park Cent. Hosp. v. Dir. of Revenue, 643 S.W.2d 599 (Mo.1983) ; Randles v. Schaffner, 485 S.W.2d 1 (Mo.1972) ; Cardinal Glennon Mem'l Hosp. Coffee Shop v. Dir. of Revenue, 624 S.W.2d 115 (Mo.App.W.D.1981) ).
The procedures applicable to an appeal from the Director's decision to the AHC are those established by chapter 536. § 621.050.2. To be entitled to judicial review of a final agency decision, section 536.100 requires the aggrieved party to “exhaust[ ] all administrative remedies provided by law.” “The purpose of exhaustion is to prevent premature interference with agency processes so that the agency may function efficiently and so that it may have an opportunity to correct its own errors, to afford the parties and the courts the benefit of its experience and expertise, and to compile a record that is adequate for judicial review.” Parker v. City of Saint Joseph, 167 S.W.3d 219, 221 (Mo.App. W.D.2005) (internal quotation omitted). “Exhaustion occurs when every step of the administrative procedure has been completed and the agency renders a final decision.” Id. If the agency arrives at a terminal, complete resolution of the case, then a decision is final. Id.
Metro Towing opted not to exercise its right under section 621.050 to appeal the February 4 Decision rejecting Metro Towing's application for a salvage dealer's license to the AHC. Because Metro Towing did not appeal the Director's February 4 Decision to the AHC within thirty days after the decision was mailed to Metro Towing, the Director's decision was final for purposes of...
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