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FOR IMMEDIATE NEWS RELEASE NEWS RELEASE # 3 FROM: CLERK OF SUPREME COURT OF LOUISIANA The Opinions handed down on the 19th day of January, 2005 , are as follows:

BY KIMBALL, J. :

2004-CA-0882

J. ROBERT WOOLEY IN HIS CAPACITY AS ACTING COMMISSIONER OF INSURANCE, STATE OF LOUISIANA v. STATE FARM FIRE AND CASUALTY INSURANCE COMPANY, HONORABLE MURPHY J. FOSTER IN HIS CAPICITY AS GOVERNOR OF LOUISIANA, ANNE WISE IN HER CAPACITY AS DIRECTOR OF THE DIVISION OF ADMINISTRATIVE LAW, AND ALLEN REYNOLDS IN HIS CAPACITY AS DIRECTOR OF THE DEPARTMENT OF STATE CIVIL SERVICE (Parish of E. Baton Rouge) For all the reasons discussed above, we find the Commissioner has not satisfied his burden of proving that the legislature's enactment of Act 739 of 1995 and Act 1332 of 1999 is in violation of any constitutional provision. Consequently, the judgment of the district court declaring these Acts unconstitutional, null and void in their entirety is reversed, vacated, and set aside. The judgment of the district court declaring the decision and order of the ALJ null and void on the ground that it was rendered by an entity without constitutional authority is similarly reversed, vacated, and set aside. The judgment of the district court granting permanent injunctive relief on various grounds in favor of the Commissioner is reversed, vacated, and set aside. The case in remanded to the court of appeal for further proceedings consistent with this opinion. REVERSED IN PART, VACATED IN PART, SET ASIDE IN PART; AND REMANDED TO THE COURT OF APPEAL. JOHNSON, J., concurs. WEIMER, J., concurs and assigns reasons.

01/19/05

SUPREME COURT OF LOUISIANA
No. 04-CA-0882 J. ROBERT WOOLEY IN HIS CAPACITY AS ACTING COMMISSIONER OF INSURANCE, STATE OF LOUISIANA v. STATE FARM FIRE AND CASUALTY INSURANCE COMPANY, HONORABLE MURPHY J. FOSTER IN HIS CAPACITY AS GOVERNOR OF LOUISIANA, ANNE WISE IN HER CAPACITY AS DIRECTOR OF THE DIVISION OF ADMINISTRATIVE LAW, AND ALLEN REYNOLDS IN HIS CAPACITY AS DIRECTOR OF THE DEPARTMENT OF STATE CIVIL SERVICE

ON APPEAL FROM THE NINETEENTH JUDICIAL DISTRICT COURT, FOR THE PARISH OF EAST BATON ROUGE, HONORABLE JANICE CLARK, JUDGE

KIMBALL, Justice At issue in this appeal is the constitutionality of the provisions of Act 739 of 1995 and Act 1332 of 1999, which, inter alia, create the Division of Administrative Law (hereinafter "DAL"), transfer the authority to conduct adjudications for certain agencies to the DAL, provide that the agencies shall have no authority to override the decision or order of the administrative law judge (hereinafter "ALJ") employed by the DAL, and preclude the agencies from seeking judicial review of adverse rulings by the ALJs. Finding no violation of any constitutional provision asserted by the Commissioner of Insurance, we reverse the judgment of the district court to the contrary.

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FACTS AND PROCEDURAL HISTORY In February 1996, State Farm Fire and Casualty Insurance Company (hereinafter "State Farm") filed a Rental Condominium Unitowners' policy form (hereinafter "RCU form") with the Commissioner of Insurance (hereinafter "Commissioner") for his review and approval pursuant to La. R.S. 22:620.1 State
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La. R.S. 22:620 provides: A. (1) No basic insurance policy form, other than surety bond forms, or application form where written application is required and is to be attached to the policy, or be a part of the contract or printed life or health and accident rider or endorsement form shall be issued, delivered, or used unless it has been filed with and approved by the commissioner of insurance. (2) For purposes of this Section, a basic insurance policy form shall include a certificate of coverage, any other evidence of coverage, or a subscriber agreement. (3) This Section shall not apply to policies, riders, or endorsements designed to delineate the coverage for and used with relation to insurance upon a particular subject or which relate to the manner of distribution of benefits or to the reservation of rights and benefits under such policy, and which is used at the request of the individual policyholder, contract holder, or certificate holder. (4) Any insurer may insert in its policies any provisions or conditions required by its plan of insurance or method of operation which are not prohibited by the provisions of this Code. B. Every such filing shall be made not less than forty-five days in advance of any such issuance, delivery, or use. At the expiration of forty-five days the form so filed shall be deemed approved unless prior thereto it has been affirmatively approved or disapproved by order of the commissioner of insurance. The commissioner of insurance may extend by not more than an additional fifteen days the period within which he may so affirmatively approve or disapprove any such form, by giving notice of such extension before expiration of the initial thirty-day period. At the expiration of any such period as so extended, and in the absence of such prior affirmative approval or disapproval, any such form shall be deemed approved. The commissioner of insurance
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Farm was subsequently informed that the filing had been disapproved for use in Louisiana because its Representations and Warranties provision did not comply with applicable sections of the Insurance Code.2 State Farm requested reconsideration of the issue and, after several meetings between State Farm representatives and staff members of the Louisiana Department of Insurance, State Farm was informed by letter that the RCU form was still disapproved for use in Louisiana. State Farm then requested an adjudicatory hearing which was subsequently

may withdraw any such approval at any time for cause. Approval of any such form by the commissioner of insurance shall constitute a waiver of any unexpired portion of such initial fifteen-day waiting period. C. The commissioner of insurance's order disapproving any such form or withdrawing a previous approval shall state the grounds therefor. D. No such form shall knowingly be so issued or delivered as to which the commissioner of insurance's approval does not then exist. E. The commissioner of insurance, may, by order, exempt from the requirements of this Section for so long as he deems proper, any insurance document or form or type thereof as specified in such order, to which in his opinion this Section may not practicably be applied, or the filing and approval of which are, in his opinion, not desirable or necessary for the protection of the public. F. Insurers negotiating with and insuring special commercial entities shall be exempt from the form filing and approval requirements of this Section. The commissioner shall adopt rules and regulations necessary for the implementation of this Subsection including a provision defining special commercial entities which qualify for exemption. The definition of exempt commercial policyholder shall be reviewed periodically by the commissioner. This Subsection shall apply only to commercial property and casualty insurance. The regulations required by this Subsection shall be adopted no later than April 1, 2000.
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La. R.S. 22:621 provides that the Commissioner shall disapprove a policy form "[i]f it is in any respect in violation of or does not comply with law."
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conducted by an ALJ employed by the DAL. After a hearing held on May 18, 1998, the ALJ specifically found that the RCU form complied in wording and meaning with the applicable law and issued a decision and order in favor of State Farm, ordering the Department of Insurance to approve the RCU form as submitted by State Farm. Thereafter, the Commissioner filed a petition for judicial review of the ALJ's order in the Nineteenth Judicial District Court. In his petition, the Commissioner asserted the order of the ALJ was erroneous and requested that the district court uphold the Commissioner's decision to disapprove the RCU form submitted by State Farm. State Farm subsequently filed a peremptory exception of no right of action, arguing that the Commissioner had no right to judicial review of the ALJ's ruling based upon the recently enacted Act 1332 of 1999, which was codified by La. R.S. 49:964(A)(2)3 and La. R.S. 49:992(B)(3).4 Following a hearing, the district court

granted State Farm's peremptory exception of no right of action and dismissed the Commissioner's petition for judicial review with prejudice. The Commissioner appealed. The court of appeal affirmed the judgment of the district court, finding that the district court committed no error in granting the exception of no right of action and, further, that it did not err in dismissing the

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La. R.S. 49:964(A)(2) provides: No agency or official thereof, or other person acting on behalf of an agency or official thereof shall be entitled to judicial review under this Chapter.

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La. R.S. 49:992(B)(3) provides: Nothing in this Section shall affect the right to or manner of judicial appeal in any adjudication, irrespective of whether or not such adjudication is commenced by the division or by an agency. However, no agency or official thereof, or other person acting on behalf of an agency or official thereof, shall be entitled to judicial review of a decision made pursuant to this Chapter.
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Commissioner's suit without allowing him to amend his petition to assert the unconstitutionality of the Act. Brown v. State Farm Fire & Cas. Co., 00-0539 (La. App. 1 Cir. 6/22/01), 804 So.2d 41. In reaching its decision, the court of appeal reasoned that the Department of Insurance is a juridical person, and, as such, does did not have the same rights as an individual: Louisiana Constitution art. 1,

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