Title: Wyomedia Corp. v. Division of Unemployment Ins. of Wyoming Dept. of Employment

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Wyomedia Corp. v. Division of Unemployment Ins. of Wyoming Dept. of Employment1992 WY 12824 P.2d 564Case Number: 91-202Decided: 01/30/1992Supreme Court of Wyoming
WYOMEDIA CORP., a Wyoming 
corporation,

 Appellant 
(Plaintiff),

v.

DIVISION OF UNEMPLOYMENT 
INSURANCE OF WYOMING DEPARTMENT OF EMPLOYMENT,

 Appellee (Defendant).

Appeal from District 
Court, Natrona County, Dan Spangler, J.

John Burk, 
Casper, for appellant.

Joe Scott, 
Senior Asst. Atty. Gen., Casper, for appellee.

Before 
URBIGKIT, C.J., and THOMAS, CARDINE, MACY and GOLDEN, JJ.

GOLDEN, Justice.

[¶1]      In this appeal we 
consider the viability of a declaratory judgment action independent from review 
of administrative action. We are also asked to apply the doctrine of res 
judicata. The district court dismissed the declaratory judgment action which 
sought to overturn, in effect, an earlier unappealed administrative 
action.

[¶2]      We 
affirm.

[¶3]      In late April, 
1989, the Division of Unemployment Insurance, Department of Employment, State of 
Wyoming1 (hereinafter DU) obtained a court 
order closing Casper television station KFNB operated by Casper Channel 20, 
Inc., for nonpayment of unemployment contributions. Appellant Wyomedia Corp., 
which held a mortgage and security interest in most of the station's assets, 
obtained a foreclosure judgment and sale order against those assets and later 
acquired them in execution sales. Appellant decided to recommence station 
operations, hired employees and, nine months after the station had closed, began 
broadcasting.

[¶4]      In registering 
with DU as an employer, appellant claimed it had not acquired the trade, 
business organization or substantially all of the assets of an employer that was 
subject to state unemployment compensation law. Treating appellant as a new 
employer, not a successor employer or "acquiring employment unit," DU assigned 
appellant the requisite low contribution rate for unemployment tax purposes. 
After further investigation, however, DU determined that appellant had acquired 
substantially all of the assets of an employer that had been subject to state 
unemployment compensation law and that had been delinquent for unemployment 
taxes. Determining that appellant was a successor to Casper Channel 20, Inc., DU 
assigned appellant a much higher tax rate and transferred to appellant the 
delinquent account of Casper Channel 20, Inc.

[¶5]      DU sent 
appropriate notice of this action to appellant. Appellant failed to timely file 
its request for an administrative hearing. Appellant requested DU's 
reconsideration. The appeals examiner for DU notified appellant that he would 
hold a hearing on the timeliness of appellant's appeal. Appellant agreed that 
the hearing was limited to that issue. Following that hearing, the appeals 
examiner issued a decision dismissing appellant's appeal as untimely. Appellant 
appealed this decision to the three-member Unemployment Insurance Commission; 
the Commission affirmed the decision of the appeals examiner.

[¶6]      Shortly after 
receiving the decision of the Unemployment Insurance Commission, appellant filed 
a "Complaint for Declaratory Judgment," naming DU as the defendant. The 
averments in the complaint recite appellant's acquisition of the television 
station's operation and DU's action of assessing the higher contribution tax 
rate and transferring the delinquent account to appellant. In its request for 
relief, appellant asked the court to issue a declaratory judgment judicially 
determining appellant was not a successor employer or "acquiring employing 
limit" as DU had held and to order DU to reinstate the lower contribution tax 
rate and issue a refund of overpayment funds.

[¶7]      Shortly after 
filing this pleading, appellant filed another complaint. This amended pleading 
was identical to the initial pleading except for minor word changes. The 
complaint title was worded differently, and the relief request language, "issue 
a declaratory judgment judicially determining," was changed to "review the 
actions of the defendant and judicially determine." The substance of the 
requested relief remained the same.

[¶8]      The district 
court dismissed appellant's action for failure to state a cause of action for 
review, to identify the agency decision sought to be reviewed and to state any 
reason to reverse the agency's decision. In the alternative, the district court 
dismissed appellant's action as a declaratory judgment action for failure to 
timely appeal from DU's initial action. Appellant did not appeal this 
order.

[¶9]      A month later, 
appellant filed the pleading which is the subject of this appeal, "Complaint for 
Declaratory Judgment." Except for paragraph three the averments in this pleading 
are identical to those in the earlier declaratory judgment complaints. In that 
paragraph, appellant avers that the action does not involve an issue of fact 
requiring agency decision, but that it does involve "a claim originally 
cognizable by the court under the doctrine of primary jurisdiction." In 
paragraph three of the two earlier pleadings, appellant averred that it had 
exhausted its administrative remedies and had filed the action within thirty 
days of the final administrative decision. Appellant requested the same relief 
in the latest pleading.

[¶10]   Acting upon DU's motion to dismiss 
based upon res judicata grounds, the district court entered its order dismissing 
appellant's latest pleading. Appellant filed this appeal.

ISSUES

[¶11]   Appellant states the sole issue as 
"whether or not the appellant was entitled to maintain a declaratory judgment 
action independently of administrative proceedings."

[¶12]   DU lists two issues:

Whether the district 
court was correct in dismissing Wyomedia Corporation's complaint in case No. 
67104 because it was barred by the doctrine of res judicata? Whether the 
district court was correct in dismissing Wyomedia Corporation's complaint in 
case No. 67104 because the requirements for an action for declaratory judgment 
were not met.

DISCUSSION

[¶13]   In seeking reversal of the district 
court's order dismissing its declaratory judgment action, appellant asks us to 
ignore the prior administrative proceedings as well as the unappealed district 
court order that dismissed appellant's first civil action originally styled as a 
declaratory judgment complaint and then amended to be styled as a petition for 
review. Rather, appellant asks us to focus only on its second civil action 
styled as a declaratory judgment action and to understand that action as one in 
which appellant is simply challenging DU's interpretation of W.S. 27-3-507. In 
that way, appellant believes it has squarely fit its case within the familiar 
surroundings of State v. Kraus, 706 P.2d 1130 (Wyo. 1985) and Rocky Mountain Oil 
and Gas Association v. State, 645 P.2d 1163 (Wyo. 1982). In this regard, 
appellant relies on the general statement that:

[W]here the relief 
desired is in the nature of a substitution of judicial decision for that of the 
agency on issues pertaining to the administration of the subject matter for 
which the agency was created, the [declaratory judgment] action should not be 
entertained. If, however, such desired relief concerns the * * * interpretation 
of a statute upon which the administrative action is, or is to be, based, the 
[declaratory judgment] action should be entertained.

RMOGA, 645 P.2d  
at 1168.

[¶14]   From Kraus, appellant relies on 
this statement:

While it is true that the 
declaratory judgment action filed after the period for a petition for review has 
expired cannot be used to obtain full review of administrative action, the 
plaintiffs are permitted to challenge * * * the * * * interpretation of statutes 
upon which administrative action is * * * based. [citing RMOGA].

Kraus, 706 P.2d  
at 1130.

[¶15]   In our judgment, appellant cannot 
overcome at least two obstacles. One is that appellant's desired relief in the 
latest declaratory judgment action is full review of DU's adverse action; it is 
not a mere challenge of DU's interpretation of a statute. The other obstacle is 
that the district court's order dismissing appellant's first action, which 
sought the same relief as appellant's latest action, was a final order from 
which appellant did not appeal. The bar of res judicata is a firm barrier to 
appellant's latest action which seeks the identical relief denied appellant by 
the district court's unappealed order in the previous action.

[¶16]   That appellant's latest action 
seeks full review of DU's earlier adverse action and is not a challenge to DU's 
statutory interpretation is evident from a plain reading of the complaint. In 
paragraph five of that complaint, appellant avers the existence of a dispute 
about the proper application and interpretation of W.S. 27-3-507; nowhere in the 
complaint does appellant identify, describe or explain what the contending 
interpretations are. Moreover, in request for relief, appellant does not ask the 
court to interpret the statute; appellant, in effect, asks the court to 
substitute its decision for that of DU on issues pertaining to the 
administration of the unemployment compensation law for which DU was created. 
Thus, appellant asks the court to judicially determine that a foreclosing 
creditor is not an "acquiring employing unit" under the law, and also asks the 
court to order DU to reinstate the lower contribution rate and to issue a refund 
of overpayment funds.

[¶17]   That appellant's latest action is 
barred by res judicata is also clearly evident. The district court dismissed 
appellant's first action in which appellant sought the same judicial 
determination as appellant seeks in its latest action. All of the elements 
required for the doctrine of res judicata to apply are present: the parties are 
the same in both actions, the subject matter is the same in both actions, the 
issues are the same and relate to the subject matter in both actions, and in 
both actions the capacities of the parties are identical in reference to the 
subject matter and the issues. Matter of Estate of Newell, 765 P.2d 1353, 1355 
(Wyo. 1988).

[¶18]   Affirmed.

FOOTNOTE

1 Formerly titled 
Unemployment Compensation of the Employment Security Commission.