Court Opinion

ID: 5163196
Source: CourtListenerOpinion
Date Created: 2022-01-02 03:07:53.207134+00
Date Added: 2024-06-11T08:25:43.310313
License: Public Domain

HOWE, Associate Chief Justice:
(Dissenting)
I dissent for the reasons set forth in my dissenting opinion in Gillman v. Department of Financial Institutions, 782 P.2d 506, 513 (Utah 1989).
The majority opinion in the instant case states:
From 1969 to 1980, Grove filed annual financial reports with the Department as required by section 70B-3-505(2). In its annual examinations, the Department found no violation of statutory provisions or evidence of improper dealing.
Majority at 504-505. These statements need clarification. The annual financial report referred to above is simply “a composite annual report in the form prescribed by the administrator relating to all supervised loans made by [the licensee].” Utah Code Ann. § 70B-3-505(2) (1980). This annual report is not a report of the financial condition of the licensee which would reflect upon its solvency. When these reports were filed, the Department examined them, but the Department made no on-the-premises examination of Grove nor required any reports which would disclose its financial condition. The first examination by the Department of Grove’s financial condition was not made until March 1980, eleven years after it commenced business as a supervised lender and three years after the Department knew that Grove was selling *506debentures which it treated simply as passbook accounts.
It is the position of plaintiffs that the Department had the statutory duty to examine Grove periodically to determine its solvency as directed by Utah Code Ann. §§ 7-1-7 and 7-1-8 (1971) and by provisions of the Utah Uniform Consumer Credit Code § 70B-3-506(l)-(4) (1980).
I would reverse the summary judgment and remand the case to the trial court to determine the statutory duties, if any, of the Department to examine the financial condition of Grove and to supervise Grove and, if those duties are found, to determine whether the Department’s failure constituted negligence.
STEWART, J., concurs in the dissenting opinion of HOWE, Associate C.J.
ZIMMERMAN, J., having disqualified himself, does not participate herein; DAVIDSON, Court of Appeals Judge, sat.