Opinion ID: 2224654
Heading Depth: 1
Heading Rank: 4

Heading: Violation of Iowa Code Chapter 17A.17(3).

Text: Blinder claims that the hearing officers were subject to the authority of Insurance Commissioner William Hager at the time their orders were filed. While engaged in private law practice, Mr. Hager had, in 1985, represented Blinder in connection with this contested administrative hearing. The professional relationship between Mr. Hager and Blinder was terminated and resulted in a dispute concerning attorney fees. On July 1, 1986, prior to the entry of the order by Mr. Schrader, Mr. Hager was appointed State Insurance Commissioner. Mr. Schrader, as deputy insurance commissioner, is subject to the authority of Insurance Commissioner Hager. The proceedings against Blinder are to be conducted in accordance with the State Administrative Procedure Act found in chapter 17A of the Iowa Code. Section 17A.17(3) (1987) provides: No individual who participates in the making of any proposed or final decision in a contested case shall have prosecuted or advocated in connection with that case, the specific controversy underlying that case, . . . . Nor shall any such individual be subject to the authority, direction, or discretion of any person who has prosecuted or advocated in connection with that contested case, the specific controversy underlying that contested case, or a pending factually related case or controversy, involving the same parties. Id. (emphasis added). Here, the issue is not whether Mr. Hager actually exerted influence over the decisions of the hearing officers. Rather, the issue is whether the statutory requirements of section 17A.17(3) have been violated. The record is clear that Mr. Hager directly participated in this matter as an advocate for Blinder. There is also no dispute that both Mr. Schrader, and Mr. Lyons as deputy commissioners, were subject to the authority, direction, or discretion of Insurance Commissioner Hager. Deputy Commissioners Schrader and Lyons should have recused themselves as required by the Administrative Procedures Act. We do not find that Blinder waived this argument by failing to raise the issue in a timely manner. We also reject the superintendent's contention that Citizens First National Bank v. Hoyt, 297 N.W.2d 329, 333 (Iowa 1980), is relevant to this dispute. Hoyt did not deal with an action governed by chapter 17A of the Iowa Code, therefore, it cannot be used to alter the specific statutory requirements of section 17A.17(3). The superintendent argues that the doctrine of necessity allows Mr. Schrader to act as the hearing officer, regardless of whether a conflict exists. The doctrine of necessity allows a hearing officer or judge to preside, even if a conflict exists, if there are no other officers who are qualified. See Loughran v. Federal Trade Comm'n, 143 F.2d 431, 433 (8th Cir.1944). According to the superintendent, all other hearing officers would be disqualified because of Mr. Hager's position as Insurance Commissioner. In this situation, however, the doctrine of necessity does not apply. Iowa Code section 17A.11(3) (1987) allows the use of hearing officers from other agencies when necessary. See Federal Trade Comm'n v. Cement Institute, 333 U.S. 683, 700-03, 68 S.Ct. 793, 803-04, 92 L.Ed. 1010, 1034-35 (1948) (doctrine of necessity applied because there was no statutory authorization for alternate hearing officers). Because of Insurance Commissioner Hager's direct participation in the hearing of this contested case, a hearing officer not subject to Commissioner Hager's authority should have been utilized. The findings of fact, conclusions of law and orders of the hearing officers are vacated and the district court decision is reversed. This case is remanded for proceedings consistent with this opinion. REVERSED AND REMANDED.