Court Opinion

ID: 9637954
Source: CourtListenerOpinion
Date Created: 2023-08-22 15:27:47.187188+00
Date Added: 2024-06-11T14:59:51.547819
License: Public Domain

Bogdanski, J.
(dissenting). I respectfully dissent. I agree that the plaintiff Ralph Nader failed to show personal aggrievement and that the plaintiff Margaret Curtin’s appeal became moot when she exchanged her Hartford Fire stock for ITT stock pursuant to the exchange offer approved by the insurance commissioner. But I believe that the plaintiffs Peter Cooper and Reuben Robertson are “aggrieved” by the order of the insurance commissioner as that term has traditionally been construed by this court. The plaintiff Cooper, as a common stockholder of ITT, claims to be aggrieved by the commissioner’s order because the convertibility of the preferred stock which ITT exchanged for Hartford Fire stock threatened the “dilution” of his common stock equity. The plaintiff Robertson claims to be aggrieved because the insurance commissioner approved the exchange offer without protecting his interests as a Hartford Fire policy*61holder as required by the statute governing acquisitions of domestic insurance companies. He asserts that ITT failed to comply with self-disclosure requirements, and that conditions imposed by the commissioner for the benefit of Hartford Fire policyholders on the use of Hartford Fire funds were inappropriate and unenforceable.1
In 1969, the G eneral Assembly enacted Public Act No. 444 (General Statutes §§ 38-39a through 38-39V) in response to the threat of a take-over of the domestic insurance industry by out-of-state conglomerates. The legislature feared that foreign corporations would “raid” the attractive cash reserves of acquired domestic insurance companies, weaken their stability and even remove them from the state, to the detriment of policyholders, securityholders, and the general public. See Finding and Final Order Entered by the Insurance Commssioner, May 23, 1970; Hearings before Joint Standing Committee on Insurance, 1969 Sess., Pt. 1, pp. 17-22; 13 S. Proc., *621969 Sess., Pt. 4, pp. 1975-76; 13 H.R. Proe., 1969 Sess., Pt. 8, pp. 3847-49. Representative Genovesi, for example, referred to a recent take-over in which. “[m]illions of dollars of policyholders’ surplus was raided hy the conglomerate.” 13 H.R. Proe., 1969 Sess., Pt. 8, p. 3849. Accordingly, the legislature enacted a statute requiring prior approval hy the insurance commissioner of any insurance company acquisitions. Public Act 1969, No. 444 directs him to approve an acquisition only upon a finding that the acquisition would not prevent the insurance company from continuing to write the lines of insurance for which it was licensed, that the interests of policyholders and securityholders of the insurance company would be protected, and that the acquisition would serve the public interest. General Statutes § 38-39d (b). “Any person aggrieved” by the commissioner’s approval of an acquisition may appeal to the Superior Court in Hartford County. § 38-39k (a).
“Aggrievement” is the standard jurisdictional prerequisite to an appeal from any administrative agency decision. The requirement simply means that the decision must have an actual adverse effect on a legitimate personal interest of the appellant. See, in addition to the cases cited in the majority opinion, Sea Beach Assn., Inc. v. Water Resources Commission, 164 Conn. 90, 93-94, 318 A.2d 115; 3 Davis, Administrative Law Treatise § 22.18; 2 Cooper, State Administrative Law, pp. 535-41. Although unsupported “generalizations and fears are not enough” to demonstrate aggrievement; Joyce v. Zoning Board of Appeals, 150 Conn. 696, 698, 187 A.2d 239; aggrievement is established if “there is a possibility, as distinguished from a certainty, that some legally protected interest . . . has *63been adversely affected.” O’Leary v. McGuinness, 140 Conn. 80, 83, 98 A.2d 660; see also Hartford Kosher Caterers, Inc. v. Gazda, 165 Conn. 478, 485-86, 338 A.2d 497, and cases cited. Moreover, aggrievement does not depend on the magnitude of the injury threatened. A taxpayer, for example, has standing to challenge municipal action which “would . . . result, directly or indirectly, in an increase in his taxes or would, in some other fashion, cause him irreparable injury.” Bassett v. Desmond, 140 Conn. 426, 430, 101 A.2d 294; Zuckerman v. Board of Zoning Appeals, 144 Conn. 160, 163-64, 128 A.2d 325; see also Davis, Administrative Law Treatise (1970 Sup.) §§ 20.09-5, 22.09-6, 22.21.2
Cooper bases his aggrievement on the threatened dilution of his common stock equity. This court has *64never before had occasion to decide whether such a threatened injury suffices for aggrievement, but that question has been answered affirmatively by the United States Supreme Court. In Allegheny Corporation v. Breswich & Co., 353 U.S. 151, 77 S. Ct. 763, 1 L. Ed. 2d 726, minority common stockholders of Allegheny appealed from an Interstate Commerce Commission decision approving Allegheny’s issuance of convertible preferred stock. Mr. Justice Frankfurter said (p. 160) that “under relevant notions of standing, the threatened [emphasis added] ‘dilution’ of the equity of the common stockholders provided sufficient financial interest to give them standing.” Cooper’s grievance is certainly palpable enough to satisfy the legal requirements of aggrievement in Connecticut. Bassett v. Desmond, supra; O’Leary v. McGuinness, supra.
My colleagues say that Cooper has not shown aggrievement because he did not present evidence of aggrievement to the Superior Court.3 But he was not required to do so. When a person is aggrieved as a matter of law, he need not prove aggrievement in fact. Weigel v. Planning & Zoning Commission, 160 Conn. 239, 247-49, 278 A.2d 766. Similarly, since the necessary facts to show Cooper’s aggrievement—his shareholder status and the terms of the exchange offer—were admitted and undisputed, no more evidence of aggrievement was needed. Indeed, since the threat of dilution is *65a logical consequence of the admitted and undisputed facts, it is difficult to see what additional evidence Cooper would have offered.
The majority opinion also suggests that if Cooper’s rights as an ITT shareholder were illegally prejudiced by the issuance of the series N shares, his proper course of action would have been to bring a shareholders’ action against ITT. That argument simply misconstrues the nature of Cooper’s claim. He claims that the insurance commissioner, not ITT, acted illegally in approving the exchange of stock, and that he is aggrieved by that exchange. Cooper does not claim that the issuance of the series N shares was illegal. Hence, his proper remedy is to appeal the insurance commissioner’s order.
Robertson bases his claim of aggrievement on Public Act No. 444. That statute entitles him, as a policyholder of Hartford Fire, to protection from the abuses which the General Assembly feared might result from conglomerate take-overs of domestic insurance companies. He alleges that the commissioner failed in specific respects to provide the protection mandated by Public Act No. 444 when he approved ITT’s exchange offer. He claims, for example, that the conditions imposed by the insurance commissioner to protect Hartford Fire policyholders from a raid on the treasury, set out in footnote 1, are legally and practically incapable of enforcement. If Robertson’s allegations are true, he is clearly aggrieved by the commissioner’s order.4 But Robertson was not required *66to prove his allegations in the preliminary hearing as to aggrievement, nor did the court permit him to do so. When the G-eneral Assembly limited appeals to persons aggrieved, “it could not have been the legislative intent to require the court to determine the merits of the controversy as a preliminary matter, before even entertaining the appeal.” Waterbury Trust Co. v. Porter, 130 Conn. 494, 499, 35 A.2d 837. Since Robertson is aggrieved if his allegations are true, his appeal should not have been dismissed without a hearing on the merits. See Waterbury Trust Co. v. Porter, supra.
In this case the majority departs from traditional principles of standing and thereby prevents judicial scrutiny of a far-reaching administrative action which is of great public concern. The present case involves the largest and most important insurance acquisition ever made, and probably the largest single corporate acquisition in financial history. The commissioner’s approval is the first ever obtained under Public Act No. 444, a statute enacted to ensure protection of the public interest. In the past, when questions of public importance have been presented, this court has not allowed unrealistic rules of standing to bar judicial review. In Ducharme v. Putnam, 161 Conn. 135, 137-39, 285 A.2d 318, for instance, this court held that despite precedent to the contrary, outmoded concepts of standing would not bar a municipality from challenging the constitutionality of a state statute. The requirement of aggrievement should not be erected *67into a barrier to judicial review. As Chief Justice Vanderbilt of the New Jersey Supreme Court said in a case holding that competitors of a savings and loan association were aggrieved by the banking commissioner’s approval of a branch office of the association, “in cases involving substantial public interest, the courts have held that ‘but slight private interest, added to and harmonizing with the public interest’ is sufficient to give standing .... Competing banking institutions may be the only persons with sufficient private interest in harmony with the public concern for the safety of savings and bank deposits to bring the attention of the courts to errors of law in an administrative action granting a license to establish a branch contrary to the standards set by the statute delegating authority to so act. If such banking institutions do not have the necessary standing, who then is there who can or will challenge an administrative decision favorable to the applicant? Without standing in the appellants to invoke the power of judicial review, the Commissioner’s action favorable to [the defendant] Colonial, right or wrong, proper or arbitrary, takes on a conclusive character to the posssible great detriment of the people as a whole.” Elizabeth Federal Savings & Loan Assn. v. Howell, 24 N.J. 488, 499, 501-502, 132 A.2d 779.5
The courts of this state are in the business of hearing and deciding cases on their merits. The *68requirements of standing must not be applied so as to become an obstacle to judicial review of administrative decisions affecting the people of this state.
I would find error in part and order a hearing on the merits of the claims of the plaintiffs Cooper and Robertson.

 In his finding and final order of May 23, 1970, the insurance commissioner imposed ten conditions on the exchange offer, including the following: “(d). Subject to the provision of subparagraph (e), for ten years Hartford shall not in any year transmit funds to ITT in excess of earnings of Hartford for that year as reported on the basis of generally accepted accounting principles. The companies will be free to return to ITT any capital that ITT shall have supplied to Hartford so long as Hartford’s surplus is not thereby reduced below that necessary for underwriting purposes, (e). Hartford shall not make any investments within the ITT system without the prior consent of the Connecticut Insurance Department, (f). For at least five years, Hartford shall not reduce its underwritings in any line of insurance substantially below the average of its underwritings in that line during the period 1964-1969. . . . (h). That, in the event the proposed exchange offer is consummated, ITT shall bind itself to fulfill the aforesaid conditions, (a) through (g). (i). That, in the event that the proposed exchange offer is consummated, ITT shall exercise its powers as a stockholder to cause the Hartford to amend its charter so as to make the aforesaid conditions binding on the Hartford and its shareholders.”

Professor Davis’s Administrative Law Treatise (1970 Sup.) $ 22.09-5, p. 748, states: “Common law that has endured for centuries is based on the human nature that impels assertion of principle when only a trifle is immediately involved. If A steps on B’s land, touches B’s person, or points a gun at B, in each instance causing damage or injury so trifling that it is not discernible, B nevertheless has a cause of action for trespass, for battery, or for assault. The common law in each instance allows the plaintiff:, on the basis of the trifle, to assert principle. Just as the trifle may be the basis for fighting out principle in the common law, the trifle may be the basis for standing to assert principio against the public officer or the government.” Professor Davis concludes that for standing, “[a] small injury should suffice. A choice has to be made as to how much adverse effect should be enough for standing. The requirement could be a large injury, a middle-sized one, or a small one. Much complexity as well as many unsatisfactory results would grow out of requiring an injury to equal litigation expenses or to equal such a jurisdictional minimum as $10,000 for the Supreme Court has properly treated as sufficient a fraction of a vote, a $1.50 poll tax, and a fine of five dollars and costs. . . . Therefore, the choice the federal courts have generally made, that an identifiable injury to an interest of the plaintiff will suffice even if the interest or the injury is a tiny one, should be firmly adopted and clarified.” Davis, op. cit. § 22.21, pp. 785-86.

 That Cooper did not participate in the proceedings before the insurance commissioner does not deprive him of standing to appeal as an aggrieved person. Fox v. Zoning Board of Appeals, 146 Conn. 665, 666, 154 A.2d 520. Nor is his injury nonexistent because he chose to ignore it when the first merger plan was presented to ITT stockholders. It is undisputed that Cooper has never approved the present exchange offer.

 United States v. International Telephone & Telegraph Corporation, 349 F. Sup. 22 (D. Conn.), cited by the majority opinion for the proposition that Robertson’s interest is insubstantial, is not pertinent to his present claim of aggrievement. As Judge Blumenfeld *66was careful to note in that opinion (p. 26 n.3), “[although the movant Eobertson states that he is a Hartford policyholder, the claim of a financial interest is not pressed.” Eobertson claimed to have standing to intervene solely as a representative of the public.

 To like effect, see Scripps-Howard Radio, Inc. v. F.C.C., 316 U.S. 4, 14-15, 62 S. Ct. 875, 86 L. Ed. 1229; F.C.C. v. Sanders Bros. Radio Station, 309 U.S. 470, 476-77, 60 S. Ct. 693, 84 L. Ed. 869; Associated Industries of New York, Inc. v. Ickes, 134 F.2d 694, 702-705 (2d Cir.), dismissed as moot, 320 U.S. 707, 64 S. Ct. 74, 88 L. Ed. 414; Scanwell Laboratories, Inc. v. Shaffer, 137 U.S. App. D.C. 371, 424 F.2d 859, 866-67. See also 3 Davis, Administrative Law Treatise § 22.05.