Source: http://masslegalresources.com/tag/state
Timestamp: 2019-04-22 11:57:59+00:00

Document:
STATE ROAD AUTO SALES, INC.
State Road Auto Sales, Inc., seeks a preliminary injunction that would bar the Massachusetts Division of Banks from completing an ongoing adjudicatory hearing. The Division brought administrative charges asserting that State Road violated G.L. c. 255B, which governs retail installment sales of motor vehicles, by acting as a “motor vehicle sales finance company” without a license and by entering into illegal motor vehicle installment sales with individual consumers. The Legislature authorized the Commissioner of Banks to implement and enforce c. 255B.
State Road is entitled to contest those charges through an evidentiary proceeding before a Division hearing officer. State Road argues that the Division’s administrative charges and adjudicatory proceeding are barred by State Road’s recent settlement of a class action brought on behalf of consumers who entered into motor vehicle leases with State Road that were in effect after October 21, 2013, and were signed before January 1, 2016. More specifically, State Road argues that the order approving the class action settlement deprived the Division of subject matter jurisdiction to decide the pending administrative charges and, in the alternative, that the prior settlement has collateral estoppel or issue preclusive effect that would bar the Division from exercising its jurisdiction over State Road.
The Court concludes that State Road is not entitled to preliminary injunctive relief because it has failed to exhaust its administrative remedies and therefore is not likely to succeed on the merits of its claims. Cf. Fordyce v. Town of Hanover, 457 Mass. 248, 266 (2010) (vacating preliminary injunction because plaintiffs were “unlikely to succeed on the merits”).
whether the Division can prosecute and decide the administrative charges turns on disputed issues of fact and not pure issues of law.
Under these circumstances, State Road must exhaust its administrative remedies at the Division before seeking to challenge the Division’s exercise of jurisdiction over State Road in court. See Wilczewski v. Commissioner of the Dept. of Envtl. Quality Eng’g, 404 Mass. 787, 793-794 (1989) (affirming dismissal of challenge to agency’s jurisdiction in pending matter); Gill v. Board of Reg. of Psychologists, 399 Mass. 724, 728 (1987) (ordering dismissal of action); East Chop Tennis Club v. Massachusetts Comm’n Against Discrim., 364 Mass. 444, 451 (1973) (vacating decree entered by Superior Court and ordering dismissal of action); Reliance Ins. Co. v. Commissioner of Ins., 31 Mass. App. Ct. 581, 585 (1991) (affirming dismissal of action). “Where the contention is that the [agency] is acting beyond its jurisdiction, the [agency] should have an opportunity to ascertain the facts and decide the question for itself….” Wilczewski, 404 Mass. at 793, quoting Saint Luke’s Hospital v. Labor Relations Comm’n, 320 Mass. 467, 470 (1946). And if a party to an administrative proceeding fails to contest the agency’s assertion of authority, it may not then raise the issue in court. See, e.g., Conservation Commission of Falmouth v. Pacheco, 49 Mass. App. Ct. 737, 741 (2000).
Should State Road be aggrieved by any final order issued by the Division, it would be entitled to judicial review under G.L. c. 30A, § 14. In the meantime, however, this action “is premature” and the Court cannot “appropriately entertain it.” Wilczewski, 404 Mass. at 793.
24 Mass. App. Ct. 329, 332 (1987). One discretionary exception may apply where “[t]here is a clear and convincing need for a new determination of the issue” either “because of the potential adverse impact of the determination on the public interest or the interests of persons not themselves parties in the initial action” or “because it was not sufficiently foreseeable at the time of the initial action that the issue would arise in the context of a subsequent action.” York Ford, Inc. v. Building Inspector and Zoning Adm’r of Saugus, 38 Mass. App. Ct. 938, 842 n.10 (1995), quoting Restatement (Second) of Judgments, § 28(5) (1982); accord E.N. v. E.S., 67 Mass. App. Ct. 182, 197 n.26 (2006) (dictum) (where “a substantial public interest” is at stake, issue may be relitigated in second proceeding) (quoting Restatement (Second) of Judgments § 12(2), comment c, at 119 (1982)). Since whether to apply issue preclusion in the circumstances of this case will involve the exercise of discretion, State Road’s assertions of issue preclusion must be decided by the Division in the first instance.
This is not a case in which it would be futile for State Road to exhaust its administrative remedies because it is clear as a matter of law that the Division lacks the power or authority to adjudicate the pending administrative charges. Cf. Temple Emanuel and Ciszweski, supra.
There is no merit to State Road’s assertion that the court order approving a prior class action settlement by State Road has deprived the Division of jurisdiction to pursue the pending administrative charges. State Road relies on a provision in the “Final Approval Order and Final Judgment” that was entered by Judge Sanders in September 2017 in the case of Grant v. State Road Auto Sales, Inc., 1484CV03292-BLS2. State Road argues that the Division lacks any jurisdiction over State Road or its business practices because the court retained exclusive jurisdiction over any defense in any action based on the Grant settlement, and State Road is asserting such a defense against the Division’s administrative charges. That is incorrect.
This provision does not apply here. The Division was not a party to the Grant litigation. Nor was it a member of the Settlement Class. Nor does the Division now stand in the shoes of the Settlement Class Members. The Division, as representative of the Commissioner of Banks, is a public entity with independent statutory authority to enforce c. 255B. As a result, when the Division exercises its enforcement authority it is not subrogated to the rights of individual consumers or otherwise standing in their shoes.
For all of these reasons, the claims asserted by State Road in this action are really defenses that State Road must first raise before the Division. This action is barred by the requirement that State Road must first exhaust its administrative remedies. Since State Road therefore is unlikely to succeed on the merits of its claim, the Court will deny the request for a preliminary injunction.
Plaintiff’s motion for a preliminary injunction is DENIED. The Division of Banks respond to the complaint—by filing an answer, serving a motion to dismiss, or otherwise—by February 22, 2018. If the case has not been dismissed before then, a Rule 16 litigation control conference will be held on April 10, 2018, at 2:00 p.m.
RICHARD DUDLEY, JR. vs. MASSACHUSETTS STATE POLICE.
Bristol. December 1, 2016. – June 1, 2017.
Massachusetts Tort Claims Act. Governmental Immunity. Dog. Police, Negligence. Negligence, Governmental immunity, Police. Practice, Civil, Summary judgment.
STATE BOARD OF RETIREMENT vs. THOMAS M. FINNERAN & others.
Suffolk. December 8, 2016. – April 5, 2017.
Present: Gants, C.J., Botsford, Lenk, Hines, Gaziano, & Budd, JJ.
Retirement. State Board of Retirement. Public Employment, Forfeiture of retirement benefits. Constitutional Law, Excessive fines clause. Practice, Civil, Action in nature of certiorari.
DAVID A. ALVES vs. MASSACHUSETTS STATE POLICE & others.
Bristol. November 3, 2016. – January 4, 2017.
Res Judicata. Collateral Estoppel. Judgment, Preclusive effect. Negligence, Police. Practice, Civil, Summary judgment. State Police.
SALVATORE F. DiMASI vs. STATE BOARD OF RETIREMENT & others.
Suffolk. February 9, 2016. – April 21, 2016.
Civil action commenced in the Supreme Judicial Court for the county of Suffolk on June 16, 2014.
KILNAPP ENTERPRISES, INC. vs. MASSACHUSETTS STATE AUTOMOBILE DEALERS ASSOCIATION & others.
Suffolk. December 7, 2015. – March 17, 2016.
Present: Rubin, Maldonado, & Massing, JJ.
Libel and Slander. Actionable Tort. Practice, Civil, Motion to dismiss.
Civil action commenced in the Superior Court Department on March 10, 2014.
INSURANCE COMPANY OF THE STATE OF PENNSYLVANIA vs. GREAT NORTHERN INSURANCE COMPANY.
Suffolk. November 2, 2015. – March 7, 2016.
Workers’ Compensation Act, Insurer, Coverage, Election of remedies. Insurance, Workers’ compensation insurance, Contribution among insurers, Insurer’s obligation to defend. Contribution. Tender. Election of Remedies.

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