explaining that judicial review under section 536.150 “is broader in scope than that required by the constitutional provision … for cases in which a hearing is required by law in the agency, being in effect a hearing de novo”
How later courts described this case
- explaining that judicial review under section 536.150 “is broader in scope than that required by the constitutional provision … for cases in which a hearing is required by law in the agency, being in effect a hearing de novo”
- interpreting § 536.105, the precursor of the current statute, § 536.150
- case is contested where hearing is required of which a record must be made unless waived
Written by the judges who cited it.
The opinion
STORCKMAN, Judge
(dissenting).
I readily agree that our decision in Barker v. Leggett, Mo.Sup., 295 S.W.2d 836, 840 [4], does not determine if this is a “contested case.” The particular section of Chapter 536, applicable in this situation, was not involved and the reference to § 536.100 should be disregarded as obiter dictum.
The question involved is a difficult one, but I am persuaded, in these circumstances, that the case should be reviewed as a “contested” one and desire to state briefly the basis of my dissent.
After the decision in Barker v. Leggett, supra, the plaintiffs filed with the superintendent a lengthy written application stating the basis of their claim and its history. The prayer of their petition, in substance, was that the superintendent accept jurisdiction and hear evidence and determine the claim for fees and determine whether the claim “(1) should be allowed as expenses of 'proceedings’ against insurance companies involved in the restitution proceedings, and assessed against them ratably; or (2) are usual expenses of the Division (formerly Department) of Insurance payable out of amounts appropriated by law from the Insurance Division fund on warrants issued on such fund on vouchers approved by the Superintendent and Comptroller.” There was also a general prayer for relief.
Thereafter the superintendent requested the official opinion of the Attorney General “as to my jurisdiction in this matter to try and determine the application now pending before me” and on April 17, 1957, the superintendent was advised by the Attorney General as follows:
“Therefore, we conclude that, under the provisions of Section 374.220, RSMo 1949, you do have jurisdiction to consider and determine the application now before you. As we have pointed out above, there is no statutory requirement that a hearing for such purpose be held. We think it obvious that the Superintendent is not required to hold a hearing on every claim or question that may be presented to him for determination. However, the circumstances of the present application may be such that denial of a hearing would be considered by a reviewing court to be an arbitrary and unreasonable act. Determination of the procedure is, we feel, primarily a matter within your discretion.”
On July 26, 1957, the superintendent wrote a letter to the insurance companies involved in the “proceedings” advising them of the pendency of the claim and among other things stating: “It is my thought that you and the other companies who might be liable for any amount allowed these Attorneys, if an amount is allowed them and if said allowance is determined by me to be properly assessable against the insurance companies, might want to give the matter of this present claim consideration before it is acted upon either by trying to effect a compromise with the claimants or otherwise, and it is *361 for this reason that I am notifying you of the pendency and nature of the claim.”
The superintendent, the Relator herein, alleges in his petition for prohibition filed in this court that he received a reply from the insurance companies “stating that in their opinion, and for reasons also here immaterial, Relator was without authority to make an allowance to claimants.”
On February 7, 1958, the superintendent wrote the pláintiffs a letter in which he acknowledged their letter of January 29, 1958, requesting a hearing, and in which he further stated:
“After a careful review of all the matters which have been submitted to me in connection with the above mentioned claims, I have concluded that I am not required by law to grant a hearing upon the applications before making a decision upon them.
“Even though I am not required by law to grant applicants a hearing upon their claims before deciding them, I assume that I could grant such a hearing if I thought the same would enable me better to rule upon the claims. However, it is my view that even though I should hold a hearing on these claims and should conclude after such hearing that applicants had been lawfully employed as claimed in the applications, and had rendered valuable services pursuant to said employment, the value of the services of claimants could not be allowed as expenses of the insurance department which could be paid out of current appropriations, as provided by Section 374.160, RSMo 1949, nor could the value of said services be assessed against insurance companies as expenses of proceedings against such insurance companies, as contemplated by Sections 374.160 and 374.220 RSMo 1949.
“In view of the above, I am respectfully denying your application for a hearing upon these claims, and must deny the claims.”
Thereafter the plaintiffs filed in the Circuit Court of Jackson County their petition for review of the action of the superintendent which gives rise to the present petition for prohibition.
Section 536.010 as amended Laws of Missouri 1957, p. 748, § 1 provides: “ ‘Contested case’ means a proceeding before an agency in which legal rights, duties or privileges of specific parties are required by lam to be determined after hearing.” '(Emphasis supplied unless otherwise noted.) In this case provisions of the Insurance Code largely determine whether the legal rights and privileges of specific parties are “required by law to be determined” and, if so, whether such determination is required to be made “after hearing.”
In addition to other matters specifically mentioned, it is the duty of the superintendent of the Insurance Division “generally to do and perform with justice and impartiality all such duties as are or may be imposed upon him by the laws regulating the business of insurance in this state.” § 374.040. Among his duties under the Code is the authority to employ counsel “for the purpose of enforcing the insurance laws.” § 374.120.
All expenses of the Division except, inter alia, expenses of “proceedings against any company * * * which expenses are to be paid by the company, or as provided by the law” shall be paid monthly out of the general funds of the Insurance Division. § 374.160.
The manner in which expenses of proceedings against insurance companies (374.160) are to be paid is made clear in subparagraph 1 of § 374.220 which provides that such expenses “ * * * shall be assessed by the superintendent upon the company proceeded against * * * and shall be in the first instance paid by such company, on'the order of the superintendent directly to the person or persons rendering the service.”
*362 “1. The superintendent may bring suit to recover any fees or other sums which he is authorized by law to demand or collect.
“2. Any company or person liable for any fees or assessments who shall neglect or refuse to pay the same within ten days after written demand by the superintendent, shall be liable to pay double the amount of such fees or assessments; and any judgment recovered in such case shall be for double such amount and costs.” § 374.240.
The state cannot “be responsible in any manner” for any expenses of the Division or “any charges connected therewith.” This is expressly guarded against in § 374.160. Expenses of examinations, proceedings against companies, dissolution proceedings and certain other items are chargeable directly to the companies involved or their assets in the event of liquidation. §§ 374.160 and 374.220. General expenses of the Division are payable out of the general funds and in the event of a deficiency, the amount 'thereof is assessable against all insurance companies doing business, in the state in proportion to the relative amounts of • the assets of each company. § ■ 374.260. Therefore, I cannot agree with the statement in the majority opinion that: “Plaintiffs’ claims, at least at this, stage, are claims against the state, their lawful employment having been by the state * * The plaintiffs, of course, are bound by the statutory provisions for their compensation; it was a part of their contract of employment, “including the method of payment.” State ex rel. Lucas v. Blair, 346 Mo. 1017 , 144 S.W.2d 106, 109 [5]. The claimants cannot go directly against the companies thought to be liable, but must proceed in the manner provided by the Insurance Code. Apparently, under the statutory plan, if the superintendent lawfully declines to approve and assess fees such as these, the - claimants have no further remedy. On the other hand, it would appear that if claims for fees are approved and assessed, the companies. against which the assessment is made may refuse payment and make their defenses in the action which the superintendent is authorized to bring to enforce collection. § 374.240.
This court has stated with meticulous care at every opportunity presented that the Insurance Code indicates an intention “to regulate the business from beginning to end,” and that: “The superintendent of insurance is the administrative officer in charge of that interest, and courts are without authority to interfere, with his administration of the Code.” See State ex rel. Missouri State Life Ins. Co. v. Hall, 330 Mo. 1107 , 52 S.W.2d 174, 177 , and the approval of the statement in Barker v. Leggett, Mo.Sup., 295 S.W.2d 836, 840 .
As we have held the courts cannot invade the province of the superintendent of the Insurance Division, so we should hold that the superintendent cannot abdicate his functions in favor of the courts. ■There should be no doubt about the superintendent’s authority or jurisdiction in this matter. This is made clear by the Code and by our holding in the case of Barker v. Leggett, Mo.Sup., 295 S.W.2d 840 , in which we stated: “We believe it is the intent of the insurance code to vest the superintendent with primary jurisdiction to approve the usual expenses and to assess the expenses of proceedings against companies. We believe this right of primary decision ,by the superintendent is exclusive, subject only to review by the courts * *
It seems to me in these circumstances the superintendent is acting in a quasi-judicial capacity in deciding whether or not to approve the claims for assessment against the insurance companies. State ex rel. Police Retirement System of City of St. Louis v. Murphy, 359 Mo. 854 , 224 S.W.2d 68, 70 [2], 72 [5]. There can hardly be any questions that private rights are affected.
*363 I believe it is the intent of the Insurance Code that the superintendent shall make the initial decision on the merits of a claim such as this. It seems to me that a reviewing court could not initially perform this function even after taking evidence.
If we are correct in saying that the primary decision is exclusively for the superintendent, as we did in Barker v. Leggett, supra, then it would seem he should conduct a hearing. The inquiry “which hears before it condemns”, (State ex rel. Hurwitz v. North, 304 Mo. 607 , 264 S.W. 678, 681 ), should be conducted by the superintendent under the circumstances of this case. I believe this is the legislative intent and accords with our settled construction of the Insurance Code.
The proceedings in this case were initiated by the filing of a written application seeking to invoke the relief provided by the statutes and a hearing was requested. In a case where the basic facts occurred before the term of the present superintendent, it seems especially necessary that the plaintiffs be granted an opportunity to be heard, not only to permit them to support their claim with proof, but also to afford plaintiffs an opportunity to rebut evidence or information tending to defeat the claim for compensation.
Believing that the Insurance Code and our decisions construing it contemplate and require a hearing before the superintendent in this situation, I would quash our preliminary rule as having been improvidently granted.