Opinion ID: 2600267
Heading Depth: 1
Heading Rank: 3

Heading: The Qui Tam Petition, Intervention, and Remand

Text: ¶ 47 Phillips and the Corporation Commission argue on certiorari that the Court of Civil Appeals incorrectly construed their motions to dismiss as motions for summary judgment when they challenged taxpayers' qui tam petition. Taxpayers responded to the motions to dismiss with a response containing attached materials outside of the pleadings. The replies by the Commission and Phillips did not include materials outside of the pleadings. [21] The appellate court construed the motions as motions for summary judgment because of the materials attached to taxpayers' responses. ¶ 48 This Court has consistently stated that a motion to dismiss for failure to state a claim upon which relief may be granted, as provided by 12 O.S.2001 § 2012(B)(6), is to be treated as a motion for summary judgment when matters outside of the pleadings are presented in support of the motion and those extra-pled matters are not excluded by the trial court when the motion is considered. Kordis v. Kordis, 2001 OK 99, ¶¶ 1-3, 37 P.3d 866, 868-869; Dyke v. Saint Francis Hospital, Inc., 1993 OK 114, 861 P.2d 295, 298-299. Of course, once the motion to dismiss is converted to one for summary judgment the moving party has a different burden: Once the proceeding becomes one for summary judgment, the moving party's burden changes and he is obliged to demonstrate that there exists no genuine issue as to any material fact and that he is entitled to a judgment as a matter of law. Shaffer v. Jeffery, 1996 OK 47, 915 P.2d 910, 914, quoting, 5A Wright & Miller, Federal Practice and Procedure: Civil 2d, § 1366 (1990). See also Cinco Enterprises, Inc. v. Benso, 1994 Ok 135, 890 P.2d 866, 871; Indiana Nat. Bank v. State, Dept. of Human Services, 1993 OK 101, 857 P.2d 53, 59. It is of this change of the burden that Phillips and the Commission complain. They want to challenge the legal sufficiency of the petition without seeking judgment on the merits as a matter of law. ¶ 49 Title 12, section 2012(B) provides in part: If, on a motion asserting the defense numbered 6 of this subsection to dismiss for failure of the pleading to state a claim upon which relief can be granted, matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and all parties shall be given reasonable opportunity to present all material made pertinent to the motion by the rules for summary judgment. 12 O.S. Supp.2006 § 2012(B). This language treats a motion to dismiss based upon a failure to state a claim upon which relief may be granted as a motion for summary judgment when matters outside the pleading are presented to, and not excluded by, the trial court. ¶ 50 The substance of a motion requesting judicial relief, rather than the motion's title, is determinative of the relief requested from the court. Horizons, Inc. v. Keo Leasing Co., 1984 OK 24, 681 P.2d 757, 759; Deen v. Fruehauf Corp., 1977 OK 27, 562 P.2d 505, 506. When the movant has challenged the facial sufficiency of a petition and not relied upon matters outside the pleadings in either movant's motion or movant's replies to an opposing party's responses on the motion, it makes little sense to convert the motion to one for summary judgment when its content is not seeking summary judgment. ¶ 51 In the case before us, the taxpayers attached affidavits to their responses to the motions to dismiss. If their petition lacked facts, they could certainly amend it. No responsive pleading had been filed by the Commission or Phillips, and pursuant to 12 O.S.2001 § 2015(A) [22] a petition may be amended by right at any time before an answer is served. Winston v. Stewart & Elder, P.C., 2002 OK 68, ¶ 24, 55 P.3d 1063, 1072. We see no purpose in allowing a plaintiff to unilaterally change a movant's motion to one for summary judgment and thus require the movant to meet a different burden than when challenging the sufficiency of the petition. Language to the contrary in Tisdale v. ITW Ramset/Red Head, 2003 OK CIV APP 83, ¶ 4, 77 P.3d 609, 610, and Benson v. Hunter, 2002 OK CIV APP 44, ¶¶ 5-7, 45 P.3d 444, 445, is hereby disapproved. ¶ 52 The function of a motion to dismiss is to test the law of the claims, not the facts supporting them. Estate of Hicks ex rel. Summers v. Urban East, Inc., 2004 OK 36, ¶ 5, 92 P.3d 88. The applicable test for appraising the sufficiency of a pleading challenged for failure to state a claim upon which relief may be granted teaches that no dismissal may be effected unless it should appear beyond doubt that the plaintiff can prove no set of facts in support of the claim which would entitle her to relief. Dyke v. Saint Francis Hospital, Inc., 1993 OK 114, 861 P.2d 295, 298 (note omitted). ¶ 53 We stated the following in a previous qui tam proceeding where the sufficiency of a petition was challenged: We have no doubt that an allegation to the effect that county officials charged with the responsible duties of disposing of real estate held by the county by purchase at resale, knowingly caused same to be transferred to one at a small fraction of its true value as known to them, is sufficient to state a prima facie case of fraud and is sufficient to withstand a demurrer directed at the sufficiency of the petition to state a cause of action. State ex rel. Lockhart v. Board of Com'rs of Lincoln County, 1946 OK 291, 173 P.2d 725, 727. ¶ 54 In Lockhart the allegation was simply that the officials had transferred public property for a small fraction of its true value. We concluded that the petition was sufficient to withstand a challenge to its sufficiency in stating a cause of action. In the present matter the allegations include but are not limited to (1) that state funds were paid upon claims that the officials knew were not legally due because of insufficient information supplied by Phillips, (2) that an audit by the State Auditor and Inspector had informed officials that payment had been made without authority, and (3) that officials had been coerced to make payments that were not authorized by law. As in Lockhart, we have no doubt that the allegations are sufficient to withstand a § 2012(B)(6) challenge. ¶ 55 In this case, the taxpayers sought to intervene in the declaratory judgment proceeding and sought review on appeal of the trial court's order denying their motion to intervene. In Tal II, supra, we said that taxpayers had no right to intervene because the controversy was properly presented to the trial court by the actions of the officials after the demand letter. In the matter before us, the taxpayers claim a right to intervene. ¶ 56 The Pleading Code makes timely intervention a matter of right [23] when there is either an unconditional statutory right to intervene; or when (1) the intervenor claims a significant protectable interest relating to the property or transaction that is the subject of the action, (2) the disposition of the action may, as a practical matter, impair or impede the applicant's ability to protect its interest, and (3) the existing parties may not adequately represent the applicant's interest. See Brown v. Patel, 2007 OK 16, ¶¶ 16-18, 157 P.3d 117, 123-124. The parties focus on the nature of the interest claimed by the taxpayers in this controversy. ¶ 57 In State, Bd. Com'rs Pontotoc County ex rel. Braly v. Ford, 1941 OK 270, 116 P.2d 988, we stated that when the officials fail to take the proper actions after a taxpayer's statutorily sufficient written demand, a taxpayer may institute a suit as provided by the statute and thereby acquire a substantial interest in the subject matter of the litigation. Id. 116 P.2d at 990. But because of the presumption that officials will take proper actions subsequent to a demand letter, the taxpayer's interest does not come into being until the taxpayer shows that officials failed to take the proper actions after receiving the demand letter. Id. 116 P.2d at 990-991. ¶ 58 The qui tam interest of tax-payers is thus limited to that created by the qui tam statute. Taxpayers must show the insufficiency of the declaratory judgment petition as a condition precedent to a successful intervention in the declaratory judgment proceeding. The motion to intervene argues that intervention is necessary to put before the trial court the facts of the controversy that were not raised by the declaratory judgment proceeding. Taxpayers showed the insufficiency of the allegations of the declaratory judgment petition for the purpose of intervening to present the facts of the controversy to the trial court for its consideration on the merits of the controversy. [24] ¶ 59 Another argument raised on certiorari is that the taxpayers improperly sought intervention for the purpose of dismissing the declaratory judgment petition. Taxpayers stated that if they were allowed to intervene they would seek dismissal of the officials' petition. Taxpayers made various allegations against the petition, including that the Corporation Commission did not authorize the declaratory judgment proceeding and that the declaratory judgment proceeding was not brought in good faith. Phillips and the Commission argue that public officials are presumed to act in good faith and, because of that presumption, taxpayers may not seek to intervene to challenge a declaratory judgment petition filed in response to a taxpayers' demand letter. ¶ 60 The argument of Phillips and the Commission is based upon the unstated premise that the good-faith presumption of public officials in presenting the taxpayer controversy to a court is an irrebuttable or conclusive presumption, and thus the attempt to intervene is barred as a matter of law. An irrebuttable, conclusive, or absolute presumption is a rule of law that once the averment is shown it may not be overcome by any proof that the fact is otherwise. [25] While irrebuttable presumptions are often disfavored by courts, [26] there are some circumstances where the interests of parties are properly subject to irrebuttable presumptions. For example, in David V.R. v. Wanda J.D., 1995 OK 111, 907 P.2d 1025, we explained that an irrebuttable presumption of the paternity of a child born during marriage barred the putative father's suit because of important and overriding public and social policies. ¶ 61 In Tal IV we stated that the taxpayers failed to overcome the presumption that the City would act in good faith in presenting the controversy in the declaratory judgment proceeding. State ex rel. Moshe Tal v. City of Oklahoma City, 2002 OK 97, ¶ 8, 61 P.3d 234, 241. We did not hold that the taxpayers were barred from presenting evidence and making legal arguments for the purpose of overcoming the presumption. The taxpayers in the controversy before us are challenging not only the sufficiency of the declaratory judgment petition in presenting the nature of the controversy so as to show the propriety of their quest for seeking qui tam relief, but also that the entire declaratory judgment proceeding was improperly brought and tainted by a lack of good faith on the part of the officials involved. While we have concluded that the allegations of the declaratory judgment petition are insufficient to present the taxpayer's controversy so as to bar their seeking qui tam relief, we expressly do not determine whether the allegations of taxpayers' motion to dismiss attached to their motion to intervene are sufficient either factually, or as a matter of law, to dismiss a declaratory judgment petition brought by officials in response to a taxpayers' written demand. [27] ¶ 62 In State, Bd. Com'rs Pontotoc County ex rel. Braly v. Ford, 1941 OK 270, 116 P.2d 988, the qui tam taxpayers were allowed to present evidence on the issue of whether the officials acted in good faith, although they ultimately failed to meet their evidentiary burden. Braly, 116 P.2d at 992. Phillips and the Commission have not pointed to any overriding public and social policies mandating that taxpayers should be barred from having an opportunity to present evidence and legal argument that public officials have not acted in good faith in response to a taxpayer's written demand. We hold that the presumption is not irrebuttable and may be challenged by qui tam plaintiffs. ¶ 63 In one appeal we have concluded that the trial court's order sustaining the motion dismissing the qui tam petition was error and must be reversed. In another appeal we have concluded that the trial court's order denying the motion to intervene was error and must be reversed. The orders reversed are on appeal from two different trial court cases. We limit our appellate review to the claims made on certiorari, reverse both orders appealed from the trial court, and remand the causes to the trial court for further proceedings consistent with this opinion. ¶ 64 EDMONDSON, V.C.J., HARGRAVE, KAUGER, WATT, TAYLOR, COLBERT, JJ., concur. ¶ 65 OPALA, J., concurring in result in Part I of the court's opinion and concurring in its remainder. No literal meaning can ever be ascribed to a statutory declaration that is in patent discord with legal reality and its consequences. Instead of attributing to the statute's words an intention of effecting an unlawful divestiture of public money, we will, as we must, interpret them as no more than impressing the entire fund with a trust dedicated to the purpose for which it was created, permitting no diversion to anything else. When the statute's text is so understood, the title to the fund remains unchanged, but its assets, now firmly committed to a single purpose, stand impervious to legislative tinkering. [1] ¶ 66 WINCHESTER, C.J., Disqualified.