ORDERS:
ORDER OF REMAND
STATEMENT OF THE CASE
Pursuant to S.C. Code Ann. § 38-3-210 (2002) and S.C. Code Ann. § 1-23-380 (Supp. 2003),
Appellant David Moore filed with the Administrative Law Judge Division (“Division”) a notice of
appeal of the South Carolina Department of Insurance’s (“Department”) final decision of December
23, 2003, disapproving his applications for proctoring and sponsoring continuing insurance education
courses. For the following reasons, this appeal must be remanded to the Department.
ANALYSIS
1.The available administrative remedies have not been exhausted because the
Appellant has not been afforded an opportunity for a hearing before the
Department.
This matter is before the Division pursuant to S.C. Code Ann. § 38-3-210 (2002) and S.C.
Code Ann. § 1-23-380 (Supp. 2003). Pursuant to S.C. Code Ann. § 38-3-210 (2002), this tribunal’s
review of a final decision of the Department must be conducted “in accordance with the appellate
procedures of the South Carolina Administrative Law Judge Division, as provided by law.” S.C.
Code Ann. § 38-3-210 (2002) (emphasis added). The appellate procedures of the Division provide
that the review of the final decision is limited to the record. ALJD Rule 36(G). See also S.C. Code
Ann. § 1-23-380(A)(5) (Supp. 2003) (“[t]he review . . . shall be confined to the record.”).
Although S.C. Code Ann. § 1-23-600 (Supp. 2003) gives the Division jurisdiction to preside
over contested case hearings in actions involving the departments of the government with a single
hearing officer, that statute is a general provision, whereas S.C. Code Ann. § 38-3-210 (2002) is a
specific statute granting appellate jurisdiction to the Division in cases arising from final Department
decisions. “The general rule of statutory construction is that a specific statute prevails over a more
general one.” Byrd v. Irmo High School, 321 S.C. 426, 435, 468 S.E.2d 861, 866 (1996). Thus,
S.C. Code Ann. § 38-3-210 (2002) controls, and the Division acts as an appellate tribunal regarding
final decisions of the Department, not as the trier of fact in a contested case. This matter is therefore
not before the Division for witnesses to be presented and evidence to be received and weighed, or
for findings of fact to be determined, but rather for a review of a record.
As S.C. Code Ann. § 38-3-210 grants the Division the jurisdiction to review this case in an
appellate capacity, it implicitly presumes that the Department has already conducted a contested case
hearing consistent with the Administrative Procedures Act, S.C. Code Ann. §§ 1-23-310 et seq.
(1986 & Supp. 2003). Cf. 25A S.C. Code Ann. Regs. 69-31 (Supp. 2003) (practice and procedure
for hearings before the Department pursuant to the Administrative Procedures Act) (1989). Further
support for this presumption can be found in S.C. Code Ann. §§ 38-3-150 and -170, concerning the
holding of hearings before the Department; notably, those provisions are contained in the same
chapter as S.C. Code Ann. § 38-3-210. See also Express Temps, Inc. v. S.C. Dep’t of Ins., Docket
No. 98-ALJ-09-0255-AP (S.C. Admin. Law Judge Div. June 29, 1998) (remanding appeal from
Department decision to the Department where no contested case hearing had been conducted).
Because this tribunal’s review must be in accordance with its appellate procedures which limit
its review to the record, S.C. Code Ann. § 38-3-210 (2002) and ALJD Rule 36(G), the contested
case hearing has to be provided for by the Department. Otherwise, the undersigned would be in the
position of hearing the contested case and then reviewing his own order pursuant to the Division’s
appellate procedures, which would be an absurdity. Further, the Department continues to hold
contested case hearings in matters before the Department with appeals to the Division. See, e.g,
Worthy v. S.C. Dep’t of Ins., Docket No. 03-ALJ 09-0224-AP (S.C. Admin. Law Judge Div.
October 16, 2003).
The agency transmittal in this case does not show that the requisite administrative remedies
were exhausted before the Appellant appealed to the Division. Based on the Department’s final
decision letter, it is apparent that the Appellant has not been afforded the opportunity to be heard in
a contested case proceeding allowing for the presentation of evidence and confrontation of
witnesses.
No record of a contested case hearing with evidence received or considered appears to
exist. A party must exhaust available administrative remedies before seeking judicial review. S.C.
Code Ann. § 1-23-380 (Supp. 2003); see also Hyde v. S.C. Dep’t of Mental Health, 314 S.C. 207,
208, 442 S.E.2d 582, 583 (1994) (“Where an adequate administrative remedy is available to
determine a question of fact, one must pursue the administrative remedy or be precluded from seeking
relief in the courts.”). This matter therefore must be remanded to the Department so that it may
afford the Appellant the opportunity for a contested case hearing before it.
2.The Department’s final decision fails to sufficiently set forth findings of fact and
conclusions of law.
Under the standard of review set forth in S.C. Code Ann. § 1-23-380(A)(6) (Supp. 2003),
this tribunal “shall not substitute its judgment for that of the [Department] as to the weight of the
evidence on questions of fact.” However, if this tribunal finds the Department’s decision deficient
in certain particulars, it “may . . . remand the case for further proceedings.” Id. Upon consideration
of the Department’s final decision of December 23, 2003, I find that it is appropriate to remand the
instant case to the Department so that it may clarify the basis for its conclusion by setting forth
findings of fact and conclusions of law as required by S.C. Code Ann. § 38-3-210 (2002).
An administrative agency has an obligation to state clearly and completely the facts essential
to its conclusion; where the agency fails to do this, remand is appropriate. 2 Am. Jur. 2d
Administrative Law § 630 (1994); see also Campbell v. La-Z-Boy East, 295 S.C. 384, 368 S.E.2d
679 (Ct. App. 1988) (remanding case for the agency to make more detailed findings of fact and
conclusions of law).
In the present case, the Department reached the following conclusion:
Due to your previous violation of South Carolina insurance law and
your failure to follow this Department’s directives, your application
for proctoring and sponsoring continuing insurance education course
have been disapproved.
Plainly, this fails to articulate a rationale or provide an analytical basis for the Department’s
conclusions. It does not contain a specific discussion of the violations of insurance law or failure to
follow the Department’s directives which led to the conclusion, or how or why the conduct described
in the order violates the cited code sections.
Our State Supreme Court has repeatedly held that an
administrative agency must make specific findings of fact and explain its rationale in sufficient detail
to afford meaningful judicial review. See Kiawah Property Owners’ Group v. S.C. Pub. Serv.
Comm’n, 338 S.C. 92, 525 S.E.2d 863 (1999); Porter v. S.C. Pub. Serv. Comm’n, 333 S.C. 12, 507
S.E.2d 328 (1998); Porter v. S.C. Pub. Serv. Comm’n, 332 S.C. 93, 504 S.E.2d 320 (1998); Heater
of Seabrook, Inc. v. S.C. Pub. Serv. Comm’n, 332 S.C. 20, 503 S.E.2d 739 (1998). The Court has
further overruled earlier precedent in this area to the extent that those cases suggested that an
appellate court “will, sua sponte, search the record for substantial evidence supporting a decision
when an administrative agency’s order inadequately sets forth the agency’s findings of fact and
reasoning.” Porter, 333 S.C. at 22 n.3, 507 S.E.2d at 333 n.3.
The Department has the burden of showing, with particularity, the nexus between the conduct
and the alleged wrongdoing, while explaining and supplying legal analysis to support its conclusions.
The facts of the matter must be specifically articulated and connected to the proscribed statutory
conduct for this tribunal to conduct any meaningful review of the Department’s decision.
In sum, while the Department may have conducted an orderly analysis to reach its
conclusions, and may have had specific conduct in mind when it set forth the conclusions its order,
it did not provide such analysis or reveal its rationale for reaching those conclusions in the text of the
decision. Here, the Department has not done so, and, as a result, this tribunal cannot undertake
meaningful review of its order.
ORDER
IT IS THEREFORE ORDERED that this case is REMANDED to the South Carolina
Department of Insurance to provide the Appellant with an opportunity for a contested case hearing
as required by and pursuant to S.C. Code Ann. § 1-23-310 (2003);
IT IS FURTHER ORDERED that if the Department has in fact already provided the
Appellant with an opportunity for a contested case hearing, this case must nevertheless be
REMANDED to the Department to reconsider the record and the bases for its conclusions in
accordance with this Order, and to issue a new Order setting forth separate and detailed findings of
fact and conclusions of law;
AND IT IS SO ORDERED.
______________________________
C. Dukes Scott Administrative Law Judge
February 11, 2004
Columbia, South Carolina |
