No. 89-474 IN THE SUPREME COURT OF THE STATE OF MONTANA

BENJAMIN H. GERBER, Plaintiff and Appellant,-vsCOMMISSIONER OF INSURANCE OF THE STATE OF MONTANA; RICHARD E. BACH and DAVE DRYNAN, Defendants and Respondents.

APPEAL FROM: District Court of the Thirteenth Judicial District, In and for the County of Yellowstone, The Honorable G. Todd Baugh, Judge presiding. COUNSEL OF RECORD: For Appellant: George T. Radovich; Radovich Law Firm, Billings, Montana For Respondent: Brad H. Anderson; Moulton, Bellingham, Longo & Mather, Billings, Montana

Submitted on Briefs: Dec. 14, 1989 Decided: February 15, 1990 aChief Justice J. A. Turnage delivered the Opinion of the Court. PlaintiffBenjamin

### H. Gerber appeals theorderof theDistrict Court of the Thirteenth Judicial District, Yellowstone County, dismissing his tort action against the Montana Commissioner of Insurance and her employees Richard E. Bach and Dave Drynan. We affirm. The appellant raises the single issue ofwhether theDistrict Court erred in holding that quasi-judicial immunity barred the appellant's tort action against respondents. On October 14, 1983, appellant Gerber borrowed $10,000 from Rimrock Bank of Billings, Montana, and applied for the attendant credit-life-disability insurance fromAcceleration Life Insurance Company. That same day, the bank's loan officer informed Gerber that the insurer would not accept coverage. Gerber filed two complaints with the Commissioner of Insurance arguing that the binder given to him by the loan officer created a contract requiring the insurer to compensate him for an unspecified, accidentalinjury. Followingboth complaints, insurancecommission employees issued Gerber written opinions which correctly stated that under 5 33-21-203 (1)

## , MCA, insurance policies do not become effective until the insurer accepts the risk of coverage. Gerber then filed a tort action against the Insurance Commissioner, and against commission employees Richard Bach and Dave Drynan claiming damages for bad faith, legal malpractice,negligentmisrepresentation, and intentional or negligent infliction of emotional distress. ThecomplaintallegedthattheCommissioner failed to hold a hearing as requiredby 5 33-1-701(2), MCA, and that Bach and Drynanverbally misrepresented to Gerber thathe

was entitled to recover under the insurancebinders. The District Court granted the defendantst motion to dismiss under Rule 12(b)(6), M.R.Civ.P., for failure to state a claim upon which relief can be granted. Gerber now appeals that dismissal. The decisional standards in this case are not at issue. The District Courtmay dismiss a claim on thepleadings when no set of facts would support the claim. Wheeler v. Moe (1973), 163 Mont. 154, 161, 515 P.2d 679, 683. Our standard in reviewing motions to dismiss is de novo. Koppen v. Board of Medical Examiners (Mont. 1988), 759 P.2d 173, 175, 45 St.Rep. 1433, 1436. We agreewith the District Court that the only issue in this case is a question of law and that the law bars the appellant's claim. With exceptions not relevant to this case, 5 2-9-305(5), MCA, grants absolute immunitytostate employeesactingwithin the scope of their employment. The appellant offers no allegation or argument that respondents Bach and Drynan acted outside of the scope of their employment. Therefore,the District Courtproperly dismissed the claim against them. We also affirm the District Court's dismissal of the claims against the Insurance Commissioner. Gerber's District Courtcomplaint alleges that the Insurance Commissioner failed to investigatehis grievance against the insurer, misinformed him of hisrights,and refusedtoenforcehisalleged insurance contracts. In Koppen v. Board of Medical Examiners this Court held that the

common law doctrine of quasi-judicial immunity protects executive agencies when carrying out discretionary functions. Koppen, 759 P.2d at 176, 45 St.Rep. at 1438. The investigation of consumer complaints such asGerberlsand the resulting action, if any, fall withintheCommissionerls expressly-provided, discretionary powers. The commissionermay conduct such examinations and investigations 

# . . . as [she1 may deem proper 

# . 

# . . . Section 33-1-311(3), MCA. (Emphasisadded.) The commissioner may hold hearings for any purpose within the scope of this code deemed by rherl to be necessary. Section 33-1-701(1), MCA. (Emphasisadded.) The commissionermay, after having conducted a hearing pursuant to 33-1-701, impose a fine

Section 33-1-317, MCA. (Emphasisadded.) Whenever it appears to the commissioner that a person has engaged in or is about to engage inan act orpractice constituting a violation of [this act, she] may 

# . . . issue an order directingtheperson to ceaseand desist 

# . . .

[or] bring an action in a court of competent jurisdiction to enjoin such acts or practicesSection 33-1-318, MCA. (Emphasis added.) As a discretionary function,the Insurance conduct of an investigation based on a consumerlscomplaint againstan insurer isprotected by quasi-judicial immunity. Gerber argues that, nonetheless, the Commissioner is not immune from suitbased onher failuretohold a hearing because the hearing is not discretionary. He asserts that on filing of his complaint against the insurer, the Commissioner was statutorily required to convene a hearing on the issue and failed to do so. The section cited by Gerber states in pertinent part: The commissioner shall hold a hearing 

# . . . upon written demand therefor by a person aggrieved by any act, threatened act, or failure of the commissioner to act or by any report, rule, or order of the commissioner



# . . . . [Sluchhearing shall be held within 30 days after receipt by the commissioner of demand therefor. Section 33-1-701(2), MCA. (Emphasisadded.) The appellant misconstrues this section. Section 33-1- 701(2)

### , MCA, by its plain language, applies only to grievances arising from the actions of the Insurance Commissioner. It does not require the Commissioner to hold a hearing on consumer complaints against an insurer. Even if Gerber had demanded a hearing on the actions of the Commissioner, the effortwould have been futile. Gerberlsgrievance is with the Commissionerlsinvestigation and action on hiscomplaint. Asnoted above, those functionsareprotectedby quasijudicial immunity. Gerber's argument is analogous to claiming that a prosecutor must prosecute every criminal complaint received. Like the prosecutor, the Commissionerhas thediscretion to investigateand determine whether further action is warranted. The Commissioner is not required to hold a purely ritualistic hearing on every groundless complaint. Affirmed.

C ~~ie'f Justice

We concur: