Opinion ID: 1685227
Heading Depth: 1
Heading Rank: 10

Heading: Jurisdiction: Contested Case under APA

Text: Nebraska Beef and the State defendants assign that the district court erred in finding that the plaintiffs' petition constituted a contested case under the APA. The APA defines a contested case as a proceeding before an agency in which the legal rights, duties, or privileges of specific parties are required by law or constitutional right to be determined after an agency hearing. § 84-901(3). Section 84-917 outlines the process by which an aggrieved party can pursue an appeal of a final decision in a contested case. The district court found the Board's decision to be a contested case within the definition of the APA. The district court relied on our statement in Stoneman v. United Neb. Bank, 254 Neb. 477, 577 N.W.2d 271 (1998), that a proceeding becomes a contested case when a hearing is required. See, also, Central Park Pharm. v. Nebraska Liq. Cont. Comm., 216 Neb. 676, 344 N.W.2d 918 (1984). We determined in Stoneman, supra, that when an administrative body acts in a quasi-judicial manner, due process requires notice and an opportunity for a full and fair hearing at some stage of the agency proceedings. Further, Stoneman stated that the exercise of discretion to grant or deny a license, permit, or other type of action is a quasi-judicial function. Id. The district court compared the Board's proceedings to the Department of Banking and Finance's approval of a banking application in Stoneman, supra, and First Fed. Sav. & Loan Assn. v. Department of Banking, 187 Neb. 562, 192 N.W.2d 736 (1971), and a Liquor Control Commission decision to approve a liquor license. Thus, the district court concluded that the Board's decision was a contested case under the APA. The Board, however, is not an agency subject to the APA. Section 84-901(1) defines an agency as a board, commission, department, officer, division, or other administrative office or unit of the state government authorized by law to make rules and regulations. The district court determined that because the Board was not specifically excluded from the APA under § 84-901(1), it is an entity covered by the APA and all provisions therein. This court has recognized, however, that the APA applies only to agencies authorized by law to make rules and regulations. See Hoiengs v. County of Adams, 245 Neb. 877, 516 N.W.2d 223 (1994). In Hoiengs, for example, this court determined that the Public Employees Retirement Board was not an agency subject to the APA because the act creating the retirement board did not grant the authority to make rules and regulations. See id. The Board does not have this rulemaking authority; the Act provides that the Department of Revenue, in consultation with the Governor and the Department of Economic Development, shall adopt and promulgate all rules and regulations to carry out the purposes of the Act. See § 77-4932. The Department of Revenue is clearly an agency subject to the APA. We conclude, however, that because the Board does not promulgate rules and regulations, and because Nebraska Beef's application submission to the Board does not involve a quasi-judicial contested case requiring review pursuant to § 84-917, the Board is not an agency subject to the APA. The district court did not have jurisdiction under the APA to void the Board's approval of Nebraska Beef's application based on the absence of rules and regulations. The plaintiffs agree with the State defendants and Nebraska Beef that their petition was not an appeal of a contested case under the APA. Instead, the plaintiffs assert that their lawsuit is an original equity action seeking to enjoin public officials from expending funds. Therefore, we next examine the district court's jurisdiction with regard to equity actions.