Opinion ID: 871688
Heading Depth: 2
Heading Rank: 1

Heading: AlohaCare is a person aggrieved and has standing to appeal

Text: AlohaCare brought its petition for declaratory relief as an interested person pursuant to HRS § 91-8. HRS § 91-8 allows [a]ny interested person [to] petition an agency for a declaratory order as to the applicability of any statutory provision or of any rule or order of the agency. However, HRS § 91-8 does not address the procedures or requirements for the appeal of an agency's declaratory order. Instead, those procedures and requirements are set forth in HRS § 91-14. [26] See HRS § 91-14; Lingle, 107 Hawai`i at 186, 111 P.3d at 595 (noting that orders disposing of petitions for declaratory rulings under HRS § 91-8 are appealable to the circuit court pursuant to HRS § 91-14). HRS § 91-14(a) provides that [a]ny person aggrieved by a final decision and order in a contested case . . . is entitled to judicial review thereof under [chapter 91.] (Emphasis added). This court has recognized that judicial review of orders disposing of petitions for declaratory rulings pursuant to HRS § 91-8 are also subject to judicial review, although those orders may not result from contested cases. Lingle, 107 Hawai`i at 185, 111 P.3d at 594. Put another way, an order disposing of a petition for a declaratory ruling brought pursuant to HRS § 91-8 fulfills the requirement in HRS § 91-14(a) that the decision or order at issue be entered in a contested case. In the instant case, it is undisputed that the Insurance Commissioner's Decision did not result from a contested case. See HRS § 91-1(5) (defining a contested case as a proceeding in which the legal rights, duties, or privileges of specific parties are required by law to be determined after an opportunity for agency hearing). Nevertheless, the Insurance Commissioner's Decision was appealable pursuant to HRS § 91-14, because it was an order disposing of a petition brought pursuant to HRS § 91-8. Lingle, 107 Hawai`i at 185, 111 P.3d at 594. In addition, as set forth below, Alohacare is a person aggrieved by the Insurance Commissioner's Decision, because it faced increased competition from allegedly improperly licensed competitors in the QExA contract process, and the Decision held that AlohaCare's competitors were in fact properly licensed to offer the services required under those contracts. See HRS § 91-14(a). Accordingly, Aloha-Care has standing to appeal the Insurance Commissioner's Decision.
HRS chapter 91 does not define the term person aggrieved, but this court has noted that `person aggrieved' appears to be essentially synonymous with someone who has suffered `injury in fact.' E & J Lounge Operating Co. v. Liquor Comm'n of the City and Cnty. of Honolulu, 118 Hawai`i 320, 345 n. 35, 189 P.3d 432, 457 n. 35 (2008) (citation and some quotation marks omitted). Whether a party has suffered an injury in fact is determined under a three-part test: (1) whether the person `has suffered an actual or threatened injury as a result of the [agency's decision],' (2) whether `the injury is fairly traceable to the [agency's decision],' and (3) whether `a favorable decision would likely provide relief for [the person's] injury.' Id. (some brackets added and some in original) (quoting Keahole Def. Coal., Inc. v. Bd. of Land & Natural Res., 110 Hawai`i 419, 434, 134 P.3d 585, 600 (2006)). In its reply brief, AlohaCare argues that it suffered an actual or threatened injury on two grounds. First, AlohaCare agrees with the Insurance Commissioner's determination that AlohaCare was aggrieved because a finding by the Commissioner that [United] and/or [Ohana] are properly licensed to perform the services required under the QExA contracts in issue . . . is effectively a finding that those entities can compete against [AlohaCare] for an award of the QExA contract in issue. Second, AlohaCare contends that its HMO license has been taken away or substantially diminished by the Insurance Commissioner's Decision. [27] AlohaCare argues that this effect on its license is not limited to QExA, but applies to any activity which involves arranging for the delivery of health care services. AlohaCare's argument concerning the effect of the Decision on its other activities is not supported by the record. Neither the record on appeal nor the administrative record on appeal contain any documents, exhibits, or testimony that would establish AlohaCare's possible injury relating to other activities. See United Pub. Workers, Local 646, AFSCME, AFL-CIO v. Brown, 80 Hawai`i 376, 380-81, 910 P.2d 147, 151-52 (App.1996) (holding that a union did not have standing because its asserted possible injuries of future charges or civil suits against the Union that could affect its financial resources were not demonstrated in the record through documents, exhibits or testimony). Accordingly, this injury is not sufficient to establish that AlohaCare is a person aggrieved[.] However, as noted by the Insurance Commissioner, AlohaCare was adversely affected by the Decision with respect to the type of license required to offer the QExA plan because the conclusion that United and Ohana are properly licensed to perform the services required under the QExA contracts is effectively a finding that those entities can compete against [AlohaCare] for an award of the QExA contract in issue. Accordingly, AlohaCare sustained a concrete injury because it faced increased competition from allegedly improperly licensed competitors in the QExA contract process, and the Decision held that AlohaCare's competitors were in fact properly licensed to offer the services required under those contracts. [28] In addition, AlohaCare's injury of increased competition by allegedly improperly licensed competitors for the award of the QExA contract is fairly traceable to the Decision, see E & J Lounge, 118 Hawai`i at 346 n. 35, 189 P.3d at 458 n. 35, because the Decision held that United and Ohana were properly licensed to perform the services required under the QExA contracts. [29] Finally, a favorable decision would provide AlohaCare relief from its injury. See E & J Lounge, 118 Hawai`i at 345 n. 35, 189 P.3d at 457 n. 35. If this court were to find that an HMO license is necessary to offer the services required under the QExA contracts, AlohaCare would be relieved of competition from United and Ohana in bidding for such contracts, unless United and Ohana obtained an HMO license. [30] Based on the foregoing, AlohaCare is a person aggrieved that has standing to appeal pursuant to HRS § 91-14(a). [31]
Because we conclude that AlohaCare is a person aggrieved, we need not resolve whether, as asserted by the dissent, AlohaCare had standing to appeal the Decision as an interested person. See Richard v. Metcalf, 82 Hawai`i 249, 254, 921 P.2d 169, 174 (1996) (listing, in order from the broadest to the narrowest category, the respective classes of potential litigants under HRS chapters 91 and 92 as any person, any interested person, and persons aggrieved. . . in a contested case) (citations and footnote omitted). Moreover, we note that Alohacare has not argued that it has standing to appeal the Insurance Commissioner's Decision as an interested person. [32] Finally, we note that the cases cited by the dissent, see dissenting opinion at 657-58, do not resolve, either expressly or impliedly, whether an interested person may appeal a declaratory order that did not result from a contested case. For example, in Lingle, this court addressed whether the circuit court had jurisdiction, pursuant to HRS § 91-14, to review an agency's refusal to issue a declaratory order. 107 Hawai`i at 184-86, 111 P.3d at 593-95. The petitioners argued that the circuit court did not have jurisdiction because the order did not result from a contested case. Id. at 183, 111 P.3d at 592. This court noted that it had consistently recognized that circuit courts have jurisdiction, pursuant to HRS § 91-14, to review orders disposing of petitions for declaratory rulings. Id. at 185, 111 P.3d at 594 (citations omitted). This court explained that, pursuant to HRS § 91-8, [o]rders disposing of petitions [for declaratory rulings] shall have the same status as other agency orders[,] and that the phrase other agency orders was intended to permit review of petitions for declaratory relief. Id. (some brackets in original and some added). Relying on legislative history, this court determined that the refusal to issue a declaratory order in itself would be an agency order, and therefore would be reviewable. Id. Accordingly, this court held that the circuit court had jurisdiction over the agency appeal. Id. at 186, 111 P.3d at 595. However, it does not appear that any of the parties in Lingle contested the appellants' standing to appeal, [33] and the basis for the appellants' standing, i.e., the question of whether an appellant must be aggrieved or merely interested to appeal a declaratory order, was not addressed. Id. at 184-86, 111 P.3d at 593-95; see also Vail v. Emps. Ret. Sys., 75 Haw. 42, 47, 52-66, 856 P.2d 1227, 1231, 1233-1240 (1993) (addressing an appeal of an agency's declaratory order on the merits, where the appellant's standing to seek judicial review was neither challenged nor discussed); Kim v. Emps. Ret. Sys., 89 Hawai`i 70, 73, 75-76, 968 P.2d 1081, 1084, 1086-87 (App.1998) (same). Thus, we respectfully disagree with the dissent's conclusion that this court has impliedly determined that a party appealing a declaratory order need not be aggrieved. Dissenting opinion at 657. While Lingle and the cases cited therein determined that a declaratory order is appealable, those cases did not determine by whom such an order may be appealed. [34] Accordingly, we respectfully decline to resolve whether AlohaCare had standing to appeal as an interested person, and hold that AlohaCare had standing as a person aggrieved. [35]